Ray Burke was right

Ray Burke was corrupt, a politician who disgraced himself and his profession with his taste for accepting brown-paper bags full of cash.


 Every decision he took has to be viewed with suspicion. Somebody may have been paying him to take actions favourable to the donor's interests. But that doesn't mean all of his ministerial actions were wrong automatically.

Take, for example, his changes to the tax regulations governing off-shore oil and gas exploration as Minister for Energy.

Some, especially those looking for other angles to work in the ongoing controversy over the proposed Mayo pipeline to bring gas from the Corrib field in the Atlantic onshore now that their safety argument is collapsing, would have it that Burke gave away our natural resources for nothing.

They want high taxes or royalties imposed on private sector speculators. Or they would have the State carry out exploration and exploitation of such "assets" instead.

It is a glib and facile argument, however, that is based more on ideology and wishful thinking than sound economics and cold pragmatism. It ignores the realities that oil and gas is scarce in Irish waters, difficult and expensive to locate and, if a lucky strike is made, again highly awkward and costly to exploit.

The history of carbon exploration in the waters off our coast is filled with failure. The terrain is difficult, because of geography, geology, deep waters and stormy seas. Prior to 1991 there had been just one commercial find, the Kinsale gas field, out of over 125 efforts. The Corrib field was discovered by Enterprise Oil only after the introduction of Burke's financial incentives persuaded it that the gamble might be financially worthwhile.

No government since – involving any of Fianna Fáil, Fine Gael, Labour, Democratic Left and the Progressive Democrats – has undone Burke's work.

With good reason too. Even after the changes, exploration activity in Irish waters has remained minimal. If the terms were so good, and the carbon reserves so plentiful, why aren't all the oil majors engaged in feverish exploration in our seas? The reality is the financial attractions of Ireland compared to many other locations are few. Without incentives nothing at all wRay Buould happen in our waters.

What is the alternative to attracting private speculation? It is for the State to enter the game. Would the public accept the spending of say between €100 million and €200 million by the State each year, via a new State owned company, on such adventures, with no guarantee that any finds would be made and that a single cent would be recouped? Need any more be said?


Bribing those with money

I'm the guilty holder of a Special Savings Investment Account. Guilty, because five years ago I argued strongly against their creation by the Government.

I described them as a bribe to the electorate with an eye to a general election in 2007. I called them discriminatory and inequitable in that a sizeable part of the population would be able to invest the required amounts and then receive the government's 25 per cent bonus. I warned that they would release too much money into the economy within the space of a year, creating an inflationary boom.

I was not alone in writing such things or broadcasting those points of view. And then I opened one for myself, just days before the deadline (which means I don't get my money back and the government bonus and bank interest for another 12 months).

My guilt was somewhat assuaged because I admitted my opening of the account publicly at the time and recommended that other people, despite what misgivings they might have, should do the same.

I did so because I was damned if everyone else was going to get free money from the government while I refused on the grounds of principle. Rational self-interest took hold.

As it seems to have for many opposition politicians who rightly lambasted Charlie McCreevy at the time of his mad, potentially vote-winning idea. Problem is that few of them admitted to doing so at the time. Now, somehow, some of their identities have become known, which is useful for the Government in seeking to embarrass political opponents and in proving the apparent merits of the scheme.

However, that doesn't change that the SSIAs amount to the Government's use of State money – your money – to bribe 1.1 million potential voters. Or that the SSIAs discriminate against the poorer in society who missed out on the bonanza. Or that the release of an additional €16 billion into the economy will lift prices, possibly sharply. Or that they were an unnecessary and bad idea.

Or that we are being bludgeoned now by experts telling people what to do, or not to do, with their own money, as if they have no sense at all to act in their own best interests, as if they are all fools.


No votes in mandatory pensions

Seamus Brennan is thinking of enforcing mandatory pension contributions, having sought reports from experts on the feasibility of making people, from the time they enter employment, put a certain proportion of their income into pension funds.

This is rich coming from a politician who is guaranteed a healthy state pension on his departure from political life to which he has made no cash contributions. And don't workers make involuntary payments called PRSI which are supposed to fund their pensions?

Brennan is receiving encouragement from members of the pension industry, which wants everyone to save through their products so it can earn vast commissions for managing the money. He is unlikely to get any from Bertie Ahern, however. Mandatory pension contributions, on top of income tax and PRSI, are a certain vote-loser at a general election. Brennan shouldn't be wasting his time.

The Last Word with Matt Cooper is broadcast on Today FM, Monday to Friday, 4.30pm to 7pm