Thursday 23 November 2017

We must ease off on cuts this time

Anne Ferris TD
Anne Ferris TD

Anne Ferris

What you would do if you were Minister for Finance and in charge of the Budget for 2014?

If I was Minister for Finance, I'd be listening very closely to backbench TDs about the societal impact of budgetary adjustments.

Because of correspondence coming from my office, the Minister for Finance knows the argument for free travel and fair pensions for our senior citizens.

He knows too that some cuts go beyond the level of acceptability for people in this constituency, like the removal of transport resources for people in receipt of the type of care that facilities like Sunbeam House in Bray provide. People in this constituency want a fairer household tax system. Protecting core social welfare payments is a strong objective of mine.

The teacher/pupil ratio has implications for future economic growth.

The Budget needs to grow more jobs for young people and in SMEs. Supporting tourism through preferential VAT pays for itself. Removing the burden of distressed mortgages is essential to achieving economic recovery.

Government backbench TDs have access to just one ear of the Minister for Finance. For the time being he is obliged to give his other ear to the lenders that agreed a very expensive recovery plan with Fianna Fail.

The previous government allowed the banks to operate like faulty slot machines. Money kept coming out until it was all gone.

When Sinn Fein and Fianna Fail voted to guarantee failing banks, the Troika became Ireland's new mortgagers. Like any mortgage agency they have strict conditions on loan repayment.

There are some non-negotiable budget conditions on the Troika bailout. One condition is to close the gap between money the Government takes in as taxes and money it pays out on services.

In 2010, due to the bank bailout, the State spent €50 billion more than it earned. By 2012 the gap had narrowed and the State was still overspending but by a much lower deficit of €12 billion more than it earned.

This year the gap has closed further mainly due to more than 30,000 new jobs in a year and increased exports. When we leave Troika control later this year, the cost of repaying borrowings is expected to fall, further closing the gap between earnings and spending. Things are getting better.

Because of this, the Troika has listened to the case, loudly argued by me and my Labour colleagues, for a less austere budget.

Several hundreds of millions of euros in cuts and taxes will now be avoided without slowing economic recovery. I'm not the Minister for Finance but if I was I'd be thanking Labour.

Anne Ferris is Labour Party TD for Wicklow and East Carlow. She is also Vice Chair of the Oireachtas Justice Committee.

Bray People

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