Paschal may promise big – but sums show he’ll deliver small
THE talks have barely started but Paschal Donohoe’s calculator must be overheating. Between the promises his own Fine Gael colleagues have made and now the demands landing on his desk from Independent ministers, he faces some tough decisions.
That’s the prerogative of every finance minister but the challenge facing Mr Donohoe is augmented by the emerging narrative ahead of Budget 2018.
Either by accident or design the Government has managed to pit ‘the youth’ against ‘the elderly’ in a dangerous strategy.
For decades successive administrations have maintained a hierarchy of societal groups, with OAPs at the top of the food chain.
But Leo Varadkar appears to be reordering the system. Older people are still high on the list. The Taoiseach says there’ll be money for the pensioners in October and history suggests that anything less than €5 will go down badly.
But he wants to be make childcare an equal priority. So much so that writing in yesterday’s Irish Independent he said: “As Taoiseach, I want to make life easier for families, and providing more affordable childcare is one way of doing this.”
Fine Gael also held an ice-cream party in Merrion Square a few weeks ago to mark the launch of the much-heralded Affordable Childcare Scheme.
Children’s Minister Katherine Zappone must have been flattered. The main party of government really wants to attach itself to the work happening in her department.
Perhaps that’s why she confidently handed Mr Donohoe (right) a shopping list of basic requirements for fulfilling Mr Varadkar’s ambition. Both ministers know that childcare can be a good news story. The kind of story politicians would like to tell heading into an election year. Years of under-investment cannot be fixed overnight but they have grasped the nettle, starting with subsidies for hard-working parents and then focusing on improving quality. It’s the stuff of a ‘Republic of Opportunities’. Of course there will be hitches along the way, such as the failure to have a proper IT system in place for the start of the scheme – but ministers will cry that “people are getting the money regardless”. However, the bigger problem is that by the time Ms Zappone gets €300m, the pensioners get €148m and middle Ireland gets a tax break, we’ll be asking around to see if anybody kept Ajai Chopra’s number.
On paper there is just €300m available for spending increases and tax cuts in October, although Mr Donohoe is certain to find ways of adding to this. Another hike to the price of cigarettes is a safe bet.
But no matter what the Finance Minister does there will simply not be enough.
According to sources the plan is to essentially promise big but deliver small. This budget will only bring marginal changes to your pocket in 2018 but will come with the assurance of greater bounties in 2019 and 2020 when the purse strings are set to loosen substantially.
A risky game because political promises don’t pay the mortgage.