General

Left out The vested-interest, Union-driven and flaccid left exhausted all its ideas before the catastrophe hit. The EU/IMF ‘bailout’ was supposed to be the moment of truth for Ireland’s political élites – the moment when the opposition were to come out from the shadows of the discredited and politically weak Government. In the end, the shadows became too comfortable a place for our ‘alternative leaders’ to leave. And thus, the ‘bailout’ became a moment of truth. The uncomfortable truth registered that the Irish Left’s opposition to the current régime was nothing more than grand posturing, devoid of any credible ideas and gutless to challenge the establishment. The failure of the Left to present a serious alternative to the Government’s disastrous policy responses to the current crises is, of course, nothing new. Instead, it is a function of the forces that have shaped the Irish Left for years. The first one is the complicity of the Left in the creation of the very crises we face. During the boom, the Irish Left came to rely on Social Partnership to deliver for its support-groups the spoils of the ‘class war’ with the rich Celtic Tiger blue-bloods. Social Partnership, cleverly exploited by  Fianna Fáil, but driven predominantly by the Left-aligned social-welfare pressure groups and trade unions, acted as a transfer mechanism that channelled vast amounts of private income into the coffers of its members. These very transfers came at the expense of the middle-classes and genuine entrepreneurs. The system actively solicited the means for extracting taxpayers’ funds to pay for endless spatial strategies and development plans and benchmarking awards. The former was political pork that became the support engine for the property boom, semi-state companies and in its later incarnations – to the Social Pillar interest groups. The latter yielded handsome dividends to union members allowing the Unions to retain their base within the privatised enterprises. The welfare, environmental, cultural, and anti-poverty (domestic and foreign) campaigners that sprang up in droves across the landscapes of our ‘social economy’ were the direct beneficiaries of this scheme to collect rents out of the working economy. Every new large-scale state investment project or benchmarking exercise was greeted by a chorus of voices demanding that the poor or the vulnerable or the creative or the Irish-speaking or the non-for-profit or the environmentally-concerned receive their share of the Celtic-Tiger spoils. Throughout the boom, the only criticism of Government policies that the Left registered was the incessant drone of voices demanding more transfers. “Tax more, charge more, build/provide more social housing, …more, more, more…” was the favourite refrain of the Left lost in the process of grafting its ‘Marxism for Dummies’ ideology to the bandwagon of Social Partnership. Only the extreme Left remained true to some of the core principles it held. And it was ostracised by both the state and the complacent Centre-Left parties. The lost souls and minds of the Irish Left did not pause for a nanosecond when their leaders took seats and pay at the boards of the state bodies, the Central Bank, Fás, Government-created quangoes and working groups. They might indeed have flinched for a nanosecond at Bertie’s declaration that he was the last standing socialist in Europe, but they partied on through the Inchydoney accord and went on tacitly endorsing the property boom. Demands for planning restrictions and social-housing allowances, affordable housing and ‘expanded lending to the less well-off’ all helped to inflate the bubble. The Irish Left’s response to the fiscal and banking crises that ensued has been a textbook example of mental collapse by an ex-hostage suffering from acute Stockholm syndrome. They decried the release from their captivity that was the collapse of Social Partnership instead. Faced with rapidly accelerating public debt and fiscal deficits, with a historically-unprecedented crisis in the banking sector and the deepest recession known to the civilised world since 1939, the Irish Left went on to produce not a single original alternative to the Government’s disastrous policies. In fact, the majority of the Left had simply slid into the Borg Collective response to the crises, raving “The State must protect our interests!” at every twist in the policy debate. Thus, the Left’s strategy on dealing with banks was the idea that Irish banks should be nationalised. Not for the purpose of rebuilding their balance-sheets and business models, but to ensure that they continued to underwrite absurdly-over-extended mortgages and start lending anew to the Leftist causes – the environmental and social ‘economies’. The Government, to their surprise, even obliged. The Irish Left has failed to see through the fog of its ideology that the state simply cannot go on running double-digit deficits year after year. Instead,  cuts to current expenditure were opposed, while stimulus to capital investment was promoted. Very few thinkers in the Left camp were able to grasp the simple arithmetic of deficit and debt formation, or to recognise that their preferred policies would only exacerbate the tortured death-spiral of the Irish economy. Even faced with a 32% deficit-to-GDP ratio this year, all the Left could produce in advance of the Budget 2011 was the battle cry: “Though shall not cut too much!” In place of deficit cuts, the Left has offered a clichéd ‘solution’ of taxing the rich and, once again, ‘stimulating’ the economy. But the sums never added up. Spurred on by the likes of the Irish Times and the Labour Party, the Left really does believe that Ireland’s private wealth is liquid, immense and unencumbered by leverage. They fixated on the Central Bank’s assets side of the national balance-sheet and ignored the liabilities. Out of this came the suggestions to tax deposits, including those of the multinational corporations held in IFSC accounts. This was followed by the equally brilliant suggestion of taxing wealth. All came at the time when depositors in Irish banks were already on the edge. A psychosis of inconsistent and innumerate policies continued all through the Government decision to review the state’s ownership of the semi-state enterprises. The Irish

The Harney Health Legacy 1997-2011 – waste and the demise of universal healthcare, but improved cancer care As each day passes, the damage this government has done to the people of Ireland and their health becomes clearer. Government policy since 1997 created the biggest boom and bust experienced by any first-world country since the 1930s. Despite becoming one of the richest countries in the world, even at the height of the boom, the Fianna Fáil/PD government failed to invest sufficiently in social infrastructure, even though there is a direct link between social spending and quality of life. Government policy was often flawed. And much of the money actually spent was poured in without actually changing or improving the services it was funding. There is no better exemplar of the fiasco that is Irish policy making than health. Giving generous tax breaks to developers to build private nursing homes and hospitals, granting and then taking away medical cards for over-70-year-olds and the appallingly-orchestrated establishment of the Health Service Executive are textbook examples of how not to improve health services in the public interest. The tax-breaks were masterminded by Charlie McCreevy – one of the myriad property-related tax-breaks introduced under his stewardship in the Department of Finance. They allowed for-profit  healthcare to get a foothold in the Irish ‘market’ without any supervision or oversight by the Department of Health. As a direct result nursing homes were built wherever developers wanted them – unconnected to need, and usually far away from older people’s homes and communities. Similarly, although it was government policy to have fewer, bigger, safer acute hospitals, another arm of government was giving away public money to build small, profitable, unregulated  hospitals anywhere they decided, totally contradicting the policy. The decision to give medical cards to over-70-year-olds in December 2001 was a (successful)  pre-election ploy to get the grey vote out for the re-election of the Fianna Fáil-PD government in 2002. Paradoxically this move by McCreevy was to be the only endeavour of the government during its 13-and-a-half-year reign to provide universal healthcare, free at the point of delivery. And it was a very successful experiment with ‘richer’ over-70-year-olds accessing healthcare earlier as they did not have to pay to see the GP, which in turn kept them healthier, improved their quality of life; and cost less. As the decision was a last-minute call by McCreevy or his champion, Bertie Ahern (the stories are legion and so far unverifiable as to how this decision actually got made), the government then had to negotiate a very bad deal with GPs who (led by now-TD James Reilly) stretched them over a barrel. As a result, GPs were paid three times the rate for looking after richer over-70s than those who already had medical cards. This skewed GP services so that doctors were paid more to provide care to those who needed it least. And then in October 2008, with the excuse of the economic crisis, the government unwisely made the controversial call of removing medical cards from richer over-70-year-olds. After about four changes of mind, Mary Harney won the war – the universalism was withdrawn – but older people won the battle, as many more older people have medical cards now than they did in 2001. The establishment of the HSE is the biggest public-sector reform in Irish history. Prepared by Mícheál Martin but executed by Mary Harney, there is no doubt that it was a débacle in waiting even before it began. It was badly planned, it had no leader for the first seven months – with an ex-banker as acting CEO, there was no clarity what would actually happen, no proper structures, no vision. Most incredibly, it failed to address the biggest reform needed in the Irish health system – to provide universal, quality care, free at the point of delivery – which essentially exists in  all other European countries. Not in Ireland.  In fact this government has been, and continues to busy itself, removing any last vestige of universalism in the Irish health system, now all in the name of austerity. There had been increased investment in the Irish health system. The health budget quadrupled from under €4 billion in 1998 to over €15 billion in 2008 (it will be just €14 billion in 2011). But increased investment in the noughties was really only making up for decades of under-investment and neglect. There have been numerous attempts to reform but really what we have seen is so-called reform, without any real transformation. The renegotiation of the consultants’ contract was expensive and a lost opportunity to reform the Irish health system. Instead of using the new contract as a mechanism to deliver equitable, quality care, it continues to reward consultants who practise privately and publicly.  It paid them two to three times the salaries of their European counterparts and moved us nowhere nearer a universal system of care. Six years on from the instigation of the HSE, there are a few glimmers of hope. The new HSE CEO, Cathal McGee just drove through a €200 million cut in money paid to pharmaceutical companies and is looking to save another €170 million through hard-nosed bargaining with its top 50 suppliers. Barry White, the HSE national director of quality and clinical care, is trying to a start a quiet revolution whereby care would be provided on the basis of medical need, not ability to pay. Basically he is applying the old cancer tsar’s method to all diseases, at all levels of care. He calls it ‘clinical justice’ and is involving staff at all levels and is even engaging with patients. It’s a long uphill marathon but it is certainly worth a try. Cancer care is an illustration of where genuine progress has been made. It took decades of politicians affected by and interested in the disease to give it priority. Political commitment combined with abysmally bad cancer-survival rates for Irish people and a series of healthcare scandals propelled it to the top

There is a new generation of Irish theatre-makers. They are here, they have things to say, and they have exciting new ways of saying them. In a time where, more than ever, we need to take a hard look at our surroundings and imagine a way forward, these artists are here to help us along the way.

The Dublin Fringe Festival (Absolut Fringe) has come to an end for another year, and a consensus is growing that it has been the most successful Fringe ever. A large number of new companies and artists

In another semi-State failure of cost-benefit analysis the DAA has developed terminals at Dublin airport with a 50% over-capacity; and has liabilities of around €1.7bn. by Matthew Harley In the light of recent developments at the Dublin Docklands Development Authority (DDDA), it is time to turn the spotlight on another commercial semi-State body, the Dublin Airport Authority (DAA). The DDDA debacle is just a symptom of a wider rot in our commercial semi-state sector. We have seen that the DDDA operated under a development-driven agenda that had little regard for good governance and no respect for the concept of “value for money”. As a result, the taxpayer may be stuck with a debt of €400 million arising from the purchase of the Irish Glass Bottle site for which the DDDA cannot now even pay the interest. The DAA could hit the taxpayer for five times that sum. The Annual Report for 2009 showed a sharp deterioration in group performance over 2008, with a loss of €13 million compared with a profit (after tax) of €47 million in 2008. The outlook for 2010 and 2011 is even worse. With its grandiose Terminal 2 at Dublin Airport opening for business in the next few weeks (November), the DAA is facing huge revenue shortfalls due to collapsing passenger numbers at a time when it will have to operate two underused terminals. Together, T1 and T2 could handle double the current passenger throughput of Dublin Airport. Terminal 1 handled 23.469 million passengers in 2008, perhaps with some discomfort although the Area 14 extension opened in May 2007.  Terminal 2 is designed for 15 million passengers per annum (mppa). That is a total capacity of 38.5 mppa. In 2009, passenger numbers were down to 20.5 million and are expected by the DAA to be about 19 million in 2010. On recent trends, 18 mppa is a more likely outcome. Retailers too, in a depressed economy, may not pay projected rents. Management will find it very difficult, maybe impossible, to run the airport and repay outstanding loans. As debts accumulate further, the taxpayer may have to bail out the DAA. In 2006, Brian Cowen, then Minister for Finance, increased the DAA’s statutory borrowing limit from the previous level of €0.7 billion to €1.8 billion to allow it to fund its ambitious €2 billion expansion plan. This was driven by the, “If I have it, I spend it”, Celtic Tiger, bubble-generating paradigm that then pervaded government thinking. In the same year he approved the DDDA borrowing up to a more modest €127 million towards the purchase of the Irish Glass Bottle site. DAA debts are growing rapidly. The gross debt was €1.25 billion at the end of 2009 compared to €481 million at the end of 2007. When adjusted for cash balances, net debt at the end of 2009 was €616 million compared to a surplus of €35 million at the end of 2008. Net debt could be €1.1 billion by the end of 2010. DAA debt is guaranteed by the State. Just one part of the current debt, a €600 million bond, requires the DAA to pay a coupon of nearly 6.6% per annum or nearly €40 million a year. The overall annual requirement is probably €60m, and the actual figure last year was that loss of €13m. The Airline Regulator has controversially allowed the DAA to increase passenger charges by up to 40% to counter this – to the fury of airlines. Debt will expand by at least €300 million to some €1.6 billion if the deferred parallel runway or the DAA’s now-preferred longer runway is built as the DAA continues to insist. Total debt may reach the approved €1.8 billion. This total does not include the deficit in the joint DAA/Aer Lingus pension fund, which was €700 million at the end of March 2009. It was estimated in 2006 that the DAA’s share of the then-estimated liability of €336 million, was 40%. The March 2009 €700 million deficit is believed to have fallen to about €500 million due to the improvement in equity markets. Nevertheless, a further €200 million must be added to the limit of the DAA’s liability (€1.8bn), bringing the total to a possible €2 billion. In February 2010, Standard and Poor’s Rating Services downgraded the DAA’s credit rating to BBB+ because of falling passenger numbers, which it expected to decline further in 2010 and weaken the authority’s financial position. Their report even said there was a possibility of extraordinary Government support being provided.  Ryanair’s Michael O’Leary thinks the DAA ”is going to go bust” and will ultimately “fall back on the State”. Declan Collier the DAA’s CEO has vigorously denied this. The DAA was warned about the potential non-viability of Terminal 2 by the Portmarnock Community Association and Ryanair, but these opinions were derided and ignored by the authorities, including An Bord Pleanála. Questions were asked repeatedly in the Dáil and representations were made to ministers on behalf of the PCA (mostly by Trevor Sargent TD and Terence Flanagan TD) about the failure of the DAA to undertake the Cost Benefit Analysis (CBA) required by Government investment appraisal guidelines, which is the official test of the sustainability of proposed large-scale public investments. The replies were derisory: Yes, the DAA was subject to the guidelines but, as a commercial semi-State body, it was a matter for the Board to certify to the Minister for Transport that the guidelines had been met. As the Board of the DAA had so certified, the Minister was satisfied that the guidelines had been met. So, in spite of the fact that no Cost Benefit Analysis was ever done, as required by the same guidelines, the Ministers for Transport and Finance persist with the sophism that the guidelines have been satisfied because the DAA Board says so. It seems these ministers are afraid to demand proof that the board has conformed, by asking to see the analysis, for example. Another claim often repeated in these replies