Prudence is the name of the game for cautious Cowen
And so it was with yesterday’s Estimates. Anywhere else in Europe, there would be a wow factor to announcing how much of our money the Government will spend next year.
Cowen unveiled a €3 billion increase yesterday, bringing overall State expenditure next year to €48.5bn (and more than €50bn when the social welfare and childcare packages are announced on Budget day). It almost goes without saying that it is the highest ever.
But the word that dominated Cowen’s presentation and all his interviews yesterday was ‘prudence’. He must have uttered it a dozen times between the jigs and the reels. For even a stand-still scenario - where no new policy initiatives were announced - would have absorbed a lot of the extra money, because of pay rises, inflation and other exceptional increases (the €400 million provided for compensating illegal nursing home charges).
Cowen has never favoured the swashbuckling (and often unpredictable) style of his predecessor Charlie McCreevy. He has been saying all year that his approach would be careful and, yes, prudent. Following the Inchydoney meeting, the emphasis on increased spending was always going to tilt towards his priority areas of health, education and social welfare.
The announcement of welfare and benefit increases are usually held back until Budget day. Last year, there was an €890m increase: this year, it could top the €1bn mark.
But looking through this year’s Estimates, there is no one issue or announcement or new eye-catching initiative that really stands out like last year’s dropping of granite-heavy hints on a big disability scheme or the doctor-only medical cards (not one of which has materialised a year later, by the way).
Is he being all that careful or is he just keeping his powder dry until the Budget? Well, yes, he is being cautious. When he took over as minister in September 2004, Cowen was essentially given the task of crafting three Budgets that would steer Bertie Ahern home for a third term of Taoiseach.
However, the goalposts had changed slightly. The spendthrift budgets running up to 2002 had given way to a dose of harsh economic correction. There was a widespread sense among the electorate that they had been duped. That sense only really dissipated after Cowen took over.
Moreover, a pragmatist like he is would know that there was no longer any more appetite for stunts like decentralisation. And overarching all that is the ‘caring and sharing’ drive that came out of Inchydoney.
That means embracing the spirit of Tiny Tim as much as that of Ebenezer. We got a couple of straws in the wind yesterday of the kind of giveaways that Cowen will focus on in his budget. The main one will undoubtedly be childcare, one of the two big issues that mushroomed this year.
The leading references to it yesterday suggested that his childcare proposals will form the centrepiece of his Budget day proposals.
The other big issue this year, the Eddie Hobbs factor, was also acknowledged yesterday with a e3m budget for the National Consumer Agency and increased powers for the Competition Authority.
Elsewhere, it was mainly incremental. For the opposition, there was no one plump target to aim at. Fine Gael’s Richard Bruton said there was nothing to suggest the Government was intent on tackling waste. Joan Burton honed in on the small real increases in health spending and the increase in hospital and medical charges.
Overall, a holding statement. Given that an election is looming, the Budget will not be as cautious. That apple will be too tempting for him not to take a bite out of it.
