‘Most of the people who were involved in the background of the troika were very smart . . . but they weren’t very good at politics’
Interview: Minister for Finance Michael Noonan is eager to maintain support for the recovery drive
Rush-hour traffic on Merrion Street in Dublin is just about audible within the Department of Finance as Michael Noonan quietly muses on the lessons learned in the EU-IMF bailout and the challenges ahead for Ireland.
Noonan is back on the road, landing in Baldonnel in the early hours of Tuesday night from yet another round of political talks in Brussels. He was in London last week meeting bond market participants. At the end of January he goes to New York for engagements with investors there.
“It’s a very important milestone to get out of the bailout after three years,” he says.
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Photo portraits of the Minister’s 25 predecessors line the room: everyone from Eoin MacNeill in the first Dáil to Brian Lenihan, who was in charge when control over the national finances was lost in 2010. If they’re not quite swaggering in Government Buildings these days over the imminent return of fiscal sovereignty, there’s no hiding the sense of satisfaction.
Yet Noonan says the troika was – in the round – a force for good in the Republic. He does not conceal his disdain for what he describes as a lack of political nous on the part of certain troika technocrats, but says the reforms undertaken to steer the economy back on to the rails were urgently required.
“If there was never a fiscal or banking crisis in Ireland most of the structural change which they put into the programme was necessary anyway. There are a lot of countries that don’t go into programmes, but their economies operate at a very low pitch,” he says.
“We were going down that road. We were well down that road. We’d have an economy stuttering along even if we weren’t in the programme and we’d have very heavy unemployment and very heavy emigration even if we were still accessing some market funding. There were too many things that needed to be done that hadn’t been done for a generation.”
While the Government passed each one of the troika’s 12 quarterly reviews largely without incident, there was often a sense of frustration in the world of the international lenders that the new Irish administration should have gone further, faster. In troika circles the argument went that the 2011 general election gave the Coalition an overwhelming mandate for more radical action.
Noonan disagrees profoundly with that.
“Most of the people who were involved in the background of the troika were very smart, very competent technocratic people but they weren’t very good at politics. And what I mean by politics is the ability to take a programme forward and keep the support of the people in doing it. And unless you have a troika programme [that] has a buy-in from the people, it just doesn’t work.
“And it’s great to be talking when you’re there and you have a mandate [to] go forward. But the mandate was dependent on the programme that we offered to the people at the time of the election. There’s a skill involved.
“That’s the only criticism I would make of the troika. Some of their people, while being extraordinary people, didn’t understand that politics is an art and to deliver things you have to use the art of politics. And it’s not as simple as they made it out to be, as they found out in other countries.”