New government, same austerity

Published on 7 March 2011 at 11:50


“Stand and deliver,” headlines the Irish Independent. This ironic use of the stock phrase associated with highwaymen comes after Fine Gael and Labour signed off on a coalition deal on 6 March to form Ireland’s next government. With the national economy in tatters, the new adminstration has little choice but to abide by the terms of the €85 billion EU/IMF bailout agreed by the outgoing Fianna Fail-led government. And its only option for raising money will be “cutbacks and stealth-tax increases”. “'We now face one of the darkest hours in the history of our independent State.” So runs the less than cheerful preamble to the new government programme with Fine Gael leader Enda Kenny as Taoiseach. Major challenges will include - “Renegotiating the interest rate on the EU bailout. Pushing through real public sector reform. Privatising key state assets. Finding €50bn to replace the ECB's emergency funding for the banks. Reducing the deficit without increasing income tax.”

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