The Interview: Tom Parlon, CIF chief
Construction's chief lobbyist says industry can still save us. By Laura Noonan
Published 28/10/2010 | 05:00
REPRESENTING a group as deeply unpopular as Ireland's developers demands something of a thick skin, and Construction Industry Federation (CIF) boss Tom Parlon seems unlikely to be found wanting.
Ensconced in his canal-side office, a mere stone's throw away from the hushed corridors where the Government is making decisions on the most brutal Budget in our history, Parlon is making a case for state support for the construction industry.
Some would say the industry widely credited with getting us into a situation where we have to slash €15bn from our budgets over the next four years is in no position to ask for anything, but Parlon has few problems making unpopular points.
Just look at the way he swats away questions about his own ministerial pension, earned during his time as a Progressive Democrats front-bencher in charge of the Office of Public Works.
"It's the only bit of a pension I have and I'd like to hold on to it for as long as I can," says the 57-year-old, who got about €19,000 in payments last year, adding that he will "absolutely not" be handing it over unless the cash-strapped Government brings in legislation to seize it.
When faced with the more pertinent questions about his sector's right to demand support from the Government now, he responds with the kind of numerical assault so beloved of politicians.
Dismissing criticism of the industry as "scapegoating", Parlon says it's far more important to look at construction's potential contribution to the country's employment and the nation's tax coffers.
Every employee pays at least €18,000 in taxes a year. The CIF's figures show every €1m investment in infrastructure will support eight to 12 construction jobs, or at least €144,000 to €216,000 in employment taxes.
Just think of all the revenue that could be raised if the Government agreed with the CIF and made no cut to next year's €5bn planned investment spend, Parlon argues.
And that's saying nothing about the savings of not having those workers on the dole, and the VAT and other jobs they'll support as they spread their earnings around the economy, Parlon adds.
"You can't stimulate any other sector as immediately as you can stimulate construction with infrastructure spends," Parlon insists, stressing that for all the political posturing, the Government's budget decision will ultimately be financial ones.
The CIF is convinced it has made a compelling financial case for the infrastructure spend and Parlon has another set of numbers on hand to back up the industry's various tax proposals.
The former minister is completely unapologetic about using his political connections to up the odds, proudly describing how he's approached several ministers personally, including former PD colleague Mary Harney.
"I'm in and out of the Dail every other day, any chance I get ... everybody does it," he says, rejecting the notion that there's anything "cosy" about the seepage between the lobbying and political scenes.
But the smooth-talking Parlon will need to work his charms on a wider audience than his political colleagues if his industry's fortunes are to be restored.
First up is a looming battle with construction trade unions. More than six months have passed since the CIF began making noises about a 20pc pay cut to minimum hourly rates that hover around the €18 mark.
A Labour Court recommendation for a 7.5pc cut has been in force for months, but the trade unions have yet to sign. "Patience is running out," Parlon says. "We have a deadline of early December, if we haven't had a response by then it's likely that we'll be looking to withdraw from the agreement (on industry pay rates)."
While labour costs are a big issue for the industry it's dwarfed by the spectre of NAMA (National Asset Management Agency), which will have a seismic impact on the business conditions the CIF's members work in. Critical of NAMA from the off, Parlon says "most" of his concerns have come to pass in the agency's first year.
Scores of CIF members are still waiting to transfer into NAMA, nothing is being bought or sold, no working capital is being advanced by banks and paralysis is taking hold, he says.
Parlon met the NAMA board a few weeks ago and raised those very concerns.
"They talked a very good story and it's all very well-intentioned but we've had limbo for nearly 12 months, it's imperative that they start operating," Parlon says.
"If it means they put property on the market and that reduces prices, then let's face that."
Parlon is calm when asked about the Justice Minister's recent comments about "excessive pain" to be meted on NAMA developers, insisting the agency itself is being fair regardless of the rhetoric.
But mention the word 'bailout' and the poise deserts him. "They first said NAMA was going to be a bailout for the banks. NAMA has absolutely broken the banks and they've had to be taken over by the State," he rails.
"There is not a grain of evidence that NAMA is a bailout for developers. Everything they have is being taken over, they're losing everything they have."
Is he seriously defending people's rights to live in trophy homes they can no longer afford? Isn't that a bit of a stretch?
"Certainly there was a degree of reckless spending," he admits before launching into a fervent defence of all the good developers have done.
Later though, he is more circumspect. "They did lose the run of themselves -- they started to live fairly ostentatious lives," he says of some members, before adding that they've "adjusted" and are "back to doing their business again".
He strikes a similar tone when evaluating his own three-year stint in the construction industry.
"I smile every time I read the different estimates of my salary," he says, acknowledging reports of his €250,000 package. "It's not the colour of that and it never was.
"We've been destroyed in the CIF, my salary has close enough to halved, we've lost a big share of our staff. We're formulating our own budget for next year and that is equally as challenging as the one the Government are trying to put together."