We need a debt reduction not a deferral

Over the last several weeks we’ve been listening to all and sundry telling us that the €3.1bn and change that is to be paid by the end of March — that is two days away — will somehow be deferred.

This is being advised to us as some holy grail, as if by happening we are suddenly better off.

The reality is that we will still owe the money and it still must be paid back sometime.

Now if it’s anything like a mortgage or a personal loan the longer it takes to pay back, the more interest that accrues. In other words we will actually pay more and more. Or should I say that those coming after us will end up paying off the debts of Irish gamblers and complacent politicians.

What we really should be doing is negotiating a reduction in the amount that is owed. We should never forget that in the capitalist system, reward is supposed to follow risk. The way the ECB plays it, it is still ‘heads I win and harps you lose’. But it’s not our debt. It’s a debt agreed by the incompetent and wayward government of the day made under pressure.

As a result of Anglo Irish and other bank and property development disasters, the Irish economy is in hock to half of Europe. Austerity measures are heaped on austerity measures to try and get revenue into the exchequer to reduce ever-growing external borrowing.

Yet, there are still areas within the economy that cannot be touched as if they were proverbial sacred cows. The Croke Park Agreement is one such area.

In recent days, a senior union official has stated that “if the agreement is abandoned, the alternative is permanent conflict between the trade unions and the Government”.

Do these folk not realise that we are borrowing billions every year simply to keep going and much of that money goes on salaries and pensions. If the ECB, et al, cut off the funds tomorrow there would be no money to pay out. So it’s really time to get real.

Now, it would be easy to suggest that we should dismiss such comments as being anti-public sector. The public sector comprises people just like the private sector who have homes to pay for and children and pensions to provide for.

And yes, they have been required to take cuts but they have not been required to lose their jobs and their pensions are guaranteed defined benefit, linked to the grade they enjoyed.

Perhaps the real sacred cows in this argument are the very many highly-paid public sector employees who enjoyed, and still enjoy, salaries and perks far higher than their private sector comparators.

Perhaps the real fear of the unions is that many in the exposed private sector would think it reasonable that lower paid public sector employees should be protected in as far as possible. However, these same folk do not feel any such sympathy for the very many fat cats who are protected by the same agreement. Opening the door on the agreement would mean well-off guys take a hit, God forbid.

Another untouchable would appear to be that of hospital consultants. Our consultants are good. They are professional and they are very well paid. In fact, it has been argued that they are much better paid than most of their counterparts across Britain and Europe.

Yet Health Minister James Reilly has said that he is far more interested in securing increased productivity than he is in cutting their pay. Is he suggesting that they are coasting currently and they can all do more?

What most of us would like to see is a reduced pay bill, coupled with increased productivity and remuneration more in keeping with the profession elsewhere.

Mind you that would also apply to politicians, et al. Whatever it is, there should be no untouchables in our efforts to escape this nightmare.



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