Budget 2017: A political fudge Bertie himself would have been proud of

What an amazing budget that was.
Budget 2017: A political fudge Bertie himself would have been proud of

The first budget of the New Politics regime, and it was well worth the wait.

It was a political budget of which Bertie Ahern would have been proud, no doubt.

Initially, it looked like The Late Late Show Budget 2017 had a little something for everyone in the audience. For a decade, Ahern built his political empire on the sand foundations of buying everyone off. The old got a bit; the children got a bit more. First-time buyers got a good deal. Carers; the disabled; widows — all got a little increase from Public Expenditure Minister Paschal Donohoe. Even the sheep got looked after to the tune of €25m.

But, as people began to drill down, some sectors were shafted and either got nothing or even saw their money cut.

One of the few who got screwed was the ‘working man’ who has to make do with a 10 cent increase in the minimum wage and the smallest possible cuts to the Universal Social Charge (USC).

Another man who got screwed, it seems, is Transport Minister Shane Ross, who secured not one cent of additional funding for roads, rail, and buses.

On page 117 of the budget book, the failure is laid out in stark terms: “There are no new measures provided for in 2017 beyond the delivery of existing commitments in the sectors concerned.”

There was nothing in the budget to reduce class sizes; the arts apparently took a cut of €16m, which is surprising as Donohoe is an avid music lover; while local government took a hit of €30m, according to Richard Boyd Barrett in the Dáil.

Young job-seekers also got a raw deal as their weekly dole increased from €100 to just €102.70 a week, whereas every other benefit recipient is to get €5. Cue the predictable anger from the hard left, such as Paul Murphy.

Also, the major investment in childcare has angered stay-at-home mothers, who feel undermined.

Rather than a €1.2bn package, we got a €1.3bn and instead of a 2:1 ratio in favour of new spending measures over tax cuts, it was more like 3:1.

The much-lauded ‘confidence and supply’ agreement between Fianna Fáil and Fine Gael committed to a 2:1 split.

Fianna Fáil made much hay of the fact that they forced Fine Gael off their 50:50 division which existed when they were in power with Labour. Notwithstanding the Fianna Fáil claims, the Fine Gael manifesto argued for a 2:1 split in favour of spending, as several TDs were keen to point out to the media today.

The budget announced by Noonan and Donohoe is a long way from the US-style tax system spoken of by a somewhat arrogant Enda Kenny last Christmas and for many in Fine Gael it will be a bridge too far from what it as a party should stand for. But it was a budget shaped by the general election that preceded it, a Fianna Fáil-style budget, brought in by a somewhat reluctant Fine Gael, who made sure to include enough of a whiff of the Independents to keep them on board.

It is a budget of many authors, but it is the love child of none of them. The surreal atmosphere that engulfed Leinster House yesterday typified the unchartered waters the political system finds itself in.

Was this Michael Noonan’s final budget, as many think it is? He made mention in his speech that it is his sixth but, in light of his age and recent ill health, there is a growing perception that he will not deliver another one.

The main plank of his budget package was the decision to cut not two but three rates of USC by 0.5% each at a net cost of €300m.

Other goodies included breaks for the self-employed — but not as generous as previously expected; reductions in Dirt; and a reduction in Capital Gains Tax.

Noonan did not go anywhere near using up his full allocation of time, and by the time he commended his budget to the House, there was an eerie absence of applause. This may have been a by-product of his budget by and large being out in the public domain for several weeks.

Donohoe, the hardest-working man in Irish politics in recent weeks, took to his feet in what must have been a proud moment for him personally. His wife Justine, children Oscar and Lucy, brother Ronan and mother looked on with pride from the visitors’ gallery as he detailed his €1bn package. He said he had to contend with €4.2bn spending requests from his fellow ministers — the fact he delivered a budget with as little rancour as he did, is a testament to his agility as a minister.

Not an easy thing to keep your own TDs happy, let alone Coalition colleagues and a main Opposition party who wanted their say too. But, it is a sign of how complex the current Dáil is and what was required to get this budget through. I understand that, moments before he was due in the Dáil, a whopper of a row kicked off between Donohoe and his Fianna Fáil opposite number, Dara Calleary, after an additional €15m magically appeared.

From the get-go, this budget involved a job to ensure the Government did not collapse because of it. There is little or no evidence that the Coalition was ever in jeopardy during the process, but what is clear is that the already fractured relations between Fine Gael and the Independent Alliance have been strained further.

Taking a step back, the first budget of the New Politics smacked a lot of the bad old ways of the past. With increases in welfare payments outstripping those to the minimum wage, the Government stands accused of rewarding welfare over work. Prioritising pension and other payments to the elderly by Fianna Fáil, and some in the Independent Alliance, had all the hallmarks of the giveaway budgets of the past.

In some ways, one is grateful the Government was limited in what it could do because of tight European fiscal rules. Imagine the chaos that would have ensued if we have actually had a big pot of additional money to spend. People often crib about the loss of sovereignty to Europe but two crashes in the past 30 years make me think that may not be a bad thing.

Former tánaiste Joan Burton’s succinct description that this is a budget to keep the show on the road was spot on. This was a political, not an economic, budget aimed at ensuring the minority Government survives another day.

One perhaps rather jaundiced minister concluded that this was a budget framed with one eye on a general election, which could easily happen in the spring.

New Politics — isn’t it great.

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