Case of parties trying to have cake and eat it

HOW much of the Progressive Democrats' agenda would be reflected if the party got into government with Fianna Fail? That is one of the key questions now facing the electorate, as it decides which of the two combinations it wishes to put in office.

And voters can also legitimately ask about the policy mix which the coalition partners would put forward. The common tax platform presented yesterday by them means Fine Gael had to abandon its desire to cut the top tax rate until at least year three of a new government.

First to the PDs. The smaller party yesterday outlined a radical agenda involving tight spending control, major reductions in taxation and a tough approach to ensuring that people being paid unemployment benefit are available for work and training.

Bertie Ahern would certainly have no problem with the overall demand by the PDs to control spending more tightly. The Fianna Fail leader will go on the offensive on this subject today, calling on the Government parties to outline the targets they would adhere to on public spending. Fianna Fail has said it will keep the growth in current spending to below 4 per cent a year, and the targets of the PDs are similar.

The Coalition parties have not committed themselves to any overall spending targets, although all promise to comply with the Maastricht targets, and Fine Gael says it believes that borrowing should be eliminated over five years.

In trying to push the agenda on to spending, the Fianna Fail leader will be hoping to persuade voters that whatever the various and blindingly complex details of the tax plans on offer, Fianna Fail is more likely to "deliver" by controlling spending and thus leaving room for tax reductions. In an economic document to be published today, the party will say that in government it will review all spending increases since 1995 in an attempt to ensure tighter control and better value for money.

NOTHING there with which the PDs would disagree, of course. And both parties have given some consideration to the issue of monetary union. Fianna Fail's economic document points out that budget policy will be the only policy instrument with which member governments of monetary union can influence the overall level of economic activity. The PDs, meanwhile, have said that Ireland should not make a final commitment to monetary union, if Britain stays out of the first wave, until the likely terms of membership are negotiated.

Now there is more than a suspicion that in this area the PDs are playing to the small business lobby, which is nervous about the impact of monetary union. Given Fianna Fail's unequivocal commitment and the fact that the PDs appear to believe that on balance Ireland should join even if Britain stays out - then no change in Ireland's intention to join the single currency is likely if there is a change in government. In any case, it's a bit late to follow the PDs' advice of "further consultation" with business on the issue.

But the PD manifesto is ahead of the rest in terms of raising some important issues about preparing for - monetary union, including the need to consider how the economy and particularly small Irish businesses - would prepare to deal with a sharp fall in the value of sterling. As the PDs ask, how are competitiveness and employment to be protected if this happens? Wage reductions would be one option, but employees are hardly likely to accept such cuts, particularly if pay in other areas, such as the public sector, is continuing to steam ahead.

IN other areas, Fianna Fail would have some problems with the PD agenda. The larger party would not be in favour of holding unemployment benefits steady in real terms, or of the tough approach advocated by the PDs for policing the live register. And the scale of the tax reductions being proposed by the PDs - well over £2 billion over five years - is well ahead of the Fianna Fail package of a maximum of £1.8 billion, or that being put forward by any of the other parties.

Finally, Fianna Fail would certainly not accept the suggestion of the PDs to abolish employees' PRSI, although it might go along with some reduction. So the tax cutting promises of the PDs need to be treated with caution. They would clearly be watered down in talks with Fianna Fail.

Likewise, not all the measures put forward by the three existing Coalition partners can possibly be included in a joint budgetary strategy. Already they have compromised by - correctly - promising to target increasing personal allowances and the standard rate band in the first two Budgets. Bang goes the Fine Gael commitment to cut the top tax rate - at least until the second half of a new government term.

And the three parties have put forward different strategies to help families, with Labour and Democratic Left favouring increases in child benefit, while Fine Gael wants to phase in a new subsidy for children under five. Whatever bluster the parties come up with about sharing priorities in this area cannot hide the fact that they cannot afford both to increase child benefit and introduce the new children's subsidy.

Fianna Fail can also be accused of some confusion on the tax front. Having committed himself not to get into an auction on tax, Bertie Ahern has now said that he would like to increase personal allowances substantially. This measure was not included in Fianna Fail's original costings, but is the centrepoint of the coalition parties' tax cutting plan.

To be fair, Fianna Fail is not putting it forward as a firm commitment, but as it would cost at least £400 million over five years, it is hardly an optional add on. So was it added to the Fianna Fail plan at the last minute in an attempt to neutralise the Coalition's appeal to lower to middle income earners?

It is hardly a surprise, of course, that in putting forward their plans, all the parties - and the two potential government combinations - are trying to have their cake and eat it. But voters need to remember that, after the election, normal transmission will resume and many promises will be quietly forgotten.