Wednesday 26 July 2017

Ivan Yates: Biggest decision of Varadkar’s career will be the timing of the next general election

Minister Leo Varadkar with his parents, Dr Ashok Varadkar and wife Miriam, and his sister Sonia at the Fine Gael Hustings for the leadership of the party at the Red Cow Hotel in Dublin. Picture: Arthur Carron
Minister Leo Varadkar with his parents, Dr Ashok Varadkar and wife Miriam, and his sister Sonia at the Fine Gael Hustings for the leadership of the party at the Red Cow Hotel in Dublin. Picture: Arthur Carron
Leo Varadkar and Simon Coveney at the Fine Gael hustings Picture: Arthur Carron
Ivan Yates

Ivan Yates

Fine Gael’s leadership race was completely overshadowed by the terror attack in Manchester and the collapse of the trial of Seán FitzPatrick.

Both events leave ordinary people with a profound sense of powerlessness. Justice is in short supply.

Globally, governments’ security and intelligence services are unable to protect the most vulnerable citizens.

Yet again here, Ireland refuses to do accountability.

Historic incidents of botched public maladministration – massive court awards for clinical failures in hospitals, flagrantly false crime statistics, Army deafness, absentee banking regulation, fire hazard building standards, intervention beef abuses, undetected fraud and now the Office of the Director of Corporate Enforcement’s inability to procure evidence properly – have one common theme. No matter what depth of incompetent negligence is exposed, no one is ever fired, James Comey-style.

Life goes on. Leo Varadkar and Simon Coveney continue to campaign as if the result of the contest is in doubt. Leo may win each element of the electoral college, as councillors and members resonate with parliamentarians. Their respective policy papers indicate both have more innate intellectual depth than the two immediately previous FG leaders, with earnest new thinking and smart proposals.

Leo Varadkar and Simon Coveney at the Fine Gael hustings Picture: Arthur Carron
Leo Varadkar and Simon Coveney at the Fine Gael hustings Picture: Arthur Carron

This is shadow boxing. Leo and Simon share a common EU worldview, perspectives on an enterprise economy that is driven by enhancing competitiveness and incentivising investment and hard work. They both seek social solidarity, but will openly confront the strident Left when it advocates limitless unaffordable free housing, welfare and water.

Some 2.1 million workers (employed and self-employed) are the potential bedrock of the future FG constituency. Contemporary facts, post-recession, are most punitive: Irish earners hit 51pc marginal tax at €33,800; identical workforce numbers and incomes, between now and 2008, cough up extra total pay-related taxes from €12bn to €20bn (from 27pc to 41pc of all taxation receipts). This is an unsustainable emergency imposition on payrolls.

The idea to outlaw strikes in essential “life and death” services by making Labour Court arbitration legally binding is clever and reasonable. The chorus of unspeakable horror from public sector unions and RTÉ at any attempt to diminish industrial rights was akin to instant knee-jerk outrage and contempt.

Step back and rationalise each argument. Unions insist they must be always allowed to blackmail the general public to enrich themselves. It’s a no-brainer as to where the public interest lies, versus sectional vested interests. This is despite evidence that public sector pay, pensions and job security here, relative to both private sector pay and international comparisons, are clearly already decidedly advantageous.

Leo and Simon (like all wannabe vote-getters) set out stalls based on rose-tinted, sunny scenarios of future growth, fulsome fiscal space and economic optimism. For sure, capital investment is critical to unlock serious capacity restraints in the capital. We can’t even accommodate requirements in Dublin for affordable accommodation, office space and international education facilities to meet the needs of 800 potential staff from the European Medicines Agency.

We need extreme caution ahead. Downside threats from Brexit haven’t adequately permeated the body politic. Already indicative early signs emerge of a British recession, starting in London. Let’s hope the new taoiseach appoints a cabinet minister to co-ordinate the enormity of all aspects of interdepartmental minutia to prepare for the implications and consequences, and for effective responses on travel, food, energy, the Border region, etc.

Our political/diplomatic strategy must get us into the EU/UK negotiating room if we’re to avoid marginalisation.

Whatever the ultimate Irish outcome of Brexit, one certainty is now apparent. In every sector, Ireland will have to radically revise the basis of competition with Britain on cost. We must repel cheap food imports (like displaced products of UK-imported Brazilian beef/New Zealand lamb), newspapers/books, low-cost used cars and the entire range of consumer goods. On the export side, we face even more pressure as ‘Buy British’ sentiment grows.

UK tourist numbers, which represent 40pc of all overseas visitors, have already dropped by 6.5pc this year because of sterling’s decline from 76p to 85p. Fair value may end up at 92p to the euro. This alone is a massive national wake-up call, with €50bn of trade at stake – growth forecasts for 2018/19 must be binned.

Economics always dictate and determine politics. But ‘Taoiseach’ Leo faces a collective impulsion of both economics and politics. He’s set to inherit an impossible task of making this Government viable. The past year is devoid of legislative action or any tangible political achievement – an utterly wasteful time-serving period of impotence and inertia. Every problem is long-fingered with reviews, tribunals, committees, commissions and assemblies. Every issue evolves into a compromised fudge of populist indecision. Do nothing.

Leo cannot breathe life into this dead Dáil corpse. If he attempts to limp and linger on into 2018, he’ll be personally blamed for sustaining a paralysed parliament. He must know those who keep this minority FG administration on life support have a vested interest in ensuring it never succeeds.

FG/Independent Alliance faces an electoral backlash if it pretends for too long this feckless edifice represents effective acceptable government.

Leo’s cabinet in-tray and diary will contain hundreds of urgent ‘must do’ items. His brain, agenda, energy and focus should be singular. An autumn general election.

Mr Varadkar’s tenure as FG leader won’t be judged by the margin of victory on June 2, nor instant opinion polls, nor media reviews. His defining benchmark test will be to secure more votes (25pc) and more than 50 TDs than obtained in 2016.

The best upside: he could potentially attain 30pc with 60 seats through an early honeymoon bounce. Worst downside: a delayed, damaged campaign with 40 seats, resulting in a renewed Coveney leadership challenge. Mr Varadkar must get his own mandate to govern. The FG contest doesn’t provide adequate credible authority.

Gordon Brown made a critical error in funking an early election. Enda Kenny missed his opportunity in November 2015.

Sinn Féin is likely to replace Gerry Adams with Mary Lou McDonald by the year’s end – another good reason to get ahead of that electoral curve.

Leo’s success in the current contest can be attributed to premium preparation. Confirming life’s adage: “Preparation meets opportunity, equals success.” Once the logic of an early election dawns, his main task as party leader is to make immediate preparations.

Remember Theresa May’s U-turn. Ignore imminent dispensable denials. TDs abhor impending elections. All parties need to get ready.

It’s Leo’s most important call. It’s Game On in October.

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