Enda promises the world after his 100 days

Cookie_Monster

No Income Tax Rises (apart from the stealth ones)
No Welfare cut
No PS pay cuts

How on earth do they plan to juggle that lot then

3.6bn is being saved this year, out of a balance of what, 20.
good work there, a whole 18% saved, never mind the yawning gap still there

THE Government last night categorically ruled out income tax rises or social welfare cuts in the Budget.

But stealth taxes and cuts to public services are now on the cards because spending must be reduced by €3.6bn under the terms of the bailout deal.

The tax pledge is being seen as an attempt to encourage consumer spending amid fears that further income cuts would damage prospects for growth.

Speaking to mark his first 100 days in office, Taoiseach Enda Kenny was adamant yesterday that there would "not be any income tax increases in the Budget".

He added: "I say that because it is fundamental to the Programme for Government and also because it is very necessary in difficult times, it's important that people be able to have some planning put into their lives."

Tanaiste Eamon Gilmore also ruled out any cuts in social welfare rates in the Budget and called for more spending to boost growth.

"In order to underpin that, I think there's an obligation on Government to provide certainty, because obviously people are looking at what their incomes are going to be like towards the end of the year -- whether they're on social welfare or whether they're in employment and paying income tax."

The two men's comments marked a dramatic turnaround by the Government.

Last week, Finance Minister Michael Noonan left open the possibility of income tax rises due to what he said was the "fraught" economic situation.

Social Protection Minister Joan Burton also refused earlier this week to rule out social welfare cuts.

That approach was initially maintained by Mr Gilmore yesterday when he said he could not rule out income tax rises.

"I don't think anyone can at this point give a guarantee as to what will or won't be in the next Budget," said the Tanaiste.

But the intervention by Mr Kenny and Mr Gilmore at Government Buildings eight hours later means that both income tax increases and social welfare cuts are now off the table for the Budget.

The Government will have to rely on its comprehensive spending review of public services -- due for completion in September -- to identify where cuts can be made.

Environment Minister Phil Hogan again stated his intention to impose an interim property tax -- called the household service charge -- on homeowners on January 1 next.

He also told the Dail that a "pay-as-you-use" water charge would be introduced as soon as the installation of meters in homes is completed. That is expected to take three years.

An official source said last night that the ruling out of both income tax increases and social welfare cuts had made it "very tight" to achieve the Budget targets and therefore "some very hard decisions" would have to be made.

The source said that further cuts to public sector pay were unlikely as long as the Croke Park agreement delivered more savings -- and that the focus was now more likely to be on reducing non-pay costs instead.

At Government Buildings in Dublin yesterday, Mr Kenny used a phrase previously employed by his predecessor Brian Cowen when he said: "We will have to do more with less."

Mr Kenny promoted the Government's record during its first 100 days in office.

But Fianna Fail leader Micheal Martin said: "If anyone examines the promises and commitments that were made in relation to those 100 days, one would have to say objectively that the performance of the Government has been somewhat underwhelming."

http://www.independent.ie/national-news/kenny-we-wont-raise-taxes-or-cut-welfare-2677627.html

keithclancy

Cookie_Monster wrote: »

No Tax Rises (apart from the stealth ones)
No Welfare cut
No PS pay cuts

How on earth do they plan to juggle that lot then

3.6bn is being saved this year, out of a balance of what, 20.
good work there, a whole 18% saved, never mind the yawning gap still there



http://www.independent.ie/national-news/kenny-we-wont-raise-taxes-or-cut-welfare-2677627.html

3.6 out of 20 isn't bad when you consider that unemployment went up, PS Workers haven't accepted a paycut.

Why do people call them Stealth Taxes ... its not like its hidden, its written down.

Are you saying other Countries don't have "stealth taxes" or what are you comparing it to ?

Zubeneschamali

Cookie_Monster wrote: »

No Tax Rises (apart from the stealth ones)

He didn't say anything even close to "No Tax Rises". He clearly said "No income tax rises".

Davekoolhill

I think they had to say that, there was no way after 100 days they could come out with more negative news, but there could be more cuts creeping in which the government will most likely play down.

Cookie_Monster

Zubeneschamali wrote: »

He didn't say anything even close to "No Tax Rises". He clearly said "No income tax rises".

sorry, that's what I meant. So instead of an easy, transparent income tax raise, they are adding all sorts of rates and charges and what not.

ionapaul

Personally, I think they can afford to raise CGT again - I pay it quite regularly and although it doesn't make up too much of my annual income (maybe a few grand here and there, I've had a five-figure capital gain year only once so I'm small fry!) I could live with another 5%. It is also a tax that targets the most wealthy sections of society ahead of those that are already squeezed, and you only pay it if you've actually made and booked a profit.

I'm sure there are other taxes that could be raised in a similar fashion.

Diarmuid

ionapaul wrote: »

Personally, I think they can afford to raise CGT again - I pay it quite regularly and although it doesn't make up too much of my annual income (maybe a few grand here and there, I've had a five-figure capital gain year only once so I'm small fry!) I could live with another 5%. It is also a tax that targets the most wealthy sections of society ahead of those that are already squeezed, and you only pay it if you've actually made and booked a profit.

Who's making a capital gains these days?

keithclancy

Diarmuid wrote: »

Who's making a capital gains these days?

Anyone who bought shares in UK banks that were in the Toilet and are selling them today.

ionapaul

Diarmuid wrote: »

Who's making a capital gains these days?

I'll be making a CGT payment before the end of the year, it may get bigger than I currently expect if I sell additional equities to book profits (though I'm currently keeping more than I would usually in equities, partially to hedge against us leaving the Euro and my capital being devalued if it is in an Irish-based bank and converted to Punts Nua!) - I'm sure others are similarly liable for CGT this year. Not as many as in previous years (a lot of people who thought Irish bank shares were a good idea have been cleaned out, obviously) but there are still profits made and thus the opportunity to levy more tax.

halkar

Zubeneschamali wrote: »

He didn't say anything even close to "No Tax Rises". He clearly said "No income tax rises".

Enda: no income tax rises.
Noonan: Ok, lets add another 2-3% levy on gross
Enda: clever.

dan_d

Hmm...they haven't exactly ruled out PS cuts though. Only if the CPA continues to make savings. And they may not be deciding that the CPA savings are sufficient..the IMF may be.

However in general I think we are in for another year of stealthy levies and charges, cuts to public services, such as Transport and health, and bizarre working arrangements and opening hours for other public services in order to "cut costs".

Sigh.

Why can't they just take the so-called hard decisions, do a bit of slashing and burning and have done with it?? so far they've done a whole lot better than FF, but there's only so much of the tip-toeing around the problem that we can take. It might be time to just charge in with a machete...

Dannyboy83

dan_d wrote: »

Hmm...they haven't exactly ruled out PS cuts though.

Unfortunately, they have:
Net Current expenditure is currently 48,915, this is projected to be 48,055 by 2015. (No change)

Tax Revenue is currently 34,900
This is projected to rise to 44,290 by 2015. (Tax increases of 10billion per year)

They have ruled out PS cuts.
In fact, they have effectively ruled out PS reform.
They are going to massively increase taxes.
(Income tax will stay the same tho, and they'll continue to lie through their teeth that we are a low tax economy - just as they did when the USC was introduced)

DJCR

dan_d wrote: »

Why can't they just take the so-called hard decisions, do a bit of slashing and burning and have done with it?? so far they've done a whole lot better than FF, but there's only so much of the tip-toeing around the problem that we can take. It might be time to just charge in with a machete...

Is that not a bit of a paradox? They haven't made any hard decisions yet they have done a whole lot better than FF?

Doing nothing isn't exactly what this country needs right now and that is pretty much what this government is doing. I mean, no Social Welfare cuts or lowering of PS spending? Where are they going to get the money for any meaningfull reform. This government are becoming more and more unrealistic in their plans and this worries me. Surely Fiscal responsibility should be top of their adgenda but it clearly isn't.

When FF were in government they made the hugely unpopular decisions of cutting PS pay, PS employment freeze, lowering of the minimum wage to try increase/safeguard current employment, introducing the income levy etc etc etc I can go on.

Even if we go to the decision that was the bank guarentee which has been a travesty but at the time was the way to go due to having a decision needing to be made immediately and having a lack of info from the banks (no one realised how corrupt they were) .... At least a decision was made!!

Even before that the government safeguarded deposits in banks which provided confidence in the system and safeguarded everyones savings in this country.... Another decision made!! - This one turned out to have been successful.

Yes the decisions were not popular, yes many would say it was Fianna Fails' own fault and none of this would have happened if they weren't in Govt. But I doubt it, I'd say we would have got to this point anyway from what was the oppositions reactions to FF spending (Scrooges etc).

Fact is, the really hard decisions have been made already..... anything the Govt. do now they can blame on FF and say well they did it already but they didn't do enough etc etc etc However, they are trolling along, U Turning on a lot of issues, disagreeing with each other on others, roaring out random crowd pleasers and then being slapped down ..... Maybe they can get away with this in Opposition but in Government they must stop posturing and actually MAKE A DECISION!!

Riskymove

Zubeneschamali wrote: »

He didn't say anything even close to "No Tax Rises". He clearly said "No income tax rises".

similarly they indicate no cut to social welfare rates

this usually means OAP, dole etc

they could still make a wide range of cuts on other benefits, most notably child benefit but also free scheme eligibility etc

Riskymove

Dannyboy83 wrote: »

They have ruled out PS cuts.
In fact, they have effectively ruled out PS reform.

not they have not

in fact, most clearly out of all this waffle was that if croke park does not deliver further savings they will have to look at pay cuts

Liam Byrne

Zubeneschamali wrote: »

He didn't say anything even close to "No Tax Rises". He clearly said "No income tax rises".

Probably the most pertinent point of the usual political double-speak.

Levies and other such pseudonyms not ruled out
Reduction in what we get for our existing taxes not ruled out (e.g. I remember when bin collections were part of our taxes, now they're €300 extra a year)
Local authority charges not ruled out
Additional taxes on fuel, tolls, drink, cigarettes, cars, etc not ruled out

Relatively low "income" tax is only one of the many, many taxes and levies that make Ireland a rotten place in which to live.

Zubeneschamali

Liam Byrne wrote: »

make Ireland a rotten place in which to live.

Actually, a recent OECD survey shows Ireland is one of the top 10 best countries in the world to live in.

Cookie_Monster

Zubeneschamali wrote: »

Actually, a recent OECD survey shows Ireland is one of the top 10 best countries in the world to live in.

similar stuff has been trotted out every year for the last decade. I'm always amazed how Ireland gets up so high given the cost of living, the total lack of services, the lax standards in housing and infrastructure, the weather and the government

Dannyboy83

Riskymove wrote: »

not they have not

in fact, most clearly out of all this waffle was that if croke park does not deliver further savings they will have to look at pay cuts

Which violates the Croke Park Agreement, correct?

Show me where have they factored 'pay cuts/redundancies' into their balance sheet?



Answer : they haven't. The state is not going to shrink in size.

On the bright side, the overpaid public sector will be more heavily hit by tax increases than the rest of us, because they earn so much more than us:
http://www.independent.ie/national-news/state-employees-earn-euro268-more-per-week-than-private-workers-2677650.html

Riskymove

Dannyboy83 wrote: »

Which violates the Croke Park Agreement, correct?

well obviously if they decide croke park has not delivered then they will scrap it

Show me where have they factored 'pay cuts/redundancies' into their balance sheet?

current expenditure is to drop by €2bn next year and a further €2bn over the following years!!

in any event they do not show how any savings or increases in any area to be achieved in that table

On the bright side, the overpaid public sector will be more heavily hit by tax

what? no they wont, they will be hit the same

Zubeneschamali

Cookie_Monster wrote: »

I'm always amazed how Ireland gets up so high given the cost of living, the total lack of services, the lax standards in housing and infrastructure, the weather and the government

Have you ever lived anywhere else for longer than a holiday? Because everywhere else I've lived for more than a month would get on the average Irish person's nerves after a while.

Liam Byrne

Zubeneschamali wrote: »

Actually, a recent OECD survey shows Ireland is one of the top 10 best countries in the world to live in.

I don't ever remember being asked my opinion for that survey, and I'm an average Irish person.

Riskymove

Cookie_Monster wrote: »

similar stuff has been trotted out every year for the last decade. I'm always amazed how Ireland gets up so high given the cost of living, the total lack of services, the lax standards in housing and infrastructure, the weather and the government

try downtown Moghadishu for while

the top ten sounds good until you realise just how few countries around the world have living standards that we do

hmmm

What people need to plan for the future is to understand where the pain will fall in the future. Coming out with meaningless statements about there being no increases in income tax or cuts social welfare makes no sense as we know that the next budget needs to find 3 billion from somewhere. I don't know what Kenny and Gilmore are playing at, do they have that little respect for our intelligence?

If they really wanted to help people feel confident about the future, they should announce today what the major elements of the budgets for the next 4 years will be. That would be new politics - but no, what we get is "no increase in income tax and no social welfare cuts", and in the background we see kites flying for new taxes and charges from all their Ministers.

p.s. changes to my ability to save for my future through a private sector pension is the only thing that fills me with enough rage to one day grab a brick and head down to Leinster house. I'm not alone in feeling this way.

Dannyboy83

Riskymove wrote: »

well obviously if they decide croke park has not delivered then they will scrap it

In a Labour coalition? I wouldn't hold my breath.

I'm betting on something like the following:
They'll 'scrap' the CPA,
announce it as a political victory to the electorate and do a victory dance on Fianna Fail's grave,
and quietly announce the CPA Mark II, which will 'focus more stringently on efficencies' with an actual Net difference of zero.

Fine Gael get to showboat over scrapping the CPA, and the Unions will say be happy to play along - they'll be the real victors and get to pretend they have sacrificed something and are doing their bit for the country.

FG started out saying they would seek 30,000 redundancies.
I think that sank to 20k when they went into coalition with Labour.
It would be interesting to see what natural wastage over 4 years would amount to? 20k?
(Of course, people who retire from the PS pay bill go onto the PS pension bill, one bill goes down, the other bill goes up)

We are going down the European route:
High tax/High spend
(This works in Europe, they get value from that system. We don't/won't)

Just today, a friend in Limerick told me one of his classmates is getting €550 pre-tax from a co-op! That's not far off the average industrial wage - for someone who is essentially a photocopier/coffee boy!

current expenditure is to drop by €2bn next year and a further €2bn over the following years!!

But where will that expenditure come from I wonder?
I know there are big changes underway in terms of prices paid for generic and brand name drugs for example.
I'm not saying that isn't positive, it is.
But if what does that render the PS as? A sacred cow?

See my recent thread about "Why are the roads so atrocious?"
I may be wrong here in fairness, wide open to correction, but as I understand it, some of the cuts to the road maintenance budget are being recorded as reductions in current expenditure, not capital expenditure, due to the way funds are distributed to local government.

The workers have taken little in the way of pay cuts, meaning there is nothing left for materials. So you can't reduce the number of workers, you can't reduce their pay, but there is no money for material for them to work. How is this logical?

I wouldn't be in the least surprised to hear that Current Expenditure in the areas of PS Pay & Pensions will be left untouched 'for fear of deflating the economy' while they jack up the tax rate by €10 billion. LMAO

in any event they do not show how any savings or increases in any area to be achieved in that table

True.
But that doesn't change the fact that expenditure is going to remain static, while taxes go through the roof.
It's black and white.

what? no they wont, they will be hit the same

Of course they'll pay more tax.
I'm not saying they'll pay at a higher rate, I'm saying since they earn more, they'll pay more anyway.
Wheter it's done through cuts or taxation, their net income is going to take a massive hit.

We should take the pragmatic route, reduce spending and give the economy a chance to recover.
But we won't. We'll tax ourselves into oblivion instead.