The campaign gathers pace
EVENTS IN Europe are shaping the nature of the referendum debate in Ireland as a growing demand for measures to stimulate growth challenges the dominance of German-style fiscal discipline. The development has been seized upon by the Government as an antidote to warnings of “permanent austerity” being circulated by its opponents. Stability within the euro zone and access to bailout funding remains, however, at the heart of the Yes campaign.
In the Dáil yesterday, Enda Kenny carefully distinguished between the text of the fiscal stability treaty due for consideration in the referendum on May 31st, and “an additional growth agenda” that will be discussed at a special EU summit on May 23rd. The Taoiseach “strongly supported” French president François Hollande in promoting this growth agenda, but warned the process could take some time. Change was also advocated when the governor of the Central Bank Patrick Honohan said the cost of protecting bank bondholders should not fall on national governments.
These developments reflect increasing turbulence within the euro zone as growth stalls and concern about its banking system reignites. The fiscal treaty is designed to bring about greater stability and financial integration, but it is only part of a process. Defeat, Mr Kenny claims, will have long-term consequences; Minister for Finance Michael Noonan mentions higher taxes and Labour Party leader Eamon Gilmore warns of “a return to the eye of the storm” if emergency funding is unavailable. Such comments are dismissed as “scare-mongering” by Gerry Adams of Sinn Féin who insists Ireland can rely on the goodwill of EU neighbours.
Opposition to the treaty has been marked by demands for an end to cutbacks and the introduction of a domestic jobs-creation programme, despite a shortfall of €16 billion in Government revenues. Water and property charges were invoked as reasons for voting No. And, until the Referendum Commission ruled otherwise, opponents insisted that rejection would not exclude Ireland from EU bailout funds.
The Government is in a difficult place. The electorate is worried and the economic outlook uncertain. Uncertainty is the enemy of us all. Countering it has to be factored in to all deliberations whether it is at an Irish or a European level.
Having announced a date for the referendum in March, the Coalition concentrated on legislative matters and forward planning and allowed campaigners for a No vote to make much of the initial running. With three weeks remaining until polling day, however, it has begun to engage directly with the electorate. In that regard, it has received significant support from Fianna Fáil where Micheál Martin, in silencing a rebellious Éamon Ó Cuív, declared the treaty to be “an essential part of the agenda to restore growth and job creation”.
A majority of Irish consumers believe their employment and financial prospects will improve during the coming year and they are unlikely to jeopardise those expectations. Within the EU Commission, attitudes are changing with a greater emphasis being placed on growth. These positive strands can create a narrative that will appeal to the electorate on May 31st.