CIOB members in Ireland have been left in limbo following the general election in Ireland last Friday, with no clear winner emerging and the possibility of a further election being needed before a government can be formed.
Prime Minister Enda Kenny announced last Sunday that his centre-right Fine Gael party would not return to power in a coalition with Labour, after waning support for both parties meant that they could not form a majority.
After almost a week of vote counting, the results were confirmed on 3 March, with the Fine Gael party winning 50 of parliament’s 158 seats, down from 76 in the 2011 elections. It’s current coalition partner Labour has fared even worse, winning just seven seats.
The main centre-left opposition Fianna Fail party, in power before and during the 2008-10 financial crisis, surprisingly bounced back to win 44 seats – in what is seen as the best performance of any party contesting the election.
An 80-seat majority is needed to govern the country.
“This is a big concern here for us within the country, but also from a global perspective. Everything is up in the air and a fragmented government affects the economy.”
Michael Gallagher FCIOB, Turner & Townsend
In September, the Irish government had announced the launch of a new €27bn capital spending plan covering 2016-2021, which was seeking to harness economic recovery and would heavily involve infrastructure and construction.
Michael Gallagher FCIOB, associate director at construction services provider Turner & Townsend, said the current situation was quite worrying, and could be viewed by foreign investors as a disincentive to return to the Irish market.
“This is a big concern here for us within the country, but also from a global perspective. Everything is up in the air and a fragmented government affects the economy,” said Gallagher.
“Construction and housing are two key themes for the Irish recovery and without a stable government, or the prospect of months of talks, there’s no room to move forward.”
“Additional housing funds were promised in the plan, will they be delayed as a new government gets formed?”
This view was echoed by Ivan McCarthy FCIOB, a manager at contractor John Sisk & Son. He said: “Housing, infrastructure, construction are some of the main sectors the government has committed to invest in, but stability is needed for this to progress.”
However, McCarthy was concerned that the current situation would put any such plan on hold and thus harm the industry as a whole the longer the situation remained unclear.
Fianna Fail was largely blamed by the public for the country’s economic woes after the financial crisis. However, in a remarkable comeback it is likely to hold the fate of the next government in its hands.
Sinn Fein won 23 seats while a range of independent candidates and smaller parties between them won 34 seats.
Talks are now expected between Fine Gael and Fianna Fail about forming a new coalition government, but it is thought they will not be concluded before Easter and the deadline of 10 March, when the parliament (Dàil) reconvenes.
Although both parties are not poles apart politically, deep-seated historical animosities mean any deal in making a new coalition could be long and painful.
The fear is that this delay, along with any further political disruptions, could hamper the country’s economic recovery which the construction sector is seen as integral to.
