Fianna Fáil are seeing something of a bounceback in tomorrow morning’s Sunday Business Post RedC poll.  The numbers, as reported by RTÉ News:

• Fianna Fáil: 30 (+4)
• Fine Gael: 35 (+2)
• Labour Party: 14 (-1)
• Sinn Féin: 8 (-2)
• Green Party: 5 (-1)
• Independent/Others: 8 (-2)

The poll is a week earlier than normal (normally it’s the last weekend of the month, which is next weekend), but this may have been a conscious decision to: a) get a quick poll out to see what’s happening with FF; and b) avoid a poll being taken in the two days after Fine Gael’s National Conference (happening today & tomorrow).

What it shows is that, although the last poll may have exaggerated Fianna Fáil’s collapse a little, it wasn’t entirely wrong (or at least, their collapse has softened a little).  More importantly for Fine Gael, it shows that their rise is solid - and they’re still going up in the polls.  One wonders if this is despite or because of Enda Kenny’s lack of publicity recently.

For Labour, Sinn Féin, Greens and Independents, it’s all well within the margin of error across the two polls.  Sinn Féin may be a little worried that they haven’t capitalised on anything to do with the economic collapse - their natural supporters should be the ones feeling the pinch most.

Were things good, Joan Burton would be roundly accused of talking down the economy. However, things aren’t good and so the answer to her Parliamentary Question on tax reliefs for construction holds some pretty grim reading. In the financial year 2006, the government waved of €464.4m in 19 property based tax exemption schemes. This included €64m for student accomodation and €140m in urban renewal.

The government over the same period the tax foregone on the Business Expansion Scheme and the Seed Capital Scheme was just €21.4m and €1.2m respectively. Granted this is not all the money available to business and via a variety of bodies like the IDA, FAS and others subsidies are given to development and skills. However the stark contrast in figures chimes with the sense that we all have now of a party in government which prioritised those who lobbied hardest - our friendly developers - over the much vaunted knowledge economy.

As others have written on this topic, the support for tech startups and small business is negligible and something that other opposition parties can make hay out of. Indigenous enterprise will be required to dig us out of this hole, if we are to use tax breaks to incentivise economic benefit it should go to those business who can provide sustainable long term jobs.

The PQ is below the fold.

DÁIL QUESTION

NO  232

To ask the Minister for Finance the amount of tax that was foregone under each of every property tax based scheme in 2006 and 2007; and if he will make a statement on the matter.

*    For WRITTEN answer on Tuesday, 11th November, 2008.
Ref No: 39627/08

Minister for Finance ( Mr Lenihan) :

I am informed by the Revenue Commissioners that the amount of tax foregone under each property-based scheme in 2006 is as follows:-

I am advised by the Revenue Commissioners that data for the tax year 2007 is not yet available as the appropriate income tax and corporation tax returns for that year are either not yet due for filing (by 17th November 2008 in the case of returns filed via ROS) or have only recently been filed but have not yet been processed.

DÁIL QUESTION

NO   233

To ask the Minister for Finance the amount of tax that was foregone under the business expansion scheme and the seed capital scheme respectively in 2006 and 2007; and if he will make a statement on the matter.

*    For WRITTEN answer on Tuesday, 11th November, 2008.
Ref No: 39628/08

Minister for Finance (Mr Lenihan):

I am informed by the Revenue Commissioners that the estimated tax foregone in respect of the Business Expansion Scheme and the Seed Capital Scheme for the years 2006 and 2007 is as set out in the following table:

So poll numbers are down. Fianna Fail at 25% in the Irish Times poll.

I am sure there is plenty of commentary about all this already among people. There is a generally held belief that the young are the most likely to be left wing in a society and most likely to be on the Internet. So it would seem to suggest that if Internet politics aka like Obama could take off in Ireland Labour would have most to gain. Yet from the poll numbers people in the 18 to 24-year-olds are the second most supportive of Fianna Fail after pensioners and the least supportive of Labour. The most dissatisfied are the 35-49 years olds which as they are not effected by the medical cards I guess comes from the increased taxation and possibly the cuts in primary education.

And another result for Labour which really should not be surprising but probably will surprise many is that

In class terms, Labour’s highest score comes from the best well-off AB voters where it gets a 14 per cent share. The party attracts 11 per cent among C1 voters, 10 per cent from the C2 category and 9 per cent among the least well-off DE category. It is well behind Fianna Fáil among the less well-off voters.

However this is not totally bad news for Labour

The opposite is the case for Sinn Féin, which is strongest among the 18 to 24-year-olds with 14 per cent, dropping to 3 per cent among the over-65s. In regional terms the party is strongest in Dublin on 9 per cent, with a relatively even spread of 5 per cent to 6 per cent across the rest of the country. In class terms it is weakest among the AB voters and strongest in the DE category. As in previous polls the party is more attractive to men than women.

WIth Sinn Fein being strong in these area’s shows that there is votes out there to be got by Labour in the categories they assume they have but don’t (young and poor). They just need to go get them away from Sinn Fein. How they do that is difficult to know.

As for Fianna Fail. I think my headline says it all. They badly need 4 more years in government to go back up the polls.

As for Fine Gael and Enda Kenny

Fine Gael leader Enda Kenny does better than Mr Cowen for the first time but he is still in negative territory, with 46 per cent dissatisfied compared to 33 per cent who are satisfied with his performance.

If this was Richard Bruton I doubt it would be below 50%, Gilmore on 38 is also not exactly brilliant. It might look good for the opposition but really not good enough.

Finally, a slim ray of light.

‘The problem we have in the public finances is as a result of the fact that the economy is in a recession . . . we have a problem in the economy which has created difficulties in the public finances. It’s not the other way around.’

So said Eamon Gilmore on RTE yesterday. This is the first breach in the consensus dominating the debate – the consensus that prioritises the fiscal imbalance as if it were the cause, and not the result, of our economic decline.

Up to now the Left has been content to oppose the cutbacks and general tax increases contained in the budget. However, it was in danger of being caught in a two-fold trap, best summarised by Shane Coleman. He first, demanded that Labour say what it would do rather than what it opposed (fair enough – if the Left is to go beyond simple oppositionism and, instead, lead a debate, this is exactly what it has to do). But, secondly, Shane demanded to know:

This is the Right’s fiscal trap – you can decide which course to take as along as it’s a course we approve of. Any other options are off the table, any other way of looking at the problem is taboo, extremist, a non-starter.

Gilmore opened up a new front. He talked of pump-priming the economy. When asked whether this could be done given our budgetary state, Gilmore replied:

‘The Labour Party has consistently argued that it is legitimate to borrow for capital purposes . . . and, secondly, we should be using the National Pension Reserve Fund to get money invested into our own economy and in our own infrastructure to get things moving.’

So, borrowing and raiding the Pension Fund can now be put on the table –a third option. And if some think this third option is an easy way out of the ‘hard choices’ – as the Right put it such a macho way – Gilmore opened another door which Labour left closed: increased taxes on the wealthy:

‘ . . If the Labour Party were in Government and we were faced with that levy situation (i.e. Fianna Fail’s 1% levy) we would have skewed that much more on higher incomes than on low and middle incomes . . . you would have seen a higher level on those over €100,000 per year certainly and much less on those on low to middle incomes.’

And just to drive this point home, Eamon unequivocally renounced Labour’s general election policy of cutting the standard income tax rate by 2% (it actually wasn’t a party proposal – rather, something thought up at the last minute by Pat Rabbitte’s speechwriters to make a headline for his pre-election conference speech).

So, are we there yet? Have we the weapons to take the fight to the Right? No, not by a long shot. While it would be unrealistic to expect anyone to elaborate a comprehensive alternative in a seven minute interview, it is clear there is much work to do.

First, there is a real danger that Eamon will be isolated. He is the first Left politician to open up this new fiscal option (new for Ireland, anyway). But he needs support, not just from his parliamentary colleagues, but from the broader progressive field: trade unions, Left commentators and bloggers, social organisations, etc. If he’s left on his own making this argument, he will be easily overwhelmed by the Right. A once-off interview is no match for the deluge of fiscal conservative nonsense we get subjected to everyday.

Second, Eamon’s position is still not fully formed. His claim that Labour supports investment for capital borrowing is neither here nor there; parties across the ideological spectrum support this. His proposal to tap into the Pension Reserve Fund begs questions: for what projects, to what extent, on what commercial terms. The fiscal issue goes beyond capital borrowing or using Pension fund for capital projects – it is about borrowing over the length of the downside business cycle for both current and capital expenditure; a necessary breathing space while other policies are put in place to get us on the right path.

In addition, Labour still remains stuck in the ‘bricks and mortar’ argument. No doubt, putting unemployed builders back to work on school and social housing construction, can be helpful but it is by no means anywhere near sufficient. We must ‘pump prime’ the entire economy – in the manufacturing and private and public service areas – not just construction. What does this mean? What are the instruments available to us? Where do we focus our resources to maximum medium-term benefit? How much will this cost (i.e. borrowing cost)? Will we need supplementary tax revenue – not just from the incomes of the wealthy (which, at the end of the day, won’t get us too far), but from their capital assets as well? Is there something profoundly amiss in our enterprise and financial base that will have to be addressed at the same time as we reflate?

A radical rethink of the economic crisis is now on the cards. Internationally, there is a decisive shift to more progressive solutions: China’s economic stimulus package, President-elect Obama’s imminent ‘big bang’, the EU’s 100-day deadline to put financial capital to heel. The Irish economy needs its own radical home-grown package.

But, at root, this is not just an issue of economic policy – it is about an essential reconfiguration of our political choices. Eamon referred to this:

‘There’s a fundamental difference of approach between the Labour Party’s view of this and the view of the conservative parties and of some conservative commentators.’

There’s still a mountain range of work to do to fully elaborate on this ‘fundamental difference’ – not just in terms of fiscal policy but in raising domestic demand and creating new enterprise strategies. But knowing there is a cleavage between the Left and the Right (and not just with the Government), puts another conservative trap in perspective.

For just as Eamon has started to rejected the notion that fiscal policy is limited to ‘cutting spending’ or ‘increasing general taxes’, we can take this consensus-busting to the next level – by rejecting the political consensus that the only choice of government is between one led by Fianna Fail or Fine Gael.

Break that trap and the uphill climb will still be hard and arduous – but at least we can dare to hope to reach the top.

Where is the radical reform in the civil service ? Sunday Times figures show that almost every civil servant in the country has received a pay increase. The Government seemed happy to let the civil servants write the budget and now we find that the oversight process for employees in the civil service, the Performance Management and Development System (PMDS) has standards so low that in essence the civil servants are writing their own pay rises. According to the Department of Finance, the pay bill for 2008 will be €2.1 billion up 6.7% from 2007 (€1.9 billion). This sparks the questions about pay freezes, reform, and job security of civil servants. Its worse in the wider public sector where the average wage increase is around 8.9% or so and adds €1.5 billion to the wage bill per year.

Mark Tighe in the Sunday Times (26/10/2008) had reported a number of shock findings in the PMDS scheme for performance rating of civil servants. It seems that if you turn up to work and sleep at your desk for the day, you’ll still get your raise while you work in the Irish civil service. It seems that those who word hard in the civil service are being hampered and the top quality of these hard workers are not being rewarded in relation to their colleagues. Whether it is a failing of training or for management needs to be discovered because this kind of carry on would last less than five minutes in any Multinational in this country so why should it be allowed to fester in our civil service ? 

Tighe got the view of Union leader’s such as Tom Geraghty who claim the scheme has improved performance but does not his surprise that were not more people in the poor performance categories as “Everyone things they are a swan but there are bound to be a few ducks”. He further conceded that management had to motivate people and that “telling them that they are useless isn’t a great way of doing that”.

The figures released to Tighe show the soft reality of the civil service. These are especially harsh when compared with the civil service-wide PMDS evaluation ( PDF ) by Mercer Human Resource Consulting which was completed in May 2004. The suggested figures for percentages in levels are vastly different, perhaps Mercer was thinking along the lines of the private sector where only true performance and merit is rewarded. The consultants report further noted that the PMDS system itself was weak at distinguishing between the different performance levels, in highlighting which staff performed well and in handling those “few ducks” who underperformed. The figures shown below highlight how the civil service is over egging the pot (on the left) by being top heavy  in the 3, 4, and 5 categories. The consultants report (on the right) showed a more private sector view with correspondingly lower numbers in the higher categories and a vast increase in comparison to the underachieving categories.

The most telling problem with this system is that the consultants found that it was not linked to decisions on promotions, pay increases, or career development. Senator Alan Kelly of Labour has recently (8th October, 2008) voiced further concerns about PMDS as it currently only being applied to the lower grades of the civil service and that its implementation in the senior manager grades has left a lot to be desired.

Even a bad scheme like PMDS is better than no scheme. Local Authority workers (~35,000) and Health Service Executive staff (~111,000) are not yet in such a ranked/rated scheme. In the case of the Local Authority, they are considering it and in the HSE they have one but it doesn’t use any kind of ranking or rating. It really is no surprise that the HSE has a bad record for its management not knowing who is currently employed but without ranking for staff, one wonders how the staff get assessed with any due consideration.

Mark Tighe has a second Sunday Times article point out that 74.2% of all public-sector workers earned more than €40,000, further break downs show that even in the higher pay categories the public sector employees are still ahead of the average private sector counterpart. Two examples, between €50,000 to €100,000 its 29.1% of public sector workers to just 13.1% of private sector worker and above €100,000 its 2.5% public sector to 1.9% private sector. These figures are basic figures and do not include any additional loading for job security or the guarantee of a pension for public sector employees. 

Tighe spoke to Jim Power, chief economist with Friends First who pointed out the reality that “in the private sector thousands of workers are being let go and salaries are being cut by 10% to 20% in some companies. It is clear the public-sector unions believe the adjustment in the economy must be borne entirely by the private sector”. Brian Lenihan has stated a reform of this area will be “messy and unpleasant” so instead he’s waiting for a task force to deal with the problem instead. I think I’d prefer the approach of Richard Bruton to sorting out the mess because regardless of politics, he at least seems to understand the problems (overview of reform approach, Reform through Recovery response to Budget).

An annual increase of €1.5 billion in the national public sector pay bill or €100 million for the over 70’s medical card, hhmmm I think I know which problem I’d be tackling if I was in government. There was an elephant in the room for this budget, it was and still is public sector reform. Tackling this one issue would provide all the funds to provide universality for health care and education and they’d still be cash for capital development. If only there was some leadership and grasp of reality in the current Government we might cushion the impending hard landing as it stands this is an avalanche gathering speed which will plunge us into a Japanese style recession without prompt and hard calls by the Government.

Via redmum

ITs a good week for Red C to take the latest tracking poll for the Sunday Business Post. Markets are falling like stones (Friday has the potential to be another massive dead cat bounce) and the government don’t look to have stamped authority on many aspects of policy.

REcently concludd partnership talks have the ingredients to annoy rather than placate businesses and workers alike while George Hook is busy rising the blue-shirts around him. FF will at least be using these events to cover a sharp drop in their numbers.

FF (-4) 36%

FG (+3) 28%

Lab (-1) 9%

Green (-) 7%

SF (-1) 9%

PD ( +1) 3%

The obvious irony of PD support rising as they exit stage left is overshadowed by the seriousness of a further drop in Labour support in the week their campaign HQ emailed all suporters to highlight an article extolling GIlmore as the real leader of the oposition. In the current economic climate with Cowen and his government failing to secure people’s belief the Labour leader will be very dismayed by the poll. If he is not then the job is not for him. Enda will be pleased for this sort of support next June might keep him his job.

Intersting analysis over at Open Democracy about the reasons Lisbon was rejected and an attempt to conceptualise the ‘democratic deficit’ that was apparently at the heart of the rejection. It is interesting from perusing the papers today that this analysis is taking a lot of hold, that it was the local context that informed voters perspective on Europe.

I am not sure there can be any other way of approaching this short of asking all people to be European citizens in the fullest possible sense of identification.

As Richard Sinnott outlined in the Irish Times yesterday, that is a huge ask of a country where 59% describe themselves as solely “Irish”. The analysis is interesting for it suggests that the lack of a joined up system between the EU, our executive which negotiates treaties, the Dail and the media/public is what constitutes a lack of democracy in Europe. That the EU itself is ok but the procedures in this country for connecting voters to it, plugging them in and getting the buy-in or cache that wins referenda is not there. They may not be off the mark in one sense, school water charges anyone?.

Yet there is a more fundamental disconnect expressed here, I think the word that swung many voters was consolidation because pro-EU as we may be we do not want a Federal State. There is a chaotic element to Europe that is reassuring to voters, it tells them that no one is in charge per se and it remains an intergovernmental plaything at its very core. The idea of consolidation, of rationalising, of tidying up is a bridge too far at present. The idea hints at a centrality and organisation that we are more familiar with at national level, an ability to organise policy and law from the centre. It did not need to be spelled out because it was not a rational argument, it was an emotive response.

Like a pavlovian response, voters were presented with a “consolidating” treaty and thought, hang on. They didn’t do it in huge numbers, 53%-46% is not a landslide, but they did it in far greater numbers than in Nice I with a lot of “soft no” votes coming down to vote and abandoning the 60% pro-EU majority that seems to be latent in the country. Most notable voters in this regard were Munster and Connaught voters who saw this as a step they would not take - by as much as 60% - 40% in some cases.

Personally I think it was far more than a democratic deficit that swung it, dislocated social groups were wary of voting in favour of distant sites of governance (real or perceived). When the socio-economic activity is moving rapidly out of their locality and either outsourcing abroad or drying up as an industry the desire and impulse is, naturally, to retain control as locally as possible.

In a great day for Irish and European democracy, the Irish people, on a higher turnout than Nice II, rejected the illegitimate and anti-democratic Lisbon Treaty by 53.4% to 46.6%. In doing so, they have struck a blow for freedom and against remote, unaccountable and undemocratic rule by unelected bureaucrats in Brussels. They have shown great courage in the face of an Establishment media blitz by Independent Newspapers, the Irish Times, the Sunday Business Post, The Tribune and others who bombarded us with a relentless torrent of black propaganda about the “disaster” a no vote would be for Ireland. As I pointed out on a previous post, the final day before polling was marked by a disgraceful attempt at scaremongering on the front-page of the Irish Independent, claiming that a “No” vote would accelerate rising unemployment. It is interesting that while the margins were not as large on the day, the poll on the Independent’s own website and the story’s comment pages were deluged by angry criticism of the story and support for a “No” vote.

This outcome cannot be separated from the context in which it takes place, which relates to one of my biggest grievances against our party-political culture - namely the culture of the “cosy-consensus”, in which like the ideological equivalent of a business-cartel cornering the market by refusing to compete with one another on price, the political-elites insist on refusing to compete with one another on a certain set of political issues. The Irish elites insisted - like with immigration - on refusing to represent the huge segment of public opinion that has historically opposed closer European political integration. Never has that been more true that now, with the elites continuing to display open contempt for our decision. Only yesterday, Una Claffey, former government spokesperson, argued that in Lisbon “we” had gotten all we wanted. Who is the “we” in this? This mantra continues to be repeated by members of the FF elite, who insisted during the referendum campaign that “we” had gotten all our “redlines” in the negotiations. Again who are “we”? The answer is clear - they are referring to themselves - the elite. Never in the history of Irish politics as an independent country have our political-class be so out of touch with the people they claim to represent.

It is infuriating to me, as a “no” voter, to hear Barroso, Wallstrom, Polish PM Donald Tusk, French Secretary for Europe Jouyet, German Foreign Minister Steinmeier and others insist that the ratification of the Treaty must go ahead. On the contrary it must not go ahead, and most certainly must not apply to Ireland in its current form. The Irish people have said “no” and if the elites persist in trying to railroad us into ratification by trying to isolate us by getting the other 26 governments and parliaments to ratify Lisbon, then it will only reinforce Irish and European public opinion of Brussels as a remote and anti-democratic project. While a pro-European myself, I had not choice but to vote no due to a number of factors including those I have described in the previous post. The French and Dutch peoples have already said no. Now the Irish have said no. You don’t need to be a rocket-scientist to deduce how the British would vote had they been given the opportunity. When the Irish politicians tell the other states should continue ratification, what they really mean is that the governments and parliaments of those countries should do so - for not one of them will dare put this to a referendum in their respective countries due to the certainty of a “no” vote. Sarkozy said as much in a meeting with journalists some months ago.

Our decision on the current package is final. Another tarted-up copy of the rejected formula rejected by the Dutch, French, and now Irish is a non-runner. We Irish are tiring of the “permanent revolution” of European integration. We want to remain in the EU and the euro, but not at any price. The recent reintroduction of the annual 1916 parades have served to remind the Irish people of what was sacrificed for our freedom, and I believe a richer Ireland is now more self-confident and inclined to defend its sovereignty in a way that was not the case in the past. If they come back to us again with a new package, we must insist it be radically different - at least in its application to Ireland - from the one we have rejected. That must include the deletion of the self-amending Article 48 that allows for treaty ratification without referenda, the retention of our Commissioner and voting weight on the Council, an opt-out from the Charter of Fundamental Rights like Poland and the UK obtained, and the retention of our national vetoes on issues like energy, public health, and tourism and sport. Anything less deserves the same answer we gave on June 12th.

Brian Cowen, Enda Kenny and Eamon Gilmore will be more uncomfortable tonight than simply for losing an election. In their own ways they will each feel the pressure of having to face the fallout of a no vote. While it is easy to explain the no as a rejection of the entire establishment, that explanation does not really help the leaders of the three main political parties in the country.

Yesterday they lost the Lisbon referendum for a number of reasons, not least the inability of the yes campaign to parse their arguments in ways that resonated with voters. When all of the ‘plan a’ failed, it was a case of resort to namecalling/intimidation/scare-mongering. All of this was done with various degrees of media help in an environment where any political scientist would have said they could not lose. But, lost they did and today they all face unique problems as a result.

Cowen: As head of government he is paradoxically quite secure. His party will rally around him as they always do, out of a sense of loyalty. In Europe and at home he will be besieged. Pressure on him to deliver some fix, some workaround will be immense as well as him have to face the shame (should it really be shaming?) of going to a European Council meeting and explaining our ‘no’ vote. He does not have to face any leadership challegne for the spin will allow him to get on with things in the business of government.

Yet this should not fool us, he is in deep trouble. The electorate that voted were making a statement against some of the orthodoxy of current economic governance. They decided all parties were illegitimate brokers for their concerns - fishing, farming, labouring, manufacturing - and opted to support independent minded TDs and non-governmental bodies campaigning for a no vote. Cowen cannot afford to ignore such a trend in the FF heartland of rural Ireland.

The loss of fishing, farming and urban C2DE votes will harm him in the local elections. Not only does he have to face Europe and work something out to their satisfaction, he has to remain cognisant of what voters want and why they voted as they did. A balancing act in which I do not envy him.

Enda Kenny: I made a point of suggesting that Cowen is a safe leader because it now seems clear that Enda Kenny is not. He failed to carry his own Mayo constituency - as opposed to last May when 3 Fine Gael TDs were elected. Rumours have abounded since the last election of a possible move against Kenny, in the belief that he would be unable to move the party beyond their current position in 2012. The fact now exists that his attempt to direct a European campaign, aided by some big-name FG heads, was a failure. His decision to appoint Creighton as EU spokesperson did not pay off, his party could not convince its own voters to vote yes and he could not impose himself on the campaign.

Yes he is in opposition but Fine Gael has long been Ireland’s most European party, unflinchingly supportive of all EU measures. This is a rich electorate to tap for an opposition leader seeking to showcase his skills as a leader of men. It didnt happen and his party will look at next year’s local elections with some trepidation. Cowen and FF remain at 42% despite the Lisbon disaster yet Fine Gael are back to he bad old days of 23%. Knives will be sharpened and Kenny will have to fight for his life if he is to keep leadership, perhaps the injection of life is not a bad thing…..

Eamon Gilmore: Eamon Gilmore is in many ways a simple analysis but also a complicated one. First of all he is a leader of the third party, a social democratic party. He wanted a yes vote, on paper his core constituency of C2DE voters voted no. That break with the party ‘elite’ and its core vote is not isolated but is perhaps most worrying for Labour. If this was a mid-term kicking then they are alright but if those voters in urban Dublin see the Labour party as one they cannot identify with then trouble beckons. Lots of workigin class voters and constituencies voted no. Labour wanted yes. Therein lies the rub. That is the simple part.

The complicated part is Gilmore’s authority. After Ruairi Quinn’s solo run as IAE Chairperson there are issues about how Gilmore was leading his party. Who was the main Labour person on the campaign trail? Who was the one to whom we were listening for the Labour perspective? That division was not a clearcut handicap to Gilmore but it can easily be seen as such. If that is the case he also has a great deal of work to do to reassert his authority, link with his core electorate and prove Labour is in chime with these.