Budgeting for inequality and inefficiency

BY ROBBIE SMYTH

A 10% rise in government spending, with a sizeable increase in road investment, a few good sound bites on education, employment rights protection and international aid, as well as a €14 billion spend on health and €750 million on Research and Development and that still leaves room for early Christmas gifts on budget day in the form of small tax cuts and weekly pension payments set to pass the symbolic €200 mark.

There were few shocks in the 11th Fianna Fáil/PD Budget estimates. Brian Cowen offers a softer veneer than the brash arrogance of his predecessor Charlie McCreevy but it was still vintage Fianna Fáil, still focused on the glitter of the big spend flagship projects, still ignoring the advice that doesn't suit their own short term electoral agenda and still prepared to fund the same policy failures, the same inefficiencies that could be wasting billions of taxpayers euros annually.

Cowen's budget will mean substantially higher local council service charges, no new hospital beds, and will condemn tens of thousands of workers to more years of travel gridlock.

Sinn Féin TDs Caoimhghín Ó Caoláin and Seán Crowe stood out in the political reaction to the estimates as both highlighted the failed promises and privatisation agenda driving the budget policy.

Cowen ignores the experts

Cowen's estimates increased spending on road, rail and other infrastructure projects by 13.6%. He acknowledged that he is ignoring the recommendation of the Economic and Social Research Institute (ESRI) that warned increased infrastructure spending would be more costly as there was not enough capacity in the Irish construction sector to meet current housing need, ongoing demand for commercial developments as well as the governments own massive infrastructure programme.

Cowen though is intent on maintaining a massive road building programme. He could have diverted funds to the restoration of the Dublin Navan Railway as a passenger route, he could have increased the Bus Eireann and Bus Ath Cliath fleets by more than the 260 new buses promised. Cowen has announced the start of the Western Corridor rail project but refused to set aside more funding to prioritise this project. Instead the finance minister fed his road fixation.

The Government is spending €1.5 billion on roads annually, now the National Roads Authority will get an additional €1.8 billion to finish eight major road projects and begin six more.

Harney's health scare

The greatest flaws and gaps in government spending plans are in the massive €14.6 billion allocated to health out of a total budget of €54.3 billion.

Health minister Mary Harney should have an extra €1.1 billion to spend this year, €500 million of which will go on staff pay, €300 million extra is needed to maintain health services at their current levels, €120 million is earmarked for the rising costs of medicines and in the end there is in fact only an additional €190 million for improved health services.

Sinn Féin Health spokesperson Caoimhghín Ó Caoláin highlighted the failures in Harney's strategy. Ó Caoláin said: "The two-tier system with two waiting lists and two levels of care" was being reinforced by the private hospital co-location scheme. A Sinn Féin Dáil question earlier in the week revealed that Harney intends that "contracts for the 10 private hospitals on public hospital sites will be signed by the first quarter of 2007", with no cost-benefit analysis done on this scheme.

Ó Caoláin also criticised the lack of new hospital beds saying that the coalition commitment to 3000 new acute hospital beds has been dumped, "together with much of the Government's 2001 Health Strategy".

Privatising Secondary Schools

Sinn Féin Education spokesperson Seán Crowe drew attention to the failure to increase building grants for second level schools. Public Private Partnership (PPP) spending is budgeted to rise by 58% to fund the building.

Crowe said: "We have a shameful situation where schoolchildren are being taught in divided PE halls, overcrowded classrooms and in prefabs, which the Department of Education see as some sort of permanent solution. It is outrageous that some children are even being educated in disused toilets."

Attacking the increased use of PPPs, Crowe said they represent "a serious failure by successive governments to use the resources provided by recent economic growth for social programmes that serve the population". He said PPPs had "proven to be expensive and inefficient". It is an indictment of this Government said Crowe that they are channelling money into the private sector while refusing to increase the school buildings grant.

Budget day will no doubt see the unveiling of some small initiatives on tax and social welfare as we go into election year, they won't focus on the billions of euro of wasted taxpayers money.