Business

Saturday 30 August 2014

Top of the agenda. Shane Ross

Published 09/06/2002 | 00:11

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Welcome back PD Charlie WELCOME back Charlie. It's great to have three PDs in the Cabinet. McCreevy, Harney and McDowell. The public finances could not be in better hands. There is little room for spendthrift economics with this trio in charge. The three strongest characters in the Government are all believers in balancing the books.

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McCreevy is about to be tested. He was a brilliant minister in the boom years. Far from squandering the boom, he nurtured it. He cultivated the multinationals when we needed them. Labour would have scared them away. The US giants are still here, reinforced by Charlie's insistence on low income and low corporate taxes. Multinationals like him, because he has no time for the old socialist slogans of higher taxes and higher spending. If McCreevy stays, so will they.

But this time around, McCreevy will not be cutting taxes. This time, he will be cutting spending. This time, McCreevy may have to make himself unpopular.

And no better man. McCreevy's strength is his perversity. And his obstinacy. He has made an entire career out of confronting the politically correct in the Irish Times/RTE axis. He does not indulge malcontents; he does not allow emotions to cloud his judgement; nor will he ever be blackmailed into caving in to pressure groups. Which should make life interesting.

On June 30, the benchmarking body is due to report. The biggest pressure group of all, the public service, is about to be granted a bonanza. Or at least the ICTU/IBEC ridden body (now dominated by the unions and merged into the one 'ICBEC' group) will strongly recommend that Charlie pay up. What a pity that we no longer have the money to give them the rumoured 10 per cent. Indeed, we no longer have the money to give them anything. Figures released last week reveal a pending budget deficit of over ?1bn.

So, what will Charlie do?

If he refuses to pay up, he will be on a collision course with the unions; Joe O'Toole and Des Geraghty will have his guts for garters. The next social contract will be torn up. They will take to the streets. Charlie will be forced either to borrow and pay up; to cut back elsewhere; or to confront the unions.

Charlie was a great minister in times of peace. Let us now see how he rates in times of war.

His instincts are straightforward. He would like to confront the public service in the same way as he took on Commissioner Solbes and the entire EU establishment and won. But this time, the yellow bellies in the FF Cabinet (a team which inexplicably could not find room for the robust Brian Lenihan) will seek compromise and capitulation. Charlie the PD is likely to seek out his colleagues Mary Harney and Michael McDowell in search of a bit of backbone. And he is certain to find it.

But the key to the future direction of the public finances should be easy enough to find in last week's Programme for Government.

You must be joking. The document was a non-event. It never even utters the word "benchmarking". The most ominous threat to the already fragile public finances did not merit a mention. D-Day is barely two weeks away, yet it is ignored in what is supposed to be a five-year programme.

Of course, the so-called FF/PD negotiations were a cosmetic exercise. The two parties, locked in embarrassingly gentle combat, opted to say nothing about a minor matter like the economy. They gave no figure for public spending increases. They are simply committed to "keep the public finances in healthy condition".

Even Des Geraghty and Joe O'Toole could live with those meaningless aspirations.

The Programme was careful not to offend Joe and Des; well, not yet at least. Another extraordinary omission was the PD policy to pay for all the ambitious public spending projects. They had favoured selling off the ESB, Aer Lingus, Aer Rianta and the ports.

Behold the Programme. Privatisation has vanished. Not a whisper. No point in upsetting the "social partnership" comrades before the benchmarking war has even begun.

The populist instincts of FF are on the point of clashing with the responsible fiscal policies of the PDs. Thank God that Charlie McCreevy is a PD.

An ex-editor writes

IT WAS an exemplary AGM. Rival companies had muttered that I never put questions to the chairman of Independent News and Media Plc on these pages. Did this not prove editorial control by the boss? They said I had regularly asked shareholders to put the hard queries to other company chairmen but never to Tony O'Reilly, Indo chairman.

Last week, we made a few suggestions for the Indo AGM at Dublin's Shelbourne Hotel. One or two shareholders turned up ready to do battle with Sir Anthony. And threw in a few tricky numbers of their own.

They did not waste their time; they witnessed a bravura performance. Ireland's most successful businessman showed none of the brash arrogance of chairman Smurfit; nor the crusty irritability of AIB's Lochlann Quinn; nor the smugness of Howard Kilroy. The worst of all was happening Tony O'Reilly was enjoying himself. He revels in his annual bout with shareholders.

Asked about the 10 questions which appeared in last week's Sunday Independent, the chairman referred to "our former employee Shane Ross"(!) He teased the audience with the reminder that the Ireland/Germany game had started. But he was patient, courteous and took the questions head-on. No one could go away feeling they had not been heard or answered.

Contrasts with the annual boorishness of Michael Smurfit were widespread. Smurfit, with barely seven per cent of the company, treats shareholders like cattle. O'Reilly, with a little more (27 per cent), listens to their complaints and if they are particularly awkward asks them to join him at lunch afterwards.

Michael Smurfit hates his encounters with his shareholders. Tony O'Reilly relishes them. It's something to do with style . . .

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