Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I welcome the chance to speak on this important Bill. As previous speakers stated, it is the homework from the referendum campaign in June last in terms of putting into legislation our various commitments under the treaty. It also gives us a chance to stand back, perhaps for the first time, identify some of the issues of the past number of years that are responsible for having us where we are today and maybe, as Deputy O'Reilly stated, ensure through this and hopefully other legislation that a Dáil in 20 years' time will not introduce emergency budgets or cut and slash budgets to respond to a crisis.

I hope the notion of fiscal responsibility is something that will sell easily with the public in the current context but the danger is it is merely the name on a Bill with very little underneath but window dressing. That is one of the potential difficulties with this Bill. There is significant promise and potential in it, but when one looks at issues like the fiscal council, we are missing a significant opportunity to have a body with teeth that must be listened to, that is resourced and that can be independent and challenging of authority on how the system generally spends its money.

There are examples in a number of countries, such as Sweden and the Netherlands, of how that can happen. The fiscal council in Sweden has a mandate to take a position on various aspects of fiscal policy. In the Netherlands, the fiscal council provides independent budget and macroeconomic forecasts. There is an independent analysis of fiscal issues provided by the United States Congressional Budget Office, which has the resources to get research compiled and which must be listened to.

There is no sense in us assembling, as the Government has done, a fine bunch of people but putting them up there as Christmas decorations. As soon as advice they come out with that may not be politically popular is submitted for debate, the Taoiseach tells us straightaway it is not binding on the Government but he will reflect on it. The Government is treating the fiscal council similar to other budgetary lobby groups that are queuing up at the door with all of their ideas. If we are to be serious about having a fiscal council as an independent brake on the political system, then we need to treat it a little more seriously than that. We need to budget properly for it. I note in the legislation - perhaps this can be amended - that there is something about an €800,000 limit on its budget. If we trust it to do its job properly, then limiting its research capacity is not a good way to start. On its ability to communicate with people, it must be able to communicate concisely and speak in plain English. Fiscal issues are, by their nature, complex and a fiscal council needs the resources to be able to address that matter.

It will be potentially one of the great legacies of the Government if it is resourced properly, given proper powers and has the capacity to challenge the system in a way where the system must respond rather than the way in which the fiscal council is treated. The notion of fiscal responsibility, and what we are formally signing up to in this legislation in terms of budget deficits and balanced budgets, is incredibly important and long overdue, but must have lines of communication and responsibility.

I think the Minister of State, Deputy Brian Hayes, has done his time on the Committee of Public Accounts and I am not sure whether Deputy Olivia Mitchell has. What one sees at that committee every week, not only last night, are examples of fiscal irresponsibility. One will see it tomorrow, tomorrow week and tomorrow month. There seems to be never any sense of somebody paying a price for being fiscally irresponsible and I apply that to the political class as well as to the full-time accounting officers. If we are serious about fiscal responsibility and about these targets, then the Bill requires us to look at the Ministers and Secretaries Acts so that accounting officers become accountable. It should not be that they merely arrive into the Committee of Public Accounts, spin a line, get their heads kicked in at the committee and in the newspapers the next day, and then we move on to the next story, which is, effectively, what happens at present. If we are to be serious about it or if we are not to come back here in five or ten years' time sending the Taoiseach of the day off to Brussels to get a derogation for us from the 3% deficit limit, this Bill will challenge the entire political and service culture of the State. Unless accounting officers are accountable by their jobs, they will not be accountable. I include Ministers as well. If a Minister cannot ensure that his or her Department is delivering on the budget agreed by this House, then that Minister should go. The same should apply to any accounting officer, be he or she a Secretary General, an assistant secretary or the chief executive of a semi-State organisation. If we have learned anything in the past number of years, it is that lack of accountability drives further failure.

The Committee of Public Accounts does a fantastic job. It is a well-resourced committee. It shows that the committee structure in this House can really work. However, it is too small to cope with the amount of information coming to it.

On accounting officers who overspend consistently in budget, I have a certain sympathy for those in the demand-led schemes. It is difficult at the beginning of the year to anticipate how many will get sick or how many will need various social welfare allowances. If one is responsible for delivering on a capital project in a capital-spending Department or if one is responsible for delivering a programme that is supposed to be budgeted, then one's neck should be on the line if it does not happen, particularly because of maladministration. At present, such a culture does not exist. If we are to be truly correct about a fiscal responsibility Bill and about signing up to all the targets contained in it, then that is the least that we can do. What is required from the Bill is a complete re-examination of the Ministers and Secretaries Acts and various other Acts that look at the role of accounting officers in State and semi-State organisations.

On the notion of fiscal responsibility, one of the ideas of the Government was that it would review and freshen up the budgetary process. Next week we are having a debate, which I am sure will be lovely. We all will come in and impart our ideas and they will be ignored. This is the way, not only of this Government but of previous Governments. I would nearly take a bet that many of next week's ideas will not surface, but at least we are having the debate. The notion addressed by the Taoiseach this morning, of challenging each committee to look at it, is the way to go. It is too late to do it in October; it should have been done in June last so that it could have been done by the committees over the summer.

As has occurred for the past number of years, and in the time of the previous Government as well, there have been leaks thus far about older people, free travel, disability allowances for those under 18, employers' PRSI, the children's allowance and, the latest in the list, private schools. No doubt somewhere in this complex there are ministerial spin doctors plotting to see what will be next weekend's menu of leaks as to what may or may not be in the budget. That is all very fine when one is above in the west wing plotting how to get one's Minister either on or, in some cases, off the front of the newspaper this weekend, but such speculation influences people's behaviour in the domestic economy. People are not spending money because they are afraid that their children's allowance might be cut, their pensions might be cut or they might have to start paying fees in private schools. Every leak that comes out for whatever reason - it was a disgrace the way it was managed last year - will impact on our ability to deliver on the State's fiscal targets. Our domestic economy is already fragile enough without what we must put up with for the next two months before budget day in the way of leaks, counter-leaks, denials and non-denials. Meanwhile people will not spend for fear that they need to put money aside to cover whatever will come. It struck me that the Spanish budget was delivered three weeks ago, presumably for next year.

People in Spain are now in a position to make their decisions on next year's expenditure because they know what taxes and charges they will have to pay. Here, we will not make that call until 5 December although there was a time, believe it or not, when the budget was at the end of January. People will have to make expenditure and budgetary planning decisions over the course of the busiest three weeks in the year for our service economy. Indeed, for retailers, sales in those three weeks can determine whether they open or close their doors in January and we will have the budgetary process right in the middle of that.

At some stage, over the course of this Government's time in office or the next, we must move the budget forward. That will require us to change the October deadline for self-assessed tax returns, which will be a major challenge to the system. However, we must change because the manner in which we introduce budgets at the moment is impacting negatively on our domestic economy and is affecting the ability of the budget to deliver on its own targets. There is no sense in the Minister for Finance coming in here with domestic growth targets that are actually being affected by the manner in which the budgetary process is carried out. That is clearly what is happening at the moment. Those involved in retail say the sector is tanking and that people are just standing back and not making any major expenditure decisions as they await the budget. People are doing that this year and they have done so for the last ten years or more, ever since the December budget process was introduced. It has become a lot tougher in recent years because people know their income is going to be cut, as opposed to increased through tax reductions and so forth.

In fairness to the Government, it was never said officially that if we vote Yes to the fiscal compact treaty, it would be good for us in Europe and would help our influence there. We voted Yes and then on 29 June we had the communique concerning our bank debt. The indication now is that it will be resolved in March 2013 and everybody wishes the Government well in that. Everybody wants to see that happen. However, there is a danger that as we move into our EU Presidency term, the focus will go off that deal and our ministerial resources and time will be set to the Presidency agenda. I know the Government will say this will not happen but there is a certain inevitability about the burden of the Presidency.

The stepping back from the commitment of 29 June by some is significant and needs to be addressed. The letter from the three finance ministers is probably not as significant as some make it out to be because the three individuals involved have never been major fans of Ireland Inc. However, the fact that three ministers of finance, per se, would suggest that the deal is open to interpretation is significant. Prime Ministers drive the car at the European Council but finance ministers are the engine. If the finance ministries in these countries are feeding that view to their ministers, then one has to ask what the officials around the table are doing. What are the finance ministries in these countries feeding to their central bank governors who sit on the board of the ECB? It is the underlying basis of the letter that concerns me.

The Taoiseach is right when he says he has a deal but at the moment there is a question mark over what exactly that deal will be. I heard the Minister for Finance, Deputy Noonan, saying that he hopes for a signal from the ECB before the budget to allow him to plan ahead. We have delivered as a country and have implemented harsh budgets for four years in a row in the interests of the euro and it is time for the ECB to stand with us instead of forever putting blockages in our way. We must be allowed to move on from this because if we move on, the euro will move on. It is as simple as that. If we can get the core programme countries moved on, the euro will move on.

In the last number of weeks we have seen a greater confidence in the euro as a currency. However, we must not delude ourselves because this country is still in a fragile position, no matter what Timemagazine says. The question also remains as to whether Spain will enter a bailout programme but it looks likely. Deputies will have seen the difficulties in Greece on Monday night. There are also difficulties in Cyprus and a number of other countries. The ECB should realise that it is in the interests of the euro to sort out our debt issue and act accordingly. It is time for action because we have done all the talking. The case has been produced and we have shown our ability and willingness to deal with the issues. I cannot see why the procrastination is continuing.

This Bill and its consequences challenge us, as politicians, to change the way we behave in terms of our interaction with the public. We have a habit of putting sugar on everything. Now that we have these targets in place, it is time for us to look at the way we do things, in all parties and none. The days of telling people what they want to hear, with the passing of this Bill, are now over. We cannot blame Europe either and we should not do so. This Bill marks our responsibility as an Oireachtas to ensure that the country is not in the same position again in 20 years time. We must decide that we will not leave a legacy to a future Oireachtas whereby it is forced to implement the kind of budgets that this and the previous Administration had to. This Bill is the start of that process. We must also change our language in dealing with groups and organisations and our way of doing things. It will be hard and will challenge the system but it must be done. We need a complete set of political reforms.

The Fiscal Responsibility Bill is the creation of the Department of Finance but it affects the entire political and Civil Service process. Not only does it require reform of our fiscal systems, it also requires reform of the Ministers and Secretaries Act and of the entire political system and the way in which we, as politicians, do our business. It requires reform of the way we think and that applies not just to politicians but also to accounting officers and senior public servants. We must realise that we will be held responsible for breaches of this Act when it is passed. That will not just mean getting a kicking for two days in the newspapers until they move on to the next story. It will mean losing one's job or at least one's position, that is, being demoted, regardless of where one is in the elected or non-elected system. When people realise this, then they will change their behaviour and attitude. The notion that one can get away with it or bluff one's way out of it goes with the signing into law of this legislation. However, unless the Government introduces other accompanying legislation and brings changes to the areas to which I referred, then I will bet the lotto jackpot, with tax, that there will be a government in 15 or 20 years time going to Brussels looking for a derogation to the Act. That will happen if we put the legislation in place but do nothing to change our behaviour.

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