InBus_Win09_56-96:InBusiness 1-61 11/12/2009 10:52 Page 94
FEATURE | The Last Word
Time to
GET REAL
+++++++++++++++++++++++++++++++++++++++
Earlier this year, Colm McCarthy’s ‘An Bord Snip Nua’ report was met with widespread criticism.
The man himself, however, believes that it’s about time we realised the extent of our economic
problems and start to tackle them head on, writes Brian O’Neill.
+++++++++++++++++++++++++++++++++++++++
FOR ECONOMIST Colm McCarthy, 2009 has between revenue and expenditure is now service. While many commentators identified it
been an extraordinary year. Catapulted into the €20bn a year, which is €400m a week. We as a menu of proposals, McCarthy says that he
spotlight having published the eagerly awaited are borrowing that amount just to fund the believes that implementing all of the
An Bord Snip Nua report (as the media dubbed everyday running of the state. We have to get suggestions contained within the document is
it), he and his fellow members on the ‘Special that back under control.” possible. “We felt that everything we
Group on Public Service Numbers and recommended in the report was feasible and
Expenditure Programs’ committee compiled a
“IF THERE HAS TO BE A
that each of the proposals was capable of
suite of options to cut what had become being implemented,” he says. “However, the
extravagant government spending.
PERIOD OF ECONOMY IN
choices are a matter for government. The
On publication of the report in July earlier
PUBLIC SPENDING, THEN
committee was simply an advisory body, so it
this year, McCarthy became a target for public is a matter for the elected government to
anger. During his appearance on RTE’s The OBVIOUSLY THAT MUST make the choices.”
Frontline shortly after the report was published,
McCarthy defended criticism from Mary
INCLUDE THE PUBLIC
With €4bn needed to be shaved off public
spending next year, the government is faced
Coughlan who had said in the Dáil that ‘there
SERVICE PAYROLL.”
with some tough choices indeed. Much of the
are many, many recommendations in the debate surrounding where the money is going
McCarthy Report that don’t make sense.’ The Finally, it seemed the stark realisation of the to come from has centred on public services
majority of the public agreed with the Tanaiste, extent of our economic problems was and the public sector payroll in particular, much
fearing that sweeping cuts in social welfare, for beginning to dawn on us; the penny was finally to the outrage of the country’s public service
example, would only serve to worsen an already dropping. McCarthy, who points out that it is unions. “Public service pay is a very large
dire set of economic circumstances. Jack not for him to engage in pleasantries with the element in overall government spending so if
O’Connor, leader of the country’s largest trade trade unions or government ministers, was there has to be a period of economy in public
union, SIPTU, weighed in with his theory that calling it like it was. Now he says, “everybody spending, then obviously that must include the
the report was merely ‘an exercise in fantasy’. understands that we can’t go on borrowing at public service payroll,” says McCarthy.
McCarthy and his committee were on a 12 per cent of GDP. We have to try to get the
hiding to nothing, but his response to his balance back between government spending PUBLIC SECTOR PAYROLL
critics was candid and one of common sense. and government income and that obviously As expected, the unions have not taken kindly
“What doesn’t make sense is to go on involves cutting government expenditure. I to what they feel is unfair targeting of their
borrowing indefinitely at the rate that we (the don’t think anyone disagrees with that now.” members. Despite the standoff however, the
country) are currently borrowing,” he said on government have made it clear that they are
Pat Kenny’s current affairs programme. “The FEASIBLE CUTS going to seek significant reductions in the public
unfortunate position that we’re in now,” he McCarthy’s report identified and outlined just sector payroll and if agreement with the unions
continued “is that there has been an over €5.3bn in cuts in government spending cannot be reached, it simply cannot deflect the
extraordinary collapse in government revenue but did not include cuts to the capital spending reality that difficult choices have to, and will be
over the last couple of years and the gap programme or pay rates within the public made. In fact, should government not take a
94 InBusiness Winter 09
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