There is a very healthy debate going on in Ireland and indeed around the developed world about the appropriateness of austerity and the impact it is having on different economies.
In Ireland at the end of 2013 respective ministers of finance will have taken over €27bn out of the Irish economy in the relatively short period of time since 2008.
By any standards this is a lot of money to extract from an economy that has experienced one of the biggest economic crashes in modern history.
Unfortunately another €5.1bn is due to be extracted over the next couple of budgets. A very painful prospect in current circumstances.
What those who favour a continuation of this painful financial contraction are failing to identify is where the remaining monies should be raised from. A banker that I worked with back in the 1990s recently commented to me following the original rejection of Croke Park II that all teachers and nurses should be sacked and then re-hired on lower wages.
If they were not prepared to accept this, then they should take a walk. I was incredulous at this coming from somebody who has taken no pay cuts and who works in a sector that has made a major contribution to the awful mess we are now find ourselves in.
The view of many is that teachers and nurses and other public sector workers are paid too much and should just be subjected to further pay cuts. I don’t share this view — both professions have already taken severe cuts and both professions are also amongst the most important and vital in Irish society. Certainly they are much more valuable to people’s lives than certain bankers who are earning almost as much as 30 teachers. But there you are, that is how Irish society appears to place relative values on different occupations.
For the majority of public sector workers it is difficult to argue for further pay cuts, although there may be some at the upper end who are paid pretty well for what they do. If one has children in the education system or if one is unfortunate enough to get sick, one would hope we have a highly motivated and skilled cadre of teachers and nurses in the economy.
Taking more take-home pay off them at this juncture might not be the best way of assuring this. If you pay peanuts to workers such as these then you will scare away talented and motivated people and seriously undermine health and education.
This is not to suggest that further savings should not be made in the cost of providing public services or that greater efficiencies should not be achieved in delivering public services. In its latest pronouncements on the Irish economy, the EU Commission is critical of health spending and suggests it needs to be contained.
The point with health spending is that it has increased exponentially since 1997, but this increased investment is not readily visible in the quality of health service being delivered. This is a source of major concern because the demand on the health service will increase dramatically over the next couple of decades as the population ages. If we cannot manage now, what will it be like in 20 years with even more scarce resources and much greater demand.
In relation to public spending the focus needs to be on the outputs from spending rather than how much we spend.
The revelations exposed by RTÉ this week in relation to the child abuse and abysmal treatment in creches that get state monies and who are subject to HSE inspections is nauseating.
What have the inspectors in the HSE been doing? Has the State totally failed to regulate the sector and ensure humane standards? What would have happened if RTÉ had not revealed the truth? These and more questions need to be answered, but it all smacks of incompetence and a lack of accountability in parts of the public sector. As taxpayers, we deserve better.
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