By Eamon Delaney.
Hardly has the party season ended, but our politicians are back with their rash and populist promises in the run-in to next year’s election.
Tánaiste Joan Burton has promised to raise the State pension to up to €24 per week over next few years if re-elected. There is no clarification as to how this will be paid for. It is unnecessary, uncalled for and recklessly generous – pitched to attract the votes of the elderly. As it is, the State will struggle to pay for the existing pension system, given the huge demands expected in the future.
But who cares about that – that’s the future! Instead, Ms Burton’s stunt is an all-out pitch for votes when the Labour Party is in the doldrums and possibly about to be kicked out – and for which someone else will pay the bill down the road. This is, alas, the usual pattern of Irish pro-cyclical politics, boom to bust, and ‘spend the taxpayers’ cash now, if you have it.’
Labour’s proposal is also not a targeted increase. It is once again an increased benefit for all, regardless of means. We are apparently wedded to ‘universality’ in Ireland, such as with children’s allowances and, now, health services, and to the idea that State benefits should go to the wealthy too, rather than specifically to the needy. No wonder the Labour Party is seen as such a middle class party. After all, their free third-level education benefited no one more than their own well-heeled supporters.
But Fianna Fáil is no different. Indeed, far from criticising Ms Burton’s proposed €24 hike, Michael McGrath of FF said it didn’t go far enough and wouldn’t ‘cover the cost’ of cuts already imposed. It’s the same old Fianna Fáil, alas, when it comes to public spending and currying favour with the electorate, regardless of the cost to the State – and our future. This week the party rolled out its new plan for an enhanced welfare system which will bring up everybody’s basic benefits in a way that, in many cases, will make it pointless for them to start working.
Everybody, from rich to poor, is promised a minimum welfare/income by FF in excess of the current basic welfare rate of €188 per week. This basic ‘minimum income’ is being described as a ‘protection against poverty’ in a future era where few will be guaranteed work.
Granted, any income earned above this minimum payment will be taxed at a single new rate – probably at about 25pc. However, is it really the State’s business to ensure people have decent incomes and even actually pay them a monetary top-up if they don’t make enough in employment? Surely the purpose of the State is to create the conditions for employment, enterprise and, hopefully, prosperity.
However, having created the conditions that has made working attractive again – and only because the EU Troika was at their back – the Government, and FF (which began the Troika reforms) now wants to do the very opposite. Labour wants to increase dole payments by a whopping €30 per week, even though Ireland’s extensive and often generous welfare system has long been seen as a deterrent to work (welfare traps etc). And Fine Gael, which seems to have lost all its financial discipline and now resembles the Bertie-era giveaways of the mid-2000s, wants to make a similar expensive, anti-work measure.
According to Eurostat, the European Commission’s statistics agency project, Ireland has the highest expenditure rate on unemployment in the EU. We spend twice the European average on unemployment costs. But hey, let’s spend more when there’s an election coming, seems to be the politicians attitude.
It seems the Government, and all the main political parties, are all about courting popularity, and it doesn’t matter what it costs. Just look at the recent Budget, with its immediate pay restoration for public servants, and increase in Child Benefit and other allowances, and a top-up in the Christmas bonus. It was just one goodie after another as the Government’s fiscal discipline slackened in sight of a Spring election. The minimum wage was also hiked, despite protests from small businesses and entrepreneurs, who are actually creating jobs but who are ignored by most of our political culture.
This is all very depressing but it’s also surprising. Having taken flak for making all those cuts and necessary reforms, why would the Government now endanger such hard-won gains to curry favour with a seemingly content electorate, especially since most of these concessions will be long forgotten by the time of the election? Why not try to be respected rather than liked, and do what the UK Government did, running on a programme of clear and frank austerity and still getting itself resoundingly re-elected?
Instead, the FG and Labour Government is putting the interests of their parties ahead of those of the country at a time when we are still borrowing heavily and running a big budget deficit. And FF would do exactly the same.
In none of these parties, is there anyone saying that we cannot afford this extra spending and it shouldn’t be done. That is the really depressing part. It is exactly the sort of election policies which got us into trouble so many times before, in the late 1970s, the 1980s and then most notoriously in the later years of the Celtic Tiger.
This article was originally published in “The Irish Independent.”