Cowen not short of challenges facing him

Newly-elected Taoiseach Brian Cowen, on his return from Áras an Uachtarain tonight, will sit behind his desk in his new office…

Newly-elected Taoiseach Brian Cowen, on his return from Áras an Uachtarain tonight, will sit behind his desk in his new office in Government Buildings, no doubt pondering the challenges ahead, writes  Mark Hennessy, Political Correspondent.

And he is not short of issues to worry about. Some of them will force their way onto his agenda: the Lisbon European Union referendum; the pay talks, spending cutbacks.

Others, however, will require him to be the one to set the pace, most particularly the need for significant reforms in the public service.

In theory, the latter is commendable. In reality, however, such changes would impact on hundreds of thousands of civil and public servants in each and every constituency, who are not without ways of making their unhappiness known.

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First up, however, he must get voters to pay attention to, and then pass the Lisbon referendum, if his new administration is not to be thrown into chaos within a month of its formation.

Over the last month, the Government’s campaign – with the energetic exception of Minister of State, Dick Roche – has been in neutral gear, while Bertie Ahern embarked on an extended leaving of office.

Cowen, who is ever proper about obeying proprieties and not over-shadowing Ahern, was punctilious about not acting like a Taoiseach until he had the imprimatur of the Dáil.

Though other ministers had been instructed by Ahern to mention Lisbon at every available opportunity, few of them — less cognisant of Ahern’s instructions — have put their backs into the campaign so far.

Now, Cowen must put fire in their bellies, and make it clear that another Cabinet shake-up is more than possible after next year’s local and European elections for those who fail.

Most Fianna Fáil backbenchers, whose knowledge of the Treaty is flimsy at best, have yet to take fully on board the political implications for each and every single one of them of a No vote.

Undoubtedly, too, Cowen is going to have to get the message out to Fianna Fáil’s heartland that Lisbon is not a remote issue, but rather one that has party political consequences, and not just national ones.

Meanwhile, the Exchequer’s figures are likely to fall ever further behind expectations as the year goes on: in stark contrast to the habits of the last decade. Following the summer break, ministers will begin the preparation of the spending estimates for next year, with little fat to cut, though, even know, the task is set to be the toughest for a decade.

Despite falling revenues, the State has not yet trimmed its spending habits. In the first four months of the year spending rose from €13.5 billion to €15.3 billion, and a similar rise is forecast for the remaining months of 2008.

The changing environment will come as a shock to many now around the Cabinet table, since they have no experience of the dark days of the 1980s.

Such discussions, and the “leaks” that emerge from them, will impact on the public consciousness as the winter approaches, particularly as they impact on services. Furthermore, there is a danger that difficult messages may have to be passed on to the public even before then, if ministers have to trim their sails mid-year.

Meanwhile, Cowen will have to reach a deal with the unions, business and others in the national pay talks, complicated as they are by rising inflation. The issues on the table are complex. Ireland has been losing international competitiveness; yet social problems hidden somewhat by a decade of prosperity still exist.

Certainly, he has an arrow in his quiver that he can put on the table: a commitment to delay further, or even abandon, last year’s controversial ministerial pay rises. Such a declaration, even it is small beer set against the Exchequer’s budget, would set a new tone, but Cowen cannot, even if he is of a mind to do so, concede it early.

In addition, the trades’ union do not want him to make the concession, since the last thing that they want is anybody setting a pay restraint example.

Set against that backdrop, even though it is a longer-term project, will be Cowen’s belief that major reforms must be made in the public services. Using the recent OECD report as a blueprint, Cowen will first no doubt set up a team of experts to lay down the exact requirements.

However, he will have to tread carefully. Fianna Fáil lost Dublin-based State workers’ support after decentralisation was announced, and gained little elsewhere.

In time, he can hope that there will be an upside, as transferred civil and public servants settle in to their new homes.

However, meaningful State reform will have to change the daily lives of its employees if it is to be of any benefit, and that must create wells of discontent.

And it cannot be divorced from the social partnership talks. Unions are not going to allow the Government to declare change by fiat. Unions are already making it clear that while they were reluctant to concede change in the past when they could be paid for it, they will be more reluctant to do so without it.

Besides worrying about the country, he will also have to worry about his first electoral challenges as leader: next year’s local and European contests.

Back in 2004, Fianna Fail – who suffered from the absence of leading figures otherwise engaged in the EU Presidency — suffered a drubbing in the locals.

He cannot allow the same to happen again. Gordon Brown enjoyed a short honeymoon before falling from favour in the United Kingdom. Cowen will not want to go the same way.