Monday 10 December 2018

Any election is madness while Brexit uncertainty continues

Political rhetoric and posturing should be toned down as the Brexit deadline draws nearer, writes Brian Hayes

WARNING: Angela Merkel said hard Brexit could hit ‘liquidity’. Photo: Markus Schreiber/AP
WARNING: Angela Merkel said hard Brexit could hit ‘liquidity’. Photo: Markus Schreiber/AP

Brian Hayes

We are in a strange place in Irish politics right now. Everyone is planning for an election but nobody knows when or how it will happen.

What will follow the next election is anyone's guess. But a lot has changed in the last year politically.

The emergence of Leo Varadkar as Taoiseach and leader of Fine Gael has transformed the political landscape and improved FG's standing in the polls. Sinn Fein's new leader, Mary Lou McDonald, is certainly trying to make her party look less toxic and clearly wants to be in government. She has started well and is making a big push for the centre ground. Fianna Fail knows that, too. Micheal Martin also knows he has one shot at becoming Taoiseach so his decision as to when the election might be held is crucial for his future and that of his party.

The problem with the new experiment of confidence and supply in Irish politics was never starting it, but rather how to end it.

Both FG/FF correctly fear a public backlash in not honouring the arrangement. It's a bit like the Cold War all over again as both sides face off against each other, but are fearful of actually pushing the button that starts the war - the election, in this case. So all this talk of an election of late is a total distraction from the biggest issue - Brexit. It remains the unknown and the greatest threat to our growing economy which is still heavily indebted.

In fairness, FF has delivered in terms of the confidence and supply agreement. And it deserves credit, especially its leader Micheal Martin, in holding to that agreement. While FF can point legitimately to the agreement delivering two budgets thus far and probably a third this autumn, it is, however, flatlining in the polls. Never a good place to be in politics.

FF doesn't know how to bring the Government to an end and the longer it goes on, the better it seems to get for FG. But as we know, things change very quickly in politics, something that the Taoiseach is well aware of.

In the midst of all this political dance-off, the really important work of government must continue as the country faces Brexit. Frankly, over the next year we need a functioning government that is totally focused on navigating the Brussels negotiation to a successful conclusion.

Judging by the proposed text being considered for next week's EU Council meeting, recriminations from the EU side are heavy in the air. Nobody can say with any certainty that a Brexit cliff edge won't happen. That would be a disaster for Ireland, for the UK and for the EU. But bad politics can sometimes throw up bad outcomes and there is no doubt that the EU is preparing for exactly the worst outcome, and so should we in Ireland. I thought it highly significant that Germany's chancellor, Angela Merkel, told us in Munich just two weeks ago, that Ireland could suffer "liquidity problems" in the case of a hard Brexit.

For a withdrawal agreement to happen between now and October requires either the UK or the EU 27 to make some pretty extraordinary U-turns.

This week Brexit will be relegated to a minor point on the EU Council Agenda as no progress is being made. By the October Council meeting, it's hoped that a withdrawal agreement can be agreed. And let's not forget that by March 29 next year the UK is due to leave. Time is running out.

Big calls will have to be made by the Irish Government at all points in the final scenes of the Brexit drama. The idea of fighting an election, or a shadow election, when these intense negotiations are ongoing is suicidal from an Irish perspective.

Any agreement between the UK government and the EU has to be ratified by both the Westminster Parliament and the European Parliament. Can we make the assumption that the agreement will actually be passed at Westminster? Could the EU Parliament, weeks from an election, come under intense public pressure?

Really, the next 10 months or so are crucial as to whether the Brexit outcome is catastrophic for us or simply just negative for the future growth prospects of the Irish economy.

That's why, with all the skirmishing between FF/FG right now, what's needed at this moment is a bit of common sense.

Firstly, let the Government continue to negotiate with our EU colleagues and try to get the best deal possible for Ireland between now and October. I agree with Bertie Ahern that it would be extremely dangerous to wait until October to settle the Irish border question. We need to see progress before then, for example, some time between June and October.

Secondly, agree early in autumn the budget for next year but take a very cautious approach to the public finances. October's Budget doesn't need to be expansionary at all and the more we can save for a rainy day, the better where significant risks exist. Warning signs are there from the Fiscal Council to the EU commission to the OECD. A neutral budget right now would be the right thing to do.

And, finally, tone down the rhetoric and the endless political mud-wrestling. There should be no general election until the Brexit issue has been resolved. And that will be by the end of March next year at the earliest. If the Government can last until then with the agreement of Fianna Fail, effectively three years from the last election in 2016, both parties will have served the country well. And indeed both parties may well be rewarded whenever the next election actually happens.

Brian Hayes is a Fine Gael MEP for Dublin

Sunday Independent

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