It is welcome that the main Opposition parties have produced alternative budgets ahead of the publication of Tuesday’s package. Their willingness to publish detailed platforms, including some measures which will not win universal popularity, provides some frame for the debate which will take place in the Dáil after the two ministers sit down next Tuesday.
Opposition parties faces one key disadvantage in drawing up their plans. While they can have them costed by the Department of Finance, they do not have the resources of the civil service to help develop proposals. In some cases this is all too obvious, in others the parties have put forward interesting ideas nonetheless.
They also have one significant advantage. It is the ability to count in new revenues from areas like taxing property funds, or energy company profits, or the “super-rich”, or hiking the bank levy, without having to really look at the potential practicalities, trade-offs and consequences.
For this reason, the plans published yesterday by Sinn Féin, the Social Democrats and the Labour Party are best assessed as indications of their priorities, rather than as fully formed alternative packages.
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Sinn Féin, for example, is calling for a major redistribution of the tax burden and a host of new spending plans as part of a package worth over €13 billion, compared to €8.5 billion for the Government.
Other parties do not go as far, but there is no support in Leinster house for a more conservative budgeting approach focusing on lower taxes. All three parties favour much greater State investment – and involvement – in providing social and affordable housing. And they have proposals for more spending in many other areas, too.
The cost-of-living is, of course, the main focus and it is clear that the Opposition plans to attack the Government for not doing enough to help households. All have proposed a mix of permanent and temporary measures in areas like energy and family supports. The Government has resisted the idea of further temporary supports, but could be tempted to relent. A key challenge is to direct supports where they are needed– rather than spreading them too widely – and ensuring they can be withdrawn when circumstances change.
In the heat of a political battle over the budget, it is probably a waste of time to advise a focus on the longer-term, on sustainable budgeting and careful use of public money. The Opposition plans face questions in some of these areas – particularly on the scale of additional spending – and Tuesday’s budget may too. But it is worth welcoming a statement in the Labour document, which is that Ireland needs an “honest discussion” on tax and spending and how the multiple challenges ahead can be met. The huge surge in corporation tax has allowed this to be avoided for too long.
