Taoiseach Enda Kenny’s broadcast to the nation last night was clearly designed to maximise the political capital from the bailout exit but it also involved a calculated risk.

The Fine Gael-Labour Coalition deserves a great deal of credit for steering the country safely through the bailout and out the other side, even if this did involve implementing policies initiated under its reviled predecessor. Mr Kenny wisely gave most of the credit for the achievement to the Irish people rather than trying to claim it for the Government.

“Your patience and resilience have restored our national pride and empowered us to face the challenges that remain,” he said.

Since it took office, the Coalition has carried out its business with an air of competence and authority. That helped to win public acceptance for a range of measures that in other circumstances could have been difficult to implement.

International community
As well as bringing the Irish public with it, the Government also persuaded our EU partners and the international community that it knew what it was doing and would deliver on the key elements of the EU-International Monetary Fund programme. That in turn helped to win concessions on the terms of the bailout and the promissory note which fed into international confidence that Ireland could deal with its debt.

Kenny’s performance was central to all of this. His good relations with German chancellor Angela Merkel and the other prime ministers who form part of the European Peoples’ Party played a significant role.

More importantly, his indefatigable energy and unwavering upbeat mood was critical to the restoration of confidence at home and abroad. However, by making his second televised broadcast to the nation to mark the end of the bailout he has staked his political reputation on a sustained economic recovery over the next two years.

In his speech he expressed optimism for the country’s future but wisely pointed out that the progress made to date should not be put at risk.

Turning his focus to jobs, the Taoiseach insisted the country would have to continue to pursue prudent budgetary policies.

There are certainly reasonable grounds for confidence. All of the domestic economic indicators are moving into positive territory and economic growth next year looks like reaching or at least coming very close to the Government’s target of 2 per cent. The problem is that the Irish economy is massively dependant on the outside world and, while things are looking hopeful for the international economy, there is no guarantee against a shock that could upset all the calculations.

The euro appears to have weathered the storm, but the major problems confronting Italy and France could trigger a sudden loss of confidence that could put this country back in the firing line. If another bout of austerity measures has to be introduced at some stage over the next couple of years, the domestic political impact could be devastating even if the cause is outside the Government's control.

The Irish public will not forgive Kenny if, having been told that the bailout exit marks the beginning of a new chapter, it turns out that the worst is not over after all.

The decision to give the cold shoulder to European Commission president José Manuel Barroso and commissioner Olli Rehn and exclude them from the bailout exit party could also come back to bite the Government if we have to go back cap in hand at some stage over the next couple of years.