Next 10 weeks are a high-stakes game of political poker with a pot of €8bn on table
The next 10 weeks could decide how the country is governed for the next 10 years. That is the type of calculation that will be focusing minds in the main political parties as we get ready for the resumption of the Dáil on September 20. Why is the challenge so immediate and the prize so potentially enduring? Well, it’s to do with the budget – not the 2018 version, important though that will be, but the three budgets that come after that and which are central to this calculation.
While the amount of available funds in the upcoming budget will be of the order of €500m or so, the three subsequent budgets are projected to have several multiples of that available. In fact, each of the three budgets up to 2021 should have approximately €2.7bn available for new programmes or tax reductions. That means there is effectively an €8.1bn pot that the political parties will be fighting to have control of so that they can implement their policies and deliver for their voter blocks.
Given the politics of the last 10 years, that is quite a prospect to consider and a political platform worth fighting for. Whoever is in a position to direct these types of resources to their policy agenda will have an incredibly strengthened hand come the election following the one to replace this current Oireachtas. Whether it is a Fine Gael-led administration or a Fianna Fáil-led one – realistically they are the options – will depend on whether the polls for both parties shift from their current broad parity.
If Fine Gael remains level or gains a slight edge, it is harder to see the current administration being collapsed by Fianna Fáil. While the current deal between the minority Government and Fianna Fáil is framed to accommodate three budgets, if Micheál Martin and his team can put several points between himself and Leo Varadkar’s Fine Gael, there will be a lot of pressure to trigger an election in spring before we get to the third budget in October 2018.
It’s a very risky strategy but, off the back of a difficult winter or some new crisis, Fianna Fáil could claim that it had given the minority Government deal a decent run but that things just weren’t working out and it was time for a strong new mandate for a new government.
But that brings us back again to the next 10 weeks, and why it is so important. Those 10 weeks will play a huge part in deciding if either group can get the poll numbers to move in their favour. Those numbers have been pretty consistent since Fine Gael began its leadership change. The prospect of a generational shift in leadership saw Fine Gael’s numbers jump in April to 29 points. Another poll in May confirmed the positive movement with a 30pc score and then one more in July, after Fine Gael had a new leader in place, secured another 30pc result. Other than a seemingly very low 21pc score in the April poll, Fianna Fáil has statistically matched Fine Gael in the other polls, with 27pc and 29pc.
While these numbers are encouraging for both parties, as it shows them up about 5pc on their last election performances, it doesn’t make a compelling case for either to risk asking the electorate for a new mandate. This is obviously of more interest to Fianna Fáil, as the status quo currently suits Fine Gael even if it is far from ideal from a governance point of view.
Three major set-pieces in the next 10 weeks will signal if either party can harness that notoriously elusive political commodity, momentum: the budget on October 10, a Fianna Fáil árd fheis shortly after, on October 13 and 14; and then a new capital plan sometime in November. These are the types of events that one looks to as a party to build that precious momentum and those back-room teams in all parties, not just Fine Gael and Fianna Fáil, will be working very hard to do just that. But it is no easy task.
The budget is a double-edged sword, as you can fix some things but never all. The €500m available for extra spending or tax measures will not go as far as everyone will want and the 2:1 split agreed between the parties in favour of spending over tax will mean maybe €200m or so for tax cuts. When you consider that a 1pc cut off the 20pc rate costs €606m, off the 40pc rate €330m, or a €1,000 increase in the standard rate band – which Finance Minister Paschal Donohoe has flagged an interest in – costs €202m, you can see how little wriggle room there is. A capital plan can describe a future vision for the country but in the shorter term the challenge is to get projects off the drawing board and out on to the ground. An árd fheis is a fantastic opportunity to rally the troops and build a narrative that you think will carry you to electoral success. But again, if you pitch it wrong or don’t have new solutions and rely too heavily on old criticisms then the public will pick up on that quickly.
So, a high-stakes game of political poker is being played out around Kildare Street right now, with a pot of €8bn sitting in the middle of the table for the one who plays their cards best. While the €8bn is the obvious prize, it is actually only a tool to try to fix the things that need to be fixed in our society and give a well-earned break to all those who have worked so hard to keep that society afloat through 10 crisis years.
The right mix of policies helped create the possibility to have such a pot ready to be invested over the coming years but the wrong ones could easily see it diminished. There are well documented external threats we know about and some less well appreciated internal ones too that could close this window of opportunity. That’s why it’s time to take a really close look at what everyone is saying and proposing to do over those 10 weeks because the stakes really couldn’t be higher.
Remember, it’s our money on the table.