THE GOVERNMENT is beginning to reach out to other Dáil parties as it responds to the greatest economic challenge the State has faced in decades. This is a welcome, if belated, development. But selective briefings by Minister for Finance Brian Lenihan about the banking crisis do not go far enough.
Taoiseach Brian Cowen must bury whatever reservations he, as a Fianna Fáil man, has about national unity and reach out for a broad understanding with his Opposition counterparts. They, and the Dáil, have been excluded from any meaningful consultations so far about the perilous state of the public finances. At this time of unprecedented difficulties, the Dáil has a central role to play in providing hope, leadership and public understanding of complex issues.
Mr Cowen made clear last week, what many have known for months, that fall in living standards is inevitable. At issue is how this economic crash can be managed and the pain shared as equitably as possible. Before Christmas, when Government revenues collapsed, the Economic and Social Research Institute (ESRI) proposed that public sector pay should be cut, in order to protect existing services. As the private sector lost jobs and cut wages, the ESRI argued that the least damage would be caused to the general social fabric by this approach. It justified a pay cut on the grounds that a 20 per cent pay differential now exists between the public and the private sectors.
The Government, having failed to secure the agreement of the Irish Congress of Trade Unions, subsequently introduced a pay cut under the guise of a pension levy. As a result, there is growing unrest within the public sector. A minority of trade union leaders have indicated their determination to resist a reduction in their members’ living standards, by strike if necessary. That sort of talk does not reflect the gravity of the crisis facing the country nor the leadership required of persons in authority. Perhaps Mr Cowen’s apparent willingness to “tweak” charges affecting the lowest paid may bring trade union representatives back to the negotiating table? There is certainly a need for cool heads and clear thinking.
Social partnership contributed significantly to industrial peace over the past 21 years and provided an attractive climate for foreign investors. The cost came through a gradual loss of competitiveness. The national debt is set to double by the end of this year and the Government will have to borrow heavily. In those circumstances, it should be clear to public servants that all of their privileges cannot be sustained. The same holds true for politicians, who have only begun to reform their lavish system of expenses and payments and to address a culture of “jobs for the boys”.
When EU commissioner Charlie McCreevy talks in Dublin about a need for regulation and reform of the financial markets, the world has changed. What is certain, however, is that the country would benefit from the input of the Opposition parties. This is not a time to exclude the elected representatives of all of the people in the Dáil.