‘Prudent Paschal’ now risks becoming Disaster Donohoe

Crazy? Or are the FAI just taking the Mick out of McCarthy?

EVERYONE in this republic of ours is on the hook for a gigantic €42,000 personal debt, courtesy of Leo Varadkar, Paschal Donohoe and this wearied Government. And don’t even think for a moment that such an enormous public debt burden will be reduced any time soon.

Leo and the Lads are on a mission to buy the next general election and win themselves another term of generous payments, pensions and privilege.

Needless to say, the cost for all this will land in our laps.

This public debt overhang won’t come as any surprise to Paschal Donohoe. A few weeks ago he published his own annual report on this precise problem and explained how ‘public debt in Ireland is the third highest amongst the world’s advanced economies, surpassed only by Japan and the United States’.

Donohoe’s Department of Finance report then solemnly declared that reducing our public debt remains ‘an important challenge’ and, further, warned that such a high debt increases our vulnerability when the inevitable downturn comes around.

Now, you’d think that, since words have meaning, this would scare Donohoe into a policy of prudence, based on a core, unshakeable principle of reducing the debt without delay. Not a chance. The Finance Minster seems to believe that when he uses words, they merely convey what he chooses them to mean at the given time.

So, when he cautions about our vulnerability in the event of a downturn, what he means is, ‘drive on, maintain the same levels of debt despite threats from Brexit and potential trade wars instigated by Trump’.

When he says that ‘windfall receipts should be used to retire debt’, what he actually means is, ‘you must be having a laugh, we’ve a general election to win’.

Before the financial crisis we luxuriated in a debt of around €45billion. Since then this has seen an eye-watering five-fold increase, ‘now broadly stable at just north of €200billion’, as Paschal Donohoe’s own report rather cheerfully puts it.

Fact is, we are in a perilous financial situation despite all this talk about full employment and floods of cash into the exchequer.

Now the State’s own Fiscal Advisory Council have weighed in with what amounts to a savage rebuke for Taoiseach Varadkar and his Finance Minister Donohoe as the principle architects of Government financial policy.

They accuse the Government of conducting themselves in a manner ‘not conducive to prudent economic and budgetary management’.

And what that actually means is: ‘Leo and Paschal, you are both now following that great Fianna Fáil, kamikaze-economics playbook.’ They have it, so they’ll spend it. The Council says improvements in national finances have stalled since 2015, despite a thriving economy.

Interestingly, the only thing that has gone well for us in that time is the reduced cost of interest on our public debt – but that’s nothing at all to do with Leo and Paschal since interest rates are mainly subject to external forces totally beyond their control.

Leo Varadkar is determined to win the next election and, clearly, money is no object.

That’s why he’ll pump another €4.5billion of Government spending into the economy next year alone at a time when full capacity is threatening to spill over into price increases across the board.

It’s an extraordinary irony that, after all we’ve been through, it may be down to Micheál Martin and Fianna Fáil to save our bacon.

If any crowd knows how to wreck an economy then it’s Fianna Fáil. They have form. But they also have the experience to recognise the danger signs. In fairness to Fianna Fáil, ten years ago we had over €20billion in Charlie McCreevey’s famous Pension Reserve Fund. Today we have exactly nothing, except a derisory promise from Paschal Donohoe to squirrel away €500million this year.

Can you imagine how impressed the Troika will be to be offered that kind of money the next time they arrive at the Department of Finance, seeing as how they demanded €84billion the last time they dropped by?

Micheál Martin needs to have a word with Leo. He needs to rein him in. If this spending madness continues there’ll only be one winner. And it won’t be Fianna Fáil. It won’t be the great Irish public either.

Meanwhile, Paschal Donohoe now says he’s taking the Fiscal Advisory Council berating ‘seriously’.

Mr Donohue’s nickname, apparently, is Prudent Paschal, courtesy no doubt of the Fine Gael press office.

He risks a new moniker: Disaster Donohue.