The year of the cuts

HOME POLITICS: It was an extraordinary year in politics, but in spite of swingeing budget cuts and major election defeats, the…

HOME POLITICS:It was an extraordinary year in politics, but in spite of swingeing budget cuts and major election defeats, the Coalition survived 2009 in good order, writes STEPHEN COLLINS

IT HAS been an extraordinary year in Irish politics, with swingeing budgets, the unfolding banking crisis, a referendum that decided the future direction of the European Union as well as national elections in June that transformed the political landscape.

Fianna Fáil, the dominant party in the country for three-quarters of a century, was trounced in the local and European elections in June.

Fine Gael became the biggest party in a national election for the first time in its history, Labour made a leap forward that augurs well for the future, the Green Party was wiped out while Sinn Féin marked time.

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Yet for all that, the Fianna Fáil-Green Coalition made it to the end of the year, not just intact but in good order, despite delivering a Budget that cut the take-home pay of public servants for the second time in 2009 and introduced welfare cuts for the first time since the 1920s.

For a Government that had suffered such an electoral reverse a few months earlier, and hit record lows in the polls, it was some achievement.

In the first half of the year the Government frequently gave the impression it didn’t know what it was about. The 2009 budget, announced prematurely the previous October, unravelled in the first few months of the year as tax revenues simply collapsed and borrowing ballooned out of control.

Minister for Finance Brian Lenihan was forced to bring in an emergency budget in April that imposed savage new income levies on all workers, with public servants being hit on top of that with a substantial pension levy.

It was no way to tee off an election campaign, but the Government parties had no choice but to take it on the chin as the local and European elections got under way.

On the basis of the opinion polls, Fianna Fáil was expecting a reverse but the savage beating it got from the voters took even the most hardened of its TDs aback.

The party’s share of the vote slumped to 25 per cent and it was well beaten into second place in a national election for the first time since the 1920s. If the scale of the rout was repeated in a general election, Fianna Fáil could lose up to half its Dáil seats.

For the Greens, the result was even worse, as the party was left with just three council seats and no MEPs.

The other side of the coin was that Fine Gael became the biggest party in the state in a national election for the first time since it was founded in 1932.

While its national share of the vote, on 32 per cent, had been achieved in the past, it had never led the field and that resulted in a seat bonus that delivered more than 100 council seats more than Fianna Fáil.

For Enda Kenny, who has been the subject of incessant media criticism since he took over the leadership in 2002, it was an extraordinary achievement.

He has brought the party from its worst ever result to a position from which it is hard to see how it can fail to be the biggest party in the Dáil after the next general election.

For all that, the resilience shown by Fianna Fáil after the hammering in June was impressive. The party didn’t just lick its wounds over the summer, it prepared for a do-or-die effort on a range of fronts in the autumn.

Paradoxically the scale of the election disaster suffered by Fianna Fáil and the Greens in June helped to bind the Coalition together.

Both parties knew that the only way of staving off a disastrous general election was to hang together as tightly as possible for as long as possible.

Before adjourning for the summer recess, they planned a strategy to get them over the autumn hurdles one at a time.

The long-promised legislation on Nama, designed to find a path out of the banking crisis, was published by Minister for Finance Brian Lenihan just before the August holiday to give all sides time to ruminate on its contents before the autumn session of the Dáil.

However, the first item on the autumn agenda was the second referendum on the Lisbon Treaty. This time around the Government ran a tight and committed campaign, headed by Minister for Foreign Affairs Micheál Martin.

The main Opposition parties also put their backs to the wheel, as did a range of civic society groups. Sinn Féin was the only Dáil party to campaign for a No vote, and in the event the Yes side won by a more comfortable margin – 67 per cent to 33 per cent – than anybody had anticipated.

The Lisbon result put some confidence back in the Government. It led on to an agreement between the Coalition parties on a new programme for government before Lenihan navigated the Nama Bill through the Dáil and Seanad.

It will only become clear in the new year whether or not Nama will succeed, but getting the legislation enacted was a further boost for the Coalition.

The budget for 2010 was the last and potentially the most difficult item on the Government’s agenda, but Lenihan showed tremendous political skill in getting his Cabinet colleagues to back his strategy of cutting €4 billion in public spending and then getting the measure through the Dáil with comfort.

Those who have lost a significant segment of their income as a result of the Budget measures are likely to be waiting in the long grass for the Government whenever the election comes, but avoiding it in 2009 has put off the evil day, and even allowed Government TDs the hope that something will turn up in 2010 to make their lives a bit easier.