Like most people, when I first saw the cost of living skyrocketing due to runaway inflation and rising energy costs, I started to become seriously worried. “Janey mack,” we all thought. “How is this going to impact the top public servants?”
I mean, jeez louise; those lads just can’t catch a break, can they? First they had their wages cut by 10 or 15 percent during the financial crisis over a decade ago, and now this? 99% of them are languishing on a mere €150,000 a year – barely enough to put caviar on the table – and now cruel fate has given them yet another kicking. There truly is no justice in this world.
But mercifully, this pressing crisis is soon to be rectified. As reported in the Irish Examiner:
“The country’s highest paid public servants are to have their pay rates restored after they were cut during the financial crisis more than a decade ago…Salaries up to €150,000, which account for 99% of the public service, have been fully restored.”
Now, even Tánaiste Leo Varadkar admitted that “we knew this would be controversial and we knew this wasn’t coming at the best time.” And sure enough, giving remarkably rich people extra money as we somersault into a likely recession doesn’t actually look good to the average Joe Soap.
However, Varadkar defended the move by pointing out that the current law required the pay restoration, and that the government would have to pass “a new law to further delay pay restoration for this group of people.”
“There is no longer a financial emergency, we have record levels of employment, public finances are in good order,” he said.
Now this may seem reasonable on its face. The economy is in great nick, he says, and the law requires we give them this money, so why don’t we? That’s the argument. Sounds fair, right?
But there are a few problems with this, not least of which is the veracity of the claim itself.
Firstly, if the economy is in great nick, then why was this not done in 2019, or 2018?
After all, are we seriously to believe that the Irish economy is stronger today after two years of Covid lockdowns, with thousands of businesses shuttered and millions of workers on PUP and EWSS, not to mention tens of thousands of new Ukrainian arrivals? Is Varadkar telling us that the State is in a stronger financial position after all of that expense? That would obviously beggar belief, and contradicts what his ministers have said previously.
Finance Minister Paschal Donohoe was telling us this time last year there was such a crippling deficit we’d have to increase taxes after Covid.
“The idea that deficits don’t matter, especially for a small economy without the possibility to print its own currency, is so far off the mark as to be dangerous in evaluating policy options in the future,” he told the ESRI last June.
As a side note, he also reportedly discounted the risk of inflation as a serious issue at the time:
Ouch. File that under “posts that didn’t age well.”
Additionally, just this month, Varadkar’s own Social Protection Minister was telling us there was a limit to how much financial assistance the government could provide in the cost of living crisis because of financial constraints.
“There are limits as to what Government can do. We do not have a magic money tree,” she said.
Government doesn’t have ‘magic money tree’, says minister as cost-of-living crisis worsens https://t.co/TP5b6bnJw6
— Independent.ie (@Independent_ie) June 8, 2022
So it certainly doesn’t appear as if we’re swimming in cash right now based on these statements.
But if the economy was in a stronger position pre-pandemic, and it’s morally urgent that this pay restoration take place, why didn’t we do it when things were financially stable?
We’re apparently to believe that the government has enough money for reimbursing extremely wealthy public servants on six figures. They have money for housing tens of thousands or hundreds of thousands of Ukrainian refugees. They have billions of euros for the NGO sector. But when you’re stuck for a few quid with the cost of living? Sorry, pal – no can do.
We seem to live in a kind of Schrödinger’s economy, where the State is simultaneously minted and can throw money around like confetti for whatever pet projects the government wants – but we’re also broke and unable to afford things you might want. The state of the economy fluctuates minute to minute based on how enthusiastic a minister is about the expense you’re discussing.
Case in point; while Varadkar recently told the World Economic Forum that Europe isn’t heading for a recession, Taoiseach Micheál Martin was telling us that this was a very real concern just a couple of months ago.
Taoiseach Micheal Martin can't rule out recession as war rages https://t.co/UKImjifbku
— Ciara Phelan (@ciaraphelan_) March 16, 2022
Asked if he could assure people that there wouldn’t be a recession as a result of the Ukraine war, Martin said: “I can never promise anybody about economic cycles. The jury is very much out on that, but there will be a price for this war.”
In fact, Varadkar was telling us around the same time that he believed a recession could be avoided – implying that it was at least possible.
— Irish Times Politics (@IrishTimesPol) April 1, 2022
We’re living in a country that’s rich enough to house the world, but too poor to house our own citizens. We’re rich enough to shut down the economy for two years, but too poor to substantially help with the cost of living crisis. We can afford €6 billion on NGOs – the vast majority of which are useless political lobbying groups – but we need to increase levies like carbon tax on ordinary citizens to make ends meet. We can find hundreds of millions of quid for RTÉ, but we can’t find the money to increase Defence Forces wages. There’s zero consistency.
The Irish economy, it turns out, is simply whatever Irish politicians want it to be. It is exactly as strong or as weak as a minister finds convenient at the present moment. And we should all remember that the next time they come to us with their pockets turned out telling us the state is destitute.