Last Sunday it was Enda Kenny’s turn on the series of party leader interviews for RTÉ radio’s This Week programme. Over the course of a 19-minute exchange with Fran McNulty, the Taoiseach four times uttered the sentence, “I am confident a deal will be done by the end of March.”
Our Taoiseach does few extended interviews. So when Enda Kenny does a media interview and chooses therein to make the same point no fewer than four times, he is obviously trying to tell us something.
The Taoiseach’s repetition arose when McNulty asked him whether the Government would be able to secure a deal on the Anglo Irish Bank promissory notes and before the next payment of €3.1 billion due in March. The Taoiseach said he was confident there would be and, when pressed by McNulty on a Plan B, the Taoiseach repeated his confidence three times. In fact, the last time he said not only was he confident there would be a deal but that he “expected” there would be a deal.
If the Government does not get a deal on the promissory note and other aspects of restructuring of the bank-related components of our national debt, it will have significant economic consequences well beyond the amount involved.
A failure to secure such a deal would undermine sprouting confidence about Ireland on international markets and at home. In his Sunday interview, Kenny advanced a positive scenario in which a deal would mean “interest rates will fall, banks will be more flexible with credit”, all of which would contribute to recovery, and described a deal on the promissory note as “central” to our prospects of getting out of the bailout programme before early next year.
It is also clear, however, these negotiations and their outcome will have significant political consequences for the Government, not least because it itself has put so much store by them. Politically it would be devastating if it does not happen.
Kenny must know that and he must also know that a deal is coming or he would not have upped the ante as he did on Sunday. The Taoiseach’s language and emphasis suggests something significant is happening in the to-and-fro between Dublin, Brussels, Frankfurt and the IMF headquarters in Washington.
If Kenny, with considerable involvement from Michael Noonan, manages a deal on the banking debt, then he will have overcome another hurdle. Many political hurdles in his path are either carefully circumvented or simply dissipate.
He has been both an able and a lucky premier. In his first months he basked in the approval for the visiting Queen Elizabeth and then President Obama. His Government collaterally benefited from the reduced bailout interest charged to the Greeks. The macro situation appears to be easing, although unemployment, private debt and austerity budgets mean the situation for many households has not eased much.
Kenny’s enduringly optimistic demeanour and down-to-earth approach have helped. While his speaking style is often vague and disjointed, Kenny has been relatively sure-footed and has avoided gaffes. On the international stage, both he and the country have been lavished with praise, most prominently on the front of Time magazine, for Ireland’s compliance with the bailout programme.
Domestically Kenny has avoided the inclination to be everywhere, opening anything, like some of his predecessors. He has also shown a wise tendency to stay out of the firing line when controversies or crises develop, most notably in the case of Minister for Health James Reilly. The Dáil plays a diminishing role in shaping the public perception of our leaders but there too Kenny’s performance has been at about par and largely uncontroversial.
Although his approval ratings, most recently measured at 33 per cent, are relatively low, that is attributable more to the angst of the times and indifference to his low-voltage political personality than any particular annoyance or irritation at Kenny himself.
More importantly, for Kenny and Fine Gael, it is Eamon Gilmore’s Labour Party rather than Kenny’s Fine Gael that seems to be taking most of the political flak for the austerity being imposed. Although Fine Gael’s vote is about three-quarters what it was at the 2011 election, support for the Labour Party has almost halved. At somewhere between 31 and 35 per cent, depending on which poll you choose, Kenny’s party is doing relatively well, allowing for the volatility associated with midterm polling and the scale of austerity the Government is engaged in implementing.
Anyone looking at the challenges facing the Government two months ago would have seen the budget, abortion legislation and negotiating a promissory note deal as the political pressure points. The Government has safely charted its most difficult budget. It even managed to introduce a residential property tax and, while there were some inter-party hiccups, there was no serious bust-up.
The tone around the abortion issue has eased in recent weeks and although he may still lose a handful of deputies, it may not be as politically difficult for Kenny as he might once have been feared.
That leaves the outcome of negotiations on the promissory notes and other aspects of the bank debt. Kenny’s backbenchers will be hoping his über-optimism on this is justified.