Monday 21 October 2019

John Downing: 'It's solid stuff from 'Prudent Paschal' as we face into the eye of the storm'

Minister for Finance Paschal Donohoe arrives at his department ahead of delivering Budget 2020. Picture: Gerry Mooney
Minister for Finance Paschal Donohoe arrives at his department ahead of delivering Budget 2020. Picture: Gerry Mooney
John Downing

John Downing

Paschal Donohoe has conceded that, in this time of threatened Brexit blues, it is not good politics to bribe voters with their own money - even though a general election is just months away at most.

This was the unfailingly courteous Dublin Central TD's fourth Budget. He also 'rode shotgun' as public expenditure minister on a fifth Budget in 2016, putting him within shouting distance of the seven Budgets presented by Fianna Fáil's Charlie McCreevy, and making him a household name.

This one was all about Brexit - from start to finish - with many of the bits not directly about the B-word containing an element of the dreaded term.

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And during the 70 minutes he spent delivering his Budget speech, and during his succeeding tours of radio and television guff shows, still more Brexit horrors were emerging in London, Brussels and Berlin.

Brexit remains a moving-target. But the renewed vitriolic exchanges between the EU and the UK are deeply dispiriting. We look again to another Dublin visit in coming days by UK Prime Minister Boris Johnson.

So, Mr Donohoe's 2020 Budget blueprint includes a €1.2bn relief fund to cushion the economic blows of a potentially messy UK-EU divorce.

"This is a Budget that has been developed in the shadow of Brexit," Mr Donohoe said. "The context for Brexit has now shifted to no-deal as our central assumption."

It excluded EU grant aid and low-interest borrowings from the European Investment Bank.

That reminded us again how ruinous Brexit is, with spending focused on mitigating harm.

This hard Brexit fallout funding would include €200m for port and airport infrastructure and staffing next year. "Borrowed money" would also be used to intervene in a no-deal scenario, with €650m available to agriculture, enterprise and tourism sectors along with "the most affected citizens and regions".

If the worst no-deal day comes soon, then €220m would be deployed immediately. But there would be no unnecessary borrowing.

"If we do not need it, we will not borrow it. If a no-deal does not happen, it will not be borrowed for other purposes."

Mr Donohoe said support for the fishing fleet and the already beleaguered beef sector would be the Government's "first priority". As recently as last month the Central Bank warned that one in three farms could fold due to a disorderly Brexit.

This was in many ways the return of 'prudent Paschal', avoiding the electoral temptation in these perilous times to distribute voter lollipops and facing into the eye of the Brexit storm clouds. Solid stuff in the main.

Fianna Fáil continued to pull back, making some pugnacious noises as it went.

Another reminder surely that, if a calamitous Brexit happens - even though voters accept it was not our Government's fault - the political consequences will still fall mainly upon Mr Donohoe and his Cabinet colleagues.

Irish Independent

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