IRISH PROBLEMS, IRISH SOLUTIONS
August is the silly season politically with the politicians on holiday, and any bad news in the form of tax increases or benefit cuts announced quietly when there is no one to face the public’s wrath. Not this year, though, with the economy doing very nicely thank you and no desire among politicians to pick the public’s pocket with an election perhaps not too far away and the budget due early in October the last of the three under the confidence and supply arrangement which has shored up the minority government since mid–2016.
There WAS a nasty surprise for some, with letters posted over the Bank Holiday weekend by one of the country’s major banks, the PTSB , informing 10,700 mortgage holders that their loans were being sold on to a US owned vulture fund. This move was followed within the octave by similar moves from two more banks. Most of the mortgages have been non-performing for years, with only official regulations and political pressure staying potentially thousands of repossessions. Quite how the new owners will treat their new clients remains to be seen, but they are unlikely to be as accommodating, or as pliable, as the banks. Homelessness, however it originated, is currently a hot political potato, with individual cases in the news virtually on a daily basis, so the prospect of several thousand more being added is not something the government will welcome. All the more so since any repossession of a family home carries with it the spectre of eviction – toxic in Ireland. Expect this issue to “run” in the coming months.
Expect also some pre-election manoeuvring. This has already begun, with independent Minister Shane Ross proposing an allowance for grannies who mind their grandchildren. More can be expected as Budget Day approaches with the major parties conscious that this budget could be the last before an election as well as the last before Brexit, and who knows what might ( or might not) be available if the worst were to happen on that front. For Fianna Fail and its leader Micheal Martin, the stakes are particularly high. Fianna Fail continues to languish behind Fine Gael in the polls (in July they trailed 34 to 21) and should they lose another election it would be for an unprecedented third time. Some Fianna Fail deputies have suggested there should be no extension of the current arrangement with Fine Gael while Taoiseach Leo Varadkar appears to favour another year. Looking at the polls, “Well, he would, wouldn’t he?” There are complications however, in pulling the plug, not least being that there appears little public enthusiasm for an early election.
And who knows what else is out there lurking in the long grass? The best laid political plans can go awry. Take the Presidency, where both the major parties favoured endorsing Michael D for a second term, which would have meant no expensive election campaign. However Sinn Fein spoiled that particular set up by announcing it will contest, its candidate to be announced in mid -September. Some other independent candidates may also emerge. Michael D has performed creditably , despite the odd faux pas like the over-the-top tribute to Castro, and appears likely to win any contest ( he is the bookies’ strong favourite), but may be damaged by his age (he is now 77) and his announcement in 2011 that he would serve one term only. While not necessarily indicative of party support levels, apart from Sinn Fein, any Presidential contest could well throw up the unexpected.
With the caveat that a hard Brexit could fundamentally change everything, the likely main election issues are already clear and predictable: Health, the Homeless and Housing. What’s equally predictable is that, despite any resolutions or commitments that the major parties might make, the three Hs will be with us for some time to come. There are no easy or short term solutions to any of them.
The Health issue is of particularly long standing. Former Taoiseach Brian Cowen described it as “Angola”– because of hidden land mines – and successive Health Ministers have been unable to find solutions. Health has been in crisis since at least 1987, when, faced with an earlier version of fiscal crisis, a slash and cut approach was undertaken in Haughey’s third government. Wards were shut, hospitals were closed, making a precarious situation worse. The three decades since have seen monies thrown at the health service – our per capita spend compares well internationally (we are the seventh highest in the OECD) – but the combination of rising costs of medicine and a rising population, up by a third, has dissipated or negated the extra cash spent. It should be emphasised that the treatment and facilities within the Irish health service are excellent. The problems are accessing the system, with long waiting lists and an unsatisfactory current coexisting mix of public and private health care. There is now cross party consensus on Slaintecare, a ten year programme to phase in system reform and universal health care, but ten years is a long time…
Ten years is assuredly too long to tackle the current Homeless situation, which garners headlines daily. Ireland, like everywhere else, has always had its share of marginalised homeless people but the situation now transcends this, with perhaps ten thousand people (the numbers are a political football) in temporary emergency accommodation, including many families. The numbers represent collateral and legacy damage from the Crash. In Ireland the strong desire to own rather than rent a property, inter alia seen as a gold plated investment, led to several housing booms and bubbles since the 1960s, the last of which saw prices reach unprecedented highs before collapsing spectacularly after 2007, falling in some instances by up to 50%. The decade since has seen very little building activity until recently. The recession and the sharp rise in unemployment depressed demand, while the application of new tighter controls on credit, designed to head off another housing bubble, acted as a further damper on both the new building sector and the second-hand house market, where the traditional “trading up” by homeowners on the lower rungs of the property ladder all but dried up.
The market is now recovering – slowly – but remains skewed. There is now plenty of demand with nearly full employment and a rising population but credit continues to be in short supply. The industry is gearing up again and houses and apartments are being built in increasing numbers but it is likely to be several years before some equilibrium is reached. One short term result has been a dramatic rise in the cost of renting with the less well- off struggling to cope. Factor in those unable to pay their mortgages for whatever reason and the cumulative effect has been to push increasing numbers to seek housing assistance. Not a pleasant situation with an acute shortage of social housing and many therefore forced into hotel accommodation paid for by the local authorities. Time should solve it but in the meantime politicians are in for a rough ride. Thus far radicals of either hue have failed to exploit the obvious opportunities. Could this be about to change?