No to Berlin’s budget

Members of the German parliament have already discussed details of the forthcoming 26-County Budget, including a planned 2% hike in the VAT sales tax, it has been revealed.

It is normally a strictly observed protocol that no aspect of the Budget is revealed ahead of the speech in the Dáil by the Minister for Finance. However, news that the Bundestag is deliberating on Irish fiscal matters ahead of the Dublin parliament has deepened the ongoing crisis for Irish sovereignty.

Fianna Fail’s Michael McGrath described it as “a staggering and unprecedented breach of faith with the Irish parliament and Irish people”.

Sinn Féin’s Finance spokesperson Pearse Doherty said it “confirms that [German chancellor] Angela Merkel really is pulling the strings” and said it “undermines” the Dublin parliament.

“Enda Kenny needs to come into the Dáil and give a report on his meeting with Angela Merkel including exactly what details and documents he gave to his German counterpart,” he said.

The back-room dealings with Berlin contrasted with the government’s attitude to tens of thousands of its young people who descended on the Dáil in a colourful and noisy protest on Wednesday.

Over 20,000 students made impassioned pleas to resist college fee hikes in the forthcoming Budget, which could see many of them forced to emigrate.

The third-level demonstrators travelled from across the country to march from Dublin’s Parnell Square to Merrion Street. Students waved their placards and banged drums while chanting the names of the government ministers who had vowed to block any attempt to increase student fees prior to this year’s election.

They also warned that at least half the country’s students will not be able to survive if the maintenance grant - the sole income of many - is cut in the looming Budget.

One student, Michael Gallagher, a postgraduate student from Donegal, told the crowd that his parents have already emigrated to Australia and that he may be forced to follow them.

“A one-way ticket to Australia will be cheaper than my fees,” he said.

Outside the Dáil, the students held aloft a photograph of Education Minister Ruairi Quinn, taken just four days prior to the election this Spring. In it Quinn is smiling as he visibly signs a pledge not to re-introduce fees, increase registration charges or cut grants.

But inside, the pattern of coalition ministers blaming unpopular policy decisions on the ‘Troika’ -- the International Monetary Fund and EU/ECB officials who maintain the bailout loan agreed by the previous government -- continued.

Mr Quinn all but admitted the coalition had been rendered powerless by the European Union. He told parliament that his government “control neither the cheque-book nor the policy in relation to a range of such public expenditures”.

Sinn Féin president Gerry Adams nevertheless urged the government to understand the importance of third level education to the recovery of the economy.

“If you agree, you should make it clear there will not be any increase on college fees and there will not be any additional cuts to student support,” he said.

As the student rally continued to gather outside, Labour leader Eamon Gilmore blankly refused to rule out a hike in university fees, saying only “a full review” was under way.

MINISTER QUITS

Tension has mounted steadily this week over the forthcoming annual fiscal plan, due to be revealed in less than three weeks.

One Labour Party minister has already quit government. Willy Penrose resigned from cabinet following the decision to close Columb Barracks in Mullingar at the end of March 2012.

The barracks is one of four currently used by the 26-County Army to be shut as a part of a new centralisation drive. Around 500 soldiers who work at the four barracks in Counties Westmeath, Tipperary, Cavan and Mayo will be relocated elsewhere.

It was not immediately clear what savings would result from the plan.

“I was not prepared to stand over a decision that was not backed up by the facts and figures,” said Mr Penrose. “While I will no longer hold the Labour whip, I will continue to serve the people of Longford/Westmeath as an active and vocal public representative.”

His resignation was seen as a sign of internal tensions ahead of the deepening austerity drive, with the government seeking to implement 3.8 billion euros in new cutbacks and taxes.

The sharply contrasting fiscal policies of the increasingly unpopular coalition versus the state’s main opposition parties was underlined this week when Sinn Féin unveiled its budget proposals.

Under Sinn Féin’s plan, only those earning in excess of 75,000 euro ($101,000) per annum would be worse off. The coalition, meanwhile, has struggled to protect high earners from the consequences of its austerity measures.

Agriculture Minister Simon Coveney dismally failed to challenge the Sinn Féin proposals in a late-night discussion with Pearse Doherty on Wednesday.

Coveney outraged viewers of TV3’s Late Show with Vincent Browne when he repeatedly defended the salaries and benefits paid to those public servants earning in excess of 100,000 euro. He insisted high-earning public servants would not work for less than that sum.

The remarks only added fuel to a new controversy over government appointments after a review showed that the traditional “cronyism” of the 26-County state has continued unchanged under the new government.

At least twenty past or present Fine Gael and Labour party members, strategists or donors have been appointed to high-profile positions since the coalition came into office in March, it was revealed.

Despite Coveney’s humiliating experience last night, Fine Gael’s Joe McHugh today again attacked the Sinn Féin plan, leading Mr Doherty to call for a full public debate on the budget.

“Joe McHugh and his Fine Gael party want people to believe that there are no choices to be made in relation to the upcoming budget, that the Troika has laid down the law and we must obey it,” he said.

“However, my party’s pre-budget submission, which is costed by the Department of Finance, clearly shows that there are choices to be made.

“It shows how the deficit can be reduced in line with the government’s targets but in a way that takes the burden off the less-well-off, that creates a fairer taxation system, gets people back to work and eliminates wasteful spending.

“Sinn Féin is putting people at the front and centre of its budget proposals. It is all about choices and we have made the choices that protect people and will get us out of this recession.”

Urgent Appeal