Gavan Reilly

thinking out loud

Archive for the ‘Ireland’ Category

Some thoughts on the push for a European referendum

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[Edited, 7:11pm]

So this morning we learned that the Dáil’s technical group is to use a little-known clause in the Constitution – Article 27 – by getting together enough Oireachtas signatures to petition the President to put the new EU treaty to the people.

First, a quick look over the rules:

  • The petition must be signed by one third of the members of the Dáil, and a majority of the members of the Seanad
  • Their signatures are then verified in a manner provided by law
  • The petition is furnished with “a statement of the particularground or grounds on which the request is based”
  • The petition and statement are sent to the President within four days after the Oireachtas has finished its consideration of the Bill.
  • The President must convene the Council of State to consider the petition and give his response within 10 days of the Bill being passed by the Oireachtas
  • If he deems it necessary, he will refuse to sign the Bill until either a referendum is held, or a general election is called and the Dáil reconvenes
  • If it’s not deemed necessary, he signs it within 11 days of the Oireachtas passing it.
Now, some thoughts:
  • This is such an unexpected and unprecedented development that the law outlining how the signatures are verified dates from 1944!
  • Although the petition doesn’t need to be presented until four days after it’s passed by the Oireachtas, the organisers will need to be wary of the possibility of a petition for early signature: the reason there is a four-day window is because the Constitution says the President only signs a bill between five and seven days after the Oireachtas passes it. This is pushed forward in the case of a motion for early signature – meaning that, if he was so minded, the President could accede to the motion for early signature and sign the Act into law before the petition picks up the necessary signatures. Also, given the political urgency around getting this treaty ratified as soon as practicable,
  • This is a separate clause to Article 26 under which the President can refer a Bill to the Supreme Court, and adds a degree of discretion to the President that they rarely have otherwise. Article 27 is quite clear in that even if the Supreme Court is being asked to rule on its constitutionality (though only under Article 26, and not in a private claim) and it deems a referendum not to be necessary, the President can still fire ahead and order the referendum anyway. This is in line with the President’s role as the guardian of the Constitution, and his need to protect the spirit of its intentions as well as the letter of the law.
  • Parliamentary arithmetic means the government is never in danger when it’s trying to legislate, but in this case the margins are wafer-thin. Let’s have a look at the breakdown of both houses:
    • Dail:
      • Fine Gael 74 (plus one defector, Denis Naughten)
      • Labour 35 (plus three defectors, Willie Penrose, Tommy Broughan and Patrick Nulty)
      • Fianna Fáil 19
      • Sinn Féin 14
      • United Left Alliance 5
      • Non-ULA from the technical group 11
      • Other independents 3
    • Seanad:
      • Fine Gael: 19
      • Labour: 12
      • Fianna Fáil: 14
      • Sinn Féin: 3
      • Independent university senators: 5
      • Independent Taoiseach’s nominees: 7

Let’s first deal with the Dáil, which has 166 members, meaning 56 is the magic number.

  • The Technical Group, which has engineered this campaign, has 16. Sinn Féin and Fianna Fáil have both asked for a referendum. Add all of those together and we’re on 49. There are seven other people not subject to the whip: the four government defectors, and the three independents who aren’t members of the technical group.
  • It is questionable whether Messrs Naughten, Penrose, Nulty and Broughan will want to burn further bridges with their parliamentary parties – though perhaps all will be mindful that their former parties may face FF-style backlashes in the next election. Either way, the circumstances of each may mean that at least one of the four might be reluctant to jump.
  • Then we turn to the other three: Lowry, Grealish and Healy-Rae. The former pair, and the latter’s father, were among the independents on whom the previous government relied for its mandate. While the reasons that they did not join the Technical Group have never been explained, it is not because the government bought their votes: all three have voted against the government in the past months with no apparent sanction. Here, though, we have an unusual situation: in effect, if the government wants to ensure it doesn’t get pushed into a referendum, it could strike a deal with the three – who are known to be happy to strike deals – to secure their complicity.
  • So yes – even though the government has a massive majority in the Dáil, with at least 109 votes, it could have to secure the support of Michael Lowry, Noel Grealish and Michael Healy-Rae in order to ensure it doesn’t get dragged into a campaign it clearly doesn’t want, and could well lose.
Now, to the equally interesting Seanad
  • Ordinarily, the Seanad is a mere rubber-stamp for government legislation: the Constitutional power of the Taoiseach to nominate 11 members means the majority is rarely in doubt.
  • This time, Enda Kenny nominated 11 members – four of whom had been picked by his Tánaiste, Eamon Gilmore – but only four of them took party whips. Seven of those members are, in theory at least, independent – those seven have even formed their own technical group to put forward private motions. They may have been appointed there by a benevolent government but they do not answer to it.
  • This means that the government’s benches have 31 members – enough for a majority. Given the usually sub-total attendance in the Seanad, and the regular agreement of the university and independent senators to the government proposals, the majority is rarely questioned.
  • Here, however, the nomination of seven independents means there is something to be played for. Again, assuming that FF and SF in the Seanad assent to the petition, we have 17 signatures. Add the five university members, who have no political loyalties one way or the other, and we have 22. (A side note at this point: it is relatively rare that university panels elect people who are running, in effect, as members of a political party. How thankful Labour must now be that its Seanad leader, Ivana Bacik, got elected in Trinity College…)
  • Now we turn to the Taoiseach’s independents. They are likely, but not guaranteed, to act as one on this. This presents difficulties for some members: take Jillian van Turnhout, who is independent and often critical of the government, but whose husband is the Fine Gael constituency chair in Dublin South. Take also Martin McAleese, who had been reluctant to say anything out loud in the Seanad while his wife was the President. Take Marie Louise O’Donnell and Eamonn Coghlan, who attended FG pre-election events and who are open supporters of the party, though not members of it. Can van Turnhout be persuaded to cause political difficulty for her husband’s party? Can McAleese be persuaded to take an active role in convincing his wife’s successor to take an active political stance? Will O’Donnell and Coghlan end longstanding associations with their favoured party? All are questions to be answered.
  • Even if the independent group signs up, we now stand at 29 – and we need two more people from the government benches to cross over. Are there liberally-minded members on the government side who are willing to break ranks? Bear in mind that many Senators will have been dreading the day, later this year, when they were asked to approve a referendum abolishing the Seanad. A couple may have been prepared to break ranks at that point: turkeys, remember, are not in the habit of voting for Christmas. Perhaps some of them have a genuine belief that the Seanad is worth saving: could they be convinced that backing a referendum campaign could help to turn public support in favour of keeping the upper house? Will two of them be willing to bring forward their inevitable dissent and sign the petition now?
And that, ladies and gents, is why politics is Ireland’s favourite sport.
Update, 7:11pm: Two points I forgot to make earlier:
  1. The rules of a referendum change if it’s been called under Article 27. Even if the No side wins, the Constitution imposes a quorum: the volume of No votes must be more than one third of the total electorate. That means the referendum needs a turnout of well over 60% if the referendum is to be defeated.
  2. Oh, to be a fly on the wall of the Council of State meetings. The former presidents were Labour and Fianna Fáil nominees – the latter being married to a potential signatory of the petition – and there are two former FG taoisigh to FF’s three. The possibility of political motivations in the room should not be discounted: if there are members motivated by their party’s goals, the meetings could be fun…

Written by Gav

February 1st, 2012 at 12:30 pm

Too much of a good thing

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SO, MY FIRST real blog post in well over a year. I won’t make the usual ill-fated apology about trying to do more in future – variety is the spice of life, etc etc – but instead want to put across an observation about the current lie of the Irish political land.

The presidential election has been and gone, and frankly there is little left to say other than to wish Michael D the very best for his impending tenure. He’s been given a pretty hefty mandate – the largest that any person has ever won in Irish electoral history; only on six occasions (all of them referenda) have the people voted in larger numbers for a common end – and my personal hope is that he does his best to use it. It has always struck me as a political curiosity that the President (mandate 1,007,104 votes, from voters in 43 constituencies) could be politically neutered by a Taoiseach (mandate 17,472 votes, from only one constituency); it would be a personal hope that the cabinet might keep the new President’s electoral standing in mind if he should give them a subtle nudge towards a particular social goal.

Anyway, specifically I wanted to make a note on the aftermath of the two constitutional referenda from last week, and the potential impact that the fallout might have on the government’s plans to make inroads on the one place that almost everyone wants it to succeed: political reform. Read the rest of this entry »

If you’re annoyed at how RTÉ cut off Vincent Browne’s questions:

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  • Watch TV3’s special edition of Tonight with Vincent Browne at 10:30pm, instead of The Week in Politics. They’ll be airing the video, including the censored questions.
  • Email
  • Contact the Broadcasting Authority of Ireland (which has incorporated the function of the Broadcasting Complaints Commission):
    • /
    • Write to:
      • The Broadcasting Authority of Ireland
        2 – 5 Warrington Place
        Dublin 2
    • Telephone: (+353) (0)1 644 1200

Update: From RTÉ’s own website:

RTÉ is obliged under Section 39 (1) of the Broadcasting Act 2009 to ensure that

(a) all news broadcast . is reported and presented in an objective and impartial manner and without any expression of the broadcaster’s own views

(b) the broadcast treatment of current affairs, including matters which are either of public controversy or the subject of current public debate is fair to all interests concerned and that the broadcast matter is presented in an objective and impartial manner and without any expression of his or her own views, except that should it prove impracticable in relation to a single broadcast to apply this paragraph, two or more related broadcasts may be considered as a whole, if the broadcasts are transmitted within a reasonable period of each other

Written by Gav

November 21st, 2010 at 10:56 pm

On that Irish Times editorial, and ‘sovereignty’

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A quick note – which will only make sense if you’ve read Madam Editor’s piece from Thursday morning, channeling Yeats: Was It For This?.

It’s obviously an emotive issue – especially in Ireland – when the loss of sovereignty is threatened. As I was corresponding with an American colleague earlier, trying to give him some sense of context as to why Ireland takes its self-governance more than most, I found it difficult to construct even a single paragraph without having to reference Ireland’s chequered relationship with Britain.

However, the editorial – eloquent and on-the-button as it was – overlooked one salient point: the very concept that Ireland had supposedly retained its sovereignty up until now.

The point was this: why is having to borrow money from overseas sources considered a loss of sovereignty, when such borrowing is what the government – any government – does every time it has a budget deficit?

If Ireland has lost its sovereignty by having to invite the IMF in, it’s not (directly) the fault of the incumbent government, nor is it because of the scale of the loans we’ll get – even if they hit €100bn, it’s only doubling the national debt we already have.

It’s because bankers got greedy and stranded us up the proverbial creek – and that’s both the long and the short of it.

Written by Gav

November 20th, 2010 at 12:48 am

How AIB’s gym fees more than double the amount it’ll make from increasing mortgage interest rates

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The front page of today’s Irish Examiner reports that AIB still offers to cover €2,500 per year in gym or golf club expenses on the part of its employees.

AIB is offering to pay employees’ golf club fees and leisure club memberships worth millions of euro every year despite being crippled with debt and facing massive job losses and a likely state takeover.

The crisis-ridden bank confirmed the generous staff perks scheme on the same day it raised interest rates for hard-pressed mortgage holders by half a percent – and just days after it announced record losses of €2 billion for the first half of the year. The interest rate hike will affect approximately 50,000 customers who hold standard variable mortgages. [more]

The piece goes on to say that the scheme is offered to each of the bank’s 12,500 employees in Ireland, as well as the 2,500 it employs in Britain. Up to €2,500, it says, is offered to each employee.

Meanwhile, the bank increased its variable mortgage interest rate from 2.75% to 3.25% yesterday, which will (it is reported) hit about 50,000 mortgage holders with a monthly repayments increase of about €27.

So this morning, after seeing the Examiner‘s lead, I decided to crunch some figures.

In the results it filed in March, for the year ending 31 December 2009, AIB said it had a residential mortgage book valued at about €27.1bn. In layman’s terms, that means that homeowners in Ireland collectively hold mortgages, from AIB, to the tune of €27,100,000,000.

How much of this €27.1bn is lent at a variable rate? Well, that depends on who you ask. This morning’s Irish Times estimates that about 30% of the bank’s mortgages are lent at a variable rate (thanks to Aaron Quigley for alerting me), while Karl Deeter from Irish Mortgage Brokers suggested to me that the variable portfolio amounts to about 20% of the total.

This is where it gets interesting. Yesterday’s Irish Times posited that the 0.5% increase in the interest rate would result in the monthly repayment increasing by €26.96 for every €100,000 outstanding on a borrower’s mortgage.

[Update, 2pm: I’ve crunched more numbers using slightly more mathematical formulae than those in the comments or, presumably, those used by The Irish Times. Using the c = (r / (1 − (1 + r) − N))P formula the monthly repayment works out at €26.96 for every €100,000 outstanding on a 30-year mortgage. The post previously stated an increase of €26.82.]

So, if 30% of AIB’s mortgages are lent at a variable rate (€8.13bn), then AIB stands to make an extra €2,191.848 a month from the increased interest rate – that’s €26.17 million a year. If as Karl suggests the rate is closer to 20% (€5.42bn), it will make €1,461,232 extra per month, or €17.44 a year.

Now let’s go back to the gym membership scheme. Though it’s unlikely, let’s suggest – as well most employees might want to – that every single employee claims their €2,500, there’s a chance that AIB is faced with 15,000 bills for €2,500 every year. That’s €37,500,000 a year for AIB employees to go to the gym or the golf club.

So, if 20% of AIB’s mortgages are at a variable rate, then the amount by which AIB is hitting mortgage holders – the vast majority of whom, we can guess, are in negative equity – doesn’t even cover half of its bill for sending its employees to the gym or golf club.

Let me repeat that. AIB is increasing its mortgage interest rates, when potentially more than double the amount it will make is being offered to send its employees to the gym every year.

It will take at the very least 17.10 months, and at most 25.66 months, for the increased mortgage rates to cover AIB’s annual cost for the scheme.

This is the bank that got a €3.5bn recapitalisation bailout from the taxpayer last year, will probably need another one to the same amount this year (according to JP Morgan, anyway) and which has been able to offload billions in loans to NAMA that it otherwise would probably never be able to get back.

Written by Gav

August 10th, 2010 at 11:07 am