Sunday 18 March 2018

Stephen Donnelly: First-round victory to Irish but € 64bn challenge remains

If Ireland's delegation is to fully capitalise on its troika success a change of negotiation tactics is needed, says Stephen Donnelly

Last week, I sat down with the troika for the second time and was struck with a severe case of deja vu. It all felt, and sounded, very familiar. But there was one new item up for discussion: what could be done about Ireland's debt.

The troika had the pleasure of meeting opposition parties on Wednesday morning, including the technical group. We sat down with them in tastefully decorated, high-ceilinged chambers in the Department of Finance. Both parties had six men and one woman around the boardroom table -- gender discrimination is as alive and well in European bureaucracy as it is in Irish politics, it seems.

Their song mostly remained the same. They stressed the need for further structural reforms to the "non-tradable sector". Technically, this phrase includes non-tradable services -- such as haircuts -- but it was clear that the reference was to our public sector; Government, healthcare, education and so on. "Structural reforms" meant wages. As before, the message was very clear: parts of Ireland's private sector boast "outstanding productivity", but when it comes to the "non-tradable" and "sheltered" sectors, we need to "help the market find the wage level that creates jobs". Let me translate that: we could hire more frontline workers if we paid market-level wages.

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