The year of lost sparkle

Sat, Dec 29, 2012, 00:00

This was the year the Government for National Recovery finally began to lose some of its lustre, when the flag heralding a democratic revolution began to look a little tattered in those chill winds blowing from the recession-hit Continent.

The Fine Gael-Labour coalition had suffered setbacks in the first year of power but the evidence pointed to more successes than failures until its first anniversary in March.

It had pushed through a tough budget, although not without some difficulties and embarrassing U-turns. It met all the stringent targets laid down in the rescue package overseen by the troika. Enda Kenny assumed the role of Taoiseach with an ease and authority few could have predicted, although his weakness – and his tendency to be supercilious – showed at times. There was relatively good success in meeting the targets of the programme for government. There was some political reform but, as in all governments, the zeal for it in opposition was not matched in Government and it has been at most incremental rather than “revolutionary”. There was also a high degree of cohesion between the parties, especially evident in the high level of trust between Eamon Gilmore and Enda Kenny.

At the end of May the Government, supported by Fianna Fáil and some Independents, had considerable success when the potentially problematic fiscal treaty referendum was passed with a comfortable majority. That was the high point.

The children’s referendum in the autumn also passed but with a tight majority and carping criticism of the Government’s information campaign from the Supreme Court. Part of the No vote reflected disillusionment with the Coalition.

Elsewhere were indications that the high-water mark may have been reached. The Coalition parties had made expansive promises they knew they couldn’t keep. As the EU recession deepened, unemployment figures remained stubbornly high. The Government’s growth figures were revised downwards and the difficulties in meeting key aims became apparent.

Ups and downs

Some big jobs initiatives were launched – in January a 300-point plus plan to create 100,000 jobs by 2016; in July a €2.25 billion infrastructure plan to fund 13,000 jobs – but they have yet to make an impact. The Government’s promise to reduce the legacy bank burden has become almost as complicated as the plot of the cult Danish TV series The Killing. Just when the Government seems to have the quarry in its sights, there is another twist.

The fallow first few months of the year gave way to the June 29th EU summit and an apparent breakthrough. But then there were missed deadlines and the serious setback when the German, Finnish and Dutch finance ministers said so-called “legacy assets”, such as old bank debt, should remain “under the responsibility of national authorities” and not of the European Stability Mechanism. The nadir came in October when the German chancellor, Angela Merkel, confirmed the new ESM would not deal with legacy debt. Kenny staged a quick – and necessary – recovery of the situation when, two days later, both leaders issued a joint statement reaffirming Ireland’s “special position”. March is the new deadline, but there is still uncertainty.

At home, there were tensions between, and within, parties. The triple lock – no cuts in social welfare rates, no rise in income taxes, and the Croke Park agreement – left little room for manoeuvre for budgetary adjustment. A group among Fine Gael’s large new intake, known as the five-a-side, started questioning Government orthodoxy, especially on Croke Park.

And individuals within Government came under more searching scrutiny.

Without a doubt it was Minister for Health James Reilly who found himself in the most uncomfortable spotlight. Controversies dogged his year: the inclusion of two locations in his constituency; a priority list of primary care centres; being named in Stubbs Gazette; and questions being asked about his competence to manage the health portfolio in the light of huge HSE overruns.

Along the way he had to field a Dáil debate of no confidence and the fallout from the resignation of minister of state Róisín Shortall, of the Labour Party. In the long run her abrupt departure didn’t have long-term consequences for the Coalition. She got sympathy but no real support. But her criticism of Gilmore raised a question about his authority and sway that recurred more than once in 2012.

The other Minister who found himself at the centre of a storm was Phil Hogan over the poor handling of the €100 household charge. That allowed smaller parties and Sinn Féin to claim a victory in their campaigns against the charge. There were potential fault lines within the Coalition over abortion but the tragic death of Savita Halappanavar in the late autumn focused minds on a workable compromise. That debate has yet to be played out.


Polls showed a growing disillusionment and disapproval with Government performance, as promises were broken or not fulfilled. The biggest potential stumbling block for the Coalition was the budget. Though the €3.5 billion adjustment was not the biggest in recent years, it was always going to involve severe cuts and taxes. Residual sympathy from the public ran dry over swingeing cuts to child benefit, PRSI exemptions and respite care grants. It led to the first major tensions within Cabinet.

Ultimately Labour blinked when Fine Gael faced down its demand for a 3 per cent increase in the Universal Social Charge for those earning more than €100,000. The alternative they agreed to – a tax package worth €500 million on the wealthy – was too complicated and unwieldy, and hard to explain.

The public perception was that Labour was the comparative loser.

To add to its embarrassment, it had to concede that five of the six things a Labour poster had warned that a Fine Gael government would impose had come to pass. The smaller party suffered a major blow when its chairman, Colm Keaveney, defected on the Budget, becoming the fifth TD to be exiled from the parliamentary party.

The main Opposition party, Fianna Fáil, is showing signs of re-emerging from disgrace. Micheál Martin has been seen as effective but the party’s star has been finance spokesman Michael McGrath. After a year of Tallaght Strategy positions, the party is adopting more populist stances, such as a U-turn on property tax. But it has done well in recent opinion polls and the constituency changes suit it more.

Overall, Sinn Féin had a good first six months but was more static latterly. Its star has undoubtedly been the articulate and composed Mary Lou McDonald. In light of accusations of sloganeering, the party has tried to develop a stronger policy base but it will need more convincing economic policies.

It has been a mixed year for Independents. Mick Wallace was named for under-declaration of VAT, which lost him credibility and, temporarily, his placein the technical group. His close ally, Clare Daly, left the Socialist Party, primarily due to a dispute over Wallace.

The year started well for the Government but turned into a difficult year. The troika, the EU recession and the uneasy compromise that comes with coalition has spancilled the democratic revolution. There is also an innate conservatism and resistance to change in the political establishment and the public service. It all bodes for an equally challenging 2013.