Watching Paschal Donohoe standing in the Dáil, making his budget speech today was reminiscent of watching Gay Byrne at the height of his powers on The Late Late show.
By Eoin Neylon
I could almost hear Gaybo saying “And there’s one for everyone in the audience” as the package of measures was revealed in a massive €11 billion programme of budget adjustments. Income tax down €1.1 billion, cuts to fuel excise duty, a €2.1 billion programme of social protection increases, Help to Buy scheme extended for two years, and so on.
With the cost of living crisis that is facing much of the globe, in the face of Putin’s vicious and illegal invasion of Ukraine, action from the Government was needed. It was known that there was going to be significant interventions made by Government, but I don’t think the scale of the intervention was expected. This is partly a reason that, despite thousands taking to the streets last weekend for the Cost of Living Coalition protest, the numbers that did make the trek to Dublin was much smaller than organisers had hoped for.
In this information age, most Irish people know that most of the inflationary pressures are outside of our control, with the rest of the world facing them too. One need only do a summary Google search, or go on Twitter, to see that the rest of Europe, North America and the Antipodes are all in the same boat as Ireland when it comes to these challenges.
Only roughly 10,000 to 15,000 people eventually made the trek down Dublin’s O’Connell Street, many of which carrying banners of opposition political parties. Given the transportation that had been organised from around the country, this was a poor turnout ultimately. By comparison, the right to water march in August 2015 was reportedly eight times larger. There were salient points made from representative groups and these parties at the stage set up in Merrion Square, but given the heavy leaking of budget ideas, people knew many of these were coming.
However, although there was great news for social welfare recipients, carers, students, taxpayers, first time house buyers and OAP’s, there are many in the wings wondering is the scale of the splurge of cash is justified.
With the UK’s economy tanking and Sterling dropping to historic lows, there is real fear that they may take us down with them. The rainy-day fund was noticeably absent from discussions on budget day, raising the eyebrows of many economists.
Another group which will be furious with the budget is the construction sector. The 10% concrete products levy is very poorly timed. At a time of hyperinflation of construction materials, to the point that many badly needed housing projects are being postponed due to soaring costs, the Government is now lumping yet more expense on products whose cost has skyrocketed with the effects of the carbon tax already. This is entirely counter-productive when put in contrast with the Government’s “Housing for All” policy objectives.
Likewise, the hospitality sector will be livid that the 13.5% VAT rate will be restored from 1st March next year. It appears the greed of the few hoteliers in the sector have affected the sector as a whole.
Politically, the coalition will be hoping that targeted measures for certain demographics will bring about better polling numbers, particularly with women, farmers, older people, parents of children in childcare, and students. Tackling rising energy costs will also be universally popular. Opposition parties were left snipping on the fringes of the budget, nit-picking on certain measures, but the €11 billion package was unprecedented in scope.
Michael McGrath’s speech commented that Government would never fix every issue in one budget, and this is true, but there is still so much work left for Government to do, where the opposition can and will make hay. Nice speeches and headline figures in the Dáil are great, but putting these ideas into practise is something else. Any failure to deliver on these promises will rightly be punished. Government have done the easy part in wooing voters, but have given themselves the hard task of making these promises a reality, and in doing so in an equitable, sustainable manner.
This budget has, either deliberately, or unwittingly, set the stage for the next general election. If Government delivers, and the cost of living and housing are seen to be tackled, the rise of Sinn Féin in the polls will be halted. Both Ministers were keen to mention Brexit threats and the ongoing war in Ukraine to caveat their plans, but these are known quantities at this juncture and such excuses will not fly with the public. If they fail to get these expensive plans to bear fruit, then many of the Fianna Fáil, Fine Gael and Green deputies will be looking for new jobs, whenever that poll may take place.