We get what we pay for - with taxes

Hospital operations are being cancelled and health board staff laid off

Hospital operations are being cancelled and health board staff laid off. Outpatient charges are going up, overseas development aid is being cut and third-level education fees may be on the way back. And it's only August, writes Mark Brennock.

Everywhere in Europe, voters have learned that you cannot have good public services unless you pay for them. To pay for them, you must raise tax or borrow. Our extraordinary economic boom has blurred this simple fact over the past decade. Governments have been able to boast that we can have it all. We could slash taxes in the knowledge that the Exchequer was so awash with cash that it could give greater resources to public services while also reducing Government debt.

But now we are beginning to grapple with the dilemma faced almost everywhere else: how do you pay for public services when it has become politically unacceptable to advocate tax increases?

Nobody likes paying tax - or indeed paying for anything - but if we know what we are paying for it becomes more acceptable. Governments have not done enough to link taxes with the services they pay for. Instead, political debate over the last decade in Ireland has cast tax as a phenomenon that - like crime and hospital waiting lists - must be tackled, reduced and possibly even ended altogether.

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The corrupt behaviour of individual politicians has fuelled popular distrust of politics and of government itself. The ruinous borrowing spree of the 1970s and 1980s marked a watershed in this State in the public view of government. Rather than being seen as the only source of a solution to our public service problems in health, infrastructure, childcare and education, the State is viewed by many as a public monster capable of destroying the benefits of the private sector boom.

AFTER the second World War, the people of mainland Europe took a different view. They rebuilt and consolidated their road and rail networks. They created top-class health care and education systems. They limited working hours and introduced a series of social protections for ordinary employees and their families.

Tax rates rose, but everyone knew what they were paying for and there was a consensus around this political model such as we have never had here.

The European social model has been modified in recent years. As the economy became globalised taxes on work and on business came down as Europe strove to remain competitive with the United States and the emerging Asian economies.

In most EU states, election campaigns still centre on the issue of how to protect cherished State services. There is a deep-rooted acceptance of the concept of public and not just private, wealth and a rejection of the privatisation of society.

Here our notion of wealth is still private, not public. Our political choices - valuing personal tax cuts above all - have the effect of prizing the classy new car in our driveway, rather than classy new motorway on which to drive it.

Tax cuts let us upgrade the car. Tax revenues let us upgrade the road.

And in healthcare, we no longer expect our tax euros to provide us with a health service that meets our needs. Rather, we know that if you want to be sure of good health care you had better get a good job so you can pay for it.

Unlike the rest of Europe, we have never really had the debate about whether we want low tax or high social provision and public investment. As recently as last May the parties that make up the current Coalition were telling us we could have it all: low taxes, gleaming trains, first class health services and motorways stretching over the horizon.

They appear to have been mistaken. Without new sources of revenue we will not get the roads and railways or the health and education services the Government has encouraged us to expect.

SO COULD a public consensus be built around the notion that if we want better public services, we must pay for them through taxation?

The British Chancellor Gordon Brown increased social insurance payments recently for that purpose and received widespread approval. In our own general election campaign, Labour was the only party advocating extra Exchequer revenue-raising measures, although it too gave a solemn commitment not to increase personal taxation.

Having cut personal taxation dramatically, it would be difficult indeed to get voter or trade union acceptance, even for a modest increase. There are other ways of raising revenue and winning public support for it, as the British experience has shown. To generate popular support for higher taxes, however, politicians must do more to sell the idea of government itself.

You won't hear the people of Dresden, Prague and Budapest calling for a reduced State role as they mop up after this month's floods, nor will you hear the people of the United States calling on their government to fade away in response to September 11th.

When major calamities hit, people recognise that only a properly funded State can deal with the fall-out.

The task for those who advocate community values is to win support for the view that more mundane calamities - such as the failure to get good healthcare or the distress of spending three hours a day commuting as your kids grow older at home - can also be eased by a well-funded state.

Then, as now, we will get what we pay for.