Estimates

star gazer

The estimates were published today, McCreevy is saying he has to be prudent and keep control of Public finances. Strange how it was ok to spend at 20% plus for the 18 months prior to the general election. It is also going to be another batch of stealth taxes for this years budget with health charges, 5% motor tax, increasing the wait for rent supplement from nothing to six months announced today and plenty more to come.

for more info...
here

Victor

Actually they appear to have only published "abridged estimates", i.e. 100 pages which are really 30 pages on the spending of €40bn. For example, prison officer pay is to be cut - it doesn't say how.

Also there are some new fudges with money being transferred between years and expenditure being put off balance sheet by putting it in semi-state companies.

Of course we won't have a real idea until well after budget day.

The EU Presidency costs are being spread over about 10 different departments for a total of about €40m and the Bertie jet appears to be included in the Defence estimates.

Abridged estimates: http://www.finance.gov.ie/ViewDoc.asp?DocId=-1&CatID=13&m=f

star gazer

originally posted by victor
For example, prison officer pay is to be cut - it doesn't say how.

It's been in the news that McDowell is threatening tyo close two prisons, privatise two more if the prion staff don't agree to his reduction in the overtime paybill from €60million to €30million. It's one way of deflecting from the major issue of crime itself. Closing down extra capacity isn't going to make it easier to facilitate, longer mandatory sentences for murder, drug trafficing and gangland activities etc.

Of course we won't have a real idea until well after budget day.

Yip. The best way to ease the pain into peoples minds is by dragging out the announcements of stealth taxes and spending cuts. Between now and even a few days after budget day there will be lots more to 'cheer' about.

swiss

I haven't had a chance to peruse all or indeed most of the figures yet, so I'll reserve my final judgement till later. However, my initial reaction is that this is (finally) some attempt by the Government to reign in public spending. As expected, the majority of spending increases are earmarked for pay, under the governments commitment to the PPF. Although I believe doing so will help curtail inflation (inflation is IIRC currently at it's lowest rate for 4 years), the real cost benefits are to do with a reorganisation of the civil and health services IMO.

Opposition parties have dismissed the Estimates as lacking in imagination, and laying the ground for increased charges on the public.

Both points are arguably true, but without a more solid basis for arguing how exactly the government can spend the money differently, I can only dismiss this as political soundbytes.

The main 'driving issue' behind the allocation funds this year, as it has been in other years, is health. Fortunately, I haven't had to be anywhere near a hospital recently, but I've heard enough anecdotal (and substantiated) evidence to suggest that they can be overcrowded, inefficiently run and - for want of a better word - unhealthy. €10 billion this year. Somehow I don't think throwing money around is going to cure this problem.

Villain

No Increases in some areas to cover the pay increases coming along through benchmarking, so I reckon we'l see alot more double taxes been introduced for services!!!

Qadhafi

So much gone on wages its unbelivable!!!

And infastructure is sooo far behind other EU countries. Looks like the metro is binned, and no go ahead for a national stadium among many other things. A bit disapointing Charlie.

the only thing that can possibly come out of this years benchmarking and health is reorganisation of the civil and health services.

Drag that civil service into the 21st century. The same with health. Were always going to have a sh1t health service if we dont reform.

star gazer

originally posted by swiss
Both points are arguably true, but without a more solid basis for arguing how exactly the government can spend the money differently, I can only dismiss this as political soundbytes.

To be fair some had talked about renegotiating pay awards (60% of increase in spending in the estimates) and halting payments to the National Pension reserve fund. For extra spending ideas just look at all the election manifestos (incl. the governments) for 2000 extra gardaí or more medical cards or hospital beds etc. That's not to say the opposition are so much better, oppositions have a habit of going native when getting into government (eg PDs and FOI amendments)

originally posted by qadhafi
the only thing that can possibly come out of this years benchmarking and health is reorganisation of the civil and health services.

Don't hold your breath

Drag that civil service into the 21st century.

every new decade we go through there are comments like that, maybe a new milenium will be different :rolleyes:

Cork

I think that the government needs to abandon benchmarking - If it these increases increased productivity with efficencys but :

Are public offices opening Saturdays?
Are teachers holidays being cut?

Public Service Unions need to acknowledge that the benchmarking deal was done when tax revenue was more healthy.

Benchmarking have not only the potential to cost the government but these moneys could be spent on education or the health stratergy.

De Rebel

Originally posted by Cork
Benchmarking have not only the potential to cost the government but these moneys could be spent on education or the health stratergy.

Your point about diverting funds to education is well made.

swiss

Your point about diverting funds to education is well made.

Nit picking other peoples posts made baby Jesus cry.

In any case, he has a point that benchmarking commitments were made when the economic outlook was somewhat sunnier. However, does that mean that we should abandon them now, and risk industrial strife? I'm not saying we should or shouldn't pay that money, just that withholding that money could have negative economic implications (through strikes, industrial unrest etc).

Also taking this money out of the economy would serve to depress peoples spending power. This is a large area of economic analysis, and one in which I am not qualified to profess, but simply saying we should not pay them these monies because they have not met the benchmarked increases in productivity would be to understate the underlying social complexities of national pay agreements.

star gazer

originally posted by swiss
Also taking this money out of the economy would serve to depress peoples spending power. This is a large area of economic analysis, and one in which I am not qualified to profess, but simply saying we should not pay them these monies because they have not met the benchmarked increases in productivity would be to understate the underlying social complexities of national pay agreements.

Indirect taxation and service charges undermine the economies competitiveness and the individual's spending power. A small fraction of workers gain well under benchmarking while most people are going to have to pay for it in some form or another eg, service charges, A&E cost increase...

If the workers don't make the productivity benchmarked by the independent verification boards, they will not get the benchmarking awards. The problem is with the verification process and whether it will even try to get productivity relative to the benchmarking pay rise.

While public sector workers did contribute to low wages during the Celtic Tiger, and do deserve an increase, there is a question as to whether that is going to damage our economy as 'stealth taxes' creep in all over the place.

Cork

Indirect taxation and service charges undermine the economies competitiveness and the individual's spending power.

No - high personal taxation rates hinder spending power.

TV3's Agenda programme had a feature on Comsumption Taxes V Income Taxes.

I think New Zealand have moved away from Income tax to consumption taxes.

I really think that if public service workers increased their productivity to compansate the tax payer for benchmarking-Bench marking would have a zero cost effect on our economy.

I think that this will not be the case and this deal will be an added extra cost on the exchequer.

Victor

Originally posted by Cork
TV3's Agenda programme had a feature on Comsumption Taxes V Income Taxes. I think New Zealand have moved away from Income tax to consumption taxes.

I haven't seen it. I suggest you need a balance of income, wealth and consumption taxes to ensure there is greater difficulty in evasion and that everyone contributes something.

While generally progressive, income taxes can be avoided altogether by the super rich (they simply go offshore), so some consumption taxes are needed. Consumption taxes mitigate excessive consumption and are generally difficult to avoid, but harm the less well off. Wealth taxes (primarily a property tax) would encourage a better redistribution of wealth and income than currently exists, mitigates avoidance and would put a check on property inflation.

star gazer

originally posted by Cork
No - high personal taxation rates hinder spending power.

They both hinder spending power, one through inflation , the other through direct deduction.

I really think that if public service workers increased their productivity to compansate the tax payer for benchmarking-Bench marking would have a zero cost effect on our economy.

Most people that are complaining about benchamarking aren't complaining so much about the principle, rather the execution of a deal that doesn't look like yielding concrete results above and beyond previous pay deals.

originally posted by Victor
Wealth taxes (primarily a property tax) would encourage a better redistribution of wealth and income than currently exists, mitigates avoidance and would put a check on property inflation.

very difficult to get it in politically, there is a huge lobby against property taxes, some of our richest citizens made their money in building. It would be very interesting if some government gave people an option, less VAT, Charges, income tax with a new property tax. The PDs wouldn't let it happen, neither would Fine gael, anyojne for a Fianna Fail labour government?