Upbeat Labour mood leaves burning issue of public finances unresolved

OPINION: THERE WAS a real sense of optimism at the Labour Party conference in Mullingar at the weekend that the Irish political…

OPINION:THERE WAS a real sense of optimism at the Labour Party conference in Mullingar at the weekend that the Irish political system is on the verge of an upheaval that will give the party an opportunity to make an historic breakthrough. On Saturday night, Eamon Gilmore noted that Irish politics used to be characterised as a 2½ party system. "I don't want Labour to be a half party. I want there to be a three-way contest," he said, to roars of approval, writes STEPHEN COLLINS

Delegates waved placards with the message "Gilmore for taoiseach" which was one of the themes of the weekend. While that dream was punctured somewhat by the poll in yesterday's Sunday Business Post, the underlying mood of the conference remained upbeat.

The strong emphasis on Gilmore’s leadership reflected the fact that over the past year he has managed to establish himself with the public as a political figure of substance. In his Dáil performances and public utterances, he has demonstrated an ability to connect with the electorate and that has transformed him into a leader that a growing proportion of the electorate finds attractive. He is rightly regarded by party members as a real asset.

Allied to the rise of Gilmore, senior Labour figures believe the party’s fortunes are set to improve because of what they regard as an irreversible trend among voters. That is the dramatic drop in support for Fianna Fáil, even taking the latest poll into account. Labour is confident that the overwhelming unpopularity of the Fianna Fáil-led Government will remain the dominant feature of politics until after the next general election.

READ MORE

It is not just that successive polls have demonstrated that a majority of voters have no confidence in the Government to sort out the public finances. Labour TDs report a level of public hostility towards Fianna Fáil which they can scarcely believe.

“There is simply no doubt what is going to happen at the next election. Fianna Fáil will be routed and the only question is which of the opposition parties makes the biggest gains,” said one Labour frontbencher.

Many Labour TDs also believe that there will be an election sooner rather than later. They take the view that the Government will simply crack under the immensity of the task facing it and an election this year is a real possibility.

However, Labour itself faces one central dilemma which the conference did nothing to resolve. While the party leader, frontbenchers, TDs and delegates were able to indulge in a bout of Fianna Fáil bashing, much of it well-deserved, they were not at all clear on what they would do in government to sort out the mess.

On a political level, the Labour strategy of taking every opportunity to hammer Fianna Fáil is understandable. What is worrying, though, was that there does not appear to be much genuine appreciation of the need for the kind of radical action required to get public spending under control, regardless of who is in government.

In his keynote speech, Gilmore accepted that the public finances had to be sorted out but, apart from suggesting a new tax rate for people earning more than €100,000, there was no real acknowledgement of the kind

of tough tax-raising and cost-cutting measures that are so urgently required.

The appalling problem facing the country is that public spending this year will come close to €60 billion on current projections, while tax revenues are dropping like a stone to somewhere in the region of €30 billion.

A change of government is not going to change that central fact but, from the leader down, almost all the speakers at the Labour conference gave the impression that the problem could simply be wished away and that unemployment could be solved by a few simple administrative changes.

That approach might help Labour to win plenty of new seats in an election but they will not hold them for very long if they are won under false pretences.

If Labour gets into government in the next couple of years, it will have to take responsibility for a continuation of spending cuts and tax increases the like of which the country has never seen. The long-term interests of the party, as well as the country, might be better-served by a recognition now that real pain for everybody simply cannot be avoided. During the conference, economists and commentators were condemned by a number of speakers for pointing out basic economic facts. Sadly those unpalatable facts won’t change, even if Gilmore is taoiseach.

The other issue that was skirted around at the conference was the make-up of the government after the next election. Labour has every right not to tie itself down on the issue of coalition partners in advance of an election. The party has a great chance of making significant gains and that will be best achieved by fighting the election on its own policies while promoting its own leader as the best candidate for taoiseach.

Still, whatever happens, Labour will have to go into coalition with somebody. Given the mood of public hostility to Fianna Fáil, it would be suicidal for Labour to put Brian Cowen’s party back into government after it had suffered an election trouncing.

Most Labour TDs appreciate this point but a fair number of party delegates seemed to believe that the party could actually do a deal with Fianna Fáil. If the public comes to believe that this is possible, the party’s prospects could suffer fatal damage during an election campaign.

Unless there is a dramatic turnaround in the political fortunes of all the parties between now and the election, it is almost certain that Fine Gael and Labour will have the numbers to form the next government. However, such a government could be very short-lived if one of the party’s involved takes office on the basis that hard decisions can be avoided.

Stephen Collins is Political Editor of The Irish Times