Vested interests being allowed to hold sway

As we observe a bruised Tony Blair returning to power in the UK for a third time, it may be worth reflecting briefly on some …

As we observe a bruised Tony Blair returning to power in the UK for a third time, it may be worth reflecting briefly on some of the deficiencies of our own political system.

Whatever about Britain, the strongest pressures here seem to come from well-to-do elements in our society - some of these pressures being designed to protect or advance their material interests.

Such self-interested pressures sometimes assume a measure of class solidarity: middle-class voters expect middle-class politicians to act in their joint class interest - and can occasionally be quite upset if their concerns are not accorded a favourable hearing.

Happily there are also other disinterested lobby groups, most but not all drawn from the middle-class, who press the claims of disadvantaged groups or are preoccupied with various "good causes", social or environmental.

READ MORE

What all these groups tend to have in common is a reluctance to accept that resources are scarce and demands on them effectively unlimited.

The allocation of scarce resources - mostly by marginally adding to, or less often by subtracting from, existing heads of expenditure - is influenced in part by these different kinds of external pressures. It is also influenced by a desire by politicians to develop their own new policies, based on ideas emanating from those of their party members who are interested in policy issues, or in other cases from policy studies or from Civil Service advice.

An important, but I think little recognised factor in the manner in which politicians choose to respond to these different pressures is an underlying bias within the political system favouring the employment of tax reliefs rather than grants of additional expenditure.

While the cost can be much the same either way, the majority who pay taxes prefer tax reliefs, from which they see themselves possibly benefiting. They are less enthused by grants, which they see as additions to the burden of taxation.

This bias can, however, be a seriously distorting element in resource distribution, because by definition tax reliefs benefit only those prosperous enough to pay taxes, where as grants can benefit everyone equally, and, indeed, through means testing can be designed to benefit most those in greatest need.

However, means tests are crude measurements which sometimes have perverse effects. Thus the means test for maintenance grants for university students assesses only their parents' income, not their assets.

So, by moving some of their receipts backwards or forwards from the reference year to an earlier or later year it is possible for many quite wealthy self-employed parents to qualify for maintenance grants for a child going to third-level - whereas PAYE workers with quite low incomes often find themselves excluded from the scheme.

Both the income thresholds for such grants and the amounts of the grants themselves have for many years been held at levels that exclude, or leave under-provided for, many students from relatively low income homes.

The reason for this is that politicians are understandably reluctant to pour more money into a scheme, the actual impact of which they can see to be perverse and regressive. At the same time, they have not been prepared to reform this scheme by introducing assets as well as income into the equation.

Because this would upset vocal middle-class voters this crucially important social issue seems recently to have been pushed away, at least until after the next election.

Because of the inadequacy of this scheme, the abolition of university fees a decade ago offered little help to students from less well-off homes.

For many the maintenance grant problem posed a greater problem than did the small share (30 per cent) of the cost of university education that those outside the grants scheme were being required to pay.

For many well-off families that relief was simply diverted to paying for grinds, or in some cases to shifting offspring from free schools to fee-paying schools.

Also, in the housing sector, although in relation to our population the volume of construction in our State is many times greater than in any neighbouring country, the Government is afraid to reduce or abolish grants lest they lose middle-class votes, while at the same time they anomalously impose very high stamp duty on second-hand house sales. But, perhaps the most depressing aspect of our weak and populist system of government is the virtual absence of a sense of concern for the environment.

This has been evident in the persistent refusal of recent Irish governments to have any regard for the preservation of the quality of our water supply - essential to the health of our people.

Year after year they have allowed pressure from a farmers' interest group to prevent them from safeguarding water quality - measures for the protection of which they themselves had earlier chosen to enact jointly with their EU partner governments

Why? Just because this particular vested interest had decided that obeying these laws would be inconvenient for them in the short-term.These are the very people who, if they had a sense of their own long-term interest, let alone concern for the health of their neighbours in rural Ireland, should have been the most committed to preserving what is now becoming the fiction of a "green" Ireland.

Finally, an additional distortion of our system of government derives from the quite extraordinary localism of Irish society, which demands a totally uneconomic and inefficient spreading of public resources around the State, for example in the form of what are under-equipped - and therefore for health purposes less effective - acute hospitals.

This must be one of several factors contributing to our exceptionally low expectation of life.

Similarly with the military. Yes, I know some barracks are being closed, but given the absence of much in the way of threats of local rebellion, what conceivable military case is there for keeping most of the remainder?

This is not to make a case against the principle of decentralisation of Civil Service administrative work, which makes good sense.

However, that concept has been turned into a bad and very expensive joke by decentralising civil servants to no less than 53 different locations, three-quarters of which are not centres that the Government had selected for development, and also by deciding to move nine Ministers and their offices away from the centre of government.

Not much serious thought has been given over how to make our political system more democratically responsive to our real social and environmental needs, rather than to interest group pressures.