News Analysis

Wednesday 17 September 2014

Burton on bailout and Cabinet battles

Joan Burton lays bare her thoughts on a very tough time as she nears a year in power, writes Daniel McConnell

Published 15/01/2012 | 05:00

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Joan Burton, the self-described 'idealist' Minister for Social Protection, is a unique figure in Irish politics and Irish life.

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Opinionated, determined and formidable, she has, in recent weeks, been accused of harbouring a "persecution complex" by some of her colleagues in the Cabinet.

"That's the last thing I would ever suffer from," she says as we sit in front of her blazing fire in her Cabra home on Friday evening.

She looks refreshed, having returned home from a South African holiday after a bruising Budget where she attracted flak from all sides over cuts to disability allowances, which she was forced to abandon under pressure from government backbenchers.

Also, in her first major interview since the Revenue Commissioners' pension debacle, she has a lot to say.

Over the course of two hours, she told me why a second bailout can't be ruled out because of the European crisis, days after the Taoiseach's rejection of such comments; why stopping increments should be considered; why James Reilly and the Revenue were right; and she revealed her anger at Labour renegade Patrick Nulty.

SOCIAL PROTECTION

She begins, however, about matters in her own department. In a stark statement, she says as a result of the recession we are now seeing once again the "tragedy" of intergenerational unemployment within many families.

"The real fear I have is that you start to see again households where there is no work. We don't want a situation like there was in the 1980s where there was no work. The father, the mother, they don't have any work and young adult children don't have any work. That for me is tragic," she says.

Burton is steadfast in the view that welfare must not be a "lifestyle choice" but merely a temporary stop.

"Social welfare is meant to be a temporary support for six months, one year or two when you lose your job."

She tells me that the €530m-odd her department spent last year on 96,000 rent supplements is likely to be cut radically this year.

"We are paying over half a billion euro on rent supplement and I want to get much better value for taxpayers from that."

Burton says that the department in many areas hasn't adjusted down its payments to landlords even though the going rent rates have fallen, meaning the State is vastly overpaying on rents.

A new study done by her department showed that by forcing rents down the department will save €22m this year.

She also said she wants to reduce the burden on the taxpayer in terms of utility bills.

REVENUE/PENSIONERS DEBACLE

While other senior government voices saw fit to dump on the Revenue Commissioners, Burton feels Revenue made the correct call to contact affected pensioners by letter, rather than allowing people fall into arrears.

"We received a request for data which we sent over to Revenue. We were more than

happy to accede to that request. Josephine Feehily said to the committee -- 'Look, could we have communicated this better, yes'."

She adds: "On the other hand, the reason Revenue rushed to do it before the year end was to avoid people falling into an arrears situation in 2012. They could have had a public information campaign or written to the individuals who were likely to have some liability now or in the future. They made a judgement call to do it that way. Personally, I think the revenue were probably correct to do it that way."

To Burton, it is clear the Department of Finance had prior knowledge of the situation.

"Finance made provision in the budget estimates for a yield from this so obviously there was an awareness in the Department of Finance that there was going to be an enhanced yield from this."

When I asked her about the lack of intervention by the Cabinet, Burton says the matter was one primarily for Michael Noonan.

"The minister responsible for the Revenue Commissioners is Michael Noonan. The Revenue Commissioners are a very independent body and I suppose Mr Noonan was very acutely conscious of respecting their absolute independence."

CROKE PARK

The viability of the Croke Park deal, which guarantees public sector jobs and pay until 2014, has come into question in recent weeks within the Coalition. Indeed, junior minister Brian Hayes last Wednesday said it needed to deliver more urgently if it was to be maintained.

Burton says that Croke Park must deliver soon or its viability is in question. "If Croke Park doesn't deliver, then it must be examined like all areas. The fact is, Croke Park is going to have to be examined with a microscope. The public, including public servants themselves, will want to know what has been delivered. It has provided a framework in which very painful stuff has happened, it has done so by maintaining a discussion. That is worth it, but it has to deliver and be examined under a microscope to see that everybody has delivered," she adds.

"That means efficiency, it means being effective, it means being in work at times when people need a service and doing it in a way that is cost effective," she says.

INCREMENTS

In another bold break from her party and Government's line, she said the proposal to halt incremental pay increases as advocated by Fergus Finlay and this newspaper, in particular, has merit.

"I read what Fergus Finlay had to say and I thought there was a lot of merit in what he was calling for. Increments were not on the table for the Budget. We need to think about that. But if the financial position remains as difficult as it is, we'll examine all areas.

There can't be any area closed to discussion. It is one of the areas that will be examined," she says.

BUDGET PROCESS/JAMES

REILLY

I ask her how she found her first Budget.

Her response was startling. She said she has profound difficulties in how the Budget is formulated, saying it would be far better to have the various options debated in public months in advance.

"I think it was a breathtaking learning curve for everyone involved in it, including me. The time span was very short for the actual detailed discussions. I would have liked a longer timeframe. I would have liked a lot of that information or the options to have been published then and I also think it should have gone to parliamentary committees.

"Each committee should take all of the option papers and look at the options wherever they came from. Certainly I'll be doing an exercise in my department to go back, you know, starting the end of this month, to look at it in great detail in the context of the Budget for 2013," she says.

She actually speaks up in support of James Reilly, who was lambasted by many for deliberately scaremongering before Budget day.

"In fairness to James Reilly I don't think that James was scaremongering. If you make changes in any of the big spending ministries, that's always going to be sensitive, you're back to the question, do you tell people or inform people what the options are. I don't have any difficulty with the notion that James Reilly should tell people that there are options under consideration," she says.

SCRAPS WITH RICHARD/LEO

I ask her about the row with Richard Bruton, over her proposals to make employers cover the cost of workers' sick leave. She is unapologetic.

Her proposal could not have been a surprise and blame lies with people who failed to read a document submitted for approval last May.

"Well, you see, I put that into the system in May and I mean some people in Government got around to only thinking about it quite late in the day and this is why I'm saying the one thing I will take from it is that we should discuss a lot of this months in advance of the Budget."

For his part, Varadkar sought to distance himself from the disability cuts controversy, saying it was Burton and Brendan Howlin who were responsible.

Burton gives such comments short thrift. "Ah Leo, my friend, my dear charming constituency colleague from Castleknock," she says humorously.

"As far as I am concerned, the whole Government acts together and if Leo does something in transport I share responsibility for that. Are there any other ministers who think there isn't a collective Government responsibility? Maybe Leo has his own take, but of course there is a Government responsibility."

SECOND BAILOUT/EUROPE

With the troika in town, our conversation turns to Europe, the sovereign debt crisis and whether or not Ireland will need a second bailout.

Burton doesn't hold back. In stark contrast to Taoiseach Enda Kenny and in agreement with Willem Buiter, the CitiGroup economist, Burton says as long as Europe remains in crisis, such a second bailout cannot be ruled out.

"If the eurozone crisis hadn't emerged a couple of months ago I would have been able to give a much tighter prediction [about us getting out of the clutches of the troika]," she says.

"[Only] if the eurozone comes together then we can work to the other side and Ireland can exit the programme."

I ask is getting out of the programme contingent on a solution to the European crisis? "I think the two are tied together yes. Danny, If you are asking me to crystal-ball gaze until the end of next week, no, I can't. Look, we are dealing with the programme, we have certain reserves and capacities," she says.

"But we have a number of positive indicators. If we were to get access to the collective financial power of the eurozone then we would be in a much better position. But can I predict if and when that will happen, no I can't."

What about a plan B, as Buiter suggested.

"Of course the Government has to look at all the contingencies, but we are working the programme and we are working positively on the programme. If the eurozone gets capacity to act collectively we could be in quite a positive position.

"I am working to just get Ireland in to as positive a place as possible. I want to say goodbye to the troika yet welcome them back for holidays," she says.

On whether treaty change here in Ireland is contingent on debt reduction, she says: "Of course every issue is on the table in the context of treaty change, but we don't have that yet."

PATRICK NULTY

I turn the conversation to another of her constituency colleagues, Patrick Nulty, who voted against the Government on Budget day, much to the fury of his party colleagues.

Does she share her party's anger at Nulty? "Yes quite frankly, I do share their anger," she says sharply. "I canvassed and campaigned with Patrick quite intensely. He was asked the question on the door step in my presence on quite a number of occasions about his approach and whether he would be voting with the Government.

"He gave a resounding 'Yes', as he did on the plinth on the day he took his seat. He was as aware of the financial position as I was when he took his seat. I was very disappointed."

PERSECUTION COMPLEX

Recent articles reported on the post-Budget acrimony within the Coalition. James Reilly was singled out for criticism while Burton was criticised for harbouring a "persecution complex".

I put that to her. "You go in and do a job and do it professionally. I hope I do it as pleasantly as possible.

"Cabinet is for people to express their views. I am invited by the Taoiseach to express views when issues come up for discussion. Perhaps not everybody likes people expressing their views, but that's the way I do work," she says.

Sunday Independent

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