Is Joan Burton mad?

creedp

BlatentCheek wrote: »

The last entrepreneur I can remember going forward for a political position nearly got elected president before being revealed as a Fianna Fail bagman.

Through their lobby groups business people already enjoy far better access to decision making than most of the public. This may have something to do with why everyone's taxes have effectively been subsidising the minimum wage jobs they never stop boasting about "creating"

Wasn't Albert Reynolds an entrepreneur:) Don't forget Mr Ganly's attempts to get in on the act .. is it just that the Irish electorate misunderstand the motives of this cohort of the population?

woodoo

Joan would like a significant difference between the dole and min wage. But she is too scared to lower the dole.

wildefalcon

woodoo wrote: »

Joan would like a significant difference between the dole and min wage. But she is too scared to lower the dole.

That's the nub of it - but the Labour way is for the taxpayer, employer and worker to pay!

Good loser

creedp wrote: »

Presumably by that you don't think an additional reduction of €1bn in public sector pay agreed by Labour will translate into lower costs for the private sector. Funny how high public sector wages are blamed for the high cost of living and cost of doing business here but when pay is cut it appears to have no impact on these issue.

There's going to be no €1bn reduction in public service pay.

Anyway most of the 'reduction' proposed is now a 'deferral'.

creedp

Good loser wrote: »

There's going to be no €1bn reduction in public service pay.

Anyway most of the 'reduction' proposed is now a 'deferral'.

Oh I agree . most of it has been given away in the wonderful negotiation that was 'Haddington Road' ... what was important was to claim a victory. Don't worry though the great reformer will massage the figures and hey presto €1bn!

The point still stands though continuously cutting public expenditure without implementing measures to boost the domestic economy will just result in a continuous downward spiral.

ardmacha

This thread is disappointing, like many in this forum. Joan Burton is not mad, although she well may be wrong. She has correctly identified the relationship between the rate for dole and the minimum wage, a level of analysis which some of her colleagues in government seem incapable of. It is a complex matter to determine the optimal value of a minimum wage or indeed the proper level of unemployment benefit, but all you get is political posturing about whether these amounts should be changed.

It's Labour - they cannot really support any moves which will reduce the 'Cost of Living' (and never do), as that would involve going to war with the public sector and some of the monopolies and protected classes in the private sector... so the next best alternative is to 'increase the minimum wage'.

Public sector changes are not going to directly reduce the current cost of living, the aim should be to reduce the deficit. I don't see why philosophically they should not want to minimise the damage done by monopolies n the private sector, they don't seem to have the imagination to do so.

wildefalcon

ardmacha wrote: »

This thread is disappointing, like many in this forum. Joan Burton is not mad, although she well may be wrong. She has correctly identified the relationship between the rate for dole and the minimum wage, a level of analysis which some of her colleagues in government seem incapable of. It is a complex matter to determine the optimal value of a minimum wage or indeed the proper level of unemployment benefit, but all you get is political posturing about whether these amounts should be changed.



Public sector changes are not going to directly reduce the current cost of living, the aim should be to reduce the deficit. I don't see why philosophically they should not want to minimise the damage done by monopolies n the private sector, they don't seem to have the imagination to do so.

Agreed - reducing the deficit is the aim, but to do this we need to grow the economy, otherwise we're all chasing a smaller piece of a smaller pie.

To grow the economy we need to improve the conditions that cause businesses to start-up. Small business: hairdressers, mechanics, shops, etc.

No big incentive schemes, no strategic strategy with gateways and hubs and that sort of crap, just simple things.

We need to reduce the taxes on smaller businesses, make it easier and cheaper to rent a premises, make it easier for the small business to employ someone. Lower business rates for start-ups, higher rates for empty property (why do we incentive-ise landlords to have empty premises?).

I still think that Employers PRSI is the most stupid tax. It is a DIRECT tax on jobs.

The savings the PS are making are being channelled into the deficit reduction, only. Some of these savings need to be diverted into making it easier to start a business. Indigenous growth lasts longest, provides most and is cheapest to implement.

JB may have the wrong end of the stick, but at least she knows there is something brown and sticky about, unlike the rest of the Cabinet.

ardmacha

To grow the economy we need to improve the conditions that cause businesses to start-up. Small business: hairdressers, mechanics, shops, etc.

No big incentive schemes, no strategic strategy with gateways and hubs and that sort of crap, just simple things.

We need to reduce the taxes on smaller businesses, make it easier and cheaper to rent a premises, make it easier for the small business to employ someone. Lower business rates for start-ups, higher rates for empty property (why do we incentive-ise landlords to have empty premises?).

I agree. Cutting taxes is always a bit tricky when there is a big deficit, and may not help business because there will be confidence while this deficit exists. Cutting red tape, simplifying procedures etc can both help business and help cut the deficit. However, there is very little imagination used in trying to achieve this, the main initiative so far is Haddington Road which aims to make the people processing the same crap forms work 3 hours a week longer doing the same pointless procedures they have always done, except they work longer and get paid less.

I still think that Employers PRSI is the most stupid tax.

Which other tax would you increase instead?

noodler

wildefalcon wrote: »

I still think that Employers PRSI is the most stupid tax. It is a DIRECT tax on jobs.

I haven't looked it up but I am certain I remember Burton saying in the run up to last year's budget that our Employer's social contribution was actually reasonably low compared to other western countries?

EDIT: The Forfas Costs of Doing Business Report published last April says that our social contributions from Employers is the 7th lowest in the OECD 28.

(Employee social contributions also very low at 2nd lowest although there is probably a bit of balance there since actually pay extra income taxes with the USC).

woodoo

creedp wrote: »

Oh I agree . most of it has been given away in the wonderful negotiation that was 'Haddington Road' ... what was important was to claim a victory. Don't worry though the great reformer will massage the figures and hey presto €1bn!

The point still stands though continuously cutting public expenditure without implementing measures to boost the domestic economy will just result in a continuous downward spiral.

The increase in working hours is a significant reform. Not a hope in hell of that being agreed to in normal times. The government did well to get it.

wildefalcon

I'd restructure ERs PRSI, make it top heavy, not do away with it.

Say, finger in the air, everything over €30k at 5%, €50k at 8%, 70k at 11%, €100k at 15%, €150 at 20% etc, silly money at silly rates.

A progressive tax, unfashionable as they may be nowadays. Encourage employers to hire more people, rather than pay existing people megabucks.

hmmm

wildefalcon wrote: »

A progressive tax, unfashionable as they may be nowadays. Encourage employers to hire more people, rather than pay existing people megabucks.

I don't begrudge a surgeon "silly money" as you call it. I'd prefer to have someone who is well paid, has trained for 10 years and who has worked hard all their life operate on me rather than someone on 30k wielding a scalpel in this socialist utopia where we're all paid the same amount.

I don't begrudge people the money they make, unless they're Labour politicians or union leaders, because most of them have worked hard to get where they are. Taxing them at punitive rates is simple begrudgery.

Mr. teddywinkles

Sleepy wrote: »

Increasing minimum wage will make us less competitive, not moreso. As Scortho points out, it will lead to knock on raises across the board.

Why should welfare decrease? Because for many, it's a disincentive to work. It's significantly higher than the cost of survival in Ireland and that's all welfare was ever designed to support: survival. I'd agree that it needs more stratification e.g. high decreases for those living at home with parents or living in lower cost areas (e.g. rural areas are much cheaper to live in than urban), lower decreases or possibly even increases for those supporting large families etc. A total overhaul of welfare could save millions without negatively effecting recipients (e.g. scrap childrens allowance, replacing it with higher welfare rates for dependents and tax credits for those in employment, replacing rent allowance with long-term rental contracts between state and landlord, etc.).

While it may be facetious of ISME to claim such an increase would lead to employers being forced to let staff go on any wide-scale level, it may have that result in some small businesses and will certainly impact on any decision to increase numbers. Lets face it, the most problematic element of our Live Register isn't the young graduates leaving college, it's the former site-labourers and retail assistants that left school at 16 to join the Celtic Tiger workforce. Those that haven't up-skilled by now are either incapable or unwilling to do so and, as such, will only ever really be able to apply for minimum wage roles until they do. They're never getting large salaries for being unskilled workers in Ireland again (unless we find another bubble to over-inflate). Every extra euro added to the minimum wage makes it harder for employers to justify taking them on and as long as our welfare system provides as comfortable a lifestyle as it can do (or even luxurious a lifestyle when gamed appropriately) they have little incentive to upskill themselves or work for minimum wage.

can I ask the question who is it we are competing with exactly. I hear a lot of this every day. The only comparsion i can see is what the cost of living in individual countries across the EU is. You can't consoladate a whole load of countries together with different living costs, free movement of people, different standards of living and expect no consequences.
Any polish person will tell you that to work here for min wage will afford then a lot better oppurtunities back home if they save. But to permanetly live here on min wage, living like a king does not come as easy. Also because you graduated from third level means automatic employment?
excuse the spelling btw

Mr. teddywinkles

SpaceTime wrote: »

It's more that she (like most TDs and ministers) don't operate in the business world at all.
They're mostly former teachers, public servants, protected professions like lawyers etc. In Joan's case she's a former DIT lecturer if I'm not mistaken.

There aren't enough entrepreneurs going forward for political positions.

wouldn't say many ever worked for min wage either

OMD

creedp wrote: »

. I'm simply making the point that cut to public expenditure have so far had no positive impact on the cost of living in this country. In fact the opposite is the case, i.e. cuts in public expenditure have coincided with significant increases in the cost of living/reductions in disposable income

What are you basing "significant increases in the cost of living" on? Ireland's inflation is one of the lowest in Europe. In addition it has been below the European average for 5 years now where it has averaged about 0.5% a year. That is hardly a "significant increase".
It also compares well with our main trading partner UK where prices have increased over 3% a year and the rest of Europe where inflation averaged 2% a year thus increasing our competitiveness. I am not saying government policy has caused this but you cannot really argue government policy has caused significant increases in the cost of living.
http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-14062013-AP/EN/2-14062013-AP-EN.PDF

wildefalcon

hmmm wrote: »

I don't begrudge a surgeon "silly money" as you call it. I'd prefer to have someone who is well paid, has trained for 10 years and who has worked hard all their life operate on me rather than someone on 30k wielding a scalpel in this socialist utopia where we're all paid the same amount.

I don't begrudge people the money they make, unless they're Labour politicians or union leaders, because most of them have worked hard to get where they are. Taxing them at punitive rates is simple begrudgery.

Employers PRSI isn't a tax on the employee, it's a tax on the employer. I don't believe the PS pays full ERs PRSI anyway.

coffee_cake

Very stupid idea - as if unemployment isn't high enough already.

wildefalcon

bluewolf wrote: »

Very stupid idea - as if unemployment isn't high enough already.

Do you mean the current scheme where employers are penalised for hiring new staff? At present employers pay over 4% tax IN ADDITION to the salary they pay an employee, up to about €350 per weel, thereafter they pay 10%.

Or my proposal where employers are encouraged to take on more staff, rather than pay existing staff to do extra work, and large bonuses/salaries (greater than €100,000) are discouraged?

Kristopherus

wildefalcon wrote: »

Employers PRSI isn't a tax on the employee, it's a tax on the employer. I don't believe the PS pays full ERs PRSI anyway.

Yes they do.

coolshannagh28

The anomaly we have in Ireland is that employers lay people off rather than cut wages as in other countries, this relates directly back to the minimum wage and the wage rates and agreements stacked on top of that . A lower minimum wage could and would have saved jobs but our me fein culture evidenced particularly by the latest PS wage agreements which penalise the younger latecomers prevents this.

wildefalcon

Kristopherus wrote: »

Yes they do.

I think it's only 2%, rather than 10% - according to the welfare website. It's a bit silly, though - the Exchequer paying a tax that goes to the Exchequer.

ardmacha

The anomaly we have in Ireland is that employers lay people off rather than cut wages as in other countries, this relates directly back to the minimum wage and the wage rates and agreements stacked on top of that . A lower minimum wage could and would have saved jobs but our me fein culture evidenced particularly by the latest PS wage agreements which penalise the younger latecomers prevents this.

Employers typically keep their productive experienced staff, and try and become more productive. If they have less work they adopt a 4 day week or the like, not cuts in the rate. The minimum wage is largely irrelevant to this. As for the recent PS agreement, it did exactly the opposite of this, penalising the skilled and experienced in favour of the unskilled and inexperienced. A political stunt which is the antithesis of what an efficient business would do.

coolshannagh28

ardmacha wrote: »

Employers typically keep their productive experienced staff, and try and become more productive. If they have less work they adopt a 4 day week or the like, not cuts in the rate. The minimum wage is largely irrelevant to this. As for the recent PS agreement, it did exactly the opposite of this, penalising the skilled and experienced in favour of the unskilled and inexperienced. A political stunt which is the antithesis of what an efficient business would do.

You didn't address either of my points ,in other countries layoff rates are lower as workers collectively agree reduced wages in order to maintain employment for the more vulnerable .
The penalisation of younger entrants to the PS is another side to this where the insiders take advantage to maintain their wages and conditions . My point being that reductions in wages and by extension the minimum wage would maintain employment levels .

fly_agaric

wildefalcon wrote: »

I think it's only 2%, rather than 10% - according to the welfare website. It's a bit silly, though - the Exchequer paying a tax that goes to the Exchequer.

afaik It is pre 1995 hires that pay a lower rate (and get less benefits??). People recruited after that pay normal PRSI.

It's not that silly to have civil/public service employees paying taxes.
It does imply they are citizens who just happen to do a job for the state rather than serfs who are kept at the pleasure of either the politicians or joe public. Maybe that's what [some such as yourself] may not like about it I suppose.

She IS an idiot. She does not want to deal with the real issue. Rather than reduce welfare she wants to increase the minimum wage.

Replacement wage for PAYE (inc PRSI and Health Levy): €43,059.60.

Replacement wage for Self-Employed (inc PRSI and Health Levy): €43,191.17.

If we are to recognise that a self-employed person has to cover some of the costs of their work out of pocket, say 25% of the net revenue received in income (a conservative assumption if you need to operate some equipment, run a van etc), a self-employed person working in this country would have to generate around €54,000 in revenue in order to come close to breaking even with a welfare recipient!

http://trueeconomics.blogspot.com.au/2009/08/economics-14082009-irish-welfare-rates.html

creedp

woodoo wrote: »

The increase in working hours is a significant reform. Not a hope in hell of that being agreed to in normal times. The government did well to get it.

While that might be the case .. how much will it contribute to the infamous €1bn in savings?

creedp

OMD wrote: »

What are you basing "significant increases in the cost of living" on? Ireland's inflation is one of the lowest in Europe. In addition it has been below the European average for 5 years now where it has averaged about 0.5% a year. That is hardly a "significant increase".
It also compares well with our main trading partner UK where prices have increased over 3% a year and the rest of Europe where inflation averaged 2% a year thus increasing our competitiveness. I am not saying government policy has caused this but you cannot really argue government policy has caused significant increases in the cost of living.
http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-14062013-AP/EN/2-14062013-AP-EN.PDF

OK I was a bit loose with my use of the term 'cost of living' as I was throwing in the increases in taxation (e.g. USC, household tax, motor tax) along with actual cost of living increases.

Since you did compare us with other European countries' this low inflation has helped with this http://www.independent.ie/lifestyle/food-drink/ireland-the-fifth-most-expensive-country-to-buy-food-in-europe-29362555.html

Realtivity

Sleepy wrote: »

There's certainly no argument that the premium for working a minimum wage job over one's welfare entitlements is currently too small to entice many off the live register

Of course there is no argument !

All you have to do is watch the pathetic lines of employers attending at the DSP offices on sign on day, begging and pleading with people to take on jobs that they cannot fill.:rolleyes:

Joan Burton is not the only one who is mad. People making comments like this need to pay a visit to the real world occasionally :mad:

Farmer Pudsey

In other threads I have expressed the opinion that we should not decrease the minimum however neither should we increase it, as at present it is the highest in Europe. It is time for a reality check welfare is as well the highest in Europe. We are by the way no longer a high cost economy except in government/utility services. It is not just direct welfare benefits but the add on. The amount of people on disability is staggering as is single parent top up. All this kill the incentive to work we need a serious reality check.

computer44

She did a very right thing, by cutting the pensions of OAPS that have boats in Dalkey. It has to be means tested why are 65 plus getting a OAP when they have enormous wealth. And does Pat Kennys wife claim child benefit.