Ibec’s chief Danny McCoy came out as a card-carrying social democrat at this year’s annual Dublin Economics Workshop, calling for bigger government, more public services and higher taxes to pay for them. Not what you might expect from the head of the State’s main business lobby.
“Thinking businesses will realise that the things they state as their frustrations with this State can only be sorted by bigger government in terms of things like regulation, in terms of planning,” he told the annual economists’ think-in at Whites Hotel in Wexford.
“The reality is we have pretty much the same amount of public sector workers now as we did 15 years ago... but one million extra private sector workers,” he said.
A wealthy state such as Ireland needs “more guards, more teachers, more nurses, more planners”, he said, suggesting the tax system, particularly PRSI (both workers’ and employers’), needed to be re-engineered to pay for it. He alluded to the €1 trillion wealth of Irish households as something that needed to be tapped to pay for this new, bigger State but stopped short of calling for a wealth tax, favoured by Sinn Féin.
McCoy claimed that “we were frittering away the surge in money that we have” on temporary inflation-busting measures when it could have been used for transformative investments in education or health. It’s not obvious how Ibec’s membership will view McCoy’s new left-leaning crusade. Most complain Ireland is already a high-tax state.
Separately, economist Colm McCarthy told the meeting that the potential cost overrun associated with the national children’s hospital could hit €2 billion before the project is complete, a figure that, he claimed, could fund 400 primary schools.
His specialised topic was white elephants and capital project budget “overshoots” — not the same thing. He highlighted what he described as three “extraordinary debacles” to do with capital spending: the National Broadband Plan, the national children’s hospital and the National Maternity Hospital. Voluntary adherence to the public-sector spending code needed to be scrapped, he said.
