Haughey's Forty Years of Controversy (26 page)

There had been some questionable incidents involving one of the businesses of beef baron, Larry Goodman. In 1986 the authorities discovered evidence of a scheme to defraud the EC. Documentation to secure EC export credit on an £80 million deal was falsified both by exaggerating the weight of the meat and including trimmings that were not eligible for export credit.

It was an obvious fraud in the eye of the authorities, but for some reason the fraud squad was not called in to investigate for almost two years, by which time there had been a change of governments. The company involved was penalised by the government withholding £1 million of EC money as a penalty.

When Barry Desmond of the Labour party raised the issue in the Dáil in March 1989, Charlie accused him of national sabotage. In light of what had happened, there were many questions that needed to be answered, but the government was not prepared to set up a judicial inquiry. When the Labour party and Progressive Democrats persisted with questions, Charlie sought to distance himself. He accused his opponent of trying ‘to involve me in a matter about which I had no official knowledge and for which I had no official responsibility'.

Just what he meant by ‘no official knowledge' was any body's guess. He was personally informed of the fraud by the secretary of the Department of Agriculture in January 1988, but he apparently decided to go along with the low-key approach adopted under the previous government in order not to damage the image of the beef industry.

Although the policy had really been implemented before Charlie's return to power, he became particularly vulnerable when it was disclosed that Larry Goodman had been allowed the unprecedented privilege of keeping his private jet at the Army Air Corps base in Baldonnel. In addition, there were serious rumblings about export credit insurance given to his companies.

Iraq had been considered a bad credit risk because of the on-going war with Iran, coupled with falling oil prices on the world market. As a result the coalition government suspended export credit insurance to companies trading with Iraq in 1986, but this was re-introduced in 1987 after Charlie returned to power. Although Iraq was given eighteen months credit, £53 million was already overdue and there was a further £119 million outstanding at the time of the election. The Irish tax payer was going to have to foot that bill, if Iraq defaulted.

The uneasiness over this, coupled with the perception that the election was unnecessary, tended to have a corrosive effect on the Fianna Fáil campaign. As a result the party's support declined steadily in the three weeks before polling day. In the first poll published after the election was called, for instance, Fianna Fáil's support dropped to 47%, to 45% the following week, and to 41.1% a week later in the actual vote on election day.

Party workers found a lot of resentment on the doorsteps. Having campaigned strongly against health cuts in 1987, they found themselves having to explain why Fianna Fáil had instituted even more severe cuts, curtailing programmes that Haughey had introduced while Minister for Health in Jack Lynch's last government.

‘It gives me not the slightest bit of pleasure to have to cut back the very programmes I put in myself,' Charlie explained during the campaign. He made a particularly damaging admission on the health situation during a phone-in programme on RTÉ radio, when he said that he ‘wasn't aware of the full extent of the problems and difficulties and hardship it was causing'.

This was an extraordinary admission, tantamount to acknowledging that he did not know what his government was doing. Some people saw it as an indication that his political judgment was slipping, and that impression was compounded by the election results, which were little short of disastrous from his standpoint.

In the outgoing Dáil, Fianna Fáil had 81 seats, but it returned with only 77, seven short of an overall majority. The only bigger losers were the Progressive Democrats, who lost eight of their 14 seats.

The party's dramatic reversal had the impact of making what had once been unthinkable now look attractive. As Seán Tracy could be re-appointed speaker, the six seats won by the Progressive Democrats just happened to be the number that Charlie needed to form a government. On his past record he had been ready to pay dearly for the necessary support and Mary Harney realised there was an opportunity for her and her colleagues – all of whom were former members of Fianna Fáil – to salvage something from the election disaster.

‘However we may dislike certain people or parties,' she said, ‘we have to play our part in giving this country a government for the foreseeable future.' She was clearly signalling the possibility of an arrangement, but Pearse Wyse seemed to throw a wet blanket over the idea of any co-operation while Charlie remained as leader. ‘I believed that no man, including Mr Haughey, has the right to stand in the way of stable government,' he said. ‘In no circumstances could I bring myself to vote for him as Taoiseach.'

The Progressive Democrats were pledged to vote for the Fine Gael leader, and they decided to keep their commitment when the Dáil met to select a Taoiseach on 28 June. But in the interim Des O'Malley and Pat Cox, who had just been elected to the European parliament, held exploratory talks with Charlie. They insisted that the price of Progressive Democratic support would be a coalition. When Charlie said he could ‘never sell' that to Fianna Fáil, O'Malley smiled. He said that Charlie should not ‘make a mistake in under estimating his ability to sell anything to his party'.

As expected Charlie's nomination was defeated by 86 votes to 78, but so also were the nominations of Alan Dukes and Dick Spring. Under the constitution, Charlie would remain as Taoiseach until a successor was elected, but there was some confusion as to the correct constitutional procedure, as this had never before happened. Charlie proposed that the Dáil adjourn until 3 July to give him a chance to form a government. He said he would not be advising the president to dissolve the Dáil at this stage, as it would not be in ‘the best interests of the country to precipitate another general election' so soon, if this could be avoided. He and his cabinet colleagues would continue in office and the ‘day to day business of the government will be carried on uninterrupted', he said.

Alan Dukes raised no objection. Prior to the first meeting of the last Dáil in 1987, it will be remembered that Fine Gael sources had been claiming that the Taoiseach could have up to forty-eight hours. But Dick Spring insisted that Charlie was constitutionally obliged to go to the president to resign his office formally.

Charlie said he had advice from the attorney-general that ‘time was not of the essence' and that he had ‘up to a week' before having to resign. It was ironic the same person had said the opposite in relation to the possibility of Garret FitzGerald delaying for a couple of days two years earlier.

Article 28.10 of the constitution stipulates: ‘The Taoiseach shall resign from office upon his ceasing to retain the support of a majority in Dáil Éireann unless on his advice the president dis solves Dáil Éireann and on the reassembly of Dáil Éireann after the dissolution the Taoiseach secures the support of a majority in Dáil Éireann'. The Taoiseach was obviously obliged to resign unless he called for another general election.

Much of the argument was really academic anyway, because the following paragraph of the constitution stipulates that ‘the Taoiseach and the other members of the government shall continue to carry on their duties until their successors shall have been appointed'. It was just a question of procedure, but in such matters procedure is extremely important.

Charlie was leaving himself open to the charge of refusing to resign in defiance of the constitution. He and Neil Blaney had been the first ministers in the history of the state to refuse to resign when called upon to do so by the Taoiseach during the arms crisis. Now Charlie would be setting a constitutional precedent.

During a two-hour recess he was convinced by colleagues that, regardless of the advice from the attorney-general, it was politically imperative that he should resign as soon as possible.

Immediately after the recess he announced his intention of tendering his resignation to the president. He added that he would not ask for a dissolution but would continue to try to form a government. The Dáil then adjourned for four days, until the following Monday, 3 July 1989.

The Progressive Democrats made it clear that they were not interested in propping up a minority Fianna Fáil government, no matter what inducements were offered to them. They were only interested in a coalition, but Fianna Fáil had a longstanding policy of not going into coalition with anybody.

The Fianna Fáil national executive voted unanimously against coalition and Charlie went on RTÉ's
This Week
programme on 2 July to say that he was totally opposed to the idea.

This, of course, raised the spectre of another election, but this would now be strictly a matter for the president, because he now had the authority to refuse to dissolve the Dáil as the Taoiseach had ceased to retain majority support. Charlie contended, however, that the ‘accepted wisdom' had always been that the president would never exercise this power.

When the Dáil reconvened next day, Charlie asked for a further adjournment until the afternoon of 6 July. Dukes agreed but not before making a hard-hitting speech in which he criticised Charlie's attempt ‘to prejudge the response that the president might make to advise on a dissolution of the Dáil'. It was ironic that Charlie, of all people, should adopt such an attitude.

His approach now was in sharp contrast ‘with his actions in January 1982,' when he tried to get the president to reject Garret FitzGerald's request for a dissolution of the Dáil, O'Malley observed.

When the cabinet met next day, it was evenly split on the issue of coalition with senior members like Albert Reynolds, Pádraig Flynn, John Wilson and Michael O'Kennedy firmly opposed. Brian Lenihan, on the other hand, felt they had no choice. He argued that, under the circumstances, they would be able to sell the idea of coalition to the party.

Flynn stunned his colleagues with a vicious attack on Charlie, whose lust for power had put them in the invidious position, he said. Later that afternoon he went on RTÉ's
Today at Five
to say that a coalition was out of the question. ‘All the members of the cabinet are unanimous for no coalition,' he said. ‘The national executive, the parliamentary party and the grassroots have indicated this is a core value which we must preserve.'

When Charlie met the Progressive Democrats shortly afterwards, he formally agreed to form a coalition, subject to an agreement on a joint programme for government. On being asked about remarks concerning opposition within the party, he was dismissive.

‘I haven't told them yet,' Charlie replied.

Next day, Thursday, 6 July, the Dáil reconvened and Charlie asked for a further adjournment until 12 July. Dukes again agreed, but warned that this was the last time. ‘One thing is perfectly clear,' he said. ‘The issue before us must be resolved before this House meets next Wednesday .'

Some deputies were becoming uneasy about the delay. Roger Garland of the Green party noted that the Dáil was dithering ‘while the world goes down the tube'. He complained about the destruction of the world's rain forests and the ozone layer. As a result of the greenhouse effect, the polar ice caps were melting and he forecast the inundation of a large part of Bangladesh, as well as low-lying areas of Dublin, Cork and Limerick.

‘He's only looking for the floating vote,' one Fianna Fáil back-bencher interjected.

If Garland thought the Dáil could have had the slightest impact on any of those matters within a week, he was the only one.

Details on policy matters relating to the programme for government were negotiated by Albert Reynolds and Bertie Ahern for Fianna Fáil, and Bobby Molloy and Pat Cox for the Progressive Democrats. Things on which they were unable to agree and matters relating to the actual makeup of the government were then left to the two leaders.

Fianna Fáil was insistent that Progressive Democrats were proportionally entitled to only one seat in the cabinet, but O'Malley insisted on two. He realised that Charlie was under strong pressure from within the cabinet and he actually expressed sympathy for the Taoiseach at one point.

The parliamentary party allowed Charlie freedom to negotiate a coalition, but not before Máire Geoghegan-Quinn made some bitter comments. ‘Don't ask me to accept that what is being done is in the national interest,' she said. It was simply being done to satisfy the leader's desire for power.

Most of the backbenchers, however, were so anxious to avoid a further election that they favoured coalition. ‘They're more enlightened than some of my cabinet,' Charlie remarked caustically. ‘They are only a crowd of gobshites.'

By the eve of the Dáil meeting the only outstanding issue was the question of whether the Progressive Democrats would be offered one or two seats in cabinet. Albert Reynolds told RTÉ that the party had authorised Charlie to give only one seat, but Charlie gave in to O'Malley's demands and agreed to appoint him and Molloy to the cabinet and Mary Harney as a minister of state. In addition, the Progressive Democrats were promised three seats in the Senate out of the eleven to be appointed by the Taoiseach.

‘Never in the history of Irish politics has so much been given by so many to so few,' grumbled one Fianna Fáiler.

‘Nobody but myself could have done it,' Charlie proudly declared.

With a presidential election due in November 1990, there was speculation that Charlie might run for the seven-year term. He was expected by many to step down as Taoiseach at the end of Ireland's presidency of the European Community in July 1990, and it seemed natural enough that he would move on to Aras an Uachtaráin for a seven year term at this stage of his political career, especially when there were questions about his health.