Tuesday 16 July 2019

A real leader would dare to prioritise public services over pay restoration

As we approach the formation of a budget, the central question facing all political parties and vested interests is: Which should have priority, pay restoration or service restoration?
As we approach the formation of a budget, the central question facing all political parties and vested interests is: Which should have priority, pay restoration or service restoration?
Eddie Molloy

Eddie Molloy

When I contacted travel writer and consultant Eoghan Corry to check if I had heard him correctly on radio saying that there were one million visits from Ireland to Spain in the past year, he said: "No, it was 1.3 million visits, and new figures due soon from Spanish tourism authorities are expected to show the numbers rising to 1.4 million and possibly even 1.5 million."

Early signs that the good times appeared to be back were the purchase of 400,000 tickets to see Garth Brooks, and since then new car sales have soared. Now it looks like we are all beginning to party again, refilling the punch-bowl - with wines sales up by a million cases. Sounds familiar?

It is entirely up to each person how they spend their own hard-earned money, but is it good government to return to the populist economic policies that caused the recent collapse of the public finances, with its catastrophic consequences for everyone, especially poor and otherwise disadvantaged people?

It bears thinking about that, with 550,000 people waiting more than a year for a hospital appointment, the law of averages means that 130,000 of those who chose to spend their money holidaying in Spain came home to rejoin the 12-month queue to see a doctor, and perhaps a similar number to spend 48 hours on a chair or a trolley in A&E.

As we approach the formation of a budget, the central question facing all political parties and vested interests is: Which should have priority, pay restoration or service restoration?

When he was Minister for Health, Leo Varadkar answered this question, saying, "If I had extra money I would rather spend it on more staff than giving more money to existing staff." Notwithstanding the real difficulties in hiring nurses, partly because of the packages on offer, repairing shameful deficits in our public services must surely be the priority for government.

For example, 6,500 children deemed to be at risk of neglect or abuse have no assigned social worker; thousands of families are living in hotel rooms; public nursing homes will not meet basic standards until 2021; mental health services are grossly underfunded.

The most intelligent response to this came in a recent radio interview with Tom Healy of the Nevin Institute, the economic think tank of the Irish Congress of Trade Unions. He first set the context: Ireland is a low-tax country, and reducing, never mind scrapping the Universal Social Charge (USC) would be a grave mistake. The USC is a progressive, fair tax and should, if anything, be built upon. The Government needs to collect more tax, not less, and from a wider base. Then, asked, "What about the demands for pay restoration and the growing pressure from the unions for pay increases?" Mr Healy replied: "The best way to put more money back in people's pockets would be to restore our health services, improve our education system, and deal with homelessness," adding words to the effect that this would be of most benefit to those in greatest need.

The key task of any government in this kind of context is to manage expectations, but ever since the first green shoots appeared in 2014, all parties have done the opposite, with promises to "keep the recovery going … scrap the hated USC …put more money back in people's pockets... give people a break ... abolish water charges … provide free childcare" and all kinds of other goodies. Given this narrative, powerful public service unions are now demanding of a precariously balanced government 15-30pc pay increases. Meanwhile, the plan is to limit the number of people on trolleys to 236 per day this winter, which will inevitably mean longer waiting lists for elective procedures.

The public interest is not best served by a descent into populist, vote-catching promises to cut taxes and put more money back in people's pockets, so that they can go to Spain in even greater numbers, as it were. The truth is that there isn't the 'fiscal space' to do so and to suggest anything else is to mislead people, especially those who most rely on public services and who may never get to Spain in their lifetime.

More than ever we need political leadership, not followership, pandering to everyone's desire for an easier time. A true leader would explain that an easier time in the short term for those who have the power to secure it is detrimental to the interests of everyone in the longer term. Is it too much to hope for that such leadership will emerge from the pack, or are we fated to shoot ourselves in the foot again?

A promising sign last week was when Finance Minister Michael Noonan, apparently prompted by the warnings of the Fiscal Council, stopped gilding the lily and spoke about what is possible - and what is prudent.

Irish Independent

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