Sunday 15 September 2019

Budget 2018: King of courtesy prepares to unveil his first Budget, as demands grow

Over the coming week, Paschal Donohoe will have to drop the mask and make some tough calls, writes Philip Ryan

Initial Budget: Minister for Finance and Public Expenditure and Reform Paschal Donohoe
Initial Budget: Minister for Finance and Public Expenditure and Reform Paschal Donohoe
Philip Ryan

Philip Ryan

There is an air of trepidation among some of the Dail's more free-speaking deputies ahead of this year's Budget Day. TDs supporting or facilitating the minority Government were happy to bang their desks and make demands before the inaugural Budget under the new regime.

Last year, there were daily calls for pension hikes, tax cuts and grants for sheep. Political posturing was carried out in the full glare of the public as our politicians got used to the dysfunctionality of 'new politics'. They all wanted a piece of the fiscal pie before the EU ruined our spending and tax-cut plans with restrictive rules. Eventually the rows, contrived or otherwise, were resolved. By the time the now former Minister for Finance Michael Noonan took to his feet in the Dail chamber, everyone was happy.

This year, it's different.

For one thing, there's less money - around €350m less - for new measures, if revenue is not generated from other measures. This means TDs, whether they are from Fianna Fail, Independent Alliance or elsewhere, are nervous about making unrealistic demands because they will look foolish when they are shot down.

One Independent Alliance member put it like this: "We have to be seen to be asking for things we will actually get. If we don't get what we call for, people will be wondering what's the point in having us in the Government."

There is a similar attitude at Fianna Fail - though members would say they are not really in Government.

The second big difference with this year's Budget is that there is a new Minister for Finance. This is Paschal Donohoe's first - and potentially only - Budget. Nothing can be taken for granted in the current political climate. The mild-mannered king of courtesy will have his pleasantries pushed to the limit over coming weeks.

Every day, deputies have traipsed into his office in the Department of Finance in Merrion Street. They could be from Fine Gael, Fianna Fail, the Independent Alliance or just plain old independent TDs. Each one of them arrives with a begging bowl. The needs of their departments, parties, political groupings or constituents are more important than the others. Ministers say their officials have warned their department will implode if they don't receive more investment. Fianna Fail and Independent Alliance TDs warn that their TDs might not allow the Budget to pass if they don't get what they are demanding.

With each visit, Donohoe repeats the same mantra: "there's very little money to go round this year and we have to be prudent with the resources we have." He remains courteous at all times. He's full of pleases and thank yous. He tells them he will get back to them when he examines their proposals but he urges them not to raise their expectations as things are tight.

"He has a very good bedside manners - he's like a granny counting her pennies," said one TD who recently met with Donohoe.

A cabinet minister who has been locked in negotiations with him described him as "unwaveringly courteous, but with a backbone of steel".

They say he is practical and reasonable, but gives nothing away. He is a very different beast from Michael Noonan, who was more traditional in his approach to Budget talks and politics in general. Deals could be signed off in the corner of the bar in Leinster House rather than in his ministerial office.

Donohoe and Varadkar are more businesslike in their approach. After their meetings with the new Minister for Finance, ministers and TDs alike have left the department with very little to return to their offices to celebrate. Despite their disappointment, they tend not to vent their frustration at Donohoe.

Most people who deal with the minister like him: manners go a long way. Some wonder how he keeps up the pleasantries in the heat of the battle. They wonder if there's something behind the cordial facade. Fianna Fail leader Micheal Martin used to find Donohoe's courteous nature overbearing, but even he has come round to the minister's charm.

Donohoe has been plotting his Budget strategy with Varadkar from the moment they took office. They developed their 'balance the books' message and it is beginning to resonate with a large section of the public. Everyone likes a clean credit card bill, and any business owner will tell you of the elation they feel when the figures in the columns of their ledger match. But Donohoe still has to allow the various factions to put their stamp on the Budget, so they can proudly announce successes of their own on the big day.

The Independent Alliance kicked off its talks last week and made some reasonable - and some unreasonable - demands. It wants reliable vote-grabbing payments (such as the bereavement grant and telephone allowance) restored. It also wants more funding for the Housing Assistance Payment.

Shane Ross is pushing for tax relief for grandparents who look after their grandchildren. John Halligan has proposed raising money by increasing gambling tax by 0.1pc, the €50m raised from this being used for mental health services. Donohoe has been straight with the Alliance and told members it is unlikely he will be able to meet all of their demands - but he knows he needs to keep them happy.

Disability Minister Finian McGrath is looking for a range of measures, including extra respite care for people with disabilities, more emergency residential places, additional speech and language therapists and an increase in home-help packages. Most importantly, he wants work to begin on a new emergency ward for Beaumont Hospital (or "Finian's Stepaside Garda Station", as some members of the Alliance call it).

Fianna Fail, so far, has not been as forceful in its negotiations as last year. Members want commitments set out in the confidence-and-supply agreement fulfilled. They want more money for education, especially at third-level, where Thomas Byrne is seeking a €100m investment, and they also seek to tweak the pupil-teacher ratio.

Housing and health are also key areas Micheal Martin wants addressed. Fianna Fail wants a welfare package that would see hikes in the pension, dole and payments to carers and people with disabilities. They want prescription charges cut and the threshold for the drug payment scheme increased. In Justice, Jim O'Callaghan wants 800 new gardai next year, more Garda overtime and an increase in CCTV in rural communities

Behind the scenes there is also a secret game of poker being played by opposing sides. Both the Independent Alliance and Fianna Fail want to be first out of the traps to claim responsibility for any significant Budget announcements. Each side hopes to push Donohoe for investment in an area they know the opposing side favours; once they get the commitment they will publicly claim they were the one to push the deal over the line.

The minister also has to keep some unaligned independents happy. Children's Minister Katherine Zappone put out a statement to local media in her Dublin South West constituency last week announcing how she had pushed Donohoe for investment in Tallaght Hospital, IT Tallaght and three local schools - on top of money she is seeking for her own department. Communications Minister Denis Naughten asked Donohoe for more home-help hours, which would be roundly supported by everyone in the talks.

Tipperary TD Michael Lowry, who plans to support the Budget, said last week he wasn't seeking anything because last month he secured funding from Donohoe and Minister for Health Simon Harris for a 40-bed modular unit for South Tipperary General Hospital. Mr Lowry said he doesn't believe in the "politics of threats and hysterics", instead using reason in his negotiations with the ministers.

"It wasn't a political decision; it was a decision promoted by the consultants in the hospital," Mr Lowry said.

"I reasoned the case with the minister and got it resolved. I don't have a shopping list for the Budget. I have access to Government and I use it wisely."

Lowry aside, Donohoe is giving everyone involved in the process a lot of his time. The dedicated family man is working a seven-day week (though he did make time to see LCD Soundsystem perform last week). But he knows the time for courtesy and manners is over: in the coming days he will need to make tough and lasting decisions.

Sunday Independent

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