Thursday 18 July 2019

Kenny to attack Fianna Fail's handling of economy

Taoiseach likely to use opening address to highlight Fine Gael's opposition to Fianna Fail's policies

Philip Ryan

Philip Ryan

Taoiseach Enda Kenny will use his opening address to the Banking Inquiry to attack Fianna Fail's handling of the country's finances during more than a decade in government, the Sunday Independent has been told.

After robust defences of their time in office by former taoisigh Brian Cowen and Bertie Ahern, Mr Kenny will, it is understood, seek to highlight Fine Gael's opposition to key Fianna Fail decisions during the boom which ultimately led to the collapse of the country's economy. However, sources claim the Fine Gael leader will concede that his party made the same flawed assessment of economic growth as the Fianna Fail-led governments of the Celtic Tiger years. He will also admit that Fine Gael's assessment of the budgetary spend was broadly in line with those of the Fianna Fail governments accused of splurging the State's finances to buy elections.

Political insiders expect Mr Kenny will attack Mr Ahern's social partnership agreements which led to massive wage hikes for public servants.

Sources claim that in his opening statement, the Taoiseach will also say Fine Gael in Opposition sought to stop the Government from spending taxpayers' money frivolously and looked for a cost-to-benefit analysis of tax incentives.

Changes to the financial regulatory system in 2002, which saw the Financial Regulator and Central Bank split into separate entities, were also criticised by Fine Gael.

It is understood Mr Kenny will also argue that economic growth was strong during Fine Gael's last time in office, and this was underpinned by strong public finances and a rise in employment.

The Taoiseach is likely to say that an uncompetitive economy was left to the mercy of the international credit crunch in 2007 and appropriate safeguards had not been implemented to protect the country from the fallout, according to sources.

He will contend, say sources, that the country became a more domestic than export-led economy, which overly relied on growth in public spending.

Mr Kenny is also expected to lay some of the blame for the economic crash with the flawed design of the euro and the introduction of the monetary union in 2001.

Sources say the Taoiseach will argue that these flaws contributed to the collapse of the Irish economy and those of other eurozone countries forced into bailouts. He will say some of these issues have been repaired in recent years but insist more work needs to be done in this area.

Mr Kenny is due to appear before the Inquiry on Thursday to give evidence on his time as an Opposition leader.

Tanaiste Joan Burton, Jobs Minister Richard Bruton and former Communications Minister Pat Rabbitte will also attend on the same day.

Fine Gael had hoped the Inquiry would act as a reminder to the public of Fianna Fail's time in power and its handling of the country's finances during successive governments. However, Fine Gael sources have admitted they have been disappointed with the lack of public engagement with the Inquiry.

There is also a belief within some sections of the party that key witnesses such as Mr Cowen, Mr Ahern and senior civil servants came out of the hearings relatively unscathed.

There is huge disappointment that senior Anglo Irish Bank executives, including former chairman Sean FitzPatrick, will not have to face a public grilling over their handling of the failed lender due to ongoing criminal cases.

The Director of Public Prosecutions (DPP) informed the inquiry that Mr FitzPatrick, along with Anglo's former head of treasury John Bowe and executive Pat Whelan, will not be able to attend as it could prejudice a future trial. Former executives Peter Fitzpatrick and Willie McAteer will also not appear following directions from the DPP.

The Banking Inquiry is due to hear from other Anglo executives in the coming weeks, including Mike Aynsley, who was appointed chief executive as the bank's financial problems emerged.

Alan Dukes, who was app- ointed public interest director following the bank bailout, will appear at the hearing on the same day. Former Anglo non-executive director Fintan Drury will also appear.

Sunday Independent

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