Is Lenihan playing a dangerous game??

gerry28

Is brian Lenihan playing a dangerous game by threatening more public sector paycuts if there is industrial action in the new year.

I think it is crazy, there hasn't been as big an uproar over the cuts as he might have expected.

Why go stoking the fire now and getting people angry who might have just wanted to get on with things.

Dirk Gently

nah, he holds all the cards. He already has the majority of the public on his side and resolve is weak for any more strikes within the public sector. He needs to be careful but I reckon his latest comments will scare most people who were unsure into backing down rather than inspire them into action against him. The more militant sections will strike regardless but he'll frighten enough of the rest to marginalise those who do strike.

RealityCheck

gerry28 wrote: »

Is brian Lenihan playing a dangerous game by threatening more public sector paycuts if there is industrial action in the new year.

I think it is crazy, there hasn't been as big an uproar over the cuts as he might have expected.

Why go stoking the fire now and getting people angry who might have just wanted to get on with things.

He is to an extent alright. At the same time he is only outlining the reality of the situation. It might make others think twice about striking. Industrial strife will only set us back more.

bobbyjoe

Stupid thing to say.
Hopefully he won't be making many more budgets anyway.

RealityCheck

bobbyjoe wrote: »

Stupid thing to say.
Hopefully he won't be making many more budgets anyway.

He is only stating the obvious. Anyway it was said in response to the unions who are claiming they will cause serious disruption across the public sector.

IMF budgets will be great craic alright .

You think FG could do much differently? These are emergency budgets.

bobbyjoe

RealityCheck wrote: »

He is only stating the obvious. Anyway it was said in response to the unions who are claiming they will cause serious disruption across the public sector.

IMF budgets will be great craic alright .

You think FG could do much differently? These are emergency budgets.

To quote Ronan Keating, Sometimes its best to say nothing at all.
No point rubbing the Unions noses in it after screwing them over.

Anyone could do it better imho.

ninty9er

bobbyjoe wrote: »

To quote Ronan Keating, Sometimes its best to say nothing at all.
No point rubbing the Unions noses in it after screwing them over.

Anyone could do it better imho.

The only people screwing the unions are their leaders.

hairy cake

I would reckon this would get the PS backs up in a serious way. Think about it - this is a couple of steps away from removing workers' rights...

Cian92

He's like bloody Mussolinni.

jdivision

He'll be cutting Public service numbers next year anyway so probably right to flag it. no need to be in your face but still...

Dirk Gently

hairy cake wrote: »

Think about it - this is a couple of steps away from removing workers' rights...

This is the long term goal, for both private and public workers. Let the people eat themselves and at the end of the day we'll be competitive again, once everyone is on temp contracts, wages are low and unions are no longer a force to be reckoned with. It's not something you have to think hard about, it's the overall goal. It might be easier to swallow if there was even a token attempt to hold bankers and developers to account, but such is the docile Irish public that even that's not necessary.

dvpower

Hanafin was also on the radio during the week saying that further pay cuts were possible but only if public service reform was not achievable.

The unions have identified various potential areas of reform in last weeks failed talks (that they were willing to move on). So its natural that the government would want to pursue these.

I'm not sure he's playing a dangerous game. The unions are threatening action over the budget pay cuts; I think he's just trying to move the game on a step.

thebman

ninty9er wrote: »

The only people screwing the unions are their leaders.

and I never thought I'd be thanking a post from ninty9er

As for the so called attempt to decline public and private, it doesn't really exist.

Private companies will reduce where they have to in order to survive but few others will cut as it annoys workers and reduces productivity if unnecessary cuts are made just to raise profits. Its one thing to not give increases if company profits increase, its another thing to cut wages and then post record profits. It just wouldn't be done in the vast majority of companies.

hmmm

His quote has been taken completely out of context - all he was doing was making the point that should industrial action reduce the money available for the Government, there would have to be cutbacks. It's not rocket science and a ridiculous story in the first place.

To The North

gerry28 wrote: »

Is brian Lenihan playing a dangerous game by threatening more public sector paycuts if there is industrial action in the new year.

I think it is crazy, there hasn't been as big an uproar over the cuts as he might have expected.

Why go stoking the fire now and getting people angry who might have just wanted to get on with things.

i have a theory that he's planning on giving back some of the cuts i.e. the 5% on the first €30,000 in exchange for at least some of the reform he's looking for. it's just a theory mind you.

i'd love to see some reform, but i can't see people very willing to change anything in the current climate and threats like this are only going to get people angry rather than scared (i think he's trying to scare people anyway).

personally as a young person working in the PS i can't see any future in it anymore, at my level anyway. i get the feeling that a lot of young people like myself will up and take their chances elsewhere leaving behind the older generations who are most resistant to change in my own experience.

imme

gerry28 wrote: »

Is brian Lenihan playing a dangerous game by threatening more public sector paycuts if there is industrial action in the new year.

I think it is crazy, there hasn't been as big an uproar over the cuts as he might have expected.

Why go stoking the fire now and getting people angry who might have just wanted to get on with things.

when did Lenihan say this, I'm not saying he didn't but could you say where he did.
Are non-PS people not the only ones that are allowed to be angry.:rolleyes:
*is being facetious*

Pete4779

gerry28 wrote: »

Is brian Lenihan playing a dangerous game by threatening more public sector paycuts if there is industrial action in the new year.

I think it is crazy, there hasn't been as big an uproar over the cuts as he might have expected.

Why go stoking the fire now and getting people angry who might have just wanted to get on with things.

More cuts need to happen. The next thing that needs to be hit IMHO is reduction in minimum wage and bringing a *lot* more people on lower salaries into the tax net. He did what had to be done to maintain some sort of national credibility and to prevent us spiralling into a Greek-style situation of riots on the streets or IMF arriving in Latvia.

As long as he keeps doing it, we will eventually normalise in 3-4 years. The alternative is becoming a basket case - so far, the international response to the budget has been positive and that is what matters more, not Jimmy John Joe Jack O'Murphy in the civil service/union/morkeshing.

imme

Pete4779 wrote: »

More cuts need to happen. The next thing that needs to be hit IMHO is reduction in minimum wage and bringing a *lot* more people on lower salaries into the tax net. He did what had to be done to maintain some sort of national credibility and to prevent us spiralling into a Greek-style situation of riots on the streets or IMF arriving in Latvia.

As long as he keeps doing it, we will eventually normalise in 3-4 years. The alternative is becoming a basket case - so far, the international response to the budget has been positive and that is what matters more, not Jimmy John Joe Jack O'Murphy in the civil service/union/morkeshing.

If the minimum wage were lowered how would that bring more people into the tax net. Am I missing something?. Are you missing something?
The Greek situation (political wise) is quite different to the Irish situation.
The IMF don't just turn up at your door you know.

thebman

To The North wrote: »

i have a theory that he's planning on giving back some of the cuts i.e. the 5% on the first €30,000 in exchange for at least some of the reform he's looking for. it's just a theory mind you.

i'd love to see some reform, but i can't see people very willing to change anything in the current climate and threats like this are only going to get people angry rather than scared (i think he's trying to scare people anyway).

personally as a young person working in the PS i can't see any future in it anymore, at my level anyway. i get the feeling that a lot of young people like myself will up and take their chances elsewhere leaving behind the older generations who are most resistant to change in my own experience.

I don't think that is the case. I don't think he can afford to give up on any cuts made as it will look bad to those financing us. I think he might threaten more and settle for reform but that about it.

Pete4779

imme wrote: »

If the minimum wage were lowered how would that bring more people into the tax net. Am I missing something?. Are you missing something?
The Greek situation (political wise) is quite different to the Irish situation.
The IMF don't just turn up at your door you know.

Reducing minimum wage in line with deflation will maintain a standard of living for those on the minimum level of income, but bringing in more people into the tax net as salaries decrease is essential or else income tax receipts for the state will simply decline faster than the budget can cut public sector salaries.

Basically, the entire cost of the state needs to reduce at the same time as spreading the tax net far far lower. The only way any type of state services can be maintained is if those on lower incomes start to pay them, but to protect the ultra low income earners at the same time.

nesf

hmmm wrote: »

His quote has been taken completely out of context - all he was doing was making the point that should industrial action reduce the money available for the Government, there would have to be cutbacks. It's not rocket science and a ridiculous story in the first place.

Exactly, if you listen to his full statement he's merely pointing out that disrupting the functioning of the State through striking and non-compliance to the extent that it worsens the State's finances will just increase the need to introduce more pay cuts.

If savings aren't made next year through reforms then well, they have come from the other pool of potential savings, i.e. public sector workers' wallets. Hopefully the rank and file will recognise this and not give their leaders the mandate for action.

nesf

clown bag wrote: »

This is the long term goal, for both private and public workers. Let the people eat themselves and at the end of the day we'll be competitive again, once everyone is on temp contracts, wages are low and unions are no longer a force to be reckoned with. It's not something you have to think hard about, it's the overall goal. It might be easier to swallow if there was even a token attempt to hold bankers and developers to account, but such is the docile Irish public that even that's not necessary.

Nah, you're overselling it. Our private sector is recognised abroad as being a flexible labour market. You don't have the Spanish/French situation of the private sector being split into two groups, one cheap to hire and easy to fire, the other expensive to keep but very difficult to fire. The only place that exists here is in some parts of the public sector with for example temporary teachers versus permanent ones and whatnot. Private sector change isn't on anyone's agenda really outside of the minimum wage changes mooted. Workers' rights in the private sector have been no barrier to MNCs setting up here and so on so there's no call for them to be changed.

In the public sector the main problem right now is this insider/outside divide between the "haves" (the permanent workers the unions protect) and the "nots" the poor contract staff that are only hired because the "haves" can't be fired so there needs to be some flexibility. We'd be far better served by a less divided system where merit etc guaranteed your place not the year or time when you were hired.

Wages need to come down alright but there's little to no call to change workers' rights in the private sector.

gerry28

hmmm wrote: »

His quote has been taken completely out of context - all he was doing was making the point that should industrial action reduce the money available for the Government, there would have to be cutbacks. It's not rocket science and a ridiculous story in the first place.

Mary Hanifan and Mary Coughlan said the same thing over the last few days. He put it a little less confrontationally though.... but the same threat was implied i believe.

imme

Pete4779 wrote: »

Reducing minimum wage in line with deflation will maintain a standard of living for those on the minimum level of income, but bringing in more people into the tax net as salaries decrease is essential or else income tax receipts for the state will simply decline faster than the budget can cut public sector salaries.

Basically, the entire cost of the state needs to reduce at the same time as spreading the tax net far far lower. The only way any type of state services can be maintained is if those on lower incomes start to pay them, but to protect the ultra low income earners at the same time.

ok so your in favour of tax credits being lowered, you hadn't said that. you said a reduction of the min wage would result in more people paying tax.
at what pay rate should people start to pay tax 11k, 12k, 15k, 17k. There'd be a heck of a lot of home repossessions.
Are you in favour of any economic stimulus plan amid all this slashing?
What is an ultra low wage as u call it.

Riskymove

gerry28 wrote: »

Mary Hanifan and Mary Coughlan said the same thing over the last few days. He put it a little less confrontationally though.... but the same threat was implied i believe.

I'd disagree there, two different things

the two Marys comments were basically that the Government would now be looking for reforms and if they were not forthcoming then they might have to re-visit pay


Lenihan is simply stating that if the Unions actions (or indeed anything else) were to result in a worsening of the financial situation then further cuts may be required....as it stands, if things go to the current plan, no further pay cuts are needed

bdoo

Riskymove wrote: »

Lenihan is simply stating that if the Unions actions (or indeed anything else) were to result in a worsening of the financial situation then further cuts may be required....as it stands, if things go to the current plan, no further pay cuts are needed

He has already stated that we need another 4bn next year so there's no guarentee of no more cuts.

As for the notion that there is deflation that's not really the case for everyday items like food! The main contributor to the fall in the costy of living is the reduction in mortgage interest rates so there is no benefit to anyone who doesn't have a mortgage.

In addition the Carbob tax will impact on everyone's pocket making it more expensive to drive to work and heat your house, as most of us know very little of our energy needs come from renewable sources so it will surely have a knock on effect to esb bills etc.

It is not getting any cheaper to live here, but there certainly is an effort to push wages down in all sectors to 'restore competitiveness' but when private sector wages and the minimum wage go down let's watch and see do the dividends paid to shareholders in major companies and bonuses for directors fall in line with the reduction or will the profit margins simply grow.... and will it affect our bankers?

dvpower

bdoo wrote: »

As for the notion that there is deflation that's not really the case for everyday items like food! The main contributor to the fall in the costy of living is the reduction in mortgage interest rates so there is no benefit to anyone who doesn't have a mortgage.

Not so, according to the Irish Times

Irish Times wrote:

The cost of housing and utilities fell by 28.8 per cent in the year to the end of October, while clothing and footwear costs fell 12.8 per cent. There was also a 6.4 per cent decline in the cost of food and non-alcoholic beverages, and a 4.1 per cent drop in prices paid for furnishing and household equipment.

muboop1

Pete4779 wrote: »

More cuts need to happen. The next thing that needs to be hit IMHO is reduction in minimum wage and bringing a *lot* more people on lower salaries into the tax net. He did what had to be done to maintain some sort of national credibility and to prevent us spiralling into a Greek-style situation of riots on the streets or IMF arriving in Latvia.

As long as he keeps doing it, we will eventually normalise in 3-4 years. The alternative is becoming a basket case - so far, the international response to the budget has been positive and that is what matters more, not Jimmy John Joe Jack O'Murphy in the civil service/union/morkeshing.

Reduce minimum wage on being on the dole is to close. As it is it can be more financially beneficial to be on dole then working at minimum wage.

If he is going to reduce min wage, so must the dole me severely cut.
Which is we are honest would be a good thing overall no?

Cost of living would come sky rocketing down, maybe not at first, but in end it has to!

murphaph

imme wrote: »

ok so your in favour of tax credits being lowered, you hadn't said that. you said a reduction of the min wage would result in more people paying tax.
at what pay rate should people start to pay tax 11k, 12k, 15k, 17k. There'd be a heck of a lot of home repossessions.
Are you in favour of any economic stimulus plan amid all this slashing?
What is an ultra low wage as u call it.

In Germany it's anyone earning over 400 Euro per month who pays tax. That's 4,800 a year. After that you start to contribute. I think everyone should pay some tax, even starting at say 5% for those earning 10k or more. As wages fall, we'll have no choice but to lower the tax net. It should never have been allowed to escalate to a point where so many people now pay no tax. It was sold as a great thing during the boom, but it clearly wasn't.

Pete4779

imme wrote: »

ok so your in favour of tax credits being lowered, you hadn't said that. you said a reduction of the min wage would result in more people paying tax.
at what pay rate should people start to pay tax 11k, 12k, 15k, 17k. There'd be a heck of a lot of home repossessions.
Are you in favour of any economic stimulus plan amid all this slashing?
What is an ultra low wage as u call it.

People should start paying taxes towards their healthcare at around 10k, but that's an entirely arbritrary figure I just picked. For example, someone in Germany on 20k will pay around 5k in taxes. 12-14% of income goes to health insurance.

Economic stimulus packages are for industrialised countries; Ireland is not one of those. They work in large economies like US, Germany, UK which have large internal economies. In Ireland, a huge amount of income if spent is spent on imported goods, moving the money brought in by trade back out again.

Our industries, what little there is, is pharmaceuticals and possibly software. We do not have a large market for people to spend on Irish electronics, cars, the items with porfits that would go back to Irish companies.

Minimum wage here is ludicrously high and those earning it pay nothing towards social insurance costs, healthcare, further education, etc., . Ireland's minimum wage level is around the same as Netherlands, but crucially, the level is only a fraction if you are under 22, and we are also not rich enough to have companies paying that much, but with nothing paid into the system back.

Interestingly, Switzerland, Sweden, Norway - countries we would do well to imitate - have no minimum wage.

imme

Pete4779 wrote: »

Minimum wage here is ludicrously high and those earning it pay nothing towards social insurance costs, healthcare, further education, etc., . Ireland's minimum wage level is around the same as Netherlands, but crucially, the level is only a fraction if you are under 22, and we are also not rich enough to have companies paying that much, but with nothing paid into the system back.

Interestingly, Switzerland, Sweden, Norway - countries we would do well to imitate - have no minimum wage.

The Irish min wage was set in the year 2000, was it too high then too in your opinion????
€8.65 is too high?

"The International Labour Office in Geneva, Switzerland reports that some 90% of countries around the world have legislation supporting a minimum wage." from http://www.investopedia.com
In what ways would you like us to imitate the Swiss, the Swedes, the Norwegians, we have no armaments industry like Sweden or Switzerland, no heavy industry to compare to theirs, no oil to compare to Norway.

imme

murphaph wrote: »

It should never have been allowed to escalate to a point where so many people now pay no tax.

would you include BILLIONAIRES in that category as well as the low paid

murphaph

imme wrote: »

would you include BILLIONAIRES in that category as well as the low paid

You do know that the top 20% or so of earners pay 80% of Ireland's income tax, right? How much more "taxing the rich" do you think can be done before the rich get completely pissed off and leave?

irish_bob

Pete4779 wrote: »

People should start paying taxes towards their healthcare at around 10k, but that's an entirely arbritrary figure I just picked. For example, someone in Germany on 20k will pay around 5k in taxes. 12-14% of income goes to health insurance.

Economic stimulus packages are for industrialised countries; Ireland is not one of those. They work in large economies like US, Germany, UK which have large internal economies. In Ireland, a huge amount of income if spent is spent on imported goods, moving the money brought in by trade back out again.

Our industries, what little there is, is pharmaceuticals and possibly software. We do not have a large market for people to spend on Irish electronics, cars, the items with porfits that would go back to Irish companies.

Minimum wage here is ludicrously high and those earning it pay nothing towards social insurance costs, healthcare, further education, etc., . Ireland's minimum wage level is around the same as Netherlands, but crucially, the level is only a fraction if you are under 22, and we are also not rich enough to have companies paying that much, but with nothing paid into the system back.

Interestingly, Switzerland, Sweden, Norway - countries we would do well to imitate - have no minimum wage.

excellent post although id like to add that if minimum wage is reduced , the dole must be reduced by an even greater amount

thebman

dvpower wrote: »

Not so, according to the Irish Times

Also rents have dropped considerably in many circumstances so its unreasonable to say only people with mortgages have gotten a decrease.

TCP/IP_King

murphaph wrote: »

You do know that the top 20% or so of earners pay 80% of Ireland's income tax, right? How much more "taxing the rich" do you think can be done before the rich get completely pissed off and leave?

Read more about income inequality in Ireland
http://www.tascnet.ie/upload/file/HEAP%20POSTER%2005-11C.pdf
explained by
http://www.tascnet.ie/upload/file/9644%20HEAP%20BOOKLET%281%29.pdf

before spewing more IBEC/ISME/FF spin

nesf

TCP/IP_King wrote: »

Read more about income inequality in Ireland
http://www.tascnet.ie/upload/file/HEAP%20POSTER%2005-11C.pdf
explained by
http://www.tascnet.ie/upload/file/9644%20HEAP%20BOOKLET%281%29.pdf

before spewing more IBEC/ISME/FF spin

You respond to alleged spin by responding with spin from a thinktank on the other side of the debate? Seriously, the mind boggles.

imme

nesf wrote: »

You respond to alleged spin by responding with spin from a thinktank on the other side of the debate? Seriously, the mind boggles.

have you nothing to add to the debate nesf?
someone made a point and another poster hit back with another point and you say they shouldn't have responded. 'the mind boggles'?

When I made the point that set them off (re billionaires not paying tax), I had the case of a small number of 'Irish' people who get away with paying very little or no tax.
I am aware that in general higher earners contribute greatly to the exchequer and to the country, as another poster said.

Here's an interesting story that some people might remember from earlier this year.
http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=NEWS+FEATURES-qqqm=nav-qqqid=40646-qqqx=1.asp

nesf

imme wrote: »

have you nothing to add to the debate nesf?
someone made a point and another poster hit back with another point and you say they shouldn't have responded. 'the mind boggles'?

When I made the point that set them off (re billionaires not paying tax), I had the case of a small number of 'Irish' people who get away with paying very little or no tax.
I am aware that in general higher earners contribute greatly to the exchequer and to the country, as another poster said.

Here's an interesting story that some people might remember from earlier this year.
http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=NEWS+FEATURES-qqqm=nav-qqqid=40646-qqqx=1.asp

The story has been dealt with at length, as has the topic of taxation and how ordinary PAYE workers and self employed who don't earn absurd amounts of money and who don't benefit from these tax breaks are the ones who pay the vast majority of tax in this country. That's who the "wealthiest quintile" are. Ordinary workers earing 80-90K plus. Double income families and couples, two teachers or two Gardaí well advanced in their careers could break 80K easily and 100K some of the time.

The issue is this, it's a fact that most tax is paid by the wealthier quintile of the population. This isn't surprising and isn't news to anyone with any understanding of the area. Someone then responds to this, calling it spin and links to an inequality survey by a group dedicated to highlighting inequality which has nothing to do with the first point! If anything it would be shocking if there wasn't such inequality and we had such a progressive tax burden on society since in an equal society we wouldn't have to tax the wealthiest quintile of the population so heavily now would we?

murphaph

TCP/IP_King wrote: »

Read more about income inequality in Ireland
http://www.tascnet.ie/upload/file/HEAP%20POSTER%2005-11C.pdf
explained by
http://www.tascnet.ie/upload/file/9644%20HEAP%20BOOKLET%281%29.pdf

before spewing more IBEC/ISME/FF spin

Totally irrelevant to the issue at hand. The top earners pay the most tax in Ireland. FACT.

TCP/IP_King

murphaph wrote: »

Totally irrelevant to the issue at hand. The top earners pay the most tax in Ireland. FACT.

Very relevant.
As another poster pointed out, it's a valid point to make about income inequality in the context of taxation.

People need to read a bit wider than the indo and turn off joe duffy et al.

TCP/IP_King

nesf wrote: »

blah blah blah ... etc etc

Did you bother to read the links?

TCP/IP_King

imme wrote: »

....

Here's an interesting story that some people might remember from earlier this year.
http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=NEWS+FEATURES-qqqm=nav-qqqid=40646-qqqx=1.asp

No takers ??