If there is one thing the main players involved in this governing arrangement – Fianna Fáil, Fine Gael and the Independents – can agree on it’s that nobody gave them a chance of getting this far.
They cannot be denied their moment to gloat now that the third and final budget of the confidence and supply agreement has been announced even if its measures have yet to be fully passed.
Those who truly believed at the start of this Government’s term in 2016 that three budgets would be hammered out between Fianna Fáil and Fine Gael, with Shane Ross and others thrown in, could probably be counted on one hand.
The arrangement cobbled together by Micheál Martin and Enda Kenny was written off so many times, but those involved did what politicians do best: find a way to keep the show on the road.
Kenny’s successor, Leo Varadkar, and Martin have already agreed to review the arrangement over the coming weeks in a process that will directly pit the judgement, guile and instinct of one leader against the other.
The point is approaching when they can no longer shirk the choice of whether the deal is extended or the country faces an election. Against that backdrop much was made of the package announced by Paschal Donohoe being an election budget with giveaways aplenty.
Yet, in line with last year’s budget, it was less a call to electoral arms than a study in incrementalism.
Budgetary template
Donohoe has set a budgetary template which he has followed thus far, and is likely to do so in future if he remains in the Department of Finance. Modest income tax reductions, €5 welfare increases and increased spending on services – funded, if needs be, by revenue-raising measures – decorate his budgetary calling card.
Fianna Fáil is in full alignment, and has helped shape this approach. The ease of the budget negotiations between the two main parties speaks to a now extraordinary level of consensus.
Donohoe has also identified where he can raise revenue in future should it be required. Two options – increases in carbon tax and excise on diesel – were considered for this budget but abandoned. Both are politically difficult, but are there to be taken off the shelf next year if there is to be another Donohoe budget.
The increase in the special VAT rate for the hospitality sector was a tough call, but was focused enough to prevent major political damage.
Diesel increases in particular would hit hauliers and would have a disproportionate impact in rural Ireland, but equalising the excise between diesel and petrol has now been flagged for the future.
More money was allocated for health and housing, the areas of weakness for the Government, but new announcements in both areas are likely to be given a jaded welcome by voters who have heard much promised before and only want results.
Two areas
Those two areas above all others will dominate the talks between Fine Gael and Fianna Fáil on the future of confidence and supply. If the budget talks were relatively straightforward, the review and possible extension of the current Government deal will be far trickier.
There are voices within Fine Gael – said to number Simon Harris, Eoghan Murphy and possibly Donohoe himself – urging Varadkar not to allow Martin bog him down in process and stymie a run to the country. The call Varadkar will have to make is if and when to end talks with Fianna Fáil.
One old Fine Gael hand remarked gnomically on Tuesday that Donohoe had not delivered an election budget but neither had he delivered one that would prevent Fine Gael going to the country.
Donohoe himself cast Budget 2019 as one that secures the public finances and balances the books. Politically it could also be described an insurance policy taken out against a potential election.
It neither seeks to thrill nor leaves many disappointed, but, in covering as many bases as possible, provides cover for an election – if there is to be one – whilst also setting a course by which this Government could last even longer.
