Campaign News Feed

Brian Cowen made three major blunders that have driven our economy in to
a recession, according to Fine Gael's Deputy Leader and Finance
Spokesman, Richard Bruton T.D. He was speaking today (Thursday) at the
presentation of a new Fine Gael report - "Recovery through Reform" -
that analyses the origins of the current recession and sets out measures
to help restore our economic performance.

"In the space of four years at the helm at Finance Brian Cowen steadily
and deliberately pursued policies that sabotaged our economy's capacity
to weather external shocks. Having steered the economy in to recession
there is very little confidence that he can steer us out of it again.
The reality is that Cowen made three critical blunders in his time in
Finance that drove us in to a recession. They were;

Cowen's Blunders:
1. Reckless inflationary budgets, driven by electoral needs, that killed
our competitiveness,
2. Huge increases in day to day spending financed by unsustainable
property tax revenues,
3. Stalled public sector reform and abandoned value for money
discipline.

"These three blunders are at the heart of the emerging recession we are
now facing. Given his exceptionally poor performance in his brief over
a four year period and his failure to introduce any radical reform
measures one must be pessimistic over the prospects of Brian Cowen
driving the type of change programme needed to help us out of the
recession we are now facing.(see detailed data in accompanying slide
presentation - available from FG Press Office)

"Fine Gael spent years warning Brian Cowen of the dangers of reckless
spending programmes, unsustainable property and consumer tax revenues
and an unwillingness to change our approach to the public finances.
Regrettably those warnings were ignored and we now face a severe
recession while other countries face an economic downturn.

"To extricate ourselves from Brian Cowen's recession there are a series
of actions that Fine Gael sees across four vital areas that are key to
our ultimate recovery. These include measures that will;

FG Action Areas:
1. Cut out avoidable waste
2. Help keep prices and inflation down,
3. Change the way our finances are managed, and
4. Reform the way our public services are managed, regulated and
provided.

"More particularly, this will mean;

Fine Gael Proposals:
Waste;
1. Cancel ministerial and higher public service pay rises
2. Cut number of junior ministers by at least three
3. Announce list of agencies to be rationalised in 2008-09
4. Release up to €400m from failed FF decentralisation programme

Cost of Living;
1. Close stamp duty loophole for landowners/developers ...and use funds to
cut duty rates for ordinary families trading up and down
2. Cut VAT from 13.5% to 12.5% using a €1.5bn carbon windfall levy on
power generators
3. Freeze state charges (hospitals, transport, TV licence etc.)
4. Finalise moderate pay deal supported by credible commitment to bring
inflation down below euro area average

Budget Reform;
1. Limit growth in net voted current spending to 4% in 2009-11, but
accelerate capital spending in line with NDP commitments
2. Abandon "Existing Level of Service" estimates process
3. Require EVERY department to secure 1% budget savings each year - this
would create a €2.0bn "Strategic Fund" for 2009 to finance priority
welfare and service improvements e.g. indexing social welfare and
keeping promises on teachers, Gardaí and medical staff

Public Service Reform;
1. Public Sector Efficiency
- Accountability with consequences - making pay and promotion linked to
performance
- Staff mobility and open recruitment - breaking down barriers between
agencies and Departments and the private sector
- Procurement - streamlining State purchasing functions
2. Regulation and Competition
- Electricity grid - opening up access to the grid to renewables to cut
costs and improve the environment
- Bus competition - more open competition in Dublin and other cities
3. Grow Productivity through ICT and Innovation
- Next Generation Broadband Roll-Out - stimulate greater private sector
investment in next generation networks.

"These proposals, many on the reform side that have been pushed for
nearly 5 years by Fine Gael, are the type of measures that are required
to lead us out of recession. More of the same from this Government
simply won't do. We have to see real change and real reform. Hitting
and hoping that a dot com boom or construction boom will disguise your
ineptness is not good enough for the Irish people who will end up
suffering if easy option politics are chosen again.

"For the first time in many years a Fianna Fail Government will have to
start making its own luck. Our proposals, I believe, will help turn our
fortunes around in a way that we can be optimistic about our future.
Failure to act, as shown over the last four years, only leads to more
hardship and suffering."

Budget Critique 2009 - Bruton - July 3.pdf