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Workers are the front-line casualties of economic crisis – Morgan

28 January, 2009


Speaking during today's Dáil debate on the Economy Sinn Féin Finance Spokesperson Arthur Morgan TD said the front-line casualties in the economic crisis are the thousands of workers losing their jobs every month. Deputy Morgan criticised the so-called stimulus plan from the Government and said if the Government had implemented some of Sinn Féin's Public Finance proposals from their pre-budget submission we would be well on the way to meeting the €2billion target that the Government has set. Deputy Morgan also called for legislation to outlaw the behaviour of the likes of Seán Fitzpatrick.

He said, "The front-line casualties in the economic crisis we are debating today are the thousands of workers who are losing their jobs every month. In the past four weeks we've seen Dell announce 1,900 job losses with a further related 4,000 jobs to go. 300 people have been let go at Kostal. 400 workers have been made redundant in Dundalk and only last Monday it was announced that 750 workers in Ulster Bank will join the growing queues at our social welfare offices.

"While this is all happening the Government is doing nothing. Everyone, including the dogs on street, can see that the Government has not done a single thing for Irish workers since this crisis started six months ago. Thanks to this inertia, we are now at a stage where almost 300,000 people are on the Jobseekers Benefit and, by Minister Hanafin's own admission, staff in welfare offices are 'working flat out' to process welfare applications.

"While our dreadful economic circumstances are as clear as daylight, the Government's plan of action is as clear as mud. Over the last 4 months we have seen one woolly document after another proposing nothing and leading to nothing. The Government has done a u-turn on almost every decision it has made and our own Minister Lenihan and the so-called "excellent people" at the Department for Finance have got nearly every estimate they've made completely wrong.

"We had been led to believe that the Stimulus Package produced last December would provide us with a clear path. But instead we got a flimsy discussion document long on waffle and short on ideas. Despite the criticisms from all quarters, the latest framework document headings which were presented by the Department of Finance in the negotiations with the social partners have been described as 'vague' and 'blancmange'.

"And while Irish workers are being asked to bail out the banks, the likes of Sean Fitzpatrick and Roddy Molloy are riding off into the sunset with golden handshakes worth hundreds of thousands of euro and pensions worth more than €100,000 per annum. Do you not think there is something wrong here Minister?

"The question that I have asked time and time again is when will we finally see legislation to outlaw the behaviour of the likes of Sean Fitzpatrick and when will there be wholesale changes in our regulators to ensure that it does not keep on happening?

"Sinn Féin made a number of proposals in our pre-budget submission to find the resources to deal with the deficit. The Government didn't do enough on bringing a standard rate of tax relief; they failed to lift the PRSI ceiling sufficiently and again did nothing to address the litany of tax exemptions that allow investors to evade paying tax. These are the measures that had to be taken and not some sordid and mean-spirited attack on lower paid workers. Had these measures been acted upon we would be well on the way to meeting the €2billion target that the Government has set." ENDS

Full text of Deputy Morgan's contribution follows:

The front-line casualties in the economic crisis we are debating today are the thousands of workers who are losing their jobs every month.

In the past four weeks we've seen Dell announce 1,900 job losses with a further related 4,000 jobs to go. 300 people have been let go at Kostal. 400 workers have been made redundant in Dundalk and only last Monday it was announced that 750 workers in Ulster Bank will join the growing queues at our social welfare offices.

While this is all happening the Government is doing nothing. Everyone, including the dogs on street, can see that the Government has not done a single thing for Irish workers since this crisis started six months ago.

The most noticeable measure that this Government has taken has been to bail out their greedy property developing friends and of course the banking sector. Apart from that I can't even think of one other move.

Thanks to this inertia, we are now at a stage where almost 300,000 people are on the Jobseekers Benefit and, by Minister Hanafin's own admission, staff in welfare offices are "working flat out" to process welfare applications.

While our dreadful economic circumstances are as clear as daylight, the Government's plan of action is as clear as mud. Over the last 4 months we have seen one woolly document after another proposing nothing and leading to nothing. The Government has done a u-turn on almost every decision it has made and our own Minister Lenihan and the so-called "excellent people" at the Department for Finance have got nearly every estimate they've made completely wrong.

We had been led to believe that the Stimulus Package produced last December would provide us with a clear path. But instead we got a flimsy discussion document long on waffle and short on ideas. Despite the criticisms from all quarters, the latest framework document headings which were presented by the Department of Finance in the negotiations with the social partners have been described as "vague" and "blancmange". According to reports this document did not even mention public sector pay cuts - despite the Minister for Justice stating only last Monday that nothing could be ruled out.

The confusion that has been created by the Taoiseach and the Minister for Finance through their mixed signals and dithering has reinforced the public perception that the Government do not know what they're doing. And if they do, then they are deliberately creating confusion so that they can implement the most severe of cut backs imaginable while the confusion still reigns. Amidst all this uncertainty we are now one of the last countries in the western world to implement a recovery plan.

There has been much talk over the last few weeks of zombie banks but this is a 'zombie government' that has helped create our "zombie banks". The Minister for Finance unbelievably claimed last week on BBC newsnight that our "economy is vibrant". Well, I'm sure if the Minister bothered to listen to the 5,000 Irish workers who are losing their jobs every week, I think he would hear a different story on our so-called thriving economy. It is this type of bull from the Government and senior officials in the banking sector that is making it far more difficult to get to grips with our dire circumstances.

Central to the Government's failures to do anything right at the moment, is the banking crisis. Despite the Government's claims, this banking crisis was very much of its own making. In the last 4 months we have seen the disaster go from bad to worse and we still have no evidence that the Government has finally got on top of it. You know at this stage I dread to switch on the news on Sunday nights out of fear of the newest Government bird brained idea cooked up by their friends in property development.

The Government's guarantee scheme was described by Minister Lenihan last September as "the cheapest bailout in the world". Well the tax payer is now set to take on a €73 billion loan book - on top of its €440 billion guarantee scheme and its €10 billion botched recapitalisation. The aim of the latest nationalisation scheme was to get a corrupt, debt riddled bank and its cash strapped builders off the hook.

The Minister had said 4 weeks ago at the press conference of its botched recapitalisation scheme that "nationalisation would be affirming that we have no confidence in the bank as a bank to survive". The Government then went on to say that under state ownership it will be "business as usual" for Anglo Irish.

Minister. the last thing we need is business as usual at Anglo. When will you outline a business plan for Anglo? Do you accept that it's a case of 'Business as usual at Anglo - No Thanks!'

The latest news on the Anglo-Irish saga is that it will be transformed into some kind of skip for bad debts, which would enable other banks to get off scot free. Why should the tax payer have to pay for the mess that the banking institutions created themselves? With your help of course.

And while Irish workers are being asked to bail out the banks, the likes of Sean Fitzpatrick and Roddy Molloy are riding off into the sunset with golden handshakes worth hundreds of thousands of euro and pensions worth more than €100,000 per annum. Do you not think there is something wrong here Minister?

The question that I have asked time and time again is when will we finally see legislation to outlaw the behaviour of the likes of Sean Fitzpatrick and when will there be wholesale changes in our regulators to ensure that it does not keep on happening?

While the Government gives golden handshakes you have shifted responsibility onto public service workers for the mess that you have created. Having listened to senior Government members, IBEC officials and even Fine Gael unfortunately you would swear that the deficit in public finances is solely down to our public service.

Over the past number of months, the attacks on the public sector from these parties have intensified and the public sector has been wrongly described as "inefficient" and "bloated" while public spending is characterised as "unsustainable". Of course there are some inefficiencies in the public sector but these can be dealt with quickly.

But as an economist stated in yesterday's Irish Times, the crisis in public finance was not created by the public sector, it was the property market that did it. Successive Fianna Fáil Governments, because of their cosy relationship with developers, made this country dependent on property taxes and encouraged a property bubble that continued to swell out of all proportions.

With the bursting of the property bubble which is what bubbles usually do, our revenue plummeted. The Taoiseach encouraged this bubble and it is he and Minister Lenihan that continue to prioritise those dodgy developers over our workers, our SMEs and our economy.

So why should it be the low paid workers in any sector who must take the hit for your own incompetence and the incompetence of those around you? If there are savings to be made why don't we start with your friends - those who can afford it best?

Everyone can see that the CEOs of state bodies from FAS to Coillte Teoranta are grossly overpaid and if anyone must take the hit these are the people to start off with.

We all accept that there efficiencies which can be delivered by the public sector but this does not mean take an axe to it. With all the talk of "efficiency" and adopting a "business model" nobody from IBEC to Fianna Fail has ever once looked at the horrendous wastage of state resources as a result of outsourcing to private companies. We have all seen the scale of bills for so-called consultants.

In the health system in particular hundreds of millions of euro have been thrown away on subsidising for-profit health care companies which is only draining our public hospitals of resources.

Despite all the Minister for Health's claims of efficiency the reality is that private health care is inefficient; a complete waste of tax payers money and is an inferior service to the public system. Numerous reports in the United State have proven that for-profit health care companies - that the Minister for Health and our Taoiseach are so fond of - do not provide the same level of care as public hospitals do.

There is also hundreds of millions of euro of tax being foregone by the state in exemptions for investors through the promotion of private hospitals. This is most evident in the co-location strategy that the Government has continued to pursue despite the objections of those working in our health system. So why is it that the Government can slap an income levy on people barely over the minimum wage and continue to shelter investors from being taxed on their rental income through private hospital adventures? These are not ordinary people - they are extremely wealthy individuals who continue to avoid paying taxes despite our plummeting public finances.

And why is it that the Government can find the billions to bail out banks and property developers, when there is not a brass farthing for our schools or the elderly? There is not enough funding to hire midwives to allow them do their work properly. Midwife ratio should be 1 to every 25 births but in Our Lady of Lourdes Hospital Maternity Unit the ratio it 1 to every 48 births - according to the HSE.

It surely these areas that need to be looked at rather than undermining our frontline services and our low paid workers.

Sinn Féin made a number of proposals in our pre-budget submission to find the resources to deal with the deficit. The Government didn't do enough on bringing a standard rate of tax relief; they failed to lift the PRSI ceiling sufficiently and again did nothing to address the litany of tax exemptions that allow investors to evade paying tax. These are the measures that had to be taken and not some sordid and mean-spirited attack on lower paid workers. Had these measures been acted upon we would be well on the way to meeting the €2billion target that the Government has set.

If the Government wants to get spending under control it is going to have to change its "private good-public bad" mindset and put an end to this wasteful outsourcing of our public services. This means, for example, an end to subsidising the private practice of consultants in public hospitals.

The State will have to take control of vital national and natural resources such as the massive Corrib gas field and renationalise our Eircom.

It also means establishing a major public State Bank to address these problems. This would involve the nationalisation of a major banking institution that deals with credit for SMEs, that can restructure mortgages to stop families from losing their homes and that can give confidence back to the Irish people and workers who have the skills and knowledge to get us out of the economic turmoil that we find ourselves in.

For economic renewal and to secure our public finances the public will have to come first and the property developers will have to come last.

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