Budget 2017 Explainer: The big budget players and what you need to know about them
Published 09/10/2016 | 08:26
Budget 2017 negotiations have been no mean feat.
With around €1 billion in ‘fiscal space’ - a number that seems to drop and rise depending on who you talk to - and everyone in the country wanting a piece of the recovery, this budget may pass by the skin of its teeth.
Everyone wants to spend more and give more back, but with so many different priorities, who ends up making the decisions? These are the big budget players, what they mean to do and whether it’s possible.
The Taoiseach is determined to stick to his election slogan of Keep the Recovery Going; he intends to put more money in people’s pockets while keeping the finances relatively balanced. The problem is that there doesn’t seem to be enough recovery to go around and keep everyone happy, and ultimately it’s his job to decide who gets the most out of the budget. On budget day, like any other day, the ministers have made their proposals but Enda Kenny is calling the shots.
With all the speculation about economic growth and the dreaded ‘fiscal space’, Michael Noonan is the one who has to make sure the numbers match up. Income tax is down because wages haven’t increased enough, VAT is down because spending hasn’t increased enough, corporation tax is up due to increased profits, there’s €300,000 put aside for tax cuts and it’s Noonan’s job to make sure it all adds up to balance the budget.
The government and Fianna Fáil are clashing over minimum wages and tax cuts, predictions vary on how much ‘fiscal space’ there actually is - and if the government overspend or overtax, it will be Noonan who takes the blame.
- Read more: 'Is it Paschal Sheehy?' – Watch these people hilariously fail to recognise some Irish ministers ahead of Budget 2017
The Tánaiste has one of the most difficult briefs to work with in this particular budget. With four days of strikes looming, Frances Fitzgerald has to find a way to keep the Gardaí happy while also allowing room to hire 800 more for next year.
Given the big spends ministers want in social protection, housing and health, it seems unlikely that the Tánaiste will get extra cash beyond the fund for recruitment; Gardaí may be waiting a while for their pay rises and Europe may be waiting longer to resettle refugees.
With a record number of homeless people and slow movement on new developments, Simon Coveney has to do a lot with a little this year.
Coveney plans to introduce an income tax credit for first-time buyers on newly built homes and a repair and lease scheme for landlords to repair vacant homes and lend them back to the state for affordable housing. This may make housing accessible to more people, but with limited funds and a deadline on the tax credits available for buying homes, the dent he'll be able to put in the housing crisis is likely very small.
Leo Varadkar is under pressure from all directions in making the Social Protection budget. Fianna Fáil want €5 extra a week for pensioners, but Varadkar is determined to give widows, carers and people with disabilities a boost. He claims the pension hike alone would cost €350 million, but his suggestion to delay it until the second half of the year is coming under fire from Fianna Fáil and it is unclear how he’ll make ends meet.
Micheál Martin may not be in the Cabinet, but he has as much sway as any of them in this particular budget. Instead of providing a costed opposition budget, Fianna Fáil have opted to push their priorities in negotiations with Fine Gael - and if Kenny can’t get Martin to play ball, the budget won’t pass.
Martin will be looking to take credit for the budget’s successes and distance himself from its disappointments. Whatever his plans are, it seems Martin is making his party ready for an election.