Government's response to McCarthy is pathetic


BUSINESS OPINION:The Government is playing for time instead of dealing with the cost of the public service, writes JOHN McMANUS

THE “POLITICS as usual” approach that has marked the Government response to the publication of the Report of the Special Group on Public Service Numbers and Expenditure Programmes is both pathetic and deeply concerning.

If you arrived in Ireland last week fresh from abroad you could be forgiven for thinking that Colm McCarthy – the chairman of the group that drew up the report – is some sort of radical political figure who appears to have public support for his views on spending, and that the Government is playing for time while it sees how things are going to play out.

What you would find hard to believe is that nine months ago, as the Government finances were in meltdown, McCarthy was asked by the Minister for Finance to chair a group to look at costs, as part of a wider commitment in a published policy statement called the Statement on Transforming Public Services.

You would also find it hard to believe – unless you were familiar with Irish politics – that for the last nine months the Government has been hiding behind the review group in order to avoid having to actually make or implement any policy on transforming the public service.

Ministers have routinely kicked to touch on the issue by referring to the need to wait until McCarthy was finished.

Now McCarthy is finished, and he is being treated like some sort of nuisance.

If you want to clear a room of Government Ministers, just send in McCarthy and a newspaper photographer. It was clear from the day of publication that this was how it was going to be.

It was left to McCarthy – a university academic and consultant economist – to lead the Government press briefings and even more bizarrely go on radio and TV to sell a document he had been asked to write by the Government to be the basis for radical policy.

The really surprising thing in many ways is that you could be surprised about this at all. Assuming that you are, the signs were all there from the beginning. Rereading the so-called policy statement in hindsight, you start to pick up the carefully placed qualifying statements.

This is a good example: “Their recommendations will assist the Minister for Finance to identify economies which can be made in the immediate future.

“Specifically, the intention is to identify those posts and activities that are not essential and, inter alia, to develop proposals for the redeployment of staff.”

Loosely translated, this means: “We are going to once again refuse to do our job and manage the country; instead we shall duck the issues of the unsustainable cost of the public service. We will commission a big report, do nothing, and hope everything works out for best. It’s fooled you in the past and hopefully it will work again.”

And indeed it has. The review group was one of the reasons the Government was able to push through massive tax increases and introduce a public service pension levy while encouraging pay cuts in the private sector.

There was an implicit bargain that tax increases and pay cuts were the immediate first aid to stabilise the patient, while the cure was the reform of the public sector – which in truth most public servants are in favour of in their role as taxpayers and users of public services.

Instead, we got the nonsense that passes for politics here. The report is finally with us, and instead of taking ownership of it, the Minister for Finance and the rest of the Cabinet are engaging in all sorts of manoeuvring to try and limit the damage to a Government and maybe a party that is already beyond saving.

But old habits die hard and they are trying to engineer a situation in which they are some sort of honest broker between the public sector unions and McCarthy – a man with no power, no mandate and under no obligation to play along with their games.

It would be vaguely amusing if the stakes were not so high. International sentiment may have improved towards Ireland on the basis of what has been done to date, but investors in Irish bonds also presume that we will follow through with the rest of the job.

Fortunately, they don’t know the half of it. Particularly, that despite the hard lessons of the recent past, we are engaging in the same sort of of gutless dysfunction politics that got us into this mess.

We still have a political class that is by and large congenitally unwilling and unable to devise and implement policy, and bizarrely doesn’t really think that such is the job of Government.