I have decided to enter the contest for the leadership of the Labour Party, and I am asking for your support and your vote. This is a decisive moment for our Party.
As a people, we have been left with no choice but to take action to deal with the crisis in our public finances. There is no escaping from this – it is, and will be a central truth of Irish political and economic life for years to come.
But while Fianna Fail have left the country with no choice on whether to take action on the deficit, we have got choices on how to do so.
Labour has been clear and resolute on this issue. Before the budget, we published details of how to address the deficit. Not through the kind of divisive and hopeless approach taken by the government, hitting the low-paid and the most vulnerable. We proposed an imaginative and socially just programme, which addressed the budgetary crisis in a way that could bring hope to the country through jobs and opportunity, rather than despondency and social division. And we have continued to offer credible and dynamic policy proposals to the Irish people – most recently through our plan for a National Investment Bank.
The government have had few successes during their two and a half years in office. But they have succeeded in one objective: to divide.
They have divided young from old; people with health cover from those with none; people with jobs from those without. Most of all, they have succeeded in an utterly cynical and despicable drive to foster division and mutual disrespect between public and private sector workers in our country.
Our plan is different. A Labour-led government will deal with the deficit – certainly we will. But we will do so in a way that puts people back to work, and in a way that brings hope rather than despair and resignation. And we will do so in a way that does not visit the harshest impact on our poorest and most vulnerable fellow citizens. We will work with, not against, our public servants and lead a programme of reform, not a campaign of slash and burn to vital public services.
Bringing stability to the public finances is a necessary task. But it is only one element of a necessary economic strategy. That’s what this motion is saying, and I urge delegates to support it.
The Finance Bill began in the Seanad this morning. Following a speech by the Minister, I rose with my own contribution. You can read it below.
Particularly in this area of discussing the economy and our future, I am all in favour of hope. We all want to have a debate that is characterised by hope so that we can be genuinely positive and face the future in that vein. That is the basis upon which any of us would come to this debate. Certainly, there is need for a restoration of hope and confidence in the economy.
However, my problem with this debate is that while a number of speakers stated they hope that things will happen, it has been characterised by a significant degree of what I can only describe as wishful thinking, not entirely – in some cases, not at all – based on the facts.
It started out this afternoon with the Minister’s speech. The Minister treated us to an account of what he describes as “tentative signs that the economy is beginning to stabilise on a number of fronts.” He spoke of unspecified key macro-economic and fiscal data releases being generally in line with expectations. He repeated that growth is likely to return in the second half of the year and re-establish itself on a full-year basis in 2011. He also repeated his famous phrase from his Budget Statement that the economy is now turning the corner. On today’s lunchtime news, the Minister for Enterprise, Trade and Innovation, Deputy Batt O’Keeffe, was somewhat less positive than this, couching his remarks along the lines that he felt we have come close to a situation where we might turn the corner, which is somewhat different.
I long for the day, as many people do, that the economy genuinely turns the corner. However, I vehemently disagree with politicians, particularly those in positions of power, seeking to persuade people on the basis of assertion that a new state of affairs has come about because, as of yet, it simply has not.
The second example of wishful thinking came from my colleague Senator Boyle. Earlier, he indicated he was initially sceptical when last summer the Minister for Finance, with little discussion, changed the configuration between cuts and revenue measures that would make up the €4 billion to be taken out of the economy this year. However, Senator Boyle came around to the view that the Minister got the balance about right. No one has explained to me, or could if they were being honest, how they believe the Minister got that balance right.
Senator Joe O’Toole seems to be in a better position to explain Government policy than the Government. He said on the Order of Business today there is double speak and double think on this issue of credit.
The principal basis upon which NAMA was advocated by the Minister for Finance, put through these Houses and supported by Members on the Government side was that it would lead to the availability of credit to small businesses. Every time anybody on the Government side says anything about NAMA, they claim that it is necessary so that credit can be provided to business. It is not leading to the provision of credit to business at all.
We now have a policy that is not clear and is in a mess, and when the Labour Party was told a year ago that our position on nationalisation was ideologically based, the Minister is now doing precisely what we said he ought to have done in the first place.
For the sake of the people facing searing debt I hope the proposals the Minister for Communications, Energy and Natural Resources mentioned last weekend come to fruition. However, people will excuse me for expressing a certain amount of scepticism about that particular statement because it bears closer scrutiny. It refers to the setting up of an expert group, presumably to come together and bring forward recommendations.
The Minister used the term “rolling recommendations”, whatever they are, in respect of what would be done to address this problem. First, it is an expert group set up to make recommendations. From what one can see, it not a group set up to do anything, although perhaps I can be corrected on that if I am wrong. Second, the expert group is not to be set up imminently. It will be set up within weeks.
Senator O’Toole has said, “Fair play to the Greens if they make it happen”, but there is no particular evidence that anything will be made happen from this statement. There is simply a statement of intent to have a group of people come together to discuss it and make recommendations. That is very different from the concrete proposals that have been brought forward, including proposals by Labour, in respect of addressing this very serious and urgent issue.
The Seanad discussed the plans for a banking inquiry. Labour is very much against the idea of a private inquiry and I had an opportunity to put my views to the Minister of State, Martin Mansergh TD.
I welcome the Minister of State to the House to talk about the promised inquiry that is to be instigated into the banking system and related issues that have brought us to this position. I have had the opportunity to read his speech but I do not know if he spoke also perhaps impromptu about whether the investigation of the commission – most people accept that the preliminary stages ought properly to be held quickly and therefore in private – should hold public hearings. That would be a matter for the terms of reference but these should be set by the Oireachtas. There is some suggestion that will be the case. I invite the Minister of State to agree that it would be appropriate for the default position to be that the commission of inquiry would hold its hearings in public. There could be circumstances in the course of its investigation that it might decide a particular hearing should be held in private but the default position should be that proceedings would be in public.
The question of trust is at the heart of this whole controversy and debate. One cannot restore trust by simply asking people to trust. It does not work that way, certainly not in view of what happened in this country in the past two years. Far too much of what has gone on has occurred behind closed doors. People do not trust a whole range of actors, from politicians and the Government in particular to the banks and the construction industry. People cannot be expected to trust an inquiry held predominantly in private. People argue against this by suggesting we want a public execution in St. Stephen’s Green and that we will bring on the guillotine, as if this is the only basis for calling for it to be heard in public. I disagree with some members of the Opposition who give the impression, perhaps unwittingly, of wanting an inquiry that would be a public execution, whether of the Taoiseach or anyone else. If the Taoiseach is to be executed politically it will be done at the time of the next general election. I very much hope it is done but that is a matter for the general election. That does not undermine the proposition that a commission of inquiry ought to be held in public to examine the grave issues the Minister of State touched on in his speech. Why should there not be a presumption of hearings in public, with perhaps some allowance for the inquiry to make an ad hoc decision on a particular part of the inquiry to be held in private? I will not re-engage with the differentiation between private and secret drawn on some radio programme, where the Minister for the Environment, Heritage and Local Government, Deputy Gormley, got himself into trouble.
What is the problem for the Government? The Minister for Finance made some reference to it costing €150 million for lawyers. I do not accept this. If people seek to have lawyers representing them, this will be true whether the inquiry is in public or private. If it is contemplated that there should be a cost, there is no way around the argument that if this is not held in the public eye it will not deliver the restoration of trust we all wanted to see. This is an argument the Green Party made, unsuccessfully as it turns out. If this is not held in public, it will not deliver the restoration of trust we all want to see.
The type of inquiry into the banking system a committee of the Oireachtas may undertake is a live issue in the country. The Supreme Court decision in the Abbeylara case is in place, on which I have two brief points to make. First, there is the question of the restrictions on the Oireachtas in making findings of fact which could touch on the personal culpability of individuals. I understand clearly that there is such a caveat contained within that decision. Second, there is the issue as to whether the Oireachtas ever had lawful authority to carry out such inquiries. These issues are very much on the table.
My party brought forward legislation in the other House to deal with the second of these two issues, but it was rejected by the Government. On the first issue, I do not accept that it is not possible for a committee of the Oireachtas to hold a meaningful inquiry into what went wrong in the banking system without touching on the personal culpability of individuals because there are other places in which that matter should be dealt with. I am a strong supporter of those who say the criminal justice system is where criminal charges ought to be dealt with.
However, this does not prevent serious politicians who claim to have credibility from having an inquiry into the lending practices of the banks to determine what strategies were in place, why AIB and Bank of Ireland now proclaim they had a difficulty because Anglo Irish Bank was doing certain things and they had to follow suit. We need to know what strategies were employed and the history of regulation, including that by politicians. These issues do not turn on the personal culpability of individuals in terms of the level of criminality, rather they are legitimate questions which ought to be pursued in a public inquiry. I believe they could be dealt with, without any worries on a constitutional level, by a committee of the Oireachtas.
The second issue I want to raise can be addressed by the Government, that is, the extraordinary statement or indication to the effect that the commission of inquiry will hold its investigations other than in public. What is the reason for this secrecy? What is the exact position? Last Monday, the hapless Senator Boyle was telling the country that the Green Party was going to a deliver a public inquiry. The Minister for the Environment, Heritage and Local Government, Deputy John Gormley, has learned a great deal since he went into Government because he is telling us that black is white and that the inquiry will be held in public. It is a question of saying, in effect, “Well, we are a small party in government; we tried and pushed, but could not deliver.” However, the Minister does not say this, rather he says it will be held in public. What exactly is going on?
Apparently, the Taoiseach said this morning that the commission of inquiry could decide to hold hearings in public. That is a different line. If he is prepared to contemplate the commission of inquiry deciding to hold hearings in public, what is stopping the Government from including it in the terms of reference that the inquiry will be held in public? There is an overwhelming public interest in this inquiry being held in public. The impact of what has happened to the banks and those to whom they loaned money is in the public domain. The 300,000 empty houses are there to be seen plainly by everybody and the impact on people’s lives is also there to be seen. There should be an inquiry and it should be held in public.
Last night, I had an opportunity to speak in the Seanad in reaction to Budget 2010. Below is my own contribution.
I am grateful to Senator Boyle for his acknowledgement, which members of the Government find it difficult to make, that at least part of the deficit problem the Government, and by extension the people, must deal with is attributable to what has occurred in the banks. That is unquestionably the case. From time to time and mainly in the context of NAMA, Ministers attempt to suggest, in a roundabout fashion, that the NAMA borrowings are not real money or real borrowing. However, the borrowings are real and will constitute an exposure for the people in respect of the bonds that banks will be given in exchange for loans.
More immediately, the deficit has increased since September when the Department of Finance acknowledged that it amounted to just over €20 billion compared with €9.4 billion at the end of September in the previous year. The statement reads: “The year-on-year deterioration in the deficit of some €10.8 billion is primarily explained by a decline in tax receipts of €4.8 billion, the €4 billion payment to Anglo Irish Bank and €1.7 billion in respect of the frontloading of the annual contribution to the National Pensions Reserve Fund.” It is no use that Government spokespersons attempt to convey the impression that the issue of the banks and the extraordinary exposure of the taxpayer in that respect is off line and has nothing to do with the budgetary crisis. These matters are connected in a substantial way, meaning that there has been an element of dishonesty in the remarks of some Government spokespersons.
Senator Boyle, similar to Senator MacSharry, stated that these budget decisions would have been made by any political party in power, but I do not accept that the decision to reduce the pay of public servants earning €30,000 per annum would have been made by any party in government, certainly not mine. I do not accept that the decision to cut child benefit or social welfare would have been made by any party in government, as was suggested by Senator Boyle more in hope than in a belief that it was the case.
This is about politics. Perhaps I am approaching politics from a slightly different perspective than Senator MacSharry who stated that the issue has gone way beyond politics, which is an extraordinary phrase. The current situation signals the arrival of politics, not its departure. I do not know what my colleagues understand or believe politics to be, but it is my belief that politics is about making choices and deciding, for example, whether one agrees, as parties did in recent weeks, on the appropriateness of reducing the 2010 deficit by €4 billion. Politics is about where to make the savings and what choices to make, be it on cutting public expenditure and, if so, where, or on increasing taxes and, if so, where. People should not be afraid of this. When there is an argument on these issues, people refer to it as being “all politics”. In my respectful submission, the problem with the current system is that there is not enough politics or calm, measured and careful debate, contest and disagreement on issues. I am not calling for disagreement for its own sake, but the only way to determine what will next occur in any society, particularly one in paralysis and crisis like ours – I am referring to wider society, not just the economy – is to have a free flow of debate and interaction. This is called politics. I am not looking to get away from this fact. Rather, I am looking to embrace it.
Yesterday, the Bill that will introduce NAMA began its journey through the Upper House. The Government have insisted that the legislation must be back in the Dail by Thursday, giving the Seanad three days to deal with the Bill. Below is my Second Stage speech. Keep with the site or with the Facebook page for further updates.
It is true there are no certainties in this matter. There can be no certainty on anybody’s part. In particular, the Minister cannot be certain that what he hopes will occur will actually transpire. There can be no certainty associated with the assertion that matters will come right. None of us can be certain with regard to what is going to occur. That is a measure of how momentous and serious is this debate.
We have reached the 11th hour and the Government has signalled that the legislation will return to the Lower House on Thursday, which constitutes a curtailment of the debate in this Chamber. In such circumstances, there is a sense of inevitability regarding Members’ approach to this debate. However, this should not mean we should set aside our serious and genuine objections to what the Minister is proposing.
Like other Senators, I recognise the Minister’s good faith about the way he has approached this matter. I sometimes feel uncomfortable making that point in respect of Government Ministers. I assume good faith on the part of members of the Government, whereas other Senators often use half of the time available to them to inform a Minister that he or she is a great man or woman. I operate on the basis that the Minister for Finance is doing a professional job for the country and believe this is also the basis on which he operates. He does not, therefore, require to be congratulated. In so far as it is important to say so – particularly on a personal level – the Minister’s input has been considerable, if wrong-headed, in recent months. However, that input has been solely motivated by the need to act in the very best interests of the country.
Unfortunately, in the context of what has occurred in the past 15 years, the Minister is dealing with a legacy created by the Government and his party, as a component thereof. It is fine for Senator MacSharry to express his frustration and annoyance that this point continues to be raised. I will not treat him to a few minutes’ worth of material on the Galway tent. Owing to time constraints, I will not refer at all to the history of Fianna Fáil, its associations, etc. but if I had time, I would gladly do so. I am referring to Fianna Fáil as the party of Government; I am not dealing now with its historic links with the building industry or anything else. Fianna Fáil was in office when our current difficulties emerged. It was in power when my party brought forward proposals in the late 1990s to examine the matter of house prices.
At that time my party argued, in trenchant terms, that there was no requirement to amend the Constitution in order to implement the principal recommendations made in the Kenny report which was published over 35 years ago. These issues were canvassed and debated during the lifetime of the last two or three Administrations. It is not satisfactory for those opposite to simply state they are not to blame and that everything happened around them and that they had nothing to do with it. That is simply not the case.
I am afraid it is not credible to say that by his statement at the weekend the Taoiseach has got himself into the driving seat. The Taoiseach has been in the driving seat for 18 months in this country.
Prior to that, he was in the seat beside the driver as he was in the Department of Finance for an extended period. I am not prepared to go along with the notion that the Taoiseach now has credibility on public sector reform. He just does not have that credibility. There is a cabinet sub-committee that is supposed to be meeting on this issue for the last year and a half, but the Taoiseach could not even answer the question yesterday on whether that committee had met. I understood from his response that it has not met. It is no use saying the Taoiseach has now put himself into the driving seat. The Taoiseach has had every opportunity for 18 months and more to address these issues, but he has failed to do so, along with his Government.
It is perfectly legitimate for people to criticise the public service and to call for reform, as I have. The problem is that the debate has become suffused with anecdote, prejudice and worse. Everybody has their story about the public service and what should happen. However, the Government gets to do more than what we get to do, which is to come in here and call for things to happen. It is ludicrous for RTE to report the Taoiseach as “calling” for public service reform. That is what we do in here. We call for things but unfortunately we have little or no power to deliver them. The Taoiseach does not get to call for things. He gets to do things. That is why he is the Taoiseach.
We should forget about calling for things and expressing wishes. Let us have a balanced review of the problems that exist and of the issues in the public service that require reform. That can be done in a relatively short period. Let us then have some action on the issue. People who are marching on the streets are being told they are the problem, but they are not the problem. Cuts do not amount to reform. If people are serious about reform, let us have a balanced assessment on what needs to be done and then let us have some action.