Saturday 20 January 2018

Independents hold Lenihan to ransom over Finance Bill

Michael Brennan Deputy Political Editor

TWO Independent TDs were last night holding the Government to ransom over the passage of the Finance Bill, as they made one final push to extract political favours.

Backbenchers Michael Lowry and Jackie Healy-Rae threatened not to support the crucial law needed to enact tough budget changes.

Both men were accused of trying to "squeeze the last drop from the orange" in exploiting the desperate push by the Government to get the Finance Bill through. Finance Minister Brian Lenihan warned the passage of the bill was key to getting continued funding from the €85bn IMF-EU bailout fund.

The Cabinet agreed last- minute tax reductions for the country's 1.6 million medical card holders earlier yesterday in an attempt to win the support of Mr Lowry and Mr Healy-Rae.

If they do not support the Finance Bill in today's Dail vote at noon, it will be defeated and there will be an immediate general election.

While both Independents came under fire for playing to their own constituency interests, some of their demands would prove popular with taxpayers and pensioners across the country.

Taoiseach Brian Cowen and Finance Minister Brian Lenihan were reduced to personally pleading with Mr Lowry, who has been given authority by Mr Healy-Rae to negotiate on his behalf.

Mr Lowry said he was "minded" to vote against the bill unless their four remaining demands for changes were met.

"If we don't vote for it, it's gone. Taoiseach Brian Cowen will be heading for the Park," he said.

The remaining four demands on Mr Lowry's shopping list include:

  • The exemption of 120,000 retired public servants from the universal social charge.
  • A reversal of the decision in the bill to bring forward the payment of preliminary tax by self-employed people by a month to September 30.
  • A reversal of the decision to not allow tax relief on the first €2,000 of fees for full-time third level students.
  • Re-introduce the 90pc tax on bankers' bonuses, which has been excluded from the bill due to the rushed timeframe.

There is agreement that the Finance Bill should be passed by the Dail and Seanad by Saturday. That would allow Mr Cowen to dissolve the Dail on Tuesday next week and call a general election -- with Friday, February 25, the most likely date.

But the general election date would have to be set immediately if the Government loses the vote on the Finance Bill. It only has 79 guaranteed votes without Mr Lowry and Mr Healy-Rae against the opposition's 81 votes.

It cannot depend on the vote of Tipperary North TD Mattie McGrath, who quit Fianna Fail yesterday, and even the declared backing of Independent Wicklow TD Joe Behan will not make any difference if Mr Lowry and Mr Healy-Rae do not support the bill.

Taoiseach Brian Cowen told the Dail yesterday that passing the Finance Bill was an important factor "to maintain our international reputation".

Green Party leader John Gormley appealed to Fine Gael and Labour to drop their opposition to the Finance Bill and allow it to pass by abstaining.

"They should act responsibly in the national interest," he said.

But Fine Gael chief whip Paul Kehoe made it clear all his party's TDs would be turning out to vote against it.

Labour leader Eamon Gilmore said his party would oppose the bill.

Mr Lenihan told the Dail that a failure to pass the Finance Bill could jeopardise the €85bn IMF-EU deal.

It was revealed yesterday that Ireland will draw down another €3.3bn instalment after the European Financial Stability Fund successfully raised the cash on the markets.

The Government, which has already taken €5bn from the fund, will be charged around 6pc interest on the loan, even though the money was borrowed at a much lower rate of 2.89pc.

During the debate on the Finance Bill yesterday, Fine Gael finance spokesman Michael Noonan restated his party's aim to renegotiate the terms of the bailout deal.

Irish Independent

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