"Recovery through Reform" - FG plan to stem economic tide

[mccafferty cat]

With exchequer receipts in freefall and growth contracting rapidly, Fine Gael are the first group to have made any kind of proposals to stem the tide. The Government have yet to make a single proposal, while the know-it-alls at the ESRI were pretty scant on ideas for action as well.

Richard Bruton's proposals are summarised as follows:

Fine Gael Proposals:
Waste;
1. Cancel ministerial and higher public service pay rises
2. Cut number of junior ministers by at least three
3. Announce list of agencies to be rationalised in 2008-09
4. Release up to €400m from failed FF decentralisation programme

Cost of Living;
1. Close stamp duty loophole for landowners/developers ...and use funds to cut duty rates for ordinary families trading up and down
2. Cut VAT from 13.5% to 12.5% using a €1.5bn carbon windfall levy on power generators
3. Freeze state charges (hospitals, transport, TV licence etc.)
4. Finalise moderate pay deal supported by credible commitment to bring inflation down below euro area average

Budget Reform;
1. Limit growth in net voted current spending to 4% in 2009-11, but accelerate capital spending in line with NDP commitments
2. Abandon "Existing Level of Service" estimates process
3. Require EVERY department to secure 1% budget savings each year - this would create a €2.0bn "Strategic Fund" for 2009 to finance priority welfare and service improvements e.g. indexing social welfare and keeping promises on teachers, Gardaí and medical staff

Public Service Reform;
1. Public Sector Efficiency
- Accountability with consequences - making pay and promotion linked to performance
- Staff mobility and open recruitment - breaking down barriers between agencies and Departments and the private sector
- Procurement - streamlining State purchasing functions
2. Regulation and Competition
- Electricity grid - opening up access to the grid to renewables to cut costs and improve the environment
- Bus competition - more open competition in Dublin and other cities
3. Grow Productivity through ICT and Innovation
- Next Generation Broadband Roll-Out - stimulate greater private sector investment in next generation networks.

The "strategic fund" idea seems particularly sensible. If such a fund had been in place since the election last year, then the need for cutbacks now would have been greatly reduced.

Isn't it kind of worrying that the Opposition is in a better position to propose solutions to the current crisis than the Government is?

I think a lot of people would feel a hell of a lot more comfortable at the moment if Richard Bruton was Minster for Finance

[meriwether]

The VAT one is inspired.

Its a tax on consumption that disproportiaonally affects the poor. Rich people dont mind paying VAT on rolex's, but cutting VAT on staples and essentials can actually make a difference to those on the breadline.

At last - at long last - something to get opur teeth into.

The Bertie-gate episode will go down as a lost year for Irish politics.

[CorkHurler]

Is this "recovery through reform" for FG or the economy?
The last time we had a cut in VAT it was absorbed by the retailers and not passed on to consumers and was reversed the following year.

[Dublinguy]

Is this "recovery through reform" for FG or the economy?
The last time we had a cut in VAT it was absorbed by the retailers and not passed on to consumers and was reversed the following year.

well Cork Hurler what proposals have FF (the party that have put us in this situation) put forward???

Even if the cut is absorbed by retailers as the next round of increases in prices it will still reduce inflation and reduce the pressure for larger pay rises.

[White Horse]

Well done to Fine Gael on puuting together constructive proposals. I look forward to other parties doing likewise. That way we can pull together and get out this the mess Cowen has made of the economy.

[KingKane]

Is this "recovery through reform" for FG or the economy?
The last time we had a cut in VAT it was absorbed by the retailers and not passed on to consumers and was reversed the following year.

Any VAT reduction that is not passed on to the consumer is proof positive that the markets are not competitive. Weren't FF going to do something about making things competitive for the consumer or was that just more wind escaping from the builders' party?

[FutureTaoiseach]

It's not that these are bad ideas - in fact they are good. The problem is that Labour will never allow it because it is funded by the unions who will neveallow real reform of the public sector without a fight and Labour has shown itself consistently unwilling in govt to take them on. It would be like the turkeys voting for xmas because Labour's bread is buttered by the unions. But it perhaps underlines why FG and Labour should merge, so that the Rainbow's credibility on this issue won't continue to be undermined by a Janus-headed attitude to public-sector reform.

[Eddiepops]

I like a lot of this. The one about the carbon levy on energy generators being used to lower VAT obviously appeals, although I do see the problems in it. Fair play to FG for this, this is more like what opposition should be about!

[meriwether]

I like a lot of this. The one about the carbon levy on energy generators being used to lower VAT obviously appeals, although I do see the problems in it. Fair play to FG for this, this is more like what opposition should be about!

Agreed!

While I dont regret focusing on Ahern-gate, it lead to a policy black-hole - fr everyone.
Thankfully we can move away from that.

Am=nyway, people always want differences between FF and FG.

Here's one. Richard Bruton v Brian Lenihan.

One of these understands the economy. One of these has ideas. One of these was not over promoted by a leader who wishes to make him unpopular in order to safeguard their own position.

[hiding behind a poster]

It's not that these are bad ideas - in fact they are good. The problem is that Labour will never allow it because it is funded by the unions who will neveallow real reform of the public sector without a fight and Labour has shown itself consistently unwilling in govt to take them on. It would be like the turkeys voting for xmas because Labour's bread is buttered by the unions. But it perhaps underlines why FG and Labour should merge, so that the Rainbow's credibility on this issue won't continue to be undermined by a Janus-headed attitude to public-sector reform.

This is a joke post, right? The FF/PD government of 2007 went back on a string of election commitments in order to appease the public sector unions - they ditched their own commitments for an independent competing terminal at Dublin Airport in order to appease the DAA unions, they ditched their own commitments for liberalising the bus market in Dublin in order to appease the CIE unions, and most importantly, in benchmarking they presided over the biggest giveaway of public money in Irish history, for absolutely NOTHING in return in most cases. And you have the nerve to suggest that OTHER parties might be beholden to the unions? Anyway, FG had lots of these ideas in their election manifesto, and in many cases they were contained in joint FG/Labour policy documents.

So as usual, you don't know what you're talking about.