The most anticipated budget has finally been delivered with miserly news from Scrooge Lenihan casting a shadow of gloom over the festive season for many householders. The harshest of cuts are once again impacting on the most vulnerable, with social welfare recipients and public service workers to bear the brunt of the €4 billion savings in expenditure.
Even though the Minister for Finance said that we must “all share the burden” — and rightly so those at the “those at top lead by example” with ministerial pay cuts along with a reduction in the Taoiseach’s salary — reductions in Child Benefit, social welfare, and one billion pay cuts in public sector wages will undoubtedly lead to social unrest in the coming weeks.
Public servants’ unions are already threatening industrial action as their salaries will be slashed on a tiered scale, with the average pay cut ranging from five to eight per cent and those at senior level taking a 15 per cent cut.
Private sector workers may breathe a sigh of relief as there are no further tax blows, however this sector has already suffered huge job losses and have already endured severe pay cuts on wages, which for the many are lower than public sector wages.
There has been widespread denouncements in the aftermath of the Budget against Child Benefit cuts which will be reduced by €16 a month (welfare-dependent families are not affected ), and those on medical cards will see a 50 cent charge for every medical card prescription from April. Other reductions see a 4.1 per cent cut for those on Unemployment Benefit, an €8.30 per week drop in Disability Allowance, and a reduction in the Jobseekers Allowance for those under 25 (and in cases where job offers have been refused ). These cuts may seem harsh, and for those who are direly in need of such benefits it is, however there are plenty of people milking the Social Welfare system and these new measures may stop fraudsters from draining State money.
Everyone will immediately feel the pinch when the cost of petrol and diesel to go up 4.2 cent (petrol ) and almost 5 cent (diesel ) a litre, and next year the cost of home heating oil will increase due to the carbon tax.
As for stimulating the economy, measures such as injecting more money into FÁS were announced, however the Irish Small and Medium Enterprises Association reacted with criticism that there were few incentives introduced to assist smaller enterprises and there is “no sign of a badly needed stimulus package”.
Other measures include that mortgage interest relief will be extended to 2018 to encourage house buying; a scrappage scheme has been announced and following the devastating weeks of flooding, relief assistance of €70m will be help victims and prevent future floods.
The final sweetener came in the form of lower price on booze, to counteract the vast number of people who travel to the North to buy their liquor. Excise duty on alcohol is reduced to 12 cent cut on beer and cider, a 14 cent cut on a measure of spirits, and a 16 cent cut on a bottle of wine. Alcohol Action Ireland was shocked at this decision especially when “cutting supports for the most needy and vulnerable, he is proposing major cuts in excise on a luxury good”. The majority of the country won’t be raising their glass (even if it is filled with cheaper wine ) this Christmas to raise a toast to Mr Lenihan’s Budget, in fact in the wake of things most people are more likely to drown their sorrows and exclaim “Bah, humbug!” However this budget could be the first step in leading us into the New Year and into the future with the building blocks of economic recovery, supporting Mr Lenihan’s belief that the “worst is over”.
Geraldine Carr [email protected]