Varadkar can make history with his future not his past

The thing that most people outside of Ireland have made a big deal of, when it comes to our new Taoiseach, has hardly skimmed the surface here at home. They focus on his Indian heritage; the fact that he is gay; his unique distinction as Ireland’s youngest Taoiseach.

But what exercises people’s minds here is what kind of a Taoiseach will he make, and will he be centrist or Tory Boy right-wing?

He has said he will spring a few surprises within the first weeks – but to do that, he is going to need moolah. And the Fiscal Space is pretty limited – around €500m, according to the Irish Fiscal Advisory Authority (that’s the body which advises the Government on economic affairs, and whose advice the Government ignores every time).

Without even introducing any new measure, spending will increase. That’s because there will be commitments to pay more to public service employees under the unwinding of the financial emergency measures (FEMPI) as well as what are described as demographic factors. That is essentially an ageing population more dependent on pensions and on health services. As you will probably have guessed by now, the cost of health services in this world never decline.

Already he has hinted at where the money might be obtained – the ‘rainy day’ fund announced by Michael Noonan in the last Budget will be ditched before it even gets off the ground.

That fund was to kick off next year and was to be a new National Pension Reserve Fund to pay for public pension funds in the future. Varadkar now wants to spend that money on spending.

His other big idea for revenue raising is to go against the current Programme for Government plan of getting rid of the not-loved Universal Social Charge. He wants to retain it and combine it with PRSI to make a new social insurance fund.

It’s clear that Varadkar and his close circle of advisers have been kicking around a lot of ideas in the past few weeks (and probably over the past few years) in preparation for this moment. They have included reforms of political departments, reforms of delivery and new policies. Varadkar himself has talked about the Taoiseach assuming some of the overarching responsibilities for the health sector.

There was also an idea floating around ministerial circles of the Department of Justice being divided up to accommodate a ‘Home Affairs’ department. Then there was the idea of a new ’Minister without Portfolio’ who would sit at the Cabinet table but would have no specific responsibility. That Minister would also provide the link between Government and the Fine Gael parliamentary party.

For more, read this week’s Connacht Tribune.