Business

Tuesday 29 July 2014

The toughest job in government – my top five finance ministers

Maeve Dineen

Published 24/11/2012|05:00

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This week the 'Financial Times' voted Michael Noonan the fifth best Finance Minister in Europe in its annual ranking. Mr Noonan's relative high ranking comes just two years after the same survey ranked the late Brian Lenihan as the worst Finance Minister in Europe.

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Being a country's finance minister may appear to be something of a poisoned chalice in the current economic environment, but there are still plenty of politicians clamouring to steer their countries through the aftermath of the global crisis. The FT's rankings try to ignore the state of the economy and focus on performance but rarely succeed.

In 2006 Brian Cowen was voted the best European finance minister by the same survey. A year later, just months before the crisis began, he was ranked sixth while Christine Lagarde in France came in 12th.

But everyone loves a list. In this spirit, I have decided to create my own ranking of our country's top five Finance Ministers in reverse order.

At number five, comes Ray MacSharry, for his second stint in office from March 1987 to November 1988 when he finally brought state spending under control by increasing taxes and slashing spending. His first Budget, replete with health cuts, inevitably brought howls from his own party as well as the opposition, but in retrospect it was the moment that the economic chaos triggered by Jack Lynch and nurtured by Charles Haughey, was finally brought to an end.

At number four comes Bertie Ahern, for his three-year stint from 1991 to December 1994. The Bert may have been keeping cash under the bed in Drumcondra and benefiting from digouts, but he made a damn good finance minister during the currency crisis of 1992, when he jacked up mortgage rates to 18pc as part of the battle to fight off the speculators.

Nerves of steel

He again showed nerves of steel when sterling was forced out of the EU currency system on 'Black Wednesday' and Mr Ahern presided over a 10pc devaluation of the Irish pound. This is seen by many as the birth of the Celtic Tiger, even if the same Tiger then devoured him in the end.

At number three is Fine Gael's Richie Ryan who took on the job in 1973 and held it for a little over four years during the oil crisis which brought economies in many western countries to the brink of ruin. Lampooned as 'Richie Ruin', 'Minister for Hardship' on 'Hall's Pictorial Weekly', and 'Red Richie' for his wealth tax, Mr Ryan brought in one of the toughest budgets ever seen on these shores in 1976. It was a brave measure but perhaps too brave as it allowed Jack Lynch to campaign for and then implement one of the biggest stimulus packages, that ended in a decade of austerity, high unemployment and emigration.

Inflation

At number two, comes Ruairi Quinn for his stint in office from December 1994 to June 1997. The only Minister for Finance from the Labour Party in Irish history tamed inflation, kept government finances under control and shocked pretty much everybody when he slashed corporation tax for local companies to avoid raising the tax for multinationals.

It was one of the bravest things ever to come out of Merrion Street and one of the most successful. What happened afterwards was not his fault but Mr Quinn can certainly claim to be one of the creators of the genuine Celtic Tiger.

Number one is James Ryan, who took on the job and a moribund economy in 1957 under Eamon de Valera and handed back the office eight years later in much better shape under Sean Lemass. It was Mr Ryan who championed the First Programme for Economic Development by legendary Department of Finance secretary general T.K. Whitaker. That plan ended Mr De Valera's insane policy of self-sufficiency and ushered in a new era of free trade.

While all this is obvious now, it was Mr Ryan's policies that slowly stopped emigration and ensured that the Republic, which had shrunk to just 2.8 million people, had a future.

Mr Ryan was perhaps our greatest finance minister but he was also lucky. Lucky to operate in the 1960s when the winds of change blew through the West, ushering in a period of fantastic growth.

He also formed part of a triumvirate with Mr Lemass and Mr Whitaker that gave the three men the strength to push ahead with radical, almost heretical, policies when most of the Establishment was broken and hostile.

*As a footnote, I'm going to include a special 'Achievement Award' for a Minister of Finance in difficult circumstances. It goes to the Big Fella, Michael Collins.

That was his job in the Provisional Government as well as commanding a guerrilla campaign and organising nationwide collections of cash which local councils refused to pay to the British administration. And the books balanced in the end. Cometh the hour, cometh the man – but not yet the woman.

Irish Independent

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