PDs won the policy debate, Harney declares

The following is an edited version of the speech delivered by the leader of the Progressive Democrats, Ms Mary Harney, to the…

The following is an edited version of the speech delivered by the leader of the Progressive Democrats, Ms Mary Harney, to the party's national conference in Galway on Saturday:

Thirteen years ago this country was in despair. We were crippled with an enormous burden of national debt. We were saddled with punitive levels of personal taxation. We were afflicted with levels of emigration and unemployment which sapped the confidence of our nation. It seemed to many as if this country was doomed to permanent under-development and permanent under-achievement. It seemed as if there was no way forward, no future.

But the Progressive Democrats helped to define a future for this country.

Thirteen years ago we charted a new course for Irish politics. We called for cuts in personal taxation to get more people back to work. We called for pro-enterprise economic policies to reward risk-taking and encourage investment. We called for the liberalisation of markets for the benefit of consumers.

READ MORE

Thirteen years ago these policies were regarded as unaffordable and unworkable.

Thirteen years on, they are accepted by virtually everybody. Make no mistake about it: the Progressive Democrats have won the policy debate. It is a measure of our political achievement that there is now no party in this country willing to campaign for an increase in the top rate of income tax.

The Ireland of 1999 is a very different place from the Ireland of 1985. We have moved from despair to hope, from self-doubt to self-confidence, from poverty to prosperity.

The transformation has been dramatic by any standards. Thirteen years ago we were one of the most debt-ridden countries in the world, racking up huge deficits year after year. Today, we have the biggest budget surplus of any country in the world bar oil-rich Norway.

Ireland is now in uncharted waters. We are prosperous; we are successful; we are increasingly wealthy by international standards. As a nation, we have never been here before.

All of a sudden we are confronting problems we never thought possible. How do we address labour shortages? How do we cope with the rapid growth in car-ownership? How do we deal with the explosion in demand for housing?

Planning our way out of misery was the challenge facing this country 13 years ago. Managing for prosperity is the challenge facing us today. The Progressive Democrats had the right answers 13 years ago and I believe that we have the right answers now.

Vision is an essential part of politics, particularly in a country where the desire to look backwards has always been greater than the will to look forwards. Tonight I want to put forward my vision of what this country should look like in the year 2010.

As we address ourselves to our vision of the future it is essential that we set about renewing Irish democracy. Confidence in our political system has been severely dented. Apathy and cynicism are corroding the very fabric of our democracy.

This is, perhaps, ironic given the extent to which democratic politics is delivering - on Northern Ireland, on jobs, on the management of the economy.

We have all been shaken by the spate of revelations right across the spectrum. I do not think that Ireland is a corrupt society but there is now clear evidence of improper activity.

Some people play by different rules to the rest of us. They feel they can ignore the laws of corporate governance. Others feel they can treat the tax code of this State with contempt.

One of the foundation stones of our society is the principle that all citizens are equal before the law. This principle, this republican ideal, is the very foundation on which our democracy is built. If that principle is undermined, our democracy itself is undermined.

Two things are required. First, we must be prepared to investigate and uncover suspected wrongdoing. Second, we must take firm and decisive action on the basis of the findings of our investigations, no matter how influential the people concerned may be.

This is fundamentally a question of culture, of attitude, of capacity. Are we in this country really willing to apply the law with equal vigour, without fear or favour, to the poor and the rich, the weak and the powerful, the privileged and the less privileged?

If we are, the future of this democracy is safe and the people's confidence in this State and its institutions can be restored.

I believe that we in Ireland now have the resources, the ability and the confidence to shape our own destiny as a nation. We can decide what kind of society we want, what kind of country we want. We can set our own objectives and our own ambitions. No previous generation of Irish people has had such an opportunity.

Ireland is peaceful today but that peace cannot be taken for granted. For 30 years political violence raged in Northern Ireland and the problem seemed insoluble. Now, a lasting settlement is tantalisingly close. I am optimistic that a solution can be found that will enable the different political traditions on this island to live together in peaceful coexistence.

Compromise will be the basis of any Northern Ireland settlement. The majority tradition will have to recognise that a state that is 45 per cent nationalist cannot be governed as if it were 100 per cent unionist. Equally, the republican element of the nationalist tradition will have to play by the rules of the democratic game: you cannot retain the option of force just in case democratic decisions go against you.

The mission statement of the Progressive Democrats for the next decade is straightforward: we want to build an enterprise economy and an inclusive society. We believe that only an enterprise economy can generate the wealth needed to end social exclusion.

Low taxation is fundamental to an enterprise economy. The State must not penalise success and it must not deprive people of the reward for working.

The Progressive Democrats are still the only party committed to tax reform and tax reduction as matters of political principle. And I would emphasise that we are committed to both - tax reduction and tax reform.

We want to see tax rates coming down further and we want to see people on middle incomes taken out of the top-rate net. We will be working hard in government to make these things happen.

But we also want tax reform. We want to build on the huge progress made in last December's budget, when we delivered on our commitment to introduce tax credits.

We want to take hundreds of thousands of people on modest incomes out of the tax net altogether. We want to eliminate the poverty traps that prevent people moving from unemployment to employment. We want to transform our entire tax and social welfare system so that it is always worthwhile for a person to take up a job, no matter what their situation.

The concepts of enterprise economy and inclusive society are inextricably linked. Look what has happened over the last two years. The private sector, the engine of growth in any modern economy, began to rev up towards its full potential. We created jobs at the rate of 2,000 per week. The number of people on the live register has tumbled by 60,000, with the long-term unemployed being the main beneficiaries.

That's how you tackle poverty. That's how you build an inclusive society. That's how you give everyone a chance to share in the national prosperity which we now enjoy.

In the Ireland of the next decade, more so than ever before, a good education will be a passport to advancement, a passport to employment, a passport to social and economic success. Lose out in the education stakes and you could lose out for life.

Education can open up new vistas of opportunity for the most disadvantaged communities in this country. It can address the poverty of expectation which is endemic in so many of them. It can build gateways through which people can pass from poverty to prosperity. It can end the effective apartheid of Irish society which has developed since the early 1980s.

Education can help to end social exclusion. It can help to build an inclusive society. But investing in buildings or books is not sufficient on its own: if we want to educate for advantage we will have to market the advantages of education in those communities that need it most.

We will have to promote the opportunities that are available. We will have to put forward role-models that young people can emulate. We will have to persuade more parents that education can offer their children the future that they themselves never had.

And we will have to recognise that teachers cannot be asked to deal with disadvantage on their own. They cannot be asked to solve in the classroom the social and economic problems of whole communities.

The fact is that we can only achieve equality of opportunity through inequality of investment. We will have to put disproportionate resources into the most deprived communities if we are to break the vicious circle of disadvantage and despair whereby unemployment and under-achievement are effectively transmitted from one generation to the next.

Children, their education and their welfare, should be central to the whole thrust of public policy. I recognise that childcare costs can be a very major burden for families where both partners are working and striving to cope with mortgage payments. I recognise that home-makers who devote themselves exclusively to child-rearing make an enormous and invaluable contribution to Irish society.

We have to ask ourselves hard questions about our policies towards children. Are we really focused on their interests ? Are we determined to treat all children equally? If we are, then there is only one thing to do: deliver real and significant increases in child benefit.

We could put hundreds of millions of pounds into special tax breaks for families with children. But what about children whose parents' income is too low to be taxed? What about children whose parents are unemployed? What about children whose parents are dependent on social welfare? What about fairness and equality?

The fairest solution is increased child benefit and enhanced childcare provision; and that means creches in the workplace, creches in communities and, particularly, creches in the most disadvantaged communities.

Our objective must be to create, within 10 years, a society in which anyone who wants to work can work, a society in which anyone who wants to participate can participate, a society in which people with disabilities and older people and can feel valued and respected.

These are great times for business in Ireland. The economy is booming. Interest rates are plummeting. Social partnership provides a stable climate for forward planning. Corporate tax rates are low.

I am determined that corporate tax rates will stay low. Let us recognise that the Irish economic miracle has been built on the incentive power of low taxation. It is low taxation which stimulates investment and encourages enterprise. So many US corporations don't come here just because they like the scenery.

It is imperative that we protect our low tax regime. It is imperative that we protect our right to decide our own tax policies. This party, the Progressive Democrats, disagrees fundamentally with the tax-and-spend philosophy which enjoys widespread support in continental Europe. The European experience shows that high taxation produces high unemployment; the Irish experience proves the opposite.

European socialists are unhappy with what they call harmful competition in the area of taxation. As a Progressive Democrat and as a liberal, I believe that the very notion of harmful competition is a contradiction in terms. Ireland's corporate tax regime has been good for this country and we are going to hold on to it.

The climate for Irish business is favourable and I want to see Irish business achieving much more. I want to see indigenous Irish industry prosper and grow over the next decade.

I want to see this country generating more start-ups and producing more international-class companies. Already we are shifting grant assistance more and more into research and development, encouraging firms to innovate, to pursue new opportunities, to explore new markets. We are investing in the future.

I also want to see Irish business adopting a more open and imaginative attitude to gain-sharing with their workers. Many of our big companies have employee share-ownership schemes in operation. They recognise that their workers are part of the team.

But such schemes are rare among small, family-owned businesses. I would offer words of encouragement to small businesses: be imaginative; think positive; look ahead; consider the benefits that employee share ownership could bring to your staff and to your company. Otherwise I fear, in the fast-moving world of tomorrow, small companies will remain just that - small companies.

We must aim for a situation by the end of the next decade where employee share participation is the norm in Ireland. A new concept of partnership in the workplace could be the key factor which gives this country competitive advantage in the international marketplace of the future.

Lack of infrastructure is one of the major threats to our continued economic success. We don't have the roads to cope with our cars, the railways to cope with our commuters or the water and sewerage services to cope with our demand for housing.

We are suffering now for a lack of vision in the past. For years we saved money by ripping up railways; we saved money by long-fingering water and sewerage projects; we saved money on roads by thinking small rather than thinking big. Well now is the time to think big. We have to provide this country with a first-class physical infrastructure and we have years to do it. If we carry on as we are going we will be lucky to achieve it in 20.

A massive programme of investment is needed and a fresh approach is needed if we are to deliver that investment: I am talking about bringing in the private sector to help solve our infrastructural problems.

The inadequacies of our national road network are there for all to see. We still don't have a proper road link between any two of our cities. But you cannot run a first-rate economy with a third-rate road network. I want to see a proper national road network of international standard put in place over the next 10 years, one that will provide motorway or dual carriageway links between all the major population centres on this island, north and south.

And I am not just talking about routes out of Dublin. It is essential also that we develop high-quality road corridors to link major population centres such as Sligo, Galway, Limerick, Cork and Waterford with each other.

The private sector has shown, both here and abroad, that it can deliver when it comes to major capital projects. We need a flat-out effort from both the public sector and the private sector if we are to keep pace with the rapid pace of growth in our economy.

A good public transport system is essential for the smooth running of a competitive modern economy. We in Ireland have a lot of ground to make up in this area if we are to have the kind of customer-oriented taxi, bus and rail services that are taken for granted in other countries.

Housing is one area where increased private-sector involvement is urgently required. National housing output has doubled in the space of a few years and that is a tribute to the sterling work put in by Bobby Molloy.

But more needs to be done if we are to ensure a sufficient supply of affordable homes and maintain stability in the housing market. We must take a long-term view. Affordability is about availability. The more zoned and serviced land that is available for building, the more affordable housing that we can bring to the market.

We need to make sufficient land available to cover our housing needs for the next 10 years. But an entirely new approach to development is required if we are to deal adequately with our national housing needs.

We Irish people are generally reasonable when we are properly consulted. We cannot be expected to welcome the kind of development that drops hundreds of new houses into communities which do not have the schools or the roads or the transport services to deal with them.

But people will welcome development that is carried out in a properly planned way and which takes into account the needs of their own communities.

Zoning land is not enough, of course: we must also service it. And that is where I see a role for the private sector. We must fast-track major water and sanitation schemes in order to bring more building land onto the market.

Sustaining economic growth and building greater national prosperity will be one of the main challenges facing us over the next decade. But we must also ensure that the fruits of growth are spread fairly across all areas of the country.

I believe that balanced development of all our regions must now become one of our key national goals and I believe that we in the Progressive Democrats must pursue the regionalisation agenda with vigour and determination.

Look at the map of Ireland today. Consider what it might look like in the year 2010.

We are building over 40,000 new houses per year. That means that, in terms of bricks and mortar, we are effectively creating the physical equivalent of a new city of Cork every 12 months. Over the next 10 years we will create 10 Corks; yet, we have no system of national planning to ensure that this expansion is properly managed in the best interests of the whole country.

Without coherent planning we will have lop-sided development. Rising demand will put huge pressure on essential public services in urban areas; falling demand will put pressure on the same services in rural areas. Such a scenario would be bad for rural Ireland and bad for urban Ireland. Such a scenario would be a nightmare: what we need is a vision.

As a nation, we have major decisions to make. Our population will increase by several hundred thousand over the next 10 years. Where do we want those people to live? Where do we want those people to work? Do we want Dublin to sprawl ever further into the surrounding counties?

Infrastructure holds the key to balanced development. This is a small country: remoteness should not be a problem. If we can build a proper modern transport network I believe that all regions can enjoy their fair share of national prosperity.

Few countries have derived such spectacular benefits as Ireland from the introduction of competition. Look at what has happened in air travel; look at what is happening in telecommunications. Yet, few countries have been as slow to embrace the concept of competition as Ireland.

The consumer must come first. This will require something of a sea-change in Irish thinking. For years we have used legislative restrictions to protect vested interests at the expense of the public interest. We must start doing things the other way round.

The Progressive Democrats are a liberal party. We believe in a liberal approach to economic issues. We believe that it is the duty of the State to regulate markets in the interests of the common good, not in the interests of a selected few.

The example of Telecom Eireann shows how market liberalisation and the introduction of competition can be achieved to the benefit of consumers, taxpayers and company employees. If this kind of success is possible in telecommunications is it not also possible also in a whole host of other areas?

We must embrace competition. We must recognise and vindicate the rights of consumers. We must champion the public interest over the vested interest.

Never before has this country enjoyed so much wealth, so much success, so much self-confidence. We are maturing as a nation and our relationship with our European partners must also mature.

Before the end of the next decade this country will be a net contributor to the EU budget. We got a helping hand from Europe when we needed it. Soon, it will be our turn to extend the same helping hand to new members of the EU from central and eastern Europe.

We in the Progressive Democrats are not Eurosceptics but we are Eurorealists.

We do not believe in a United States of Europe. We do not believe in a single European government. What we do believe in is a Europe of independent but interdependent states, each of which is free to pursue its own political and economic destiny within the boundaries of the European treaties.

Ireland has benefited enormously from membership of the European Union and we will continue to benefit in future. We have a huge vested interest in a stable Europe, a democratic Europe, a peaceful Europe.

All Irish people are appalled at the pictures of human misery emerging from the Balkans. For the second time inside a decade we are witnessing events of a type that have not been seen in Europe since the end of the second World War. Current events in the Balkans show that the peace and stability of Europe cannot be taken for granted.

We in Ireland will have to face up to a number of hard questions in the area of foreign policy. Are we neutral in the struggle between dictatorship and democracy? Are we neutral in the struggle between fascism and freedom? Are we neutral in the struggle for human rights?

We will have to face up to our responsibilities as a nation. We will have to play a more active role in preserving the security and stability of Europe. And we can make a positive start by joining Partnership for Peace.

In the long run enlargement of the EU will be the best guarantor of the peace and stability of Europe. Our ultimate objective must be the creation of a larger Europe, a Europe that embraces the different states, the different nations, the different peoples of the Balkans.

The idea that the Serbs and their neighbours might live in peace and harmony with each other as members of the same Union might seem unrealistic today. But not so long ago it seemed very unrealistic to think that France and Germany might one day live in peace and harmony with each other.

The face of Ireland is changing. The faces of Ireland are changing. Recently, on a visit to a primary school in Dublin, I encountered children from 23 different nationalities.

We must think in terms of a new republic, a republic based above all on the principle of tolerance - tolerance of other political traditions on this island, tolerance of traditions which have only recently arrived here or which have yet to arrive here.

It is both ironic and sad that, at the very time when we have learned to tolerate the other political tradition on this island a new intolerance has emerged - an intolerance of difference.

As a nation of emigrants we should know better than most how to treat immigrants. Right-wing racism is rampant now in many parts of the world. The Progressive Democrats is a liberal party. We must make sure that, in the midst of unprecedented prosperity, this country does not forget the meaning of the word "welcome".

As I said earlier, this country has never been here before. We have never had to cope with the problems of success. We have never had to plan for prosperity. But we now have the money. We have the confidence. We now have the capacity to develop. We are in the fortunate position that we can build whatever future we want for this country.

I say to the people of this country: you can make a difference; you can change the face of Irish politics; you can help to take this country in a new direction.

I need your trust. I need your support. I need your backing for the Progressive Democrats candidates in the elections on June 11th. For years we in Ireland were constrained by a lack of resources. We can be constrained now only by and a lack of imagination, a lack of ambition.

The Progressive Democrats have a clear and confident vision of where we want this country to go between now and the year 2010. Help me to make that vision a reality.