Saturday 10 December 2016

Ailish O'Hora analysis: Lack of Brexit plan is a gaping hole, bring back TK Whitaker

Published 11/10/2016 | 15:47

DR. TK Whitaker, Ireland's 'greatest economic thinker'.
DR. TK Whitaker, Ireland's 'greatest economic thinker'.

There’s no doubting that the referendum result in the UK earlier this year came as a surprise to many.

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But today’s budget plan lacks a key component – a better Brexit plan.

Giving more resources to the Revenue Commissioners with a focus on customs and excise is a good idea, of course, as is giving a further €5m to the IDA in its bid to attract foreign direct investment.

It will be argued, of course, that there are too many unknowns at this stage and that the UK hasn’t even triggered Article 50 that kick-starts Brexit.

But what we needed today was some reassurance - a strategic plan outlining how, for example, economic policies will have to be Brexit-proofed in this new era.

Many of our basic policies are already being called into question.

While SMEs and entrepreneurs are the backbone of the economy, we have become too dependent on multinationals and our lower 12.5pc corporation tax.

The recent €13bn European Commission Apple ruling only went to highlight how vulnerable and one dimensional how many of our policies are.

TK Whitaker: Portrait of a Patriot by Anne Chambers
TK Whitaker: Portrait of a Patriot by Anne Chambers

That and the recent leprechaun economics fiasco that showed GDP growth of 26pc must have some of the foreign direct investors scratching their heads.

Brexit is the elephant in the room – and representative groups like the Irish Exporters Association and IBEC have been voicing their concerns for a long time now.

What’s equally concerning is that our default position seems to be reactionary and not proactive enough.

Brexit is undoubtedly the biggest challenge facing the Irish economy since the financial crisis and we're only really recovering from that now.

Leaked papers in the UK today also showed that that economy could take a €66bn hit if the Government there goes for a hard Brexit and that is a distinct possibility.

We're heading into more murky water, that's for sure.

But if companies are expected to have hedging strategies, then Governments have a responsibility too.

Maybe we need to bring back TK Whitaker – the man who was voted Irishman of the Twentieth Century by the Irish public back in 2001.

The Co Down native became secretary at the Department of Finance at 39 back in the 1950s but it was his book Economic Development: A blueprint for the economic regeneration of the country.

The book, and the White paper that was based on it, The First Programme for Economic Expansion, led to a period of unparalleled hope, growth and optimism.

It would also be timely – he turns 100 this year.

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