- NEWS
Shatter: Garda chief told me about WallaceEmbattled Justice Minister Alan Shatter said the Garda commissioner gave him details about TD Mick Wallace escaping penalty points and that he publicly revealed it to defend the integrity of the force.
Panicked last minutes aboard the Tit Bonhomme revealed at inquest Rarely has a voice ever carried so much panic.
- WORLD
Horror and heroism as tornado wreaks havocThe search for survivors and the dead in the Oklahoma City suburb raked by a massive tornado was almost complete last night.
Chile miner happy to be played by Banderas in filmAntonio Banderas will star in a movie as one of the 33 Chilean miners trapped deep underground for more than two months in 2010, and the charismatic survivor he's playing couldn't be happier.
- BUSINESS
Smooth exit from bailout forecastIreland is heading for a smooth exit from the bailout programme as GDP grows — delivering a huge political and reputational reward for the country, according to the latest Ernst & Young Economic Eye.
Glanbia’s Talbot first woman to take helm at a major Irish food companySiobhan Talbot is set to succeed John Moloney as group managing director of Glanbia, at the end of this year — becoming the first woman to head up a major Irish food company.
- SPORT
Deegan in dock over advantage ruleArmagh's Jamie Clarke has cleared Paul Grimley of all responsibility for Sunday's defeat by Cavan, but questioned referee Maurice Deegan's decision not to allow him advantage in scoring his second-half disallowed goal.
One more year and that’s it, insists O’DriscollBrian O'Driscoll has ruled out extending his career beyond next June.
- LIFESTYLE
Tyranny of the majorityIn the play An Enemy of the People, one man stands for right, says Pádraic Killeen.
Opening a can of wormsThe UN thinks it's a good idea, but what do the Irish think of eating creepy crawlies, wonders Jonathan deBurca Butler.
11-14C
Live Blogs
- We have no upcoming events at the moment. Please check 'Recent Events' tab for past events
Breaking stories
Stimulus package delivers little more than spin
By Jim Power
The announcement of a €2.25bn capital investment stimulus package was accompanied by great fanfare from Government.
At one level such support is understandable as it is a new experience for this Government to be in a position to announce any increase in spending.At another level, the fanfare is totally unjustified and smacks of a Government seeking to cover the last few days of the Dáil term in a cloud of hype and spin, and distract from the issues still smothering the economy.
The capital investment stimulus package totalling €2.25bn will be spent in the period out to 2018, on roads, schools, primary health facilities, new justice facilities, and the development of a new campus for Dublin Institute of Technology (DIT). The funding of the package is far from clear but it is envisaged that it will be financed from a combination of the National Pension Reserve Fund, the sale of some state assets, the European Investment Bank, and the domestic banks.
It is envisaged the projects will be delivered on a Public Private Partnership (PPP) basis, which is necessary to prevent the spending going directly onto the books of the State. Presumably, the Government is fairly certain about such funding being forthcoming, but the expected contribution from the domestic banks does not fill me with joy.
The reality is the banking system is not functioning properly, is totally risk averse, and is not channelling credit to worthy businesses. By investing in the proposed PPPs, the banks will be adopting a cautious investment approach, and by definition it will further divert resources away from essential lending to the business sector.
Brendan Howlin, the public expenditure and reform minister, described the projects as representing “critical infrastructure”, but it is far from clear that this is the case.
DIT is already providing a valuable and effective third-level education offering, albeit in 39 different locations. While a centralised state-of-the-art campus would be nice, it is not clear that a cost-benefit analysis would make a strong case for prioritising such a move.
Likewise, the proposed road developments do not appear to represent crucial development, because the bulk of the road infrastructure deficit has been largely solved over the past decade.
The primary healthcare facilities make sense, as does the schools investment. However, it seems strange to be investing in schools and Garda stations at a time when teacher numbers are being cut back, where some important subjects are being forced off the curriculum in non-fee-paying schools, and where Garda numbers are under serious pressure.
It is important to remember that the jobs created will last only as long as the duration of the projects and it is not certain in any event that Irish firms and workers will benefit under the EU tendering process.
It is also worrying that the Government has failed to produce any cost-benefit analysis of the proposed investment projects.
Japan spent billions on capital investment projects in the 1980s and 1990s, but to no avail. The problems in Japan centred on a bankrupt banking system, a lack of consumer demand, and a basic lack of business and consumer confidence.
In many ways Ireland is struggling in the face of similar problems, which are compounded by the ongoing savage fiscal squeeze.
The latest stimulus plan will not address any of these problems. The focus of stimulus should be on cutting the cost of doing business and improving credit conditions, thereby creating employment and ultimately lightening the dark mood of the consumer.
While it is not easy to criticise any spending initiative in the current environment, I fear it will not have the dramatic impact being promised in some quarters.