Thursday, 11 June 2009
Seanad Eireann Debate
Minister of State at the Department of the Environment, Heritage and Local Government (Deputy Michael Finneran): I have been asked by the Taoiseach to address this House today on the recent elections. There has been much debate in both Chambers on last week’s local and European elections and by-elections. No one can deny the Opposition’s performances in the recent elections, and I congratulate the Opposition on the results. The results were very disappointing for my party and indeed for my own family. However, these were local and European elections, with two by-elections, and from this Government’s perspective, the position is very simple. National issues are decided at a general election and the next general election is not due until sometime around the summer of 2012. Until then, the Government must continue to lead as we chart our way back to economic renewal.
On the major issue of creating financial stability as a prerequisite for economic growth and ensuring our public finances are brought into balance over the period until 2013, external observers are commenting favourably on the direction of Government policy. This Government has put the country’s long-term prospects above politics and we are doing what is necessary to get the country back on track. Perhaps the Government parties are paying the price for those hard decisions.
It is a feature of democracies across the world that incumbent governments suffer badly in mid-term elections. Certainly in this country, incumbent governments suffered bad results in local elections in 2004, 1991 and 1985, yet there was no general election as a result. Under our Constitution, the Government and the Taoiseach are elected by Dáil Éireann. They are not elected by county councils or members of the European Parliament. The Dáil gave a resounding vote of confidence to the Taoiseach just last night, clearly stating its commitment to this Government and this Taoiseach.
This Government, along with the Green Party, is solid and cohesive and, as the Taoiseach has said, we are in it together for the long haul. I have an excellent working relationship with the Minister for the Environment, Heritage and Local Government, as does the Taoiseach, and I look forward to continuing to work with him and his colleagues as this Government does its utmost to bring growth and jobs back to Ireland. The business of government continues and important legislation continues. The Housing (Miscellaneous Provisions) Bill 2008, which began life here in the Seanad, passed Committee Stage this week and I hope it will return to this House before the summer.
Our country now needs its elected representatives to focus on the business of government in the worst economic downturn in 70 years. It does not need an election campaign which would have a hugely negative effect on the economy at a time when we require stability more than ever. We must put our shoulders to the wheel.
Contrary to some commentary, this Government is not isolated from the views of the public. We are very much aware of the direct effect of the current recession on families and individuals across the State. We see every day the effect of job losses on our friends and neighbours. The hard reality this year is that employment will decrease for the first time in many years in terms of total numbers employed, but it is also important to say that, in historic terms, many more people are working now compared with five, ten or 15 years ago. Some 1.8 million people are working as we speak because of the level of economic activity we are generating, even in these recessionary times.
The numbers on the live register are clearly a matter for concern but the only way we can return jobs to our economy is by restoring growth. The decisions we take now we do not take lightly; we take them with the long-term good of the State in mind. The electorate is clearly angry with the Government and within Government we hear and understand that anger.
This recession has had a range of effects across society and the recession stems from a range of reasons. This Government accepts that our current difficulties are not all down to international factors, although clearly the international economy has a huge impact on a small open economy such as ours.
As Minister of State with responsibility for housing, I know as well as anyone that property development and, in particular, the housing market, have been important factors in Ireland’s economic performance over the past decade and a half. Successive years of record housing output, strong demand for home ownership through record employment and strong demographic fundamentals, all supported by a steady availability of credit, allowed many thousands of households to realise their home ownership ambitions. This Government accepts that we should have done more to contain the housing market which was fuelled by low interest rates and the easy availability of credit. While the housing market has reflected the good times, it has also been an advance herald of the downturn with the signs of slowdown becoming apparent long before the onset of the global financial crisis in the second half of last year.
The Irish housing market, like housing markets in all parts of the world, has experienced a sharp contraction over the past 18 months to two years. This has been reflected in lowering levels of construction activity, easing house prices and decreasing volume of mortgage lending. In terms of prices, the slowdown in the market for both new and second-hand houses has been under way for some time now. At this point, prices are now back to 2005 levels. Output last year matched the level of output in 2000. The volume of new mortgage lending in 2008 barely reached half the levels seen in 2005 and 2006. Affordability ratios have changed significantly with the national ratio now at 2003-04 levels and the Dublin ratio now back at 1996-97 levels. Nationally, 30,000 to 40,000 fully completed units remain unsold, with many thousands more substantially complete. A couple of years on from the start of the Towards 2016 agreement, under which 17,000 affordable housing units were to be delivered in a three-year period, local authorities have almost 4,000 unsold units on hand. At the same time, net social housing need has climbed by more than 30% since 2005, approximately 1,000 new households each month are becoming reliant on rent supplement, and the numbers of households in receipt of mortgage interest supplement has increased by more than 100% in the past 12 months. All in all, it is a very different proposition, a very different housing market, and a very different economy. Most commentators point towards further house price decreases in the period ahead and for as long as wider economic sentiment remains weak, it is difficult to see a radical reversal in sentiment towards the housing market.
Many sectors did well from the performance of the housing market over the last decade and a half. However, as a key component in our economic performance generally, the housing market did more than just create wealth for a few individuals. It also delivered wider benefits through the revenues it generated for investment in priority social, economic and environmental infrastructure throughout the country which has modernised and transformed Ireland beyond recognition. However, those days are behind us now and there is little to be gained from trying to get them back, even if we wanted to. We might as well try to repeal the laws of supply and demand. The truth is that we were too reliant on residential development for too long but then experience is something one does not get until just after one needs it.
There is no doubt the contraction has had severe and negative consequences for the public finances. However, the change has not all been for the worse. We need to embrace the opportunities presented to us to put the housing market — and I refer in this respect to all aspects of the housing market — and the structure of our wider economy on a more long-term sustainable level as we rightly welcome the very significant easing of affordability brought about by the market correction and lowering interest rates. Equally, however, we need to be careful of over-correction. Output of 90,000 in a year was too high. However, given that projected sustainable demand levels point towards a required output of 50,000 to 60,000 units per annum, the level of output expected this year at 20,000 is unsustainably low over the medium term. The great danger in over-correction is that we will simply store up future under-supply risking a repeat of the cycle of rapid price increases and affordability difficulties for first-time buyers. There is, therefore, a fine balance to be struck but Government and the stakeholders involved now have the chance to achieve that equilibrium.
As Minister of State with responsibility for housing, I believe strongly that a major starting point in that process lies in trying to match up carefully significant and growing social housing need with suitable available unsold housing units to achieve a very important alignment of social and economic objectives. The task of restoring balance to the public finances has presented difficult decisions to the Government necessitating expenditure savings across all areas of public policy and in every Department. It is accepted that we require flexibility and creativity and Departments are responding with fresh thinking and fresh approaches. The same is happening in the private sector. After all, necessity is the mother of invention.
I announced in October last my intention that long-term leasing arrangements would play an increasingly prominent role in the delivery of social housing. The further deterioration in the public finances since then and degree of readjustment required in the Government budget for this year means that role will have to be even more prominent. However, I take heart from the fact we have at our disposal new and creative ways to respond to need that can help us do more with less. Across Government, innovative solutions such as the long-term leasing initiative are being developed. We have also seen the establishment of the National Asset Management Agency. To strengthen the funding position of the banks and ensure the flow of credit to the real economy, the Government is conscious of the need to address the issue of impaired assets, in particular, specific asset classes currently perceived as carrying a higher than average risk in an Irish context which generally involve lending for land and property development. Strengthening the banks’ balance sheets will considerably reduce uncertainty over bad debts and, as a consequence, ensure the flow of credit on a commercial basis to the real economy.
This Government was formed on the basis of the programme for Government agreed between the coalition parties. The Taoiseach has indicated we are now going to review the programme for Government on the basis that the whole economic world has changed. He has also indicated he intends to include the concerns of the voters and if changes need to be made in the structures of Government or Departments to reflect the priorities of the revised programme for Government, they will be made.
This Government is unwavering, we will continue to deal with the stark challenges presented to us. We will make the hard choices. I said earlier we are a small, open economy and, accordingly, we suffered the effects of the downturn in the international economy more quickly than other larger, more insulated economies but, equally, we will benefit more quickly from the recently reported green shoots and the expected long-term upturn in the international economy. Led by the Taoiseach, and in partnership with our Government partners, we will stimulate growth again and lead this country out of recession.
Senator Liam Twomey: I am especially disappointed in that regard. The Minister of State failed to admit the Government’s mistakes in leading us into this crisis. In 2007, when the then Taoiseach, Deputy Bertie Ahern, and the current Taoiseach, Deputy Brian Cowen, were re-elected, the people were in debt to the tune of approximately €100 billion, the Government debt was approximately €40 billion and the deficit was running at approximately €1 billion or €2 billion, so the nation’s debt was approximately €140 billion.
Fast forward two years when the property bubble has burst, there is an international crisis and public finances are clearly out of kilter with what is happening in Government, where do we stand? The ordinary man and woman on the street are still in debt to the tune of approximately €100 billion. Government debt is up to €70 billion. We have bailed out the banks at a cost of some €10 billion. We have purchased an array of junk bonds — essentially junk loans — for the National Asset Management Agency, NAMA, which will cost between €60 billion and €70 billion. In the two years since the previous general election, national debt has grown from €140 billion to almost €250 billion, an increase of more than €100 billion.
If that were the end of the story, we might be able to get the situation under control. However, it is clear the Government needs to borrow €20 billion per year to keep going for the foreseeable future. The State is essentially bankrupt. The situation is worse than it ever was in the 1980s. An examination of changes in gross domestic product, GDP, make this clear. GDP has contracted by 10% this year, which means the nation’s debt is massive.
Will the Minister of State provide information on how these debts are structured and how much it will cost to service them in the coming years? There will be a significant impact on our ability to improve the economic situation if we are paying billions to manage debt we have taken on in recent years and will take on in the coming years at a time when our economy is contracting. We must bring the situation under control quickly.
The private sector is attempting to improve competitiveness by reducing its costs. However, in the midst of the current financial crisis, day-to-day Government spending is increasing. If this continues, we are destined to endure chronic long-term unemployment. The failure of the Government to recognise or acknowledge that it has led us into this mess and its failure to change its policies to suit the new environment means we are destined to see the situation deteriorate. The green shoots to which the Minister of State referred are relevant to other economies. They will not affect our economy for the foreseeable future because we are not dealing with our problems.
The question that arises after the local and European elections and by-elections is whether we need a general election. I contend we do. The senior Ministers in the current Government have been in power for most of the past 20 years. They have neutered the Houses of the Oireachtas in their role as representative of the will of the people. They have transferred all the power to themselves and have taken all the credit for every positive development in recent years. When a Government takes that approach, it must take responsibility for failure. The public is angry with the Government because it feels isolated and disconnected from politics. Government Members have claimed since the weekend that they have incurred the wrath of the electorate because of the difficult decisions they had to make. That is not the case. They incurred the wrath of the people because they led them into this mess and seem set to prolong it into the future.
The Government has effectively destroyed the economy in recent years. In doing so, it has destroyed the future of many people. Losing one’s job is often a person’s worst possible scenario. Moreover, many such are also coping with substantial levels of personal indebtedness, thus making their quality of life even worse. Many people are carrying large mortgages. In County Wexford, for example, people who bought houses for €250,000 or €300,000 now find they are worth only €150,000 to €160,000, if they could manage to sell them. Young people in this situation, who have lost their jobs or are paying increased taxes and levies, especially those working in the public service, are stuck with these properties. There is no NAMA to bail young people out of the mess they are in. Instead, the Government is binding them to their problems by extracting even more money from them.
That is why voters throughout the commuter belt and in urban areas in particular, as well as those in County Wexford and elsewhere, expressed such anger towards the Government in the elections. Its policies have made their homes almost worthless and damaged their standard of living. There is no acknowledgement from the Government of the suffering endured by so many people as a consequence of the deterioration in their quality of life. The Government talks about making difficult decisions but has yet to reach the point of accepting and apologising for its responsibility in all this. That is why the public is so angry.
Services are affected throughout the State by the reduction in Government funding. Management at Waterford Regional Hospital has indicated it will be unable to provide cancer care services because of these cuts. Attempts are being made to downgrade the local hospital in my constituency of Wexford, with the number of beds reduced and plans to close the accident and emergency department. Who knows what other service reductions will be made in future? People are suffering because of the inadequate provision of home help services and home care packages. There will be great misery for those who require State services in the coming years. Again, none of this has been acknowledged by the Government.
Senator Liam Twomey: What did the Governor of the Central Bank say about the alleged green shoots on the day of the election? We have not heard a word from him since. He was playing politics. That is why people want rid of this Government. It is too embedded with all these interests. We cannot get accurate information on these matters. That is why this Government will be kicked out.
The Government claims the establishment of NAMA is necessary. It is necessary because the Government has brought us to the current financial and banking crisis. How many billions of euro will it take to get credit flowing in the Irish credit market? We have already paid billions of euro to Allied Irish Banks, Bank of Ireland and Anglo Irish Bank but credit is still not flowing within the market. Anglo Irish Bank is a junk bank — complete rubbish. The Taoiseach has claimed it would cost €65 billion to let it fail at this stage. Does he know how much it will cost to keep it going? I predict the figure will run to €40 billion or €50 billion over time.
Senator Liam Twomey: The Government has brought us into the greatest mess in the history of the State. It allowed the property bubble to grow and burst. It allowed public finances to run out of control. It was caught by a global financial crisis.
Senator Ann Ormonde: I welcome the Minister of State, Deputy Finneran. I am pleased to have the opportunity to make a contribution to this discussion. I congratulate the Opposition on its fine performance in the elections. However, I will not be dictated to in this House by somebody who blew into the Fine Gael Party and will blow out as quickly as he blew into it. I was born and reared in politics. I am familiar with the swings and roundabouts. I will never gloat or dictate to people from a height.
Senator Liam Twomey: The Senator’s party is arrogant, it has nothing to do with gloating. It gloated for long enough, as I witnessed when I was a Member of the Lower House. Fianna Fáil gloated while the country went to pot.
Senator Ann Ormonde: There is no doubt but that the election campaign was difficult. People were extremely angry as a result of the fact that the Government was obliged to make tough decisions. Regardless of who might be in government, at times such as those we are experiencing, difficult decisions must be made and pain must be endured. Fianna Fáil is in government and naturally it has been blamed for what has happened. If Fine Gael was in government, it would also be blamed for the tough decisions it might be obliged to make. That is the reality of the situation and we must find the money from somewhere. I do not know from where Fine Gael would produce the money required but we have put our proposals on the table in that regard.
I accept that people might not like what we are doing. If Fine Gael has a better option, it should put it forward. However, who is to say that people would like that party any better than Fianna Fáil?
Senator Ann Ormonde: It all comes down to the money people have in their pockets. I was involved in the election campaign in Dublin South and I have more experience than the Senator will ever obtain. I can talk in clear terms and I am prepared to accept when I am wrong. That is for sure. Having listened to people’s views and experienced their anger, I am aware that there is a need for us to reflect on what we have been told. We will do so because that is the nature of our party. Fianna Fáil has been down before. We are down now but we are not out. Let there be no doubt about that. When our backs are to the wall, that is the time at which people can count on us.
Anyone who is aware of the history of my party will be aware that it has received kicks from time to time. That is the nature of democracy. I will reflect on what has happened and on what people are saying. My party will review the programme for Government, based on what it has been told. We will do our best to try to balance the books.
Fine Gael reached rock bottom in 2002. I congratulate it on its comeback, but no one has the right to dictate that there is only one way forward. Fine Gael Members are entitled to put forward their views but they are not entitled to be nasty. That is the bottom line.
Senator Ann Ormonde: Senator Twomey had golden opportunities to remain in his party. He was lucky to obtain a seat in this House and now he has an opportunity to gain further experience. Such experience might do him the world of good and he might be lucky on the occasion of the next general election.
Senator Ann Ormonde: People must recognise that our economic circumstances have changed and that we are living in a different world. We must be careful with how we shape our views in respect of the country’s future.
The nature of employment and the future of society are changing. The world economy will dictate the kind of jobs that will be available. We must examine our position with regard to the nature of employment. Do people still want to operate on a nine-to-five basis? The various Departments, particularly the Departments of Education and Science and Enterprise, Trade and Employment, will be obliged to consider how we might upskill employees and how we should deal with those making the transition from secondary school to work. I would love to be involved in the work to be carried out in this regard.
Young people are angry because they cannot obtain employment. I am concerned about this, particularly because I was involved in the area of education and previously dealt with young people making the transition from school to work or from school to third level education. Research must be carried out in respect of how we might shape the future of society. We cannot base our models on those which obtained in the past whereby people pursued apprenticeships in various trades. We must change our thinking. I hope the Government will reflect on its programme and take into account the strong views expressed by the electorate during the campaign.
I took part in the canvass in Dublin South and I spent a great deal of time talking to people on their doorsteps. They put forward many fine ideas which I have since brought to the attention of my party.
Fianna Fáil had some fine young candidates who ran in the local elections. These individuals will stand for election again because of their age and that they are vibrant and have already run the course. They will be ready when the next local elections are held.
Fianna Fáil has three years to put matters right and I am confident that it will do so because it is the kind of party that reaches out to people. I respect democracy, the decisions of the people and the performance of the Opposition. I congratulate those in opposition on the great performance of their candidates. I will always be gracious in that regard. However, I do not want people to dictate to the House and state that there is only one way forward and that is their way.
I hope the Departments with responsibility for creating employment and developing the education system will do what is necessary. Modern technologies represent the way forward. We may be obliged to consider the process of electioneering, particularly in the context of how it might be developed for the future. Perhaps we might be obliged to move away from the old-fashioned pastime of knocking on people’s doors. I do not know whether it will be necessary to do so but the jury is out. There is certainly a need for us to engage in a brainstorming exercise in respect of these matters. I would be delighted to be involved in such an exercise. I want to save Ireland and ensure that the people who live here have the best quality of life. I want to make a positive contribution. I do not wish to engage in nastiness.
Senator Michael McCarthy: I welcome the Minister of State. I am glad we are debating the results of the recent elections. I wish to begin by congratulating all the Members of this House who contested the European and Dáil by-elections. In that context, I wish to single out my colleague, Alan Kelly, who had a spectacular victory in the Europe South constituency and who is now a Member of the European Parliament. Irrespective of one’s political beliefs, one must acknowledge that an election is an exercise in democracy and that the people have spoken. Elections are difficult for candidates and their families. In that regard, I pay tribute to those who were unsuccessful as well as those who were successful.
Senator Twomey stated that the Government is lame. In view of the fact that he is a medical doctor, I take his comments seriously. I am sure the Senator could spot a limp much quicker than the rest of us.
Senator Michael McCarthy: People’s frustration and anger manifested itself on Friday last. It was a fantastic day, not least for the Labour Party but also for its Leader, Deputy Gilmore. The Labour Party had three MEPs elected and won a record number of seats on local authorities throughout the country.
Let us not forget the reason people voted against the Government. People are literally on the edge and jobs are being lost at a terrifying rate. For example, in February 28,000 jobs were lost. In other words, 1,000 jobs were lost each day of that month. There are those who are in employment who may be out of work by Christmas. People are paying income and health levies. There are homes in which low-paid public servants are paying these levies plus the pension levy.
It is dishonest of the Government to use the term “pension levy”. After the budget last year, I stated that the pension levy is a tax. The only reason it is referred to as a levy is that it is not possible to introduce taxes between budgets. There are part-time firefighters employed by the western division of Cork County Council who are paying a pension levy but who will never receive a pension. There are cleaners who work in schools in my area and, I am sure, in those represented by Members on the Government benches who are paying the pension levy. These people are paying money into a scheme which does not exist and are being levied in respect of a pension they will never receive. There is a great deal of frustration regarding the unfairness at the heart of the pension levy scheme.
Last year the Government tried to take medical cards away from those who are over 70 years of age. The move to extend medical cards to everyone over 70 in the 2001 budget introduced by Mr. Charlie McCreevy was clearly designed to win popular support in the subsequent general election and, from a political point of view, that move was a success. When the Government realised it had to make savings and cut costs, it went straight back to vulnerable people who existed on State pensions and small occupational pensions. This caused a major amount of disquiet. There was a rowback or a turnaround but if one was 70 years of age with a State pension and a small occupational pension there was real fear. That affected all sections of the political classes, those who had been giving support to the Government for years. That frightened people. People had real fear when they sat down and figured out they would have to give €50 of their weekly budget to the doctor.
I refer to the manner in which the banks were recapitalised and bailed out, a measure my party opposed. It was quite unfair. There was a sense of unfairness at the heart of these decisions, that bankers could be bailed out and recapitalised irrespective of the merit in it at the time, when viewed by people who were losing money left, right and centre. Families depending on the early child care supplement will no longer receive that.
One of the more worrying aspects of the economic downturn, to which Senator Twomey referred, is the appalling vista of the long-term unemployed. We do not want to return to the situation in the 1980s, where huge amounts of people were unemployed. The only option for those leaving second and third level institutions was to emigrate. That option no longer exists because of the global downturn. We must ensure there are adequate structures to deal with the unemployment problem and that we do not return to the situation in the 1980s, where there were frightening levels of unemployment. According to the economic indicators of the ESRI, we are likely to exceed those by the end of the year.
I refer to the electoral register in the context of the local and European elections. In Cork South-West it is very accurate because there is an extremely diligent franchise officer, who gives 100% to the position. A candidate for Cork County Council, who has since been elected, presented himself to the polling station on polling day and was not on the register. He was registered to vote in a different electoral area, at an address at which he never lived. How can this happen? This man was already a member of a town council. In some context, such as the Joint Committee on the Environment, Heritage and Local Government, we need to approach this matter in a constructive manner to ensure the electoral register is accurate. It is anti-democratic folly to have people removed from the electoral register. I can accept it if someone changes address or turns 18 years of age soon before an election, but in this case an elected practitioner of local government presented at the local polling station. What if that candidate had lost by one or two votes? This is a serious situation. We need a separate debate on the franchise of local government and the electoral register.
We need a response from the Minister for Education and Science on the supports that exist or do not for those recently unemployed and graduates who are well qualified but can find no positions for which they can apply. Can the Government indicate the schemes it intends to roll out to provide some assistance to graduates who have already completed a primary qualification and need to go back to the workplace? Perhaps they need to weather the economic storm by upskilling. It makes economic sense to give financial assistance to someone who is adding to qualifications as opposed to giving social welfare payments, rent allowance and a medical card. Surely the economic thinking must be black and white. We should invest that support in someone who wants to get off the live register and go back to a third level institution. Now is the time to do it. We must reconfigure the back to education allowances and the schemes that provide someone with the financial means by which the person can upskill and return to the workforce when the upturn comes. Hopefully, it will be sooner rather than later.
A number of factors, national and local, affect why people were successful in these elections. The issue of fisheries affects the coastal communities around the country. I raised this matter on the Order of Business on Tuesday. I and those in the fishing industry believe it is one of the areas of activity by which we can reboot coastal economies and create employment if the proper mechanisms are in place. The fisheries legislation passed by the Houses was draconian and we must examine that area. We must relax the harsh restrictions.
Two weeks ago in west Cork, fishermen were out for ten days and when they came back they had failed to complete a log entry. The sea fisheries protection officer boarded the vessel, seized the equipment and the catch and one individual must appear before a Circuit Court judge because of a missing entry in a log book. That is preposterous. Off the coast of Donegal, a trawler picked up drugs. The crew contacted Killybegs and told the Garda Síochána it would drop the drugs back if it could return to area 7 and fish, which was the intention in the first place. The trawler returned and sea fisheries protection officers were there before the Garda Síochána and the Naval Service and boarded the vessel to check for log entries. That is driving people out of the industry, which is one where we could create employment if the Government re-examined criminal sanctions for fishermen.
I refer to some of the other issues, such as the decision by CIE to cut a bus route to Baltimore. This affects those on the margins, those who do not have transport and are on lower incomes. Other issues include the future of Bantry General Hospital. We must be cognisant of the national climate but also of the local climate. I ask the Minister of State to take these views back to Government to ensure it gets proactive about these issues.
Senator Donie Cassidy: I agree with Senator McCarthy. We have agreed to an all-day debate on the fishing industry. There is a great amount of jobs and potential in this area. The criminal offences to which Senators McCarthy and O’Donovan referred must be addressed as a matter of urgency.
I welcome the Minister of State, Deputy Finneran, who was a distinguished Member of the House as Front Bench spokesperson on finance. I thank him for listening to the views of Senators following various elections.
I pay tribute to the men and women of all political parties, particularly those in Fianna Fáil and the Green Party, and particularly the party that I have been privileged to be a member of, Fianna Fáil. Some of the most outstanding men and women in the history of the party, through no fault of their own, lost their seats in this election. It is a loss to the local authority system. I hope they continue to represent their communities and parishes. We look forward to the day they return to public life. These people are of the highest integrity and ability. They put themselves before the people and many have, unfortunately, been rejected. They suffered because of a national situation and the worst recession in our lifetime and since the 1930s. The Government had to take unpopular decisions because of this. I compliment the chairman of the Green Party and the Deputy Leader of this House, who is in the Chamber, for the responsive role the party is playing in government, along with the Progressive Democrats.
Senator Donie Cassidy: Senator Twomey was a worthy representative of the people of Wexford as I was of the people of Westmeath. There is that evil thing called the Constituency Commission and those who represent us on the Constituency Commission took my seat away. I do not know the reason Senator Twomey lost his seat but I am sure it is a valid reason the same as how I lost mine.
Senator Donie Cassidy: I understand the anger among the public. Fortunately, Senator Twomey had a job to go back to but the people I am referring to have lost their jobs. They are standing in dole queues, which Senator Twomey and I do not have the experience of doing.
If Fine Gael or Labour were in power, they would have to face the same difficult choices we have had in governing and they would have faced the anger of voters if roles were reversed. Whoever is in power must face the same difficult choices and make the same unpopular expenditure cuts.
Just two years ago, in the only poll that is really relevant, the people gave this Fianna Fáil-led Government a third time in office. This is our mandate and anybody who suggests otherwise is being opportunistic and, in particular, undemocratic. The Taoiseach received a majority vote in the Lower House last night for a vote of confidence in the Government, 85 votes to 79 votes. Those of us here for the longest time know this is a substantial majority. It is also a vote of confidence from the people’s representatives, which include the two new Deputies who I had the opportunity to congratulate.
The mandate given to the Taoiseach to govern was provided by the people two years ago and we will see it through for the five year programmes that we have come to know over the past ten years. I welcome today’s debate, which allows Members on all sides of the House the opportunity to outline and make our views known. On this side of the House, we must put on the record the great work done by this Government over the past number of years.
The crime issue is a serious challenge to our country currently but we have an excellent Minister for Justice, Equality and Law Reform in Deputy Dermot Ahern. He has brought about ten Bills on gangland crime alone, relating to surveillance and gun control, and all these have been published. This week the Criminal Procedure Bill was before the House for our consideration. It looks after the victims of crime and looks to rebalance our criminal justice system in the direction of victims. This was a commitment we gave as a party, together with our partners, the Green Party.
This Government has a very good record in the area of law, order and public services. There have been an additional 3,500 gardaí recruited in the past four years, along with an extra 7,000 teachers and 11,000 nurses and doctors. We also provided the largest social welfare increases in the history of the State and the greatest increases in old age pensions. There was no €1 per week increase there. We should give credit where it is due in this regard.
We brought in the lowest tax wedge seen in the history of our country. It is not just the Government which has made this argument; the OECD has made it over the past ten years and we have had the lowest tax rate here for that considerable time. In other words, our people paid the lowest amount of taxes of any country in the OECD and we deserve credit for that. It is a long way from the 65% top rate and 35% standard rate of tax which we had 20 years ago.
Senator Donie Cassidy: The Minister of State with responsibility for housing is with us today. A third of all homes built since the foundation of the State were built in the past ten years. That is a record we can stand over and for which we deserve credit. We spent a significant amount on infrastructure in the past ten years which was twice the EU average. The money was spent on schools, roads, rail and health. We restarted the prison building programme, and this summer we will open another 400 spaces. Again we stand over our record and deserve credit in this area.
These individual actions are aimed at improving quality of life, job retention and creation. Until this year we had full employment and turned around the issue of emigration. We deserve credit for that. It is only through employment, enterprise and the income generated by these that we can fund so much else that this Government wants to achieve. We want entrepreneurs, businesses, employees and those seeking to work to know this is our priority.
Leading from this, we have had initiatives such as the enterprise stabilisation fund to help protect jobs in our exporting companies hit by the current difficulties. Due diligence is under way on a scheme for export credit insurance to further assist our exporting companies. There is a commitment by the Government to pay its debts to businesses within 15 days of invoicing. We have sought this on all sides of the House on the Order of Business on various mornings, and I commend the Government for it.
A revamp is under way of our public procurement policy to make it more friendly to small and medium enterprises. New tax changes were introduced to support job creation through the development of intellectual property assets in Ireland. As those involved in the publishing industry know, we are the envy of the world in how strict and up to date the requirements are in our intellectual property rights regulation.
We have spent much time here over the years in order to command the respect of the world. Multinationals such as Hewlett Packard and Intel are giving us so many thousands of jobs because of the serious view which has always been taken by the Government in the protection of intellectual property rights. That has stood us well with the significant number of jobs created in the sector.
There has been an unprecedented level of training and activity measures put in place to assist those seeking employment again. New initiatives have been established to keep people in jobs deemed vulnerable and to get graduates with work experience. All this work has been undertaken at a time of unprecedented change in Ireland. Everybody in the House knows that the stabilisation of our public finances and the resolution of problems in our banking system are key to economic recovery. A combination of tax increases, expenditure reductions and efficiency gains were necessary and had to be put in place.
In 1997, when our Opposition colleagues left office, we had 1.1 million working. It is very regrettable that 400,000 people are currently unemployed but we still have 1.8 million employed today, 700,000 more than we had 12 years ago. All fair-minded commentators and politicians would indicate that we have a great chance of recovery. I understand figures to be released later this afternoon relating to the past two months will be very encouraging for us.
I welcome the assistance of colleagues on all sides of the House in this and continuing debates on the economy and challenges facing the Department of Finance, the Taoiseach and the Government. I welcome the Minister of State present who is listening to our views on the matter.
Senator Paudie Coffey: I welcome the Minister of State, Deputy Finneran, to the House and the opportunity to speak in the debate. After any election in which the people have spoken, it is important we reflect on the outcome. It has been a good election for the Opposition, which has been listening closely to the electorate for the last number of years while the Government perhaps has not.
I congratulate all those people from every party who were elected. I commiserate with those who were not elected as I know of people that may not have been of the same party colours who were good workers in their community but lost their seats. Politics is a tough game and sacrifices must be made by an individual who partakes in it. In saying that, such people joined the Government parties and benefited when the times were good; as the economy has turned around, they are the first casualties after the election.
With regard to the elections, some people have mentioned the accuracy of the register. I agree it can be inaccurate and many people are missing from it who should have been on it. The Joint Committee on the Environment, Heritage and Local Government has completed a report on how improvements can be made in this regard. I ask the Minister of State to ask the Minister to consider that report again, as I am sure the accuracy and efficiency of the electoral register can be improved if the recommendations are implemented.
As a democrat I am concerned about the national turnout as many people failed to vote. If people do not use their vote and have their say, it is disappointing and we as politicians should take note. There is also the issue of the number of spoilt ballot papers and ones unfranked by election officials. The latter is unacceptable, particularly when a voter gives up his or her time to vote.
While the elections were a good day for the Opposition, I know Government candidates would have been disappointed having suffered electoral defeats myself. However, they were defeated for a reason and the Government must listen to the message from the voting public which holds us accountable. Three out of four voters in the recent election voted against the Government. While the Government may blame international economic turmoil, it must accept the national economy was exposed over many years. The Government did not listen to the many commentators and politicians who warned that it was on the verge of collapse.
Many of the Government’s decisions, as I have said before, were based on propagating a property market bubble that was not sustainable, with over 60% of those employed involved in the construction industry. Manufacturing industry, much of it indigenous, was neglected during these good times. Ireland lost its competitiveness and took its eye off the ball regarding manufacturing exports, once our strength in the 1990s when the economy began to grow rapidly and when Fine Gael was last in power. Waterford has lost many jobs in Waterford Crystal, Honeywell and Bausch & Lomb which were indigenous manufacturing industries. We need to refocus on this sector and become competitive again in it. Unfortunately, as the property boom escalated, revenues from the construction sector were rolling in while the manufacturing sector was quietly suffering.
My brother runs a small manufacturing company. He tells me every day the serious pressures he is under at the coalface. He, like many other small businesses, is adapting to meet the challenges ahead. These businesses need to be assisted by the Government but it is neglecting them. Overheads, such as energy costs, are crippling many small and medium-sized businesses. While energy prices have been reduced lately, regulation still keeps them artificially high. Opportunities to become more energy independent are available with renewable sources. The Government should invest in the renewables area now to reduce our overdependence on imported oil and gas.
The man on the street believes the Government’s establishment of NAMA is the biggest gamble ever taken by a Government. The values of the assets the agency will take on are not known. People are aware these are inflated assets which the Government is buying back, placing a huge millstone around our necks and those of our children. As a parent of three small children under five years of age, this move is of great concern to me and many of my generation. Not only are many parents under pressure with their jobs and exposed to large mortgage repayments and higher costs of living but their children’s futures have been exposed by NAMA. People were angry and frustrated but are becoming more fearful of the economy’s future. They want real leadership in politics to turn the economy around.
Fine Gael is offering positive options and alternatives to address these fears. The Government has not been arrogant but has been in denial over the past two years. It is tired, stale, out of ideas and out of time. Fine Gael is proposing progressive and proactive economic ideas. We have the energy, the vision and now the personnel to take this country to a new level and recover the economy. I have always respected the Green Party for its good ideals. However, the party’s activists should now become members of Fine Gael which is putting green issues to the forefront in its proposals for renewing the economy. That is where the Greens should be rather than propping up a Government that is now crippled.
Senator Dan Boyle: There is no glossing over the fact this has been a difficult set of elections for the Green Party-Comhaontas Glas. It is part of the maturing of any political party to experience election success and also deep failures. It was the lot of Fine Gael in the 2002 general election and the Labour Party in the 1997 and 1987 general elections. We live in an era of pendulum politics where a large number of votes shift easily given the time and context in which an election is held. I have no doubt the electorate intended to give my party a kick in the shins; unfortunately, they amputated us from the knee down. The situation we find ourselves in gives us cause for great reflection but I believe it will lead to the betterment of our party in the long run.
That said, the Opposition parties performed well in the elections. They played on the obvious anger that exists. They also played no little part in fomenting some of that anger. That is, however, the way of politics. When the dust settles, there will be a responsibility on the Opposition parties to answer themselves the questions they raised about several Government policies. If the public service pension levy is unpopular, what is the Opposition’s alternative of raising moneys? If the income levy is unpopular, what is its alternative? I accept some other decisions made by the Government have been short-sighted, wrong-minded and need to be re-examined. However, would the Opposition parties, if they were in government, be able to deal with the current economic situation without making unpopular decisions? All governments make unpopular decisions given the current economic times.
Senator Dan Boyle: The local elections were held on the same day as the European Parliament elections. The Government party in Britain only got 15% of the national vote. The Czech Green Party, which had been in government there until recently, also experienced a similar collapse in support by virtue of being in government during the most serious economic downturn experienced. I have accepted both in and outside the Chamber that certain policy decisions, prior to my party entering into government, contributed to a worsening of the Irish economic situation, making it more than experienced elsewhere. That said, it is my preference that my party stays in government to correct the effects of many of these decisions.
The nature of being in politics and of being an honest and responsible politician is to meet challenges sincerely. It is to try, when something is wrong, to admit it. It is to use that platform, to the best of one’s abilities, to correct it and make matters better. I will never apologise for that even if that means a diminution of personal support or an inability to get elected at any time. The essence of politics is to be in government, to try to effect change and to try to make things better. However, when I hear of the games that are played on particular issues, it causes despair.
In a personal sense, I admit this was a difficult election and I came across people who undoubtedly were angry. Many people have many reasons to be angry. I refer to people who have lost their jobs, who have difficulty in making mortgage payments or those whose pension entitlements have gone up in smoke because of the collapse of markets. However, some of the anger I encountered came from people who are not affected by any of these factors and who have been caught up in a general feeling that one must be angry and that one must be angry at someone. If this country is to recover, people must be focused in their anger. One must ensure the right people take responsibility for what has gone wrong and for what needs to be corrected.
I accept there have been political failings. However, as for the issue of the banks being trotted out periodically, what is the alternative approach that the others claim will cost any less or will have a different effect? Regardless of whether one nationalises, adopts a good bank and bad bank approach or takes a NAMA approach, it all will come down to the Irish taxpayer. There is no way of avoiding what has happened and no other combination of parties or politicians will be able to effect a different result. All one can do is to try to use the situation to ensure the impact is lessened.
Unless people are sufficiently honest to admit this, our politics are suffering. I believe the real effort to bring forward changes will require honesty. This election really was about anyone but the Government. It is quite obvious that this was the voters’ intention and those were the results that followed. However, it is a sort of perversion of democracy when people get voted for on the basis of what they are not, rather than on what they are for. They were not voted for because of what they stand for or because of their experiences or abilities. While that criticism probably is too general, it was a factor in these elections. People were elected who came from nowhere and did not have a particular background but who, because the mood of the moment was anyone but the Government, succeeded in being elected. Those Members who are in the Chamber at present came through the political process in the traditional manner. They contested local and national elections, were elected as councillors in the first instances and have gained experience of all that. However, when the mood is so volatile that anything can happen, anyone can be elected and that is not safe for our democracy. We need more——
Senator Dan Boyle: The danger at present is not so much that these results may and will translate into a future general election result. That could be the case as trends are trends and sometimes momentums cannot be stopped. However, there is a danger for the Opposition parties both in being honest with people by revealing fully who they are and what they are about and being complacent. There is a risk of hubris because there have been mid-term results previously that did not translate into general election victories. I make this point in particular to Fine Gael, a party that has not been directly elected into a Government in Dáil Éireann since 1982.
Senator Dan Boyle: Before Fine Gael Members become caught up in themselves or become convinced of their brilliance, they should remember we live in a volatile country, in a volatile situation and in a volatile international environment.
Senator Dan Boyle: I fully accept this verdict. I understand from where it comes and I understand what must be done to address it. However, as for where this leads this country, whoever is in government and whenever that election takes place, I hope the people will be spoken to directly and honestly during that general election campaign because the next few years are not going to get easier and will not be better for people. We need a stable Government that is able to tell people what they need to hear and not what they want to hear. In reality, that is what mid-term elections are.
Senator Jerry Buttimer: I am sorry that Senator Boyle is leaving, as I enjoyed his speech and his lecture to Members. My mother, may God rest her, had a great saying, which was that democracy is a great leveller and the ballot box never tells lies. She was right. The ballot box last Saturday unfurled a result that many Members never would have forecast two years ago and people want change. I lament the loss of anyone’s seat, be they members of Fine Gael, Fianna Fáil or whatever, because I was that candidate two years ago in the last general election. I will not express joy at the loss of anyone’s seat because I support everyone who stands before the electorate. Politics is a great and noble profession and Members should never forget that.
However, the people are not fools. They listen, watch and observe and have understood that the Government has refused to listen and has refrained from making the correct decisions, not over the past 18 months or two years, but over the past 12 years. Today should not be about the past but about the future, about what people want and about how to get Ireland working. It is about how to make banks more trustworthy and how to allow credit to flow toward small and medium enterprises. It is about creating new jobs and about restoring the housing market of which the Minister of State, Deputy Finneran, is in charge. The elections last week both were and were not about Europe and the local elections. They were also about national issues that affected everyone. Senator Coffey is correct that Members must never forget their business is about people. The people have been let down and they took out their anger regarding national issues on the Government. Senator Boyle referred to pendulum politics and while he might be correct up to a point, it is not simply about this as it also pertains to how one responds and directs policy. It is about the future of every working person and everyone who has lost his or her job.
Senator Boyle raised questions about the banks and about the alternative budget. I wish to put on record that Fine Gael was the only party that had set out detailed and costed plans for rebuilding Ireland through the overhaul of its State companies and in the manner in which a new-era investment programme will be driven in respect of broadband, clean energy and water to create 100,000 new jobs. This is the reason Fine Gael’s pre-budget submission set out detailed reform plans to cut the cost of running the Government by 20% to pay for the targeted cuts in taxes such as VAT and PRSI. This is the reason that, through its “Fair Care” health policy, Fine Gael has a clear vision and detailed plans for a fairer and more efficient health service that will cut waiting lists, take the burden away from our hospitals by making primary care free and provide everyone with affordable health insurance. These measures are set out in black and white and I will provide them to any Member opposite who dares to criticise Fine Gael for having no policies, because we do.
The fundamentals are quite simple. In the words of the Minister for Finance, Deputy Brian Lenihan, in the Dáil this week, “People have lost jobs. They have lost savings. They have lost pensions.” The Minister failed to mention that the people have lost trust and have lost confidence in the ability of the Government to govern. Fundamentally, the people believe it will require a different jockey on the horse to take us out of the political tsunami in which we find ourselves. Fine Gael has the policies and I will happily debate policy with any Member present. I have read some of Fine Gael’s policies into the record. However, Members should discuss a new direction. I do not refer to a cosmetic change but to one that is real and meaningful because the Government has lost that vision. I do not propose change for its own sake but because the people I met on the doorsteps are disillusioned about the withdrawal of the Christmas bonus. I recently gave the House details of the case of a retired teacher whom I met some weeks ago. The woman in question, who is a spinster, worked as a national school teacher for 35 years. She bought shares in Bank of Ireland and Allied Irish Banks. She intended to fall back on them if, in her day of distress and need, she needed to go into a nursing home. That is now gone. I also met a woman in Bishopstown whose child needs 24-hour care. She told me her application for a housing adaptation grant had been refused. In light of such cases, do Senators Daly and Butler continue to believe Ireland is an equitable and just country? It is clear that it is not. The ship of State, which has been run onto the rocks, requires a new captain with a new crew that can create an equitable and fair Ireland. We need change because the Government has abdicated responsibility for matters like health, the banks and housing.
I would like to speak about the manner in which elections are run. Last Friday evening, I received a telephone call from a distressed gentleman whose wife had gone to their local polling station at 7.30 p.m., only to discover that her vote had already been used. A line had been drawn through her name. Although she had her passport and her polling card with her, she was not allowed to vote. In modern Ireland, it is not good enough that personation continues to take place and that our register of electors is in rag order. The proper procedures are not followed in many of our polling stations, which stay open from 7 a.m. to 10 p.m. I do not criticise the returning officer in Cork, Mr. Martin Harvey, who does a fine job of running elections. We need to examine how we run our electoral system, starting with a root and branch reform of the operation of the elections themselves. I look forward to reading the Standards in Public Office Commission’s report on levels of compliance with electoral law. In the city of Cork, many posters and other forms of election literature are in breach of the Electoral Acts. They do not specify who printed them, for example. If we are serious about using our electoral law to create a fair and balanced electoral system, we must apply the full rigours of the law to those who breach it. If we do not do so, the Electoral Acts will be seen as a farce and a joke. We need to be serious about the running of elections. I want a fair, balanced and equitable electoral system that gives a chance to everybody who wants to run for election.
I congratulate those who won in the recent elections. I thank those who were defeated for running and hope they will run again. I take no pleasure in seeing people beaten in elections. The people have spoken. This Government has no mandate. It has lost its moral authority to govern. It is time for a general election because this country deserves a better Government than the one it has.
Senator Mark Daly: Winston Churchill once said that democracy seems like a bad form of Government until one considers the alternatives. Senator Buttimer said that the people have spoken, but I remind him that the elections in which they spoke were local elections. Tip O’Neill’s great quote, “all politics is local”, is often used during local election campaigns. It is also used in general election campaigns. In his great study of local democracy in Ireland, Dr. Liam Weeks of UCC found that 66% of those who voted in the 2004 local elections voted for the candidate, whereas 34% voted for the party. Senator Buttimer has openly called for a general election, but we all know that his colleagues privately do not share that view. In the corridors of this House, Fine Gael Deputies and Senators are looking for an election in the same way that a turkey looks for Christmas. They are making big noises and shouting loudly, but the reality is that they do not want a general election.
Senator Mark Daly: When the people spoke, they said they were not happy. That is basically it. What we have seen is a form of Americanisation of Irish politics, in some senses. Those who are not happy decided to vote against Fianna Fáil and the Government, rather than for the Opposition. They have formed the view that the Government is not doing a great job. In essence, mistakes have been made. Seán Lemass once said that anyone who never made a mistake never did anything. In fairness to the Opposition and specifically my colleague, Senator Buttimer, Fine Gael has never made a mistake but then again it has never done anything. Opposition Senators have said that Fianna Fáil has been in power for 20 years, but I remind them that we have come a long way in that time. We made hard decisions to ensure that Ireland is no longer the poor man of Europe. Further hard decisions will have to be made in the future.
If one were to listen to the media, one would think that the end of the world is coming. I would like to give the House two examples of that. The stories in question appeared in the newspapers over the last month. It is interesting to note that people are so busy nowadays that they scan newspapers rather than read them. Headlines are important because approximately 80% of people do not go beyond them. A newspaper used the headline, “Hospital for the elderly turned off heating due to health cuts”, above a story about a hospital in Killarney. When I read the content of the article, however, I did not see any further mention of health cuts. The article mentioned that extra blankets had to be brought into the hospital one night when the hospital’s boiler broke down. The boiler in question was repaired the following day. The job was done. The headline led to a discussion about health cutbacks on Radio Kerry that lasted the morning. People were under the impression that such cutbacks led to the heating being switched off, but that was not the case. The newspaper in question was reporting fiction rather than the truth. Another newspaper suggested that a review that has yet to be published will recommend that one-person Garda stations in rural Ireland should be closed. People in rural areas, such as Waterford, Cork and Kerry and along the west coast, decided that the recommendation was an abomination. The fact is the Government is not considering the closure of one-person Garda stations. That was not part of the review, which was about making sure such stations are up to standard. There is no question of them being closed in any way, shape or form. On a daily basis, one faces a barrage of such headlines, not only about local issues like Garda stations and the health service but also about national issues like the bailout of the banks.
The problem Senator Buttimer’s party is facing is that Fine Gael’s policies are not compatible with the Labour Party’s policies. Senator Buttimer is anxious for us to call a general election, but I suggest that if it were to happen, we would certainly have another election within nine months. When two entirely incompatible groups go into government together, the honeymoon period might be great but those feelings of euphoria quickly subside when both parties realise that their respective theories on how the economy should be run are divergent. We all remember what happened when this House sat late into the night last year to consider the Government’s bank guarantee scheme. The Labour Party opposed the scheme. It was not a question of bailing out the banks; it was a question of trying to safeguard everyone’s deposits and prevent a run on the banks. The Labour Party did not want it to happen, which did not look great. Perception sometimes becomes reality. If we had not guaranteed people’s deposits, their hard-earned savings might have disappeared. As a Government, the responsible thing for us to do was to ensure that such savings were safeguarded. The reality is that we need to make our case to the Irish people. We have to ensure they understand the difficult decisions that are being taken. Any mistakes that have been made will be rectified. The most vulnerable people will be protected. I commend Fine Gael for supporting us when we took difficult decisions and needed support. In the next three years, while still in government, we will try to ensure we restore the faith of the people in the Government and our party.
Senator Joe O’Toole: I am happy to give an independent view on the inter-party rivalry that has been evident for the past hour or two. Fine Gael and the Labour Party, given their position, are perfectly entitled and correct to call for an election. Equally, the Government is correct to say there should be none.
I have been here long enough to see changes. I am sorry some of my friends in Fine Gael have not been present for this debate. I could give examples of changes that occurred when there were changes of Government. Senator Bradford was a Member of this House when we dealt with the road traffic legislation in the 1990s, which was introduced by former Minister Michael Smith. We tabled amendments on this side of the House on all sorts of issues, including speed limits and licences. We were very solid and committed regarding the legislation and we were all working together on it but then the Government fell over the Brendan Smyth case. Next thing the Government changed without an election such that the people who were on this side of the House were then on the other. I said we would at least effect some changes as a consequence. When the legislation was considered under the new Government, Senator Ross and myself re-tabled all the Fine Gael amendments tabled before the change of Government in the belief we would have the full support of the other side of the House. Did we receive it? We did not. We have learned the hard way over the years. We listen to comments and know people are sincere in what they say when they say it. This does not mean it will ultimately turn out to be what they want. This is a lesson for all of us.
The Labour Party and Fine Gael are correct to be hammering the Government at present. I met the leader of the Green Party casually yesterday and said I was sorry his party did so badly in the elections. Like Senator Buttimer, I congratulate those who put a name on the ballot paper and I feel sorry for anybody who did not get elected or lost a seat. I am genuine in saying this and Members on both sides of the House, irrespective of party affiliations, share my view.
I said to the leader of the Green Party that I could list measures he could have adopted that would not have cost money, would have received widespread support and would have been good for Fianna Fáil, bearing in mind that the Green Party was not able to convince Fianna Fáil. He asked what the measures were and I replied that the Joint Committee on Climate Change and Energy Security, of which I am a member, produced legislation called the foreshore Bill, which would be very important in terms of bringing energy resources ashore. It was the first joint committee ever to produce a Bill. I asked why the Government did not say it was a great idea and consider it. The Government would have had a wide selection of people dealing with issues that Senator Butler has raised under another heading on various occasions, including the problems associated with developing renewable energy. Senator Butler invited to Leinster House those responsible for the Spirit of Ireland proposal. Spirit of Ireland brought many strands together but the first depends on this legislation. I also mentioned to the leader of the Green Party the Climate Change Bill, which was produced by Members in the Opposition benches. The concept was agreed by the Government and it said it would bring forward its own Bill. There are many such measures that could have been considered.
I referred yesterday to Seanad reform. Perhaps the Government will consider Seanad reform with a slightly less jaundiced eye given that Fianna Fáil has probably lost two quotas in every single panel. I stated that, in my county, the naming of my home town cost the Government votes. I spoke to a young Fianna Fáil man who said residents were waiting for the Government to do something about the name of the town, which was changed by the Minister for Community, Rural and Gaeltacht Affairs, Deputy Éamon Ó Cuív, but it did nothing. These are the issues that arise. I am picking small matters although I could go through list after list of those that arise all the time. I sometimes wonder what programme managers are doing.
Senator Daly referred to headlines. I have been reading headlines and full, detailed commentary over the past year stating for a fact that Fianna Fáil was at 20%, that the percentage associated with the Labour Party was mid 20s and that the percentage associated with Fine Gael was in the 30s. We looked at the results of the local elections, in respect of which commentators say a different result is produced, and at the results of the European elections. The European elections showed the Labour Party to be just under 14%, Fine Gael to be at 29% and Fianna Fáil to have a percentage in the mid-20s. The opinion polls were completely wrong in respect of the three main parties. It is worth our while examining this.
Everyone has the same interest in the register of electors. We considered it some years ago and sorted it by sending guys out at the weekend from local authority offices to check where people live. A statement was made by the Communication Workers Union – I believe it had the support of An Post – that the only people who can reliably compile a register of electors are the people knocking on doors every day delivering the post. If I were tasked with saving money and achieving efficiency, I would remove responsibility for collecting television licence fees from An Post and impose an audiovisual charge on all households in the country, unless they opted out, such that the fee would be imposed through the taxation system. I would also pay An Post to compile the register of electors. The postman or postwoman knows who lives in each house and nobody could compile the register better and with more efficiency over time.
Consider the issue of moral authority, the Government’s mandate and the question of the incompatibility of Fianna Fáil, Fine Gael, the Labour Party and the other parties. Senator Ross and I, and perhaps the Minister of State, Deputy Finneran, were told in 1989 by an important Fianna Fáil backbencher on the plinth that under no circumstances would his party go beyond the final frontier and go into Government with the Progressive Democrats. Four hours later he walked out of a meeting having established a commitment to a Fianna Fáil-Progressive Democrats Government. The same man is the Minister for Transport today, thus demonstrating how circumstances change. The question of incompatibility does not arise in these issues and parties have their policies. It is true that the Fine Gael and Labour Party policies are incompatible at present but they are incompatible only in so far as they do not change. Politics is the art of compromise and there is no point in Fianna Fáil saying the Opposition could never form a Government given that it and the Progressive Democrats set out what they wanted and agreed a common programme for Government. This is how it is done. Differences are not irreconcilable as one just works out the programme for Government. The bigger party gets the most and one proceeds in that manner.
A proposal was made yesterday by Senator Hanafin, who said in respect of the banking crisis that all parties should spell out exactly what they mean in a question and answer session in the House. I understand NAMA and believe it is a good idea. I have questions about it and am not enthusiastic about it but believe it could work. I like the idea that we will ultimately own the property in question. I understand the first step of the Fine Gael policy but do not understand what would happen after setting up the toxic debt banks or what would happen if one decided not to meet the commitments on bonds sold internationally. I will have worries about this until the system is explained to me. That is not to say Fine Gael’s proposal is wrong; I am just outlining how I see it as a person considering all the sides.
The Labour Party speaks of part nationalisation. This is fine and it is the first step. I do not believe there is a great problem with it but I wonder what happens next. What do we do with the toxic debt? It is fine to say the people who took the risk should take the plunge. I would have no problem with that either and am assured that NAMA will be going in this same direction but, when the transfers of assets are complete, there will be debts and a problem that will still need to be resolved. I do not understand how the Labour Party would resolve the problem but that is not to say it has no solution; I am just saying I have not had it spelled out to me.
My Fianna Fáil colleagues have not boned up on these issues and do not fully understand them. They are not speaking with conviction. I say this because whenever they speak they always attack Members on this side of the House. If I were in the parliamentary party I would tell people that they should understand what they are doing and go out and argue for it. They should forget about those on the other side of the House. They should explain what they are doing and be committed to it. The country needs a solid strong Opposition and we should congratulate Fine Gael and Labour in that respect. The rest of us need to ensure we understand completely what everybody is proposing and move away from the practice of shooting across the aisle and get the facts down in front of us.
Senator Larry Butler: I will not go down the road taken by other speakers on this issue. We know what the people have said in the election. We must adjudicate on what people have said to us and decide how we will react and structure the direction of Government for the next three years. Senator O’Toole has touched briefly on one of the key issues for the running of the country for the next three years, the banking situation. We know the Fine Gael plan. What sort of message would that plan to let international bonds and pensions and so forth burn, send out internationally when we go back onto the bond market looking for investors? We would not get anyone to invest in this country if that happened.
When I was on the doorsteps people talked about how they swallowed hook, line and sinker the idea that the banks were a gilt-edged bet. Now that they realise they were not gilt-edged they blame the Government, saying it was our job to ensure the Financial Regulator worked. They are right. We are not blameless. We should have been more on top of our job. The other problem was that we did not expect what happened. The crisis in the property market came first, followed by the banking crisis and then the international crisis. We have three problems and we have not yet solved the banking crisis. That will take some time.
I could not understand how a man of Deputy Richard Bruton’s intelligence could say that €40 billion to €50 billion of his proposals should be allowed to welch on that bet. We need a banking system that enables people to invest in the country. Inward investment is one of the key factors on which we depend for job creation and for our financial services which are major employers. We do not have a choice about bailing out the banks. It would be great if we did have a choice in the matter and did not have to bail them out. Without a banking system we would not have an economy. We would lose a workforce of approximately 37,000 to 40,000 if we ran down the banking system. We are helping the banks out because we have to. The banking service is a people service involving investors, small deposit holders and people who invested in bank shares. Funnily enough bank shares have risen somewhat, although they have a long way to go. The paper value of the Government investment in the two main banks is over €5 billion. Nobody has mentioned that it has been a very good investment. It is not a question of helping out the bankers or our friends but an investment. I explained that to people on the doorsteps.
I also explained to the garda, the nurse, the teacher who said that we were taking X,Y or Z out of their pockets that €20 billion of that amount is being borrowed and we have to take corrective action to bridge the gap between what we spend and taxation. That has to be done. There will be pain for the next three years. That is the message we will send out. We are not sending the right message. It must be clearer and we must say exactly why we are doing A, B and C. We must be honest with the people. Senator Boyle got it in one when he said we must be honest with the people and tell them exactly why we have to do this and explain that we have agreed a five year strategy with our international support in Europe which respects the fact that we must make that commitment.
I thank the Minister of State for his explanation. His thoughts on the situation and where he is going from here are very good. We have the right man in the right job to deal with the housing situation. I thank him for all the hard work he has done since taking office.
The result of the 2007 general election was unusual in that Fianna Fáil and the Green Party were reluctantly elected and within months, if not weeks, of that decision the public decided that it had made the wrong decision. It compares with the re-election in Britain in 1992 of the Tory Government against all the odds. That was deemed a big surprise but within weeks the people decided they had made a mistake and it was only a question of when they would take their revenge on the Government. The same has happened here. I have been around this House long enough not to be too excited one way or the other about the ups and downs of politics. I try to be realistic about election results. The public has been waiting to get at Fianna Fáil since 2007. We cannot describe this as a surprise result.
The result of the next general election was decided months ago, if not two years ago. The Government will be defeated. It is a question of when the election takes place and the scale of that defeat. I am not concerned about the state of Fianna Fáil but the state of the country. The political challenge for us over the coming months, if the election is to be held late this year, or in 12 or 18 months’ time is to put in place policies and programmes to turn the economy around. That is being demanded. Fine Gael is pleased with the election of so many new councillors and that the public has shown faith in our leadership. We must plan for the next general election. That is the big challenge we face arising from the local elections. The compilation of the electoral register must be reviewed. Many canvassers and politicians found in recent weeks that dozens of people’s names were missing from the register. Even on polling day people who have been voting for 50 or 60 years found that their names were not on the register. Senator O’Toole expressed a view as to how the register could be improved. The example he gave should be considered. It is unacceptable that many people find their names are not on the register at the last moment when they go to vote.
I would like to address briefly our electoral system. I accept this is a matter for another day and requires a much more substantial debate. Is our electoral and political system, as currently construed, the type of system that can regenerate our country and economy and enable us plan for the years ahead? The results of the local elections last week show that, even from a Fine Gael perspective, many of our outstanding councillors, long-term public representatives, including two in my area, former councillors Aileen Pyne and Tom Sheahan, lost their seats to party colleagues. That is what happens in Irish politics. Unfortunately, there is too much debate and argument within and not enough between the parties and people do not appear to consider there is any great need for political debate, political discourse or the putting forward of new ideas in terms of our electoral system as it is currently construed. The Minister, Deputy Dempsey, the former Taoiseach, Garret FitzGerald, and many others have asked us to reflect on the need for a possible change to our electoral system. Some people say if it is not broke why fix it. However, I think it is broke. We are in our current political and economic state because of the inability in terms of our political system. Senators and Deputies should respond to the challenges posed and spend sufficient time in these Houses debating the real issues. That is one of the great political challenges we will have to take up over the next number of years. While turkeys should not be advised to vote for Christmas, if we want to put the future of this country and its people at the top of our political agenda, we have to accept that our present multi-seat PR system of electing politicians and Governments may not be the most appropriate for the Ireland of the new millennium. It may have worked in the past but that is no guarantee it will work in the future. We need a substantive non-party political debate on this subject. I am sure we will return to it on another occasion.
I congratulate all my new colleagues across the local authorities. As Senators we have a close affinity with local authority members. I empathise and sympathise with those across all parties who lost their council seats. Democracy is difficult. I wish all the new local authority members well in the years ahead.
I would like to wander around this topic the way everybody else has without being very specific about it. The initial reaction to the election results is for one to be somewhat puzzled. If anybody gives them any thought, he or she would come to the conclusion that the extraordinary rejection of the Government in these elections is not only a reflection on what has happened in the past few months. We can understand, to some extent, the extremely penal measures that have been taken by the Government against virtually every taxpayer in the country and against people in receipt of social welfare benefits. While we may not agree with these measures we can understand the reason they were taken, namely, because the budget deficit is wide and the economy is generally in a pretty perilous situation. However, that is not the reason Fianna Fáil and the Green Party got such an astoundingly bad vote. That was because there was a verdict on what Senator Bradford touched on and on the years prior to the last general election also.
What is depressing and also an eye-opener for the Government is that the people decided they had made a mistake in the last general election and that they had also been fooled. People gave a fairly decisive mandate to Fianna Fáil, although not so much to the Green Party, in the last general election on the basis — I do not believe this is in dispute — that Fianna Fáil would be the people who would run the economy best. That was the message its members sold, which gave them the resurgence they enjoyed in the last weeks of the polls. They sold that message very successfully. It was sold on the basis that they would run the economy extraordinarily successfully and they had injected people with prosperity during the previous four or five years.  The problem with that was that within weeks of the general election and gradually over a period people began to realise that the message they were sold was a lie, that what had been happening was an extraordinary piece of economic deception. Money was being pumped into people’s pockets which was not theirs. Developers were allowed to go bananas and borrow money like there was no tomorrow. That was a feeling of false prosperity to which nobody was calling a halt. That is something which people generally could not be expected to understand but understandably they were enjoying it.
I do not believe for one moment that there were not people in government, among the regulators, as Senator Butler said, and in the Department of Finance who did not realise that Ireland was living an economic lie for many years, but they did nothing about it for purely political reasons. What happened in this election was the people who had been waiting for the Government and who realised this took it out on the Government parties. They voted against them in spades. They realised not so much that they had made a mistake in the last general election, which they probably did, but that they had been deceived on a massive basis by the authorities, the oligarchs, the banks, the builders, the regulators, the politicians and the Department of Finance all during that period. It was a vote not so much only on the harsh measures but on the lack of taking corrective action before now. It was the first chance people got to do that and it was the first time they realised this.
I suspect there was also an additional cry of pain in this because all of us began to realise we were worse off than anywhere else in Europe, that we, our Government, banks and oligarchies had behaved worse than those anywhere else in Europe. Other countries’ governments in Europe, which had taken some measures that people did not like and which had to ride out a recession, did very well. That is where Ireland is in such a strange situation. Silvio Berlusconi, despite his extraordinary domestic difficulties, did very well. Angela Merkel, despite the severe recession in Germany, did very well. Nicholas Sarkozy did well in France. I concede Gordon Brown did not do so well in the UK but, I suspect, much of that was to do with an immediate problem, of which everybody is aware, to do with parliamentary expenses, which has had a sensational effect.
Whereas in Europe the people appear to have moved or stayed with the kind of centre right parties, here there was undoubtedly a move to the left. It is an extraordinary reflection on gut reaction. Much of it was middle class reaction. Joe Higgins — I personally welcome this — a member of the extreme left, put out a member of Fianna Fáil in Dublin. What are we to make of that, namely, that the largest party in the State and a man who represented a long dynasty in Fianna Fáil were put out of action completely by a Marxist-Leninist, who does not even believe in the rights of private property? What does that tell us about the people who voted for him? What we saw here was not just a working class protest vote. What has to have happened is that the middle classes came out to vote and the people in south Dublin, the people who voted for Deputy Lee, voted for Joe Higgins. The people of Dún Laoghaire, the most middle class constituency in Ireland, voted for Joe Higgins. What are we to tell from that? A move to the left like that is a move, I suggest, more of real disillusionment than a move towards the ideology which Joe Higgins unashamedly espouses.
Minister of State at the Department of the Environment, Heritage and Local Government (Deputy Michael Finneran): I am impressed with the level of debate from all Senators who contributed today. A wide range of issues were mentioned, some of which did not pertain directly to the results of the elections but may have been contributing factors. There were also a number of interesting comments and suggestions from individual Senators. It goes to show the amount of thought people put into debates such as this. I spent nearly 14 years in this House and I found that people here, by and large, spoke with conviction and thought out what they were going to say. This appears to have been the case today and I welcome it.
I was especially impressed with the comments made by Senator McCarthy regarding job creation and how people with primary degrees could be assisted in raising their skill levels and adding to their qualifications. That is the type of thinking that is required. The area of fisheries was mentioned by some other Senators, including the Leader of the House, Senator Cassidy, who spoke about the opportunities for job creation in this regard, and Senator McCarthy, who spoke about the difficulties in this area.
Senator Ormonde, who has worked in education, reflected on that area and on technology as well as on the need for a change in thinking regarding jobs. She made the point that the Fianna Fáil Party is resilient and is in a position to reorganise itself, get back into the debate on the national issues and get ready for the next general election in three years’ time. This has happened in the past, including after the local elections in 2004. As I said in my statement earlier, there were difficulties for Government parties in the last three local elections.
The issue of bailing out the banks has been mentioned by a number of people. It is worth mentioning that this is not the full story. It is important we understand, as Senator Butler stated, that this is an investment that may have a pretty good return in the medium to long term. Already the two main commercial banks have improved their share positions. Bad debts are to be dealt with under the National Asset Management Agency, NAMA. This is a totally new situation for this country. I see that finance houses in America are interested in seeking opportunities among the bad assets in this country.
I am not in a position to say with any certainty or based on any extra knowledge what the final outcome will be, but it is important we ensure lines of credit are open to businesses and individuals, whether to allow them to continue as self-employed or to provide a mortgage to buy a home. It is important banks and financial institutions are in a position to lend, are stable, and that the public interact with them in a normal way as they did in the past. Some of the interactions that went on were totally unacceptable.
I take the point that Senator Butler made about regulation. Shortly after the general election of 2007 I, as Chairman of the Joint Committee on Finance and the Public Service, went to New York and Washington along with a number of committee members. At that stage headlines were appearing in the newspapers about the problem of sub-prime lending in that country. On that visit we found out that 36,000 unregulated brokers had created most of the problems. We found that extraordinary because we were of the opinion that we had set up a regulatory regime in this country that would not allow that to happen. Of course, as it turned out, that was not the case. The regulatory regime in this country turned out to have major faults and had indeed contributed to the situation.
I understand what Senator Ross is saying but I do not think there was anyone who was not taken aback with the speed with which the crisis hit. It is easy to see now that people should have been more alert, but people around the world were not. Responses to the crisis have been slow around the world, particularly in Europe. Members of the Oireachtas called many times for reductions in interest rates, yet the president of the European Central Bank resisted that for a long time. As Chairman of the Joint Committee on Finance and the Public Service, I attended a meeting in Brussels at which he clearly stated that under no circumstances would he recommend the lowering of interest rates on the basis that his first priority was to control inflation. Despite this, he and the board of the ECB had to change their minds later. I am talking about the highest level of financial regulation in Europe.
Senator Coffey and a number of other Senators mentioned the voting register. It is unfortunate, but this matter is raised after every election. With all the expertise we have now, including franchise officers in many of our local authorities, I am amazed we still have those problems, but I will bring these comments back to the Department and contact will be made with the local authorities in this regard.
Senator O’Toole mentioned the independent view, opinion polls and Seanad reform. The issue of Seanad reform is under scrutiny at the moment and some meetings have been held in this regard. Senator Bradford also raised the issue of the voting register and mentioned the electoral system, but that is a matter for a wider debate than we have had today.
I thank Members for their contributions. Elections are what they are: a poll of opinion which has reflected, in this case, that people are unhappy with the Government. However, we must understand that the representatives elected by the people last night voted confidence in the Government by 85 votes to 79. That is where we stand at this point in the life of the Dáil and Seanad.
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