Labour has accused Fianna Fáil and Fine Gael of making promises they cannot pay for, writes Mark Brennock, Political Correspondent
Labour will use 75 per cent of contributions earmarked for the long-term pension fund to build hospitals. It will borrow to fund roads, railways and other National Development Plan projects.
In making these commitments at the weekend Mr Ruairí Quinn has opened up a clear divide between Labour and the two largest parties on economic policy.
However, apart from a pretty incomprehensible exchange on RTÉ radio yesterday between Government Chief Whip Seamus Brennan and Fine Gael finance spokesman Jim Mitchell, there has been no sign of Fianna Fáil enthusiasm to engage in debate on how to pay for expensive capital spending commitments.
Fianna Fáil and Fine Gael have said the 1 per cent of GNP being set aside each year to pay for pensions after 2025 is sacrosanct; Fine Gael would even increase it to 1.5 per cent in years of good economic growth.
Both parties say they will be able to fund commitments on health, education and infrastructure while setting aside this enormous sum - currently over €1 billion - each year. Ruairí Quinn has gambled on his party's ability to convince voters before polling day that they cannot.
The Government's own figures, said Mr Quinn, show that they need €7.5 billion to build hospitals and provide modern nursing homes. Reducing the pension set-aside by 75 per cent for five years would provide €5 billion towards this, said Mr Quinn.
This Government has operated in a time when the old left/right choices did not have to be clearly made. The growth of the economy ensured they could cut taxes, reduce the national debt and even save for future pension liabilities while still making substantial increases in public spending. The traditional argument of the left - that cuts in taxes means cuts in services - has been undermined by economic success.
Labour argued at the weekend that that era is over. The National Development Plan is behind schedule, and the Government is not committed to funding fully its own health strategy, it says. "The Government doesn't believe in it and won't fund it," Mr Quinn claimed. "Neither will Fine Gael. Labour will."
The inclusion of Fine Gael in Mr Quinn's condemnation of those allegedly making promises they can't pay for was significant. With under seven weeks to go to the expected polling day, Labour is sticking to its strategy of fighting as an independent party, leaning neither towards Fianna Fáil nor Fine Gael in terms of economic policy.
Indeed the speech from Finance spokesman Derek McDowell roundly condemned Fine Gael's recent economic framework document. Using the politically fashionable Boston/Berlin dilemma, Mr McDowell remarked that if Fianna Fáil and the PDs line up behind the Boston model, Fine Gael is at risk of sinking in mid-Atlantic.
"Fine Gael told us that they wanted the best of both worlds. Low taxes, high income and excellent public services. They want us to pay less tax and invest less and get better public services in return. No pain, all gain. Improvements in public services will be brought about by getting better value for money."
Mr McDowell and his leader said this was not possible. "You cannot have public services the envy of Europe on American spending levels, said Mr Quinn. "You cannot save 1½ per cent of your gross national product and still have enough money to invest in services and infrastructure".
Labour and Fine Gael are at one on the need to borrow to fund the National Development Plan. But on the pension fund contributions, both now have diametrically opposing positions. Fianna Fáil has yet to say whether it will borrow to fund the plan.
Depicting Bertie Ahern's Government as of the right is necessary if Labour is to convince voters that this election is about a left/right choice. "The reality is that Fianna Fáil has become Ireland's conservative party, Mr Quinn declared.
"The national green of old has given way to a new Tory blue. All the Tory hallmarks are there. Fianna Fáil are pro-corporate funding pro-privatisation and increasingly Euro sceptic."
However, Mr Quinn took the precaution of rebutting in advance any claims that Labour would put up income tax to pay for its commitments. "Labour will not increase income taxes for ordinary families and we will take minimum wage earnings out of the tax net."
Asked by reporters if this reference to "ordinary families" meant that taxes could be raised for any other category, Mr Quinn said they had no plans to do so.
He also made it clear they were not throwing all caution to the wind in regard to the pension fund. The diversion of 75 per cent of the annual contributions would be for five years only. And the smaller contributions Labour plans to make will still ensure the fund will have €12 billion in it in five years' time.
Labour's five pledges contain aspirations to which most people could sign up: A health service that treats people on the basis of need; a properly funded education system in which teachers focus on teaching, not fundraising; a more equal society; a society recognising the importance of childcare and pre-school education, and a right to housing for all.
The pledges will only become meaningful when detailed, costed commitments to specific changes are provided in the party's election manifesto. But through committing themselves to borrowing, and to diverting money intended for future pension requirements, Labour will clearly have more money to pledge to building hospitals, roads, railways and other capital projects.
They must now convince voters that Fianna Fáil and Fine Gael are making commitments they cannot pay for, and that Labour's commitments are worth paying for through borrowing and diverting 75 per cent of the money now earmarked for pension savings.
Mr Quinn also pushed out the debate on abortion, raising the prospect of another referendum, but this time to liberalise rather than restrict Ireland's abortion regime. His party was examining on what rounds abortion might be made available in Ireland, including rape, incest and a serious risk to the health of a pregnant woman. He called on the Taoiseach to legislate for the X case, saying Labour would.
He put Garda reform near the top of his political agenda, saying Labour would not serve in any Government which did not.
But most of all, with Fine Gael showing no sign yet of political recovery, Mr Quinn set out his aim to fight the election as an independent party with its own policies.
"If there is auction politics in this country it is largely because there is little philosophical or ideological difference between our two largest parties," he said.
The rhetoric, and the revenue-raising commitments, will ensure that if Labour ends up in post-election negotiations to form a government, there may be the mother and father of a row to get out of the way first.