CHEQUERED HISTORY OF BONANZA BUDGET BARROWS OF MONEY

ABUDGET bonanza is coming, but will it perform the trick needed to save the economy from the spectre of inflation? Parsimonious Paschal Donohoe may be looking a little peaky, to put it mildly, about such plenty being doled out to all the hungry Oliver Twists.

The mood though, among the majority of the Cabinet was summarised by one enthusiastic minister’s exclamation of ‘Jaysus, the punters will need a wheelbarrow to carry away all the cash we are giving them’.

Though they actually rarely get much thanks for it, politicians love giving people money, and this Budget is set to be the bonanza to end all bonanzas.

But how have bonanza budgets traditionally fared in Ireland and is this history the reason Parsimonious Paschal is so nervous

THE BONANZAS THAT FAILED 1977: TIME TO PARTY LIKE IT’S 1999

Prince, pictured below, had a famous hit with the chorus: ‘party like it’s 1999’.

The very different Jack Lynch had beaten him to it two decades earlier with promises to party like its 1977 with the ending of rates and car tax.

After the grim period of the 1970s and the Cosgrave administration, Lynch decided the best opportunity for Fianna Fáil to win was to spend its way out of trouble. It certainly worked for FF. The 1977 government had the biggest majority and the most popular Taoiseach in the history of the State.

The bad news was that FF then actually fulfilled its manifesto promises in an inflationary economy, not helped by a paralysing international oil crisis.

Even the popularity of Jack Lynch would not survive (take note Micheál) the scenario where oil was so scarce that fights broke out in queues for petrol.

The citizens were cold, and bad-tempered Jack was no longer more popular than Daniel O’Connell, and Charlie Haughey, right, was lurking.

Sometimes it appears that giving the people what they want, even if they really want it, is not a good idea.

1981: ‘IT’S TIME TO TIGHTEN OUR BELTS’

When Charlie Haughey made only the third live televised public address by a Taoiseach in the history of the State, and warned us we were ‘living away beyond our means’, everyone expected an age of austerity.

We had, Haughey said, ‘been borrowing enormous amounts of money, borrowing at a rate which just cannot continue’.

He also warned: ‘We can no longer be sure that we will be able to go on paying the prices now being demanded for all the oil and other fuels we require, to keep our factories going and to keep our homes and institutions supplied with light, heat, and power they need.’

In a pre-Green age Haughey pledged: ‘We will, of course push exploration for our own oil ahead as rapidly as possible, but in the short term, the burden of oil prices will continue to be a crushing one.’

Of course, in typical Haughey style, he did the opposite.

He appointed a cats-paw called Gene Fitzgerald as Minister for Finance. Fitzgerald’s abilities were expressed in his first press conference plea: ‘Ah Jaysus lads, go easy on me.’

Haughey was the one overseeing the 1981 budget preparations, even taking Dáil questions on matters normally reserved for the Minister for Finance, and the result was a bonanza budget with massive social welfare increases, food subsidies, housing subsidies and ESB subsidies.

Haughey had effectively cooked the books to such an extent that the budget reduced the provision for employment assistance and raised the rate of benefit while unemployment was rocketing.

The need for belt-tightening had been supplanted by the greater necessity to win the upcoming election, shooting the budget deficit up by 62% more than forecast.

The consequence was felt most acutely by his successor, Garret FitzGerald, who noted in 1981 that he was delighted to be Taoiseach for five minutes, until he was told the country was bankrupt.

The other victims were the citizens, who would experience a decade of austerity before the consequences of the Haughey bonanza were repaired.

2007: LAST THROW OF THE CELTIC TIGER DICE

By 2007 the skies were darkening for Fianna Fáil and for the country.

The sense had been growing since 2005 that we had partied too hard for too long and that FF had also been in power for too long.

Then Finance Minister Charlie McCreevy, right, who had planned to turn off the tap, suddenly disappeared to Europe and was replaced by Brian Cowen. Despite two mini-bonanza budgets, where minimum-wage earners were taken out of the tax net and government spending was pushed over €50billion, the electorate remained ungrateful.

In 2007 – an election year – as the skies turned black, Cowen had a final throw of the Celtic Tiger dice.

For once, the dismal school of economists were right to call for a slow-down of government spending. Instead, a €1.25billion package of tax reforms was introduced, including a 1% cut in the top rate of tax.

This was followed by the promise of another 1% off if the boys got back in for another five years.

Pensioners finally broke the €200 barrier with a €16 increase, while in a €1billion social welfare package, there was an extra €20.

Though some called the budget a spending spree, Mr Cowen said: ‘I am satisfied that, in present economic circumstances, this budget is fiscally sustainable, economically appropriate and socially responsible.’

Two years later, we lost our sovereignty to an IMF bail-out.

THE BONANZAS THAT WORKED 1997: THE LOCK-KEEPER’S SON RISES ALL TIDES

Having unexpectedly won the election in 1997, Fianna Fáil could not wait to start spending all the cash the FG/Labour/Democratic Left coalition had carefully squirrelled away, and Charlie McCreevy was the man to do it.

He had previously noted in his