INSIDE POLITICS:The failure of politicians to slash their own living standards before everyone else's erodes their moral authority, writes STEPHEN COLLINS
TELEVISION IMAGES showing the convoy of sleek ministerial cars pulling in to Farmleigh for last Monday’s Cabinet meeting proved – once again – that our political leaders have lost touch with the public mood. Given the pain that is going to be inflicted on every level of Irish society in the next few weeks it demonstrated an appalling gulf between the rulers and the ruled which will make it all the more difficult to develop the mood of national unity required to get through the impending storm.
It is more than two years since it was argued in this column that the abolition of the current system of State cars and radical cuts in the pay and pensions of our politicians and senior public officials were necessary first steps to giving them the moral authority to do whatever is required to put the country on the road to recovery.
The Taoiseach, his Ministers and all TDs did ultimately take pay cuts but their failure to seize the high moral ground and slash their own living standards before they asked anybody else to do the same has put a severe dent in their authority. In fact, most voters are probably unaware that the Taoiseach and his Ministers have taken pay cuts at all.
This is where the symbolism of the State car comes in. Abolishing the current system would not save all that much money. It would only be a drop in the ocean in the context of the €15 billion adjustment to be made.
Symbolically, though, it is vital for our leaders to show they are in politics to act in the public interest, as most of them genuinely are. The flaunting of the State car only fuels the cynical view that they are in it for Mercs and perks. What is so astonishing is that our Ministers simply don’t get this point. Look at the contrast in Britain where David Cameron, immediately on taking office, abolished state cars for ministers who live in London and told them to take public transport like everybody else. That struck a chord with the British public and helped him to get a reasonable hearing for his four-year austerity plan.
The dismissive attitude of Ministers here to calls for reform of the system left them open to Enda Kenny’s jibe in the Dáil on Wednesday that the display at Farmleigh was “like the return of the Anglo Irish to the big house”. If Ministers don’t tune in to the public mood and make real and visible reforms in the way they operate, and in the way the State conducts its business, then Fianna Fáil could indeed be heading for the dust heap of history like the Anglo Irish elite of a bygone era.
The failure of those at the top of the Irish political system to get the point about State cars is just one sign that they have been in power for too long. The reluctance to face up to the need to cut the public service pensions bill and reform the system from top to bottom is another. Public sector pensions in Ireland are now truly astonishing and people from outside the country find it very difficult to believe that such a system can exist. Having been exempt from the pension levy, and the public service pay cut, the average pension is now close to 70 per cent of the salary being paid to the person currently doing the job.
Even in normal times this would make no sense, either on the grounds of equity or economics. Given that almost everybody else has suffered some cut in living standards over the past two years and that further swingeing cuts are on the way in the next few weeks, it would be truly bizarre to continue to ringfence public service pensions from cuts.
The Department of Finance estimates that the net pensions bill for retired State employees this year will be €2.236 billion. This compares to a bill of €1.35 billion just five years ago. Over the past two years alone the increase in the pensions bill has been €600 million. With people on the State old-age pension expected to face cuts there is simply no justification for continuing to exempt retired public servants.
Mind you, hugely generous pensions is another perk that applies to politicians and maybe that is the nub of the problem. Former ministers and TDs have also been exempt from the cuts and, while some have taken voluntary cuts, many have not.
A comparison of like with like demonstrates just how generous, not to say profligate, the Irish system is. Former taoiseach Bertie Ahern, who has given up his entitlement to draw a portion of his pension while serving as a TD, will be entitled to a pension of about €111,540 when he leaves the Dáil. On top of that he will be entitled to a pension of just over €50,000 as a TD, giving him a total pension of more than €160,000 a year. Former taoisigh such as John Bruton, Albert Reynolds and Garret FitzGerald are already drawing pensions of this order, as is former president Mary Robinson. On top of that they all have the amazing perk of a car and driver provided at taxpayers’ expense.
The contrast with our nearest neighbour is stark. Tony Blair, who governed for almost precisely as long as Bertie Ahern, has retired on a total pension of £66,000. Given the scale of responsibilities and the enormity of the decisions about war and peace that Blair had to make, the fact that his pension is half the Irish equivalent says everything about the absurdity of the Irish public pension regime.
Speaking in the Dáil on Wednesday Taoiseach Brian Cowen emphasised that one of the reasons for the country’s difficulties was that our costs are so far out of line with our competitors. The place to start making the necessary adjustment is in the political system itself. Unless the whole panoply of State cars, ministerial salaries and absurd pension entitlements is reformed from top to bottom the necessary four-year austerity plan will be bereft of moral authority.