The Programme for Government 2011-2016 Post author By Karl Whelan Post date March 6, 2011 The newly-agreed programme for government is available here. Categories In Bailout, Banking Crisis, Fiscal Policy Tags Programme for Government 48 Comments on The Programme for Government 2011-2016 ← Renegotiation and the Bailout Black Hole → McCarthy on European Delusions 48 replies on “The Programme for Government 2011-2016” all nice and shiny…hows it going to be paid for? Hi Karl, I linked this on the bottom on the previous thread by John McHale – could you perhaps delete it and this as well to avoid confusion. By the way, they were touting for a job for you on the Dunphy show on newsttalk today. Cheers. How many bankers are going to be employed in the new bank? Are they going to be the same idiots that have populated the 6 Irish banks? Is there any hint that it might be a nice way of avoiding as many redundancies in AIB? Are the staff going to be incentivised to make risky loans, bonuses perhaps? Can anyone tell what this: “We will attach the utmost priority to avoiding further down-grades to our sovereign credit rating by setting further capital spend by the State on bank re-capitalisation at a level that is consistent with national debt sustainability.” means in practical terms? This is interesting: “The Government accepts that enabling provisions in legislation may be necessary to extend the scope of bank liability restructuring to include unsecured, unguaranteed senior bonds.”…… Though given that the government is commited to obtaining credit at whatever rate it can get it for the Croke Park experiment – which surely cannot be dumped in less that 12 months – one wonders what the point is since the funders don’t want these bondholders touched. A vulgar search: Statement of Common Purporse (sic) no mention of the word ‘DEFAULT’ ~ 50 on ‘bank’ 2 mentions of restructure – for small business and semi-states – None related to BANKS 3 mentions of ‘corporate governance’ – Note that Ireland is the only country in the EU that does not have its own ‘national code of corporate governance’. Does it show? [Richard Bruton – I’m observing your ‘promise’ to request ALL directors of State Boards to resign within 6 months …………. 6 mentions of the word ‘hope’ 14 mentions on ‘jobs’ ONE mention of the word REVOLUTION ! I must have missed it ….. darn! I wish the incoming administration well. … Honeymoon over …. (-; ….and lets not forget that there are still 80 hours where the other crowd can still do untold damage ……….. Blind Biddy remains vigilant …. Now to peruse the vichy_bank programme in a bit more detail … gotta put a new wick in that candle …. Major crisis – Paddy Power was betting on the new MOF. Howz that goin’ top be settled? Apologies … I can’t get beyond that first paragraph ……….. ‘old beliefs, traditions, and expectations were blown away’ ……….. WTF! If only we had this lot all along. No reduction in public pay or pensions. No reduction in Social Welfare. No change to Child Benefit. Free education. Free GP care. No increase in Income Tax. What was all the fuss about? “We will legislate to end upward only rent reviews for existing leases.” Quite right too. But what is the associated consequential writedown for Nama and the banks on CRE assets? Has the additional recapitalisation been budgeted for? The Stress tests value CRE assets in Ireland with these upward only rent reviews removed presumably – otherwise……. A new Department of the Public Service makes sense. Put Eddie Molloy in charge of it and see if his ability lives up to his rhetoric. But also including public expenditure in with public sector reform is a strange decision (even if it is in line with the FG manifesto). The annual Budget is a game of two halves – tax and expenditure. Splitting the Budget process across two Departments – with two different ministers from different political parties is peculiar – I’m not aware of any other country anywhere that does this ? Add in the new Economic council and you could either have a recipe for effective policy coordination or a muddle of responsibilities with conflicting objectives. Only time will tell… Radical on health … p.s just waded through it for Blind Biddy …. not a word out of her … she is now online with the credit-card picking up one of those second-hand Sherman tanks that the I_emF put up on eee_Bay … did somebody miss something? @Brian Lucey That is the question! @ALL DA BANKS DA BANKS DA BLEED1N BANKS … I can’t wait to read the comments on www dot fixmystreet dot ie And officials must respond within two working days???? Anybody any ideas about what they are talking about with reference to adoption reform? Re negotiating the bailout terms will not be easy given the commitments to maintain public sector wages and social welfare rates at levels well above those applying in most of the countries loaning us money. This document gives no indication of how the 9 billion gap can be closed. @Sporthog “Anybody any ideas about what they are talking about with reference to adoption reform?” I hear there are a lot of orphaned political representatives out there abandoned by the population. The Green ones are apparently very cuddly. Many of them are house trained and come with substantial dowrys. Unfortunately, many of them have the mental ages of children and are not coping well with their abandonment. Currently the law treats them as adults, apart from the biggest ones who have to be driven from place to place. Their integration back into society through adoption by ‘plain’ people of humble circumstances is a priority of the new government. I feared this would happen with a Labour/Fine Gael coalition, all the harder options are being abandoned for the softer policies of both parties. So they have split MoF in 2, giving Labour the public sector and FG the banks……..for the good of the country it should have been the other way round!! @ Incoming Taoiseach & Tanaiste et al Denial is not a policy – The East Wind Doth Blow Cold … Pls Face Reality McCarthy making progress with ‘poetic license’ … ” • The Presidents of the Commission and Council of the European Union are aware that several member states face high risks of sovereign default, including disorderly default, and have bust banking systems which are unable to fund themselves. We do not care about this, and have no proposals to address the matter. We know that the European Central Bank has no proposals either. • We hold simultaneously the view that the European banking system is just fine, there is no need for stress tests, but we will do them again to reassure the markets (again). And again, if needed. Any views held in markets which conflict with ours are mistaken. • We will monitor, co-ordinate and review anything else we can think of, except sovereign debt or banking crises or any measures designed to address them. ” http://www.independent.ie/opinion/analysis/european-philosophy-cannot-solve-euros-existential-crisis-2567584.html The only mention of Child Benefit I can find is a commitment to see if it can be reduced for non-residents. Did I miss something? Important if the Labour commitment not to cut it is absent… When Axel reads this its bound to cause consternation. No pay cuts, No tax increases, borrow More to pay for it and keep the banks on150 bn life support. Enda must have got the nod from Angela in Helsinki. @ All citizen-serfs and fools Neither Denial, nor Delusion, are policies – The West Wind Doth Blow Colder than the East Wind … The Big Freeze is imminent ….. With apologies to Kutz McCarthy’s progress with ‘poetic license’ … and Following McCarthy with some further ‘poetic license’, and in the spirit of the ‘aesthetic turn’ in what usually passes for Irish Economics: A revised programme fffer government in reality: and much more succinct and to the point: • The [Incoming Taoiseach and Tanaiste] are aware that [this] member state [of the EU, namely Ireland] face[s] high risks of sovereign default, including disorderly default, and [has a] bust banking system which [is] unable to fund [itself]. We do not care about this, and have no proposals to address the matter. We know that the European Central Bank has no proposals either. • We hold simultaneously the view that the [Irish and] European banking system is just fine, there is no need for stress tests, but we will do them again to reassure the markets (again). And again, if needed. [Lisbon anyone?] Any views held in markets which conflict with ours are mistaken. • We will monitor, co-ordinate and review anything else we can think of, except [vichy-bank/]sovereign debt or banking crises or any measures designed to address them. http://www.independent.ie/opinion/analysis/european-philosophy-cannot-solve-euros-existential-crisis-2567584.html For the default, as distinct to the poetic, version refer to the above link: I don’t see anything either on 3rd level fees. Again, apologies if I missed it. In other words, I wouldn’t get too worked up..I’d say they’ve left loads of room for manoeuvre… Anyone taking any bets on when we default? It’s not an economic policy per se, but the following paragraph: “Where a member of the judiciary is considering the imposition of a prison sentence of one year or less, he/she will be required by legislation to first consider the appropriateness of Community Service Orders as an alternative to imprisonment.” is just misguided, and I would be surprised if it saved more money than it cost. Many people who regularly come before the courts and get this kind of low sentence aren’t suitable for Community Service because of their drug or alcohol addictions, so punting matters for several weeks before the Probation Service can furnish a report saying that the defendant isn’t suitable is just adding to the cost of the whole affair. @ hoganmahew, Now that gave me a laugh!! This document is very wishy washy, time will tell where the cards fall. It appears to have more emphasis about social reform, equality issues etc. It reminds me of 1982, were the tail wagged the dog in that Govt. @ Kevin Walsh ‘Many people who regularly come before the courts and get this kind of low sentence aren’t suitable for Community Service because of their drug or alcohol addictions’ They are prefectly suitable provided that a reasonable, appropriate plan for the management of their addiction is put in place. Most addicts will co-operate with a community based programme, and its vastly cheaper than prison. It’s also a lot more useful in the long run. Many addicts can’t be bothered showing up to court on time, or to probation appointments at all. Unsurprisingly, they tend to be the same people who end up getting prison sentences for minor offences. @Kevin Walsh Yes – absolutely! Imagine the deluge of bankers, developers, politicians, solicitors, barristers, farmers, shopkeepers, insider economists, stockbrokers, chancers, et al ALL Chronically ADDICTED to DEBT and LIES and more LIES and more DEBT and bleed1n vichy_bondholders all showing up in court, that is if they ever show up at all at all at all at all at all, the system really couldn’t handle it – especially as each one of them would be accompanied by other barristers, solicitors, psychOtherapists, psychologists, grannies, more barristers, financial experts, Big-4 auditors ( nearly forgot the poor dears)[pls add to the above] ………. Yes a Seriously ADDICTED CROWD allroight …. best to leave them alone, – the poor dears. Wouldn’t be one yousself be any chance – …… any relation to that Professor of Finance who chaired INBS be any chance ….. btw the leetle_irelander-nattie_front hang_em_an_flog_em blog is elsewhere …. sure you mite find it. There are a number of potentially positive policies in this document and the job policies are certainly a step in the right direction. However, the stuff on higher education is an insulting joke. A multi-campus university for the south-east and some mumbling about the Hunt report and the specialisation/academic contract theme. This is scary. Come on, folks. What did you expect? We all knew it was going to be a dog’s dinner. As a programme of government it appears much less less coherent than the programme agreed by FG and Labour prior to the 1973 election. The proof of the pudding, as always, will be in the eating. And spare a thought for Messrs McDowell (who occasionally visits this parish) and O’Riordan, respectively, the chief backroom players for FG and Labour, who had to cut, paste and edit the various sections of the two parties’ manifestos and try to craft a document that might be intelligible to a reader whose first language is English. Let the games begin. And these will only start when the horse-trading begins on those issues on which the document is largely silent or on which there is vagueness and aspiration. TWEEDLEDUMB and TWEEDLEDUMBER equals more of the same for the next five years. Croke Park – If common sense prevailed salaries would be returned to 1999 levels. Banks are Public Sector entities – Ditto NAMA Closed Down developers to be given one house one car not a 200k salary and twenty years to reach LTEV – All this is known in academia – however as they are recipients of this largesse via benchmarking not a word from them, they will allow the next twenty years of graduates to emigrate and their former middle class parents PAYE for the chosen elites subsisdized by Paddy Proletariat. An interesting experiment – the ‘right’ win the election and meekly hand power to the ‘left’… @ John Looby, It’s called a trademark. History is starting to repeated itself. @ Sporthog Enda certainly has that Edward Heath look about him now – well meaning misguided consensus seeker – doomed to be usurped by a decision-taker when the edifice collapses – pity the waste of time and talent in the interim .. I assume they actually need to publish a detailed fiscal plan? Even a two-year one? Christ – this promises the world without charge. Prior to the election, Labour and FG only differed on economic policy on technocratic grounds, i.e. they both wished to have the optimal mix of cuts and tax to maximise growth within the constraints of our fiscal strait-jacket. They simply disagreed as to what the optimum mix was. These policy positions will be affected by briefings and departmental advice. Accordingly, these illusory differences will wash away with time. They really are all the same. I wonder if the government will make it to 2016. Agree with Zhou. FG and Labour are the same. So are FF. They were all bought a long time ago. The promise to get the deficit to 3% by 2015 is the important one. If they try to keep this they have to brake most of the rest. Its just one massive fudge. Sometimes being able to hold two alternative ideas in your head at the same time is a disadvantage. I agree with Paul hunt in part when he asks “What did we expect?” The problem is that in the absence of very brave larger scale cuts and taxes combo as well as a political realisation that there is inevitability of default unless we cut the bond holders loose then we have hastened disorderly default. I genuinely don’t believe that FG or Labour politicians have got that yet. They are still a couple of years behind the curve. This next bit is from the programme for Gov. “The Parties to the Government recognise that there is a growing danger of the State’s debt burden becoming unsustainable and that measures to safeguard debt sustainability must be urgently explored.” “Becoming” Give me a break. Even many traditionally conservative economists have admitted we are well past “becoming unsustainable” The absence of any kind of economic analysis at both the labour and FG meetings were deafening. People like Peter Matthews need to step up. Fudgonomics? No welfare reform. The usual old trope about welfare fraud being tackled… stifling a long yawn… Can’t quite fathom why yet another bank is needed. Has the lesson not been learned that once these state monsters are created they are difficult to demob later? Reform is the watchword. It is mentioned on 33 of 64 pages. Didn’t Tibetan monks claim to have perfected some magical chant as well? Croke Park elevated to divine status. Dear oh dear, As Mr Paul Hunt points out, what did we expect, lets leave the dust to settle and give this new administration 12 months before we rush to judgment. But I have always been impressed at how much influence and persuasion Labour has been able to exercise over FG. But these times are different. Our politicians may not realize that young people who remain in a society in which they perceive there is no future can have a tendency to rebel. If the alternative to FF is little or no different to FF then serious social unrest could be coming down the tracks in 4 years time. This could be the last chance saloon for Ireland. Is there any detail on the Strategic Investment Bank? It’s a nice soundbite; you can couple it with nice phrases like “getting credit flowing” and throw in something about the future, but if the new government is putting scarce capital into a new bank we deserve a bit of detail. The “Strategic Investment Bank” was outlined in the Labour manifesto. The idea is to use €2bn from the NPRF to establish a bank to lend to Irish SMEs. The bank would take deposits from patriotic Irish at home and abroad and issue “Citizen’s Bonds”. The Irish state already owns four banks and is about to acquire majority ownership of a fifth (BoI). So this would be a sixth state bank. Viable Irish SMEs had difficulty borrowing in 2008/2009 but the authority on the availability of credit to Irish business, The Credit Review Office, has determined that this problem is greatly diminished if it exists at all. http://www.creditreview.ie/docs/ThirdReportfromJohnTrethowanFeb2011.pdf So the “Strategic Investment Bank” is a solution to a problem that most likely does not exist by creating an expensive state run body that will duplicate the function of five other state owned organisations using money that has been already pledged for other purposes. Perhaps Joan Burton will explain the details if you would all stop interrupting her. Favourite line: We will review the Local Government Efficiency Review as part of our Comprehensive Spending Review. That’s a lot of reviewing @David O’Donnell If you think that current Irish sentencing policy is hang ’em and flog ’em stuff, then you are deeply delusional. There are some barmy judges out there, but most people get several chances before they wind up in prison. I work in the District Court, and I see the same people come back before the courts again and again. I know of one woman, a chronic alcoholic who has had over 160 bench warrants in her career, and to the best of my knowledge she has never been charged with an offence other than section 13s that carries a sentence greater than six months. Now the next time she’s found guilty of an offence, why should the judge have to get a Community Service Report? She’s not suitable for Community Service because she’s an alcoholic, and she won’t cooperate with the Probation Service anyway. splitting Finance an interesting idea. We have someone in the state who has of course worked on both sides of that “split” as the senior economic advisor. http://www.colmkearney.ie/?page_id=489 @ Kevin Walsh Your frustration is understandable. Neither the judiciary, the legislature or the psychiatrists devote much thought to addiction. The lack of service for alcoholism is appalling, and those services which do exist tend to deal only with those in recovery. We have increasing numbers of ‘street drinking’ multisubstance addicts, who clog up the court system, the hostels, the prisons and the hospital wards. Sanctions are generally ineffective as the commitment to social norms tends to be low. Chaotic drinkers tend to associate only with each other, so that progress with individual cases is almost impossible More residential facilities are urgently required. @Brian Lucey .. but does he play cricket? @paul quigley I would certainly agree that we would need more residential treatment facilities. Even a waiting list of a couple of weeks is very long when it comes to people who are in the court system – they are likely to pick up fresh charges, increasing the likelihood that they’ll get a sentence which will render them unable to avail of treatment. I’m not sure I’d agree with your comments on the judiciary. In a lot of ways their hands are tied. It’s not in their power to create treatment facilities that don’t exist, non-custodial sanctions are often ineffective against addicts, and the level of overcrowding in the prison system is such that custodial sentences are likely to be cut short and unlikely to rehabilitate. The proposal in the programme for government doesn’t address these issues, however. Instead it’ll place increasing strain on the limited and shrinking resources of the Probation Service for little benefit. @David O’D yes…alas he also follows west ham…. @Brian Lucey I’m a lifelong Hammer. Sign him on. & With The Governor on €210 billion not out … (they can’ spin for nuts at the ECB) Things are looking up … (-; Let me get this straight – 1. we’re going to nationalise the reporting of potholes while devolving powers to local government? 2. instead of a wildly popular abolition of the TV licence, its inspectorate and the associated clogging of the Courts we’re going to create an internet Poll Tax? 3. we’re going to expand incentives for green diesel washing (by freezing its tax rate) rather than abolish the whole thing and find another way to subsidise farmers which incentivises parsimony in the use of imported fuel? (and the only bolded promise too!) 4. no policy to expand rail freight to use the overstocked Irish Rail locomotive inventory and counter the fall in passenger loadings? Well, given Sean Barrett was elected that was never going to happen. 5. we’re keeping the VHI zombie in a “competitive compulsory health insurance landscape” rather than simply transformed into the basis for a National Health Insurance Plan for medically-necessary treatments paid for by an income tax, with private plans dealing with the rest (i.e. the Canadian model) 6. the later section on one parent families is bizarre – falling over to apologise for the fact that extra allowances to people in needy situations should by their nature be geared to the duration of their need. Have transitional payments by all means but to excuse entirely those who claim a payment they are not entitled to demeans those who are entirely on their own and struggling to keep going. But we mustn’t hurt anyone’s feelings no matter how many millions borrowed at 5+% are at stake. No move towards insurance of new high LTV mortgages, sigh… if there’s no insurer, there’s no-one with a direct incentive to ensure the applications are kosher! Getting rid of the Catholic grip on teaching – good. Comments are closed.