Noel Whelan: Expect a weak budget from a weak Government
It is clear budget will not be transformative moment in Irish social or economic policy
Perhaps the most significant item to watch out for in the budget is whether Katherine Zappone gets her way on childcare. Photograph: Gareth Chaney Collins
The lead into this year’s budget has followed traditional patterns. It was supposed to be different this time but it is not. Even though there is now a specific Budget Oversight Committee in the Oireachtas, the level of parliamentary involvement in framing the budget has been limited.
The nature of parliamentary and wider public discourse has again been vague. The key budgetary issues have been deliberated on and decided upon in private. We are again expected to wait with baited breath for a “big reveal” when the Ministers for Finance and Public Expenditure and Reform address the Dáil on Tuesday.
There may not be much to reveal, however. It is already clear that next week’s budget will not be a transformative moment in Irish social or economic policy. Anyone looking for dramatic shifts in our politics reflected in this budget will not find them.
The budgetary changes will be limited and predictable. It will be a cautious, tepid, care and maintenance budget. It will probably bring slight shifts in USC rates for lower and middle-income earners. It will increase health spending a little more than enough to keep up with demographic trends, and it will give a few euro to pensioners.
It will be a weak budget from a weak government reliant on the main Opposition party for its parliamentary majority.
The budget will be little more than a political virility test for each of the elements which have, or claim to have, power in the convoluted arrangements under which the current Government was constructed and is being maintained.
Winners and losersOnce the budget speeches are delivered much of the focus will turn to assessing the winners and losers within Fine Gael as a leadership contest intensifies, between Fine Gael and the Independents as their relationship struggles to “bed down”, and between Fine Gael and Fianna Fáil.
Anyone observing from a distance would be forgiven for expecting that Fine Gael should have more power in shaping this budget then it had previously. After all Fine Gael currently has its largest representation in Cabinet since the 1930s.
A year ago Fine Gael’s Michael Noonan had to share the budgetary limelight with Labour’s Brendan Howlin who was then minister for public expenditure. This year Fine Gael holds both of the Merrion Street ministries. It will be Fine Gael’s Paschal Donohoe who will rise to speak after Noonan.
The fact that only Fine Gael faces will feature in the ritualistic budget day photocalls belies the reality of Fine Gael’s restricted capacity in framing budgetary policy.
The party’s position has been dramatically altered by the general election. The results forced Fine Gael to accept that instead of splitting the additional resources available evenly between tax cuts and increased public expenditure it must implement a one-third to two-thirds divide. This is an express term of its confidence and supply agreement with Fianna Fáil.
The dynamic of the dependency which Fine Gael now has on Fianna Fáil to enable this budget to happen at all has added a new and at times very entertaining dimension to pre-budget skirmishes. While Fianna Fáil has repeatedly emphasised that this is not its budget it has not been behind the door in demanding addition funding for specific areas.
Throwing shapesWe have had Fianna Fáil’s Willie O’Dea squaring up to Leo Varadkar over which of them can claim credit for an expected €5 increase for old age pensioners. Varadkar accused O’Dea and other Fianna Fáil frontbenchers of throwing shapes and flying kites over the budget. In response Fianna Fáil’s Dara Calleary has accused Varadkar of using the budget as a “soap box for his leadership ambitions”.
Fearful of being left out in the barrage of pre-budget exchanges the Independent Alliance was busy briefing on Tuesday night in order to generate stories on Wednesday about the budget initiatives on which it was insisting.
Perhaps the most significant item, in terms of political direction and influence, to watch out for in the budget will be what happens in terms of support for childcare.
There has been a genuinely ideological conflict in the various clashes between Fine Gael and Independent Minister Katherine Zappone on her proposal to fund childcare costs directly for lower-income families. She has been met with a counter suggestion from Fine Gael backbenchers about the need to look after childcare costs for the “squeezed middle”. If, as the most recent media reports suggest, the support will, initially at least, be targeted on families earning less than €47,000 then it will represent a significant impact on the budget for an Independent Minister.
One thing seems inevitable – Fine Gael, the Independents in Government and Fianna Fáil will be tripping over each other to claim responsibility for all the popular initiatives in the budget. Any unpopular measure or hidden political banana skins will be orphaned.