Last Monday, the leader of the Labour Party gave a speech in which he called for a resurrection of community spirit. The timing of this speech, coming just four days after the launch of Labour's fiscal policy, New Direction, New Priorities, is curious and deserves a closer look.
Labour's call to resurrect the community spirit represents an attempted move by Labour towards the centre-left. This is understandable and logical when one considers that most once-socialist parties on the Continent are also shifting to this position to rekindle their popular appeal. Two weeks ago I wrote about this phenomenon here and would have let the matter rest were it not for the recent launch of Labour's intriguing fiscal policy.
The substance of the policy is fairly simple and as such is fascinating, though it is not the substance of the policy but the political manoeuvre behind it. Having already moved ideologically towards the Fianna Fail position, Labour is now moving economically towards the Fianna Fail tradition of high spending on social provisions. The new Tallaght strategy (the original, an act of patriotism by Alan Dukes) is to be welcomed and commended.
In the mid-1990s a Labour minister presided over three budgets. In those budgets pension rises were insufficient and the social welfare rises that were sanctioned have been almost doubled by this present Government. The trend of under-funding was repeated across the board, leading, for example, to huge reductions in output in the voluntary housing sector.
Apart from the late 1980s, when an economic crisis necessitated cutbacks, Fianna Fail in government has always favoured high levels of social provision and high as possible State spending to that end.
As Dr Martin Mansergh recently pointed out in a speech to the party's Dublin Forum, Fianna Fail has rejected the small government laissez-faire approach to fiscal and social policy. Our present policies underlie this - an unprecedented social inclusion package in the last budget (hopefully more of this in the upcoming budget), the 56 per cent rise in health funding, the concerted attack on educational disadvantages are not the policies of a small-spending, right-wing government.
Although Labour has committed itself to keep to the historically high and necessary spending commitment of the partnership agreements and the National Development Plan, it has also committed itself to spending an additional £3 billion within three years. This is spending for spending's sake and stems from a basic misunderstanding of the problems faced by the country today.
TO A LARGE extent the problems in our education, health and infrastructure sectors do not stem from a simple lack of funding. In health, for example, manpower is as big an issue as funding and the major concern about the National Development Plan was not that it was under-funded, but rather that the £40 billion allocated to the plan could not be effectively spent. Plainly, the solution is not always to throw money at the problem.
There are other differences between the new Tallaght Strategy and Fianna Fail's economic policy. While the Government has already taken four percentage points off the lower rate of tax, it remains committed (in a healthy economy with a budget surplus) to minimising the tax burden. Labour has now ruled out tax cuts after the present social partnership agreements term, despite the fact that the tax cuts have actually led to increases in Government revenue. We have already shown that high spending and high taxation need not go hand in hand.
Labour is also planning to withdraw funds from the Government's Pensions Fund. This move is emerging among most commentators as a cause of great concern. Europe is greying, and as the children born during the post-war years reach retirement age, many countries are finding it increasingly difficult to provide state pensions for them all.
Our own baby boom occurred sometime later and this Government is committed to setting at least 1 per cent of our Gross National Product aside each year for our future pension requirements, to ensure that we do not have such difficulties down the road. To dip into this fund now would be unwise when later on we may need to borrow huge sums to recoup the loss.
Fianna Fail's economic policies are aimed at providing the necessary spending to provide a high degree of social inclusion. A real resurrection of community spirit requires this improvement. It requires that poverty, inequality and disadvantage do not divide the community into haves and have-nots.
The reality that the future well-being of any two children born in the Rotunda hospital this afternoon may depend largely upon their parents' wealth or social status is the real enemy of community spirit. The situation where a child of a less well-off parent may face restrictions economically, educationally and socially which the child of a well-off parent may never know, is the enemy of this community spirit.
Without addressing these issues there can be no community spirit, but only resentment and poverty. Labour is now moving towards this outlook and that is to be welcomed.
