Major issues pile up as Leo grapples with full range of political obstacles

Political Agenda: Irish Taoiseach Leo Varadker faces a busy Autumn

Despite many doubting the strength of the Confidence and Supply agreement or just how long this Government might last, we are now approaching the culmination of the three-budget deal struck between Fine Gael and Fianna Fáil back in May 2016.

Now that the political party ‘think-in’ season has concluded and the Oireachtas is set to resume this week, it’s an opportune time to look at just some of the major issues that will confront the government and the Dáil in the run up to Christmas.


General Election

In the last two weeks, letters between Micheál Martin and Taoiseach Leo Varadkar have rekindled the possibility of a General Election before the end of the year.

The Taoiseach wrote to Fianna Fáil leader Micheál Martin seeking a two-year extension to the arrangement saying it was necessary in the interests of political stability during the Brexit negotiations.

Dismissing the act as a publicity stunt, a somewhat irked Micheál Martin responded by restating his position that he would not open talks on an extension of the agreement before Budget Day in October, adding he would continue to abide by the terms of the original deal, reviewing its operation at the end of 2018.


So where does that leave us?

With both Varadkar and Martin claiming they don’t want an election, we’re left to wonder where confidence and supply may take us next. With the upcoming budget, the presidential election, and a referendum in the coming months, it’s difficult to see where an election might fit in.

And, with the weekend’s Sunday Business Post Red C opinion poll showing Fine Gael with an 11-point lead over Fianna Fáil, will Micheál Martin want to take a chance on an election yet?

 

The Budget

The final budget ahead of a planned general election tends to be termed a ‘giveaway budget’ by media and opposition, as there has been an obvious tendency in the past to attempt to appease the electorate ahead of any election vote. However, Finance Minister Paschal Donohoe has insisted he will not repeat the ‘mistakes of the past.’


So, what can we expect?

The good news is there will be tax cuts on October 9; the bad news is they are unlikely to be substantial. We are expecting some small cuts to Universal Social Charge (USC) to take more people out of the tax net, while there is an added possibility of the income threshold for the 40 per cent income tax rate also being increased.

Among other measures likely to be looked at are a reduction to the level of capital gains tax (CGT) at 33 per cent; an increase in excise on diesel, given that the ESRI concluded earlier this year that such an increase would be fiscally and environmentally justifiable; and an increase in the much-discussed 9 per cent VAT rate on tourism related services. There is also speculation that Budget 2019 will be used to announce the upcoming increase of the minimum wage by 25 cent per hour, from €9.55 to €9.80.

 

The good news is there will be tax cuts on October 9; the bad news is they are unlikely to be substantial

 

The internal Government budget negotiations ran relatively smoothly last year but the talks with Fianna Fáil went down to the wire over a number of other issues. Given the existing tensions, don’t rule out a repeat performance.


Housing

It is the Government’s biggest priority. It’s also the biggest challenge. According to the Department of Housing, the number of people in emergency accommodation is edging close to the 10,000 figure, with 9,891 recorded in emergency accommodation in July.

Criticism came to a boil last month for Housing Minister Eoghan Murphy when a homeless family with seven children was forced to sleep in a Garda Station due to a lack of emergency accommodation, and a number of protests took place around Dublin, occupying derelict property, as well as the minister’s own office.

Following the tabling of a no confidence motion in him by Sinn Féin last week, a debate on the Minister’s performance and position will take place in the Dáil. It is unlikely to be passed.

Fianna Fáil leader Micheál Martin quickly ended weeks of election speculation by indicating that his party won’t back the move, saying “motions of no confidence are not going to build a single house.”

So where to now for the Government on Housing? Last week, it launched the new Land Development Agency, which will earmark State-owned lands for regeneration and development and open up sites for the provision of housing. But such measures take time, and the public, including Fine Gael TDS, will want to see real improvements.

 

The number of people in emergency accommodation is edging close to the 10,000 figure

 

Brexit – All of the above continues to be set against a backdrop of a constantly changing Brexit environment, with the October European Council deadline to secure a deal between the EU and the UK over its future relationship with Europe on the horizon.

The official position of the Irish Government has been, and continues to be, to reiterate the need for a backstop agreement to ensure there will be no hard border on the island of Ireland post Brexit. This is both EU and Ireland’s position.

Meanwhile, British Prime Minister Theresa May is working hard to dismiss fears of a no-deal Brexit and all that such a scenario might bring. The only thing that is clear is that the ongoing uncertainty is not helpful to the Irish Government or Irish businesses.


Presidential Election

Despite speculation earlier this year that Michael D Higgins would be returned unopposed to Áras an Uachtaráin, it is now set to be a much more crowded field than originally thought.

With the election set for Friday October 26, we now know there will be at least four candidates on the ballot paper alongside the incumbent: Liadh ni Riada for Sinn Féin, Independent Senator and founder of suicide intervention charity, Pieta House Joan Freeman, alongside businessmen and Dragon’s Den alumni, Seán Gallagher and Gavin Duffy.

All the signs point to a successful return of President Higgins. However, the country will be bracing itself for a lively and divisive few weeks of campaigning.

There will be other issues. This time last year, Frances Fitzgerald was both Tánaiste and Minister for Justice. Following an unanticipated whistleblower crisis involving an Garda Síochána, she resigned in November 2017.

The nature of politics suggests that issues like this could crop up again and throw the government off course.