ANALYSIS:THE MANTRA of the two Government parties during the general election campaign was that job creation would become the overriding priority once they achieved office. "It's all about jobs," Labour Party leader Eamon Gilmore said over and over again.
The cuts of €755 million announced yesterday to an already trimmed back capital programme are making those pronouncements about jobs look a bit hollow.
It was inevitable that some of the major vanity capital projects of the last government, such as Metro North, would bite the dust in the current economic climate. There is no disguising the fact, though, that cuts in capital spending will inevitably affect jobs.
What is clear from the scale of cuts in the capital programme, and the planned cuts in social welfare to come in the budget, is that the overriding priority of the Government policy is to protect the pay and pensions of the public service.
The size of the cut in the capital programme is widely perceived as a victory for the Labour Party Ministers in the Coalition who, going on the pronouncements of Tánaiste Eamon Gilmore, appear anxious to protect the Croke Park agreement at all costs.
It was noticeable at the press conference to announce the cuts that when a journalist asked Minister for Public Expenditure and Reform Brendan Howlin if cutting capital spending was not the easy part of the budget, Taoiseach Enda Kenny nodded his head. While Howlin refused to accept the proposition, it is clear that from the Labour perspective capital cuts are preferable to current cuts regardless of the consequences for jobs.
Ironically, a queue of Labour backbenchers quickly formed to attack the capital cuts insisted on by their own Ministers.
Dublin North East TD Tommy Broughan was the most trenchant, saying the shelving of the Metro North, the Dart Interconnector and other Dublin transport projects would come as “a major disappointment” to the people of the region. He claimed €200 million had already been spent on Metro North and was now “money down the drain”.
Dublin North TD Brendan Ryan also voiced his disappointment at the Metro decision, as did new TD Patrick Nulty. Clare Labour TD Michael McNamara called on the Government to proceed with planned spending on the rail network in his constituency.
The Opposition was even more critical of the cuts with Fianna Fáil spokesman on public expenditure Seán Fleming saying Ireland could not afford the level of job cuts arising from the cuts in capital investment.
He said the cutbacks would represent 9,000 fewer jobs in the economy next year alone and the job losses would continue in each of the following years as further capital spending cuts kicked in.
“We now find that Ireland will have one of the lowest levels of capital investment in the EU. This will have serious implications for long-term growth,” he said.
Sinn Féin enterprise spokesman Peadar Tóibín estimated the cuts would cost a further 7,500 jobs, while Green Party leader Eamon Ryan said the decisions would hinder recovery by undermining competitiveness and removing a stimulus for sustainable growth.
No Opposition spokesman suggested where the money for the abandoned projects would come from or what alternative cuts should be made instead. That is the luxury of Opposition, which Fine Gael and Labour availed of before the election. The Coalition parties are finding out now that the kind of choices they are faced with in office is making their pre-election rhetoric look foolish.
