No political will to make crucial adjustments

Like a lot of people, I am convinced that our politicians actually think that we are all idiots complete with the memory span of goldfish. I’d like to think differently but the list of items that support this argument is endless.

Take for instance the Government’s approach to the price of drugs. On the one hand we are told that the minister has instructed the HSE to reduce the price of drugs by using more generic and off-patent drugs rather than proprietary and branded. However, on the other hand the State has agreed with the generic manufacturers that they can charge up to 98% of the price of the patented branded product.

It does not take an Einstein to understand what most companies will do. So why are we surprised when we go to places like Spain and Portugal and even dear old Blighty, and find that drug prices there are so much less than here.

The government approach to the oil exploration industry is even more startling if the report Liquid Assets, by the Dublin Shell to Sea Campaign is to be believed. According to the report, under existing agreements negotiated by Ray Burke and Bertie Ahern, a company that finds oil or gas on Irish territory does not have to pay royalties to the State. Ownership and control of the oil or gas is transferred in full to the company and worse still it can choose to export the oil or gas directly abroad with minimal benefit accruing to Ireland.

While there is a headline 25% profits tax on the industry, the company can write off everything virtually against this tax and potentially end up paying nothing. As a result we stand to get as little as 7% in what is seen as one of the lowest returns in the world.

This is in sharp contrast to Norway which collected 50bn with a 78% tax rate on such corporations.

However, perhaps the biggest doozie of them all is the Croke Park Agreement. The Government chooses to reduce staff under the agreement rather than further cut public sector pay. In fact, it guaranteed it would not change pay and conditions until 2014 if the unions ensured their members were good boys and girls.

However, reducing staff members and other non-pay costs impacts on frontline services. In other words, it affects thee and me and every one we know. So why not reduce pay and conditions, increase hours from the current 35 or so and maintain services? I suppose it could not be because TDs’ salaries would be affected? Perish that thought.

The unions argue that reducing the pay of low paid public servants will not help solve our economic problems and that is true, but only up to a point.

Firstly, every little bit helps. Secondly, there are tens of thousands of public servants on several multiples of the minimum wage. Thirdly, private sector workers have taken a real beating in this economic downturn. Fourthly, and probably what grieves the troika most, is that such employees in the rest of Europe earn nothing like their Irish counterparts, nor do their government ministers.

Such problems are exacerbated when one considers some of the recipients of government largesse. Not very long ago city and county councillors were only paid expenses. Then along came pay, better expenses and then, of all things, a set-aside payment should they lose their council seat. Now that has been morphed into getting the set-aside even if it amounts to a tidy five-figure sum on being promoted to the Dáil as a TD. What happened to public service? There’s plenty of scope for cuts but in December Michael Noonan will stand up in the Dáil and deliver a budget that will once again hammer those least able to afford it while the protected vested interests continue on their merry way and the economy continues to suffer.

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