Tuesday 20 March 2018

Taoiseach wins scrap to stay in charge by five votes

Patricia McDonagh

TAOISEACH Brian Cowen last night won his fight to stay on as leader of the country by winning a vote of confidence by 82 votes to 77.

In a rousing speech, Mr Cowen said he took "full responsibility" for the decisions he made as Finance Minister and was "sorry" for the outcome.

But he argued that nobody had predicted the scale of the collapse and defended his record by insisting he had made moves to cool the economy.

Two damning reports on Ireland's banking crisis recently said Mr Cowen's policies as Finance Minister heightened the vulnerability of the economy.

However, flanked by cabinet colleagues yesterday, he said the record showed he had abolished property-based incentives and other tax reliefs.

"I wish merely to repeat my full acceptance of responsibility for the decisions I took, as minister and Taoiseach," he told the Dail.

"I believe that the record, informed by the expert analysis published over recent days, demonstrates that I acted to correct imbalances in our tax-relief system and to rebalance the focus of economic policy from an excessive dependence on property and construction towards a more balanced and sustainable economy."

But he admitted such moves were insufficient to prevent the disaster. The Government had been advised that the banks had sufficient capital and that a soft landing in the property sector could be expected, he pointed out.

"While this advice proved to be wrong, the suggestion that the Government was advised differently and ignored this advice never had any truth whatever," he said.

"I wish to make it clear to the house, in an honest and open manner, that I regret and am sorry about the outcomes that have come to pass."

Nobody predicted the financial and economic collapse that occurred in the developed world in 2008, he said.

And he said he agreed that a more restrictive fiscal policy would have assisted in slowing the economy.

"Hindsight is always clear and clearly we would have taken such a course if we had known of the scale of the property collapse," he said.

But recent government actions, he insisted, had been seen as the right path to take by the experts compiling the banking reports.

The reports had confirmed the need for a blanket guarantee and that Anglo Irish Bank was "systematic" at the time of this guarantee, he pointed out.

And the Government was now working to push the country towards success once again.

"Between 2009 and 2011, it is expected that our unit labour cost will have fallen by 12pc and consumer prices are already down by 2.5pc this year," he said.


"Economy activity as measured by GDP will be around 30pc higher this year than 10 years ago, and about 150pc higher than 20 years ago."

Green leader John Gormley was one of a roll call of senior ministers who pledged support for Mr Cowen, while Health Minister Mary Harney insisted he was "rock solid".

However, Fine Gael leader Enda Kenny said Mr Cowen had "hijacked" the country and handed it to a toxic circle of bankers and developers who sought to destroy it like a "cancer".

And he charged that he had condemned the country to a lost decade of misery and unemployment, and left families living in the shadow of shrinking hope.

Labour leader Eamon Gilmore insisted the country would not tackle its problems with a government that is serving out its notice and clinging on to power.

"We need a Government that gets the idea, that jobs and growth will not come from a hands-off, light touch approach," he said.

Fine Gael last night withdrew pairing arrangements for the vote, prompting a straight and tight vote.

Irish Independent

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