Renewed Programme for Government: first few pages

Slí Eile: The Renewed Programme for Government is a mixed bag. It contains some very worthy aspirations not least those bearing the ecological imprint. It also affirms that there will be no deviation from the fundamental path set by the April Supplementary Budget. In the absence of any qualifying statement we have to assume that any changes or ring-fencing of public spending (such as in education – although the details remain to be seen) will be within the targets set to achieve a 3% public deficit by 2013.

In other words we are looking at comparatively minor adjustments within a fixed adjustment process - €4bn this year; €4bn next year and €4bn. If my sums are right that adds up to €12bn! Set that level of deflation against a total public spend of over €70bn (in 2008). That’s a lot of money to take out of circulation (and indirectly to start re-cycling it to guess where). In the 1980s adjustment it was claimed that a crowding in of private sector investment was brought about by a reduction in crowding-out public spending at the time. At this speed and scale, it would seem that a €16bn adjustment process will crowd a lot of things out including consumer and real (non-estate and non-financial) investor confidence. Lets hope not and lets hope that the Government will not go ahead with this scale of amputation of public services and transfers to poor households.

Tax Reform
‘Eliminate unnecessary tax reliefs and ensure that those relief schemes which are closed to new entrants will be eliminated during the lifetime of the government where possible’
Just how many of the 100 plus tax relief schemes will be delivered in 2010, 2011 and 2012? Why wait that long? What about uncollected taxes as of September 2009?
The references to more carbon taxes, changes to local government funding and raising of the PRSI ceiling are welcome in my view. However, how much of this will really be delivered and how will the promised adjustments for any negative impacts for poorer households be effected?

Pensions
‘a single 30% rate for tax relief on private pension provision’ Still no sight of the White Paper on Pensions. And clearly, the coalition partners are signed up for a continuation of the present fragmented and inequitable system of provision for long-term income for our seniors to be. A standardisation of tax relief is welcome compared to what exists presently but we should be thinking much more creatively and boldly about a public social insurance approach to pensions funded on a continental basis.

‘There are strong indications that the tough decisions of the past year are starting to bear fruit.’ (p6)
For sure there are. You only have to look at the freefall in tax receipts as more businesses fold, people going on the dole and consumption is decreased by levies on low-income households.

Higher Education
‘We will take on 1,000 Third and Fourth level graduates to provide additional capacity and skills across the public service and in Government Departments and provide valuable work experience.’ (p6)

That’s a very good idea. How does this relate to Bord Snip proposals to cut 17,000 jobs in the wider public service?

‘We will implement incentives for employees to up-skill in preparation for the Smart Economy skills on a part time basis, as set out in the Comhar “Green New Deal’ (p7)

Good point. However, no detail accompanies this. What, concretely, has been achieved since the Smart Economy document of last December?

‘We will invest for the future by setting a target to achieve a national R&D investment of 3% of GDP, public and private combined’ (p9)

When? How?

‘Develop Ireland as an international location for Energy Efficient Data Centres and cloud computing.’ (p9)

Pardon my ignorance of such matters but can anyone enlighten on this line?

ICT innovation
Some good ideas – but nothing new – are stated here. Given the failure of privitised eircom to deliver on broadband with the consequences all too clear coupled with the general failure of most state IT projects some new thinking and action is urgently needed here. This should be linked to the skills already there in third and fourth levels. For far too long state agencies have been captive to private sector consultancy with very poor results in terms of having joined up, accessible and cost-effective ‘e-government’ (Revenue Commissioners are, at least, one very obvious exception to this).

‘Subject to European Stimulus Funding, we will make broadband available to every house in the country by 2012.’ This reminds me of a promise made in the local elections in 1991 to literally ‘fill in every pot hole on every road in the country’. Somehow we recall seeing many potholes up to and including 2008.
This is amazing especially considering where we have come from in the last 10 years. Its like saying in 1973: subject to funding from the EEC, we (?) will provide colour TV to every house in the country providing they can pay for it. Food, Fuel and Furnishing for struggling families would be more helpful in the first place. Broadband is in serious need of upgrading and extending, though.

Its late. I have only got to page 9. More in a few days. At the beginning of the Document we find the following: ‘Unless we take radical and bold action to resolve the crisis that has staunched the flow of credit, the economy will not recover’ (p3)
Time will tell – but this document is unlikely to achieve this. Rather it will deepen the economic crisis. We need a genuine new deal.