Five years ago this month, the most visionary Irish economic mind of our times issued a rallying call for a “brave budget” to tackle the “sacred cows” of child benefit, State pensions and medical cards for the over-70s.
It must be some comfort to Seán FitzPatrick in these times of trial to know that his vision is coming to pass. The Government may not be gracious enough to admit that it is following the FitzPatrick plan, but it sure as hell isn’t following any other. It literally does not know what it is doing. Here are five things the Government does not know about its own budget.
1. It doesn’t know who will take most of the pain. The most basic calculation any half-serious administration would want to know about a budget is whether it is progressive or regressive: will it hurt the well off more than the worst off? Will it widen or narrow the gap between the rich and the poor? Neither the Government nor the semi-official think tank, the ESRI, can tell us.
2. It doesn't know whether or not free GP care for the under-sixes is part of a plan for universal health insurance. Fine Gael and Labour have been committed to this idea for at least five years, and it is the major plank of social policy in the programme for government.
Opaque policy agenda
The first phase was to be free GP care for people with long-term illnesses – a plan that has been abandoned without explanation. So is the concession for the under-sixes the new first phase of a larger project? They don't know. From Labour alone we have had three different answers. Kathleen Lynch says that this is it for the lifetime of this Government. Alex White says free GP care for all will follow in the Government's lifetime. And Eamon Gilmore told us last week that he doesn't know what the next phase of the plan is because it hasn't been decided yet.
3. They don't know the law. Joan Burton announced that savings in her budget will be achieved by deploying gardaí to mount checkpoints. "We will also be looking at areas like checkpoints in estates and on roads early in the morning as people, who otherwise are claiming benefits, are actually in fact going off to work either self-employed or working and not declaring it." No one is obliged to answer any question from a garda about their work status, destination or social welfare record. If (and only if) a garda has reasonable grounds for believing that you have committed a crime, he or she can demand your name and address. Beyond that, there is just one statutory power to stop and interrogate: where someone is suspected under the Offences Against the State Act of armed violence or subversion.
4. They don't know that taxpayers have medical cards. Michael Noonan told Prime Time last week: "There is no medical card being issued that some other taxpayer isn't paying hard for through their work." We must assume that he was not doing anything as cynical as attempting to divide citizens into taxpayers and parasites, and that he does not realise that all medical card holders pay VAT on a regular basis, that many are paying PAYE (eligibility for a card is judged on "after tax" income), almost all pay property tax, and that most of the over-70s paid tax and PRSI for many decades.
5. They don't know how they're going to do the "probity check" to save the suspiciously precise sum of €113 million in medical cards. Noonan also said that this will involve a review, over the course of 2014, of every single medical card to ensure it is valid. If so, this will be one of the biggest single administrative tasks undertaken in the history of the State. There are just under two million medical cards. Validating every one in 12 months will surely cost more than the sum to be saved. This idea is based on previous studies by consultancy firms PwC and Accenture. The PwC study was, according to the Comptroller and Auditor General, "conducted on the basis of a review of reports rather than a detailed analysis of the database and expenditure". In other words, it didn't look at any individual card holders. The Accenture report was an analysis of "cost drivers, risk areas and associated controls. The review did not develop a baseline estimate of the level of excess expenditure under the medical card scheme".
Lazy, sloppy and careless
So it didn't test actual medical cards either. And the proposal advanced by the HSE in response to the C&AG's report was "to conduct additional internal reviews to ensure that prescribed controls are being applied", again nothing to do with checking every card or each of the million cards to be renewed next year.
If a manager in a sausage firm turned in a plan with so many holes in it, he would be sacked. But being “brave” and “tough” means that it’s okay to be lazy, sloppy and careless with other people’s lives.
