Irish political update: Negotiation framework published but what will the next government look like?

We finally have sight of Fianna Fáil and Fine Gael’s framework document for negotiations, but 10 weeks after the election, is this progress or just a wish list?

In an ever changing political round-table, we now have the Greens, Labour, Social Democrats and Independents ‘considering’ a seat at the table but does the draft document leave enough room for any of those parties to negotiate a deal without compromising their very existence?

A plan to recover, rebuild and renew Ireland after the Covid-19 emergency

Earlier in the week, Fianna Fáil and Fine Gael produced a framework document outlining broad principles and priorities for a new government, which is to facilitate further discussions and negotiations with other Dáil groupings and political parties. The document begins by recognising Ireland as a nation with a proud tradition of community, solidarity and decency and acknowledging the sacrifices we have all made to ensure the safety of others.

It continues on to say that any new government should be one that “puts aside the differences of the past for the overriding objective of rescuing our economy, rebuilding our country, and renewing our society” – a rather conflicting statement from two parties who have refused to enter any coalition talks with the second largest political party in Dáil Éireann, Sinn Féin.

Many party leaders were quick to criticise the document for its vagueness and lack of costings. However, the authors of the document absolutely ‘read the room’ correctly as they managed to capture the mood of solidarity and common purpose that is sweeping the nation as we each continue to play our role in supporting healthcare workers and tackling the coronavirus outbreak.

There is no question that the document has been designed with the priorities of the Green Party, the Labour Party and the Social Democrats in mind, as it emphasises a focus on the wellbeing of Irish people and society. The document lays out ten missions, including Universal Healthcare, Housing for All, and A New Green Deal – each containing alluring priorities in the hope of obtaining the backing of one (or more) of the smaller parties.

Plans for Universal Healthcare (recommended in the cross-party SláinteCare report) and an increase in hospital beds and healthcare staff are bound to appeal to former Minister of State for Primary Care and Social Democrat’s co-leader Róisín Shorthall. The Social Democrats have previously stated the implementation of SláinteCare as a red line for them in entering any coalition talks.

Getting the Greens on board was always going to be a difficult task due to their strong position on a national unity government and the reported unrest within the party on whether they should be entering talks with Fianna Fáil and Fine Gael. However, the inclusion of A New Green Deal was undoubtedly going to attract Eamon Ryan’s party of twelve TDs closer to the table. The omittance of any clear targets leaves a space for the Greens to push for their desired 7% reduction in carbon emissions, but this could create an uneasiness among the more rural Fianna Fáil TDs and members – something for the negotiation teams to bear in mind.

Labour have up until this point ruled out coalition, but as the party of the trade union movement and workers, will be faced with tough decisions on whether to repeat their past and join coalition ‘in the national interest’, as the promise of a living wage is flaunted in front of them.

Filled with many wishes, the document has definitely achieved its aims of getting parties to consider coalition. Yet, both Fianna Fáil and Fine Gael had the opportunity to include many of these aspirations in their own party election manifestos prior to the inconclusive election results. The results of which made it clear the electorate was calling out for radical change. It looks like they have gone for a capture-all approach but will any of the parties take the bait or are some already chomping at the bit?

What will the next government look like?

The Green Party, whose calls for national unity were left unanswered, are open to negotiating and have sought clarifications on the climate measures laid out in the framework document, but a two-thirds majority will be needed to get any coalition deal over the line. With twelve TDs, the Greens are the most attractive coalition partners and are likely to be gifted the ministerial briefs of Transport, Tourism and Sport and Communications, Climate Action and Environment. However, the “green wave” we witnessed over the past year has started to settle into more of a ripple as Sinn Féin instead grow in new support and take centre stage.

Alan Kelly, who has in the past likened power to a drug, is considered by many hungry for government, and for that reason, it shouldn’t be taken for granted that Labour could step up to the plate and negotiate a coalition deal. However, he will need to bring his fellow TDs on side who have already stated their opposition to entering any such coalition. The party membership will also sorely remember its massive election defeat in 2016 when they went from 37 TDs to the much smaller half a dozen seats they now claim in 2020.

The Regional Independent Group will be happy to prop up a government but would not be considered the most stable option, and therefore, are metaphorically and literally waiting in line to be called upon as a last resort.

A new state of affairs

Covid-19 has brought with it enormous challenges to businesses in Ireland and as a result, any government formed will have an extremely challenging task on their hands to bring people back to work and rebuild the economy, all while trying to solve the already difficult crises of healthcare, housing and climate change. The question is whether a government can achieve these ambitions without a return to the austerity measures experienced during the last economic crash?

Unemployment in Ireland has reached almost 750,000 since the virus reached our shores. Over 500,000 of these are in receipt of the Covid-19 Unemployment Payment. These figures exclude the 219,000 employees who are being covered by the Temporary Wage Subsidy Scheme introduced by the government in an attempt to aid businesses in retaining their employees.

These figures are unsustainable and even if the economy fully re-opens next month, this support will have long-term economic effects on the economy. One major challenge facing the government is restoring confidence and easing the flow of trade credit again for B2B in the months ahead – a vital component to ensure we do not have long-term job losses.

Looking ahead

Leo Varadkar and Micheál Martin are due to meet the Leaders of the Green Party, Social Democrats and Labour next week.

Healthcare and housing were the pre-Covid priorities and the election issues of the 2020 general election, and although the current situation is vastly different to the one we were in last February, all parties considering entering coalition will be looking for assurances that improvements to fix our crippling healthcare system and housing and homelessness crisis will be met. A sufficient deal to address these issues will need to be reached if any of the parties are to avoid the strong opposition of Sinn Féin that lies ahead.

Once an agreement is reached, talks will move to the formation of a government and an official programme for government. This process is expected to last a minimum of 4 weeks meaning it could be June before we have a government in place.

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Aideen Ginnell

Ireland Director

Aisling Cusack

Account Manager