Saturday 17 March 2018

Stability of new coalition crucial

AS EXPECTED Fine Gael and Labour will form the next government after negotiations between the two parties came to a successful conclusion at the weekend. As was also to be expected, the programme drawn up by the coalition partners involves considerable compromise on both sides. This may not be entirely welcome - depending on one's political alignment, among other matters - but it's not a bad thing to get critical areas of difference between the two parties ironed out from the outset.

The compromises will be frowned upon by the supporters of each party and, given that the newly-weds can expect no honeymoon period, areas of compromise will be the focus of much analysis and criticism. However, it is better for the two parties - whose policy differences are not inconsiderable - to sort out the areas where they need to give ground now rather than having these re-emerge as divisive issues that could threaten the stability of the government at a later stage.

A key area of compromise, and one that will cause disquiet among the general public, relates to the promised reform of the public service. Fine Gael's election manifesto promised to cut the number of people employed in our bloated and unsustainably expensive public service by 30,000 and party leader Enda Kenny was adamant during the general election campaign that this would be achieved. The Labour party, which is closely aligned to the trade unions, took a much softer line, offering a reduction of 18,000 in the public service head count, to be achieved by voluntary redundancies and worked out through the Croke Park Agreement, which at this remove was very favourable to the unions.

The compromise deal of something in the order of 21,000-25,000 voluntary job cuts over the next three years clearly favours the Labour position and will not impress the voters who gave Fine Gael its strongest ever standing in Leinster House, not least when Labour's Minister for Public Sector Reform will control the process. Neither will the deal impress the heavily taxed private sector workers who foot the bill for the civil service where workers enjoy far more favourable working conditions and unparalled job security.

Of course it goes without saying both Fine Gael and Labour have engaged in something of a charade in touting numbers of redundancies that are entirely speculative. It would be far better to calculate the minimun number of staff needed to do the work in the various areas of the public service; all others are surplus to requirements and should be left go. Whether the appropriate figure is 18,000 or 30,000 would then be perfectly clear and need not be a matter of political bartering. However, while Fine Gael's apparent capitulation on the issue is disquieting, at least the matter is now settled and should not re-emerge to threaen the stability of the newly formed government.

That stability will be crucial - the coalition partners may have sidestepped some thorny issues now, but they will need to work solidly together and tackle far more testing problems in the difficult years ahead if they are to have any hope of restoring some semblance of prosperity to the country. In the meantime there are important areas where the two parties are very much of the same mind, such as taking practical, achievable steps to create employment.

These include accelerating 'shovel ready' capital projects such as building new schools and roads that will give much needed employment; ending the practice of ' upward only' rent reviews that are crippling small businesses; and the abolition of travel tax, which will be welcomed by the tourism industry. On these initiatives they are neither limited by differences of policy nor the strong hand of the EU which now steers our economy and they have every encouragement from a people who are crying out for jobs.

The coalition partners are also agreed on the need to reform our dysfunctional political system. On this they have a free hand plus the support of the the vast majority of the people of Ireland who are sick to death of traditional Irish politics. Enda Kenny promised real change within 100 days of taking office. We now expect to see that happen and where better to start than in the corridors of power.