Taoiseach facing a bruising battle

EVEN before the summer holidays, senior government officials were bracing themselves for storm clouds in the autumn.

The country's 166 TDs are back in Leinster House today to clear legislation for a second referendum on the EU Nice Treaty. But this is certain to enmesh with a plethora of other issues as all opposition parties seek to push their contention that the Fianna Fáil-Progressive Democrat Coalition hoodwinked their way to re-election on May 17 last.

Fine Gael leader Enda Kenny, while supporting a Yes to Nice vote, has articulated a growing view that the country's voters will use the Nice II referendum to send a message to Mr Ahern that they do not like to be hoodwinked.

Sinn Féin, the Green Party, the Socialists and others campaigning for a No vote, hope to catch this tide of disillusionment and capitalise on their significant gains in the election. It could all add up to a second No vote and a major blow to Mr Ahern's prestige in Ireland and all across mainland Europe.

In summary, the series of conundrums facing Mr Ahern and his ministers looks like this:

Finance: This is where the bulk of the problems begin and end. All departments have to share an immediate burden of 300m in spending cuts agreed before the summer. Meanwhile, a newly-constituted expert group, headed by former Central Bank governor Maurice O'Connell, is going through departmental budgets line by line in efforts to identify more cuts. They are due to report by September 30 and are a key part of the preparation of the Estimates and Budget 2003.

Finance Minister Charlie McCreevy has argued that, since spending is likely to increase by some 14%, these are not cutbacks. But he will need more than semantics to see him through this one the more so as he is pledged to cut the public spending increase to single digits by 2004 and onwards.

As if all that was not bad enough, the country's 260,000 public sector workers want to see the so-called 'benchmarking' awards paid. That amounts to some 1.2bn euro extra in a full year at a time when Mr McCreevy is seeking economies of over 1bn euro per year.

The Kildare man is well capable of biting the bullet and publicly defending unpopular decisions. But his pre-election assurances that there would be no clandestine or open cutbacks are a hostage to fortune.

This is doubly unfortunate when a Government is obliged to face an electoral contest over Nice just four months after being returned to office.

Health: As it was before the election, so it is now. Health Minister Micheal Martin shoulders a large part of the financial problems in practice. A staff recruitment embargo across the health boards affecting 800 jobs has spilled over into planned job cuts in at least one area, the Western Health Board.

A series of unpopular service charges, including increases in the threshold for the drug refund scheme, increased accident and emergency levies, and cuts to the treatment purchase fund vaunted in the election as a the solution to waiting lists are among the issues.

The Government is also at loggerheads with the non-consultant hospital doctors, dentists and nurses. None of this will endear Nice to the public.

Education: The ongoing dispute with teachers, especially those from secondary schools, over payment for playground and other supervision and substitution for absent teachers, continues to simmer on. Third-level students are up in arms over a 60% increase in college registration fees.

The scare of a return to college fees, abolished by the 1994-97 Coalition, appears to have abated for the very moment at least.

Other Adjustments: All Government departments have been called upon to carry their share of the pain.

The Foreign Affairs Department's overseas aid programme has already been cut by 32m euro in spite of pledges to the UN to meet their 0.7% of GNP target contribution. Speculation is that this reduction could grow to 40m euro.

The Enterprise & Employment Department faces reductions in its allocation to the training authority, FÁS, and to the Industrial Development Authority.

The newly-created Communications Department must find savings by possibly deferring outlay on broadband communications networks and in the marine section of its department.

The Defence Department has delivered 40m euro in cuts and could be obliged to do more.

The Environment Department may delay housing developments and consider other domestic charges, including systematic charges on refuse disposal.

Taxpayers have found themselves paying extra by way of other charges and more loom. The VHI costs 18% more on top of a 15% hike last year. ESB increases and an increased RTÉ license fee also look inevitable. One way or another, motorists will pay to use new roads if they happen at all.

The National Stadium: Normally, it would not to be a good time to consider spending for fun. But the joint Irish-Scottish bid for the 2008 European Football Championship is due for final decision in December and inspections are due any day now.

Ireland's pledge to provide two of eight venues is heavily dependent on the mooted National Stadium. The rugby authority, IRFU, says it cannot make security modifications to its Landsdowne Road HQ, which would reduce capacity, without a guarantee that a larger venue will materialise. The GAA's splendid new 80,000-capacity Croke Park remains off-limits to so-called foreign games.

The FF-PD government programme undertakes only to provide a world-class stadium. Location and scale remain very contentious matters, with projected cost running at anything up to 1 billion euro.

Not Nice Impact: At the best of times, Nice II was always going to be difficult. As a topic it has limited capacity to enthuse the average citizen. If it becomes enmeshed with all these other domestic issues, it faces a very uncertain fate indeed.

The following two months will not be for the fainthearted.