The difficult position of Killian Forde

On 22 December the Sinn Féin website issued a statement regarding Sinn Féin's opposition to the Dublin City Council budget for 2010. http://www.sinnfein.ie/contents/17942

This statement outlined the parties opposition to the budget and the fact that 40,000 low income Dublin households would now be facing increased charges. However the statement also stated that Sinn féin councillor, Killian Forde, voted for the budget and Cllr. Forde had therefore acted in breach of his mandate from the party.

On the face of it, it would appear obvious that as a left winger I should attack Killian for his actions and demand that he be rebuked/disciplined by the party in the strongest terms.

However, I am torn on this issue because I feel Killian believes he is showing leadership on this matter and indeed acting in line with overall Sinn Féin policy in the South. That is to say that Sinn Féin has spoken a lot about the need to build a left alternative and the need for us to work closely with the Labour Party on doing this. It appears to me that this is exactly what Killian has done.

Dublin city Council is not run by Fiann fáil or the Greens. Labour is the biggest party and is then followed by Fine Gael with Sinn Féin only having five councillors.

Given this it should be noted that Killian Forde has spent the past nine weeks as chair of the Budget Working Group trying to transform the council budget from a really awful budget, with something slightly more palatable. Killian argues that the original proposals had much bigger cuts in the business rates, higher rent, removal of both the lift and the standing charge in bins, proposed cuts in front line 'people' services etc etc. In Killian's view this original budget was grim.

As head of the Budget Working Committee he then worked with the Labour people and in his mind got as much changed as he could.

On the Monday before the budget the City Manager made whats called order, under his powers as written in legislation to remove the waiver on the lifting of the bins, of which 40% of all Dublin households qualified. Sinn Fein disagreed with this and submitted a amendment to the budget, which Killian supported. However, this amendment was ruled out of order.

This left Killian in a position where he could vote against the budget and forget about all the work he had done with the labour Party in amending it. Or he could vote for the budget as the least worst option available. He chose to vote for the budget.

Where does this all leave Sinn Féin in the capital? Well I don't know, but if we are going to follow the ideas of Eoin o Broin and others and try to develop a strong left alternative with labour then big questions need to be answered and Killian may well have shown the party the way forward. Or perhaps not.

Over paid, Over here and Over us.

Over paid, Over here and Over us.

The Sindo, a paper that champions all that is vacuous, petty, inward looking and elitist in southern society, is not a paper I have much time for. And while they continue to have mostly insufferable journos sometimes, just sometimes, they end up putting together an article that highlights something of genuine interest. (Bear with me! I know thats a big claim).

Their article, (I wont link to it on principle) is a review of the pay of the semi-state bodies CEOs and also of the performance of the same.

Dublin Airport Authority:
Its CEO got €638,000 last year from the DAA. Usefully the article compares that salary with the British Airport equivalent which is about 5 times bigger than the DAA. Yet they only pay about 15% more for that role. The manager of the huge Schipol airport earned only about 78K more than the Dublin Airport CEO even though its twice the size. But the Dublin CEO must be worth it because while doing that job he also works as a non-executive director with Allied Irish Banks. Cut back on your hours a chara and give someone else a chance at a job. (As an aside wouldn’t it be a nice policy to bar retiring politicians from taking directorships for a period. I personally would not like to see Mary Harney retire and go straight onto a Health company’s board. Does such a restriction already exist?)

Dublin Port Authority:
Their most famous employee used be Bertie’s good friend Joe Burke. Their CEO Mr. Connellan got €299,000 in 2008. Port of London which handles twice the tonnage pays their lad €203,000. How do you save 50K here. Well according to the rules of the market you sack Mr. Connellan and offer the lad from London 249K. That’s 50,000 saved and you would have a much more experienced candidate in the position. But hey clearly this has nothing to do with the market so even if you are a gung ho free market maniac then this situation will stick in your craw.

RTE: Cathal Goan gets a cool €380k a year. The BBC Boss gets 2.5 times that to run 8 tv channels, 10 “national” radio stations, 20 local stations with revenue of about €5.2 Billion in an outfit bigger. Cathal Goan might not like to hear it but even by the standards of our neighbours he is overpaid. Can anyone tell me with a serious face that we couldn’t drop 100k off that salary can get someone as good or as bad? What about Pat Kenny?

3 clear examples and if you look at their wages from a left perspective then they are crassly wasteful and too high; but even if you are all about the free market then you cannot consistently argue for such high wages so clearly out of wack with the market. There is no basis to it! When people in the Sunday Independent start to argue the same point then its fairly obvious that there is a sentiment in the state for change. Although an outfit like the Sindo would be more interested in managing any change so as to limit any progress as much as possible. Their agenda is not the same as the Irish peoples.

It was recently commented that any party that could credibly argue a set of policies that gave voice to that demand for change would make hay at the next election. I agree with that. There is a hunger for change out there but will that anger get meaningfully channelled or will media outlets like the Sindo help fritter it away. How does a party like SF argue for meaningful change in this state when conservative media outlets begin to push the same message but with the intention of thwarting meaningful change and only delivering the bare minimum. As desire for change grows larger and larger the constant repositioning of rightist and centrist parties undercuts the left effectively ensuring that the anticipated revolution of groups like the SP are always due next year and never this year. Basically becoming wolves in left wings clothes.

To my mind overcoming this is one hell of a challenge for any progressive party.

The article also highlighted the interesting phenomenon of Bord Gais, ESB, Coillte et al all trying to get into the renewables sector. 4 state bodies all competing with each other in the one area , all hoping to undercut another arm of the state. I can see Fine Gael making hay with that when it comes to selling off semi-states in a fire sale. Rather than sell them it would be better to have a clearer vision of how these companies deliver for the state. Cutting them half-loose to fight it out with each other is little good. But then Fine Gael, same as Fianna Fail think the idea of key developmental components of our economy are much better off being owned by private, non--national, investors. Tweedledum is dead. All hail Tweedledee.

SINN FEIN MEET WITH KHALED MESHAL ON PALESTINE

SINN FEIN MEET WITH KHALED MESHAL ON PALESTINE

Eoin O Broin argues we cannot build an alliance for change without the Labour party. But listen Eoin they don't want one! So what can Sinn Féin do?

I received this post from TGmac who has an excellent site at http://socialist-continuum.blogspot.com/ He posted this as a comment in response to the Eoin Ó Broin piece on the imperative for Sinn Féin to build links with the labour party. http://sinnfeinkeepleft.blogspot.com/2009/12/is-labours-love-lost-building.html

However, I feel that this issue is so crucial to the party at this time that it deserved its own place for discussion. Much talk has come from people in the party about the need for left unity, including myself, but what does it mean and do we need to include labour in that movement if they do not wish to be part of it?

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Simple basic common sense creates an imperative for the left/progressives to agree some minimum policy agenda items. The low paid wage earners, the unemployed, the young, the poor, the sick (the list gets longer every day) need the left/progressives to get its act together. I'm sure every party is well able to highlight the injustices of the current regime, but that don't exactly take an Einstein to figure out.

O'Broin states that no progress can be made without Labour's involvement. Why? What are the benefits to the broad left/progressive movement with Labour inputs? Is is just the fact that they are able to garner about 20% support in the polls? Maybe this is a valid reason enough. Maybe it isn't. Solidarity without some agreed programs is just window dressing. The Irish people need an alternative that they can understand and believe will work. I also believe there is growing support among large swathes of the population for the notion that the present system isn't working for many people in Ireland, and is never going to work for many people. There is an inkling that change, fundamental change, is required in society, but it is by no means a given. The political party that articulates a concise and easy to understand program of change will make hay during the next GE. We probably have two years to create and articulate this program but the work starts now. We can't wait. Every day that passes is a lost opportunity.


By all means approach any person, group, community or political party that shares our views in general. Start building a concensus for change where we can. Start building a new language and program for change that people across different disciplines, circumstances and outlooks can get behind to some degree. It won't be perfect but it'll be better than what we have in the present circumstances.

But real politik is staring us in the face. Labour has stated categorically that it will not enter into a broad leftist/progressive alliance before the GE. I can understand their position. Many of their members, and some of the leadership, come from former organisations that were mired in factions, petty arguments over terminology, and just a general inability to function effectively in the political arena. They don't want to enter this world again. I fully sympathise. And lets not forget that while many Labour members easily jettisoned their Marxist repertoire, they still manage to bring their anti-Republican baggage with them.

SF should do what it does well. Organise in the long grass. Localise politics and organise at the grass roots. Highlight the fact that local problems are only a manifestation of larger national problems. Highlight the fact that the MOTUs (master of the universe, FF, FG etc.) use the national and international stage and issues to perpetuate their own localised cronyist policies.

There is one area that SF, and indeed the broad left, needs to improve upon in a big way. We need to create a professional and alternate media in this country - all 32 counties. SF should be leading the way, and maybe this project, rather than grand alliances, is something the entire left/progressives can work on together. Maybe it is in this medium that we can begin to build a concensusal alternative to the current system.

Cosy consensus in the south exposed once again by our Orange neighbours

Consensus is a word thats often associated with Holland. Apparently in that country everything is about consensus and having everyone agreeing before they act. Its somewhat ironic then that it falls once again to a Dutch company to expose and thwart the cosy consensus in the south.

The Fleming group is a Cork based construction and development interest that has debts of up to 1,000,000,000 euro, 260 million of which is owed to Anglo Irish bank and 21.5 million to ACC.

It turns out that the company's survival plan was universally acclaimed by all its creditors with the exception of the foreign company - ACC, who took this to the Supreme Court.

ACC had claimed there was no evidence Anglo Irish Bank, Bank of Scotland Ireland or Allied Irish Banks will provide the working capital required to save the group.

But defence is claiming that Anglo had taken a commercial decision to support the plan. As part of the scheme it has committed a total of €2m, €1.6m of which would go towards paying the group's unsecured creditors and for other fees it has incurred.

So Anglo, which is a state bank ie we own it, is going to pay out 2 million as part of the plan to save the Fleming group. Now that might be all well and good but so much trust has been eroded the mind tends toward suspicion instinctively.

ACC think the same believing that the rescue plan is a "personalised NAMA" where the banks would sell off the properties over a period of ten years. ACC believed that the plan went "beyond the margins of examinership" and should be rejected.

So maybe ACC is annoyed because they dont like doing business in tents on the basis of where you play golf or maybe they just think the plan sucks. Turns out ACC loaned a cool €22m to a Fleming group company for construction of the Sentinel building in Sandyford, Dublin which is currently "a shell" that ACC prices at about €500,000 to €1m. Bit of a write down that. No wonder ACC are peed off.

They are also peed of because they are not a NAMA company. They are unfortunately outside looking in. Alot like the rest of us then.

But should we listen to ACC or are they just begrudgers who would be feasting like the rest if they could. Well they probably would but ACC has already done some service to the southern state when it challenged the plan for Liam Carroll’s Zoe Group over debts of €136 million. Zoe owed owed €1.35 billion, including €1.27 billion to banks. Zoe wanted an examiner appoined and 100 days to sort its stuff out. This was supported by by AIB, Bank of Ireland and Bank of Scotland Ireland. Anglo Irish Bank & Ulster Bank lodged no objection. The only dissenters to this cosy consensus was ACC. Zoe group were found to have withheld evidence from the court and their application was booted out by a disgusted court which believed there was a deliberate attempt to disrupt the court process.

Talking about the case 'Justice Frank Clarke said the prospects for survival of the group after a two-year moratorium on interest rates expires in 2011 were “significantly improbable”, “at the further ends of optimism” and dependent on the “virtual impossibility” of a benign climate concerning interest rates, property values and letting capabilities.'

Yet despite the Zoe rescue plan being "flawed", "ïmprobable" and my favourite "at the further ends of optimism" it was accepted by all the Irish banks except the Dutch ACC who ensured it was booted out by a disgusted judge.

Is this Fleming case another example. Who knows but I am more likely to listen to ACC than the NAMA banks.

ACC used to be the Agricultural Credit Corporation before it was sold off by the state in 2002. It made a positive contribution to the southern economy while it was a state bank. Certainly more of a contribution than our current state bank - Anglo Irish. Calls for a state investment bank should be acted on. At least ACC is still making a positive contribution to the south even if is now foreign owned.

At least they, like the people of southern Ireland, are outside looking in.

Breaking news link

Is Labour's love lost? Building a progressive alliance in a world without social partnership.

In last week's An Phoblacht Eoin o'Broin again highlighted the opportunity for a broad, progressive, political alliance in south Ireland which would serve to realign southern politics away from the oddity of two right wing parties with the same ideas constantly swapping office.

Starry Plough had looked at this question before. There has never been a better time to realign politics certainly. For such a long time Fianna Fail had a strong lock on Public sector workers and also even in working class communities. Seeing as how both these groups have been targetted for some extra pain by that wretched party in the recent budget it is to be hoped that their % vote will drop even further. But for all the delight in seeing Fianna Fail on the canvas, if not quite knocked out, its a sober warning to anyone who wants to see some change in this state to see FG rising high in the polls. As so often Fine Gael will win not because their ideas are welcome but because they are not Fianna Fail. And in effect Tweedledum is about to see himself pushed over by Tweedledee. The tea party will continue full steam ahead, no changes planned thank you very much.

So can Labour upset the party and start to break this tired old musical chairs? However they choose to act Eoin is right in asserting that a meaningful left alliance would require Labour's input. They are still a strong block and without them a left wing alliance is weakened. But without a left wing alliance Labour is only going to be best supporting actor to Enda Kenny with a limited input over the big decisions with an unleashed Leo Varadkar.

The only part of the article I was unsure of was the strategy where "Firstly it would be to demonstrate to the Labour Party that republicans are serious about the long term objective of transforming the social, political and economic landscape of the country." I think its equally up to Labour to demonstrate their serious commitment to those objectives.

But that said every effort should be made to demonstrate to Labour that our committment to those objectives is firm and that we stand on the same side. I do think that Labour need to start building this idea of a broad left alliance if only to check Fine Gael who are starting to really dominate the polls with a 13% margin over FF and a 19% margin over Labour. A left alliance will give Labour leverage and the people of the south an alternative to the terrible twins.

I also think that with the effective death of social partnership that this type of alliance is necessary.

Eoin's article:

Engaging Labour

IN his February 2009 Ard Fheis speech, Gerry Adams called for an, ‘egalitarian alternative to the politics of greed, inefficiency, waste and corruption.’

He called for realignment in Irish politics to end “the dominance’ of Fianna Fáil and Fine Gael.

“The Labour Party” argued Adams “has a duty not to prop up either Fianna Fáil or Fine Gael. Instead Labour should explore with us and others the potential for co-operation in the future.”
The following month in his Ard Fheis speech Eamon Gilmore said that, “to end crony capitalism, you have to end crony politics”. He told delegates that Labour’s mission is “to build a new, better and fairer Ireland”.

A week earlier in a ‘Sunday Business Post’ interview Gilmore ruled out a left alliance. He told Pat Leahy, “There will be no alliance with Sinn Féin, parties of the left, with individuals of the left. There will be no alliance of that kind.”

While officially the Labour Party’s objective is to become the second largest party in the state and lead the next government, party strategists know that if it is in the next government it will be as a junior partner to Enda Kenny’s Fine Gael.

Such a coalition can not create “a new, better and fairer Ireland”. It will be a conservative government, dominated by a resurgent, right-wing Fine Gael.
So where does this leave Sinn Féin’s call for an alliance for change? Should we abandon any hope of Labour working for a realignment of Irish politics? Is Labour really no different to Fianna Fáil or Fine Gael?

For this writer there will be no realignment of Irish politics without Labour. No alliance for change can be built without their active participation.

Thus Sinn Féin should not abandon the Labour Party but develop a strategy of engagement. The purpose of this strategy would be threefold.

Firstly it would be to demonstrate to the Labour Party that republicans are serious about the long term objective of transforming the social, political and economic landscape of the country.

Secondly it would be to build effective working relationships at a local and national level with Labour and its supporters on issues of common concern.

Thirdly it would be to strengthen the hand of those within the Labour Party, and its broader support base in the trade union movement and civic society who believe that such an alliance is not only possible, but realisable.

There are many activists and supporters within the Labour Party who do not want to be part of a Fine Gael coalition. There are others who simply do not see any other viable option in the short term.

Those of us who believe that a better, fairer Ireland is possible have a responsibility to engage and convince those who share our broad values and aspirations that an alliance for change is the best way forward.

But an alliance for change will not emerge on its own. Those of us who believe in it need a strategy, including a strategy for engaging with the Labour Party.

This year’s European elections saw the combined left vote in the 26 Counties reach 30% for the first time in the history of the state. The economic and political model promoted by Fianna Fáil and Fine Gael is in crisis. There has never been a better time for the left to promote a real alternative.

The Greens - First yellow and now blue.

Some fairly despicable comments were passed in leinster house recently. But enough about the budget. At least we had the Greens -an Comhaontas Glas, the supposedly ethical heart, if any remains, of this govt.

Well I am not so sure about ethical considering their masterful performance over the last year. Seems like these days the Greeens are following the PDs into the same nasty, unethical politics.

Deputy Gogarty, with his nice big salary feels your pain and knows what its like. As the man explained:

"It is hard for me to gratuitously insult many of my constituents who are public sector employees and tell them: “Listen, lads. It is necessary. I feel your pain but it is necessary”.
...

"It would be highly disingenuous of me and totally insincere, therefore, to say anything other than that this is a grossly unfair section and that the Bill is grossly unfair."
...
"I am not proud of what has happened, I am not proud of the fact the banks had to be bailed out, of the corruption and worship of mammon in this country that has brought us to this sorry state, I am not proud of that, colleagues"

And then after some more raiméis we had that moment:



Deputy Gogarty, I look forward to the day when your constituents tell you in the most unparliamentary language to Fu*K off, with all due respect, Fu#k off.

So the Budget is out.

Some points that struck me as a first impression was the number of things done for optics. Smoke and mirror policies. The most annoying being Cowens pay cut. How will he surive on over 200k. Tough times indeed.


Excise duty on alcohol reduced - 12 cent cut on beer and cider, 14 cent cut on a measure of spirits, 60 cent cut on a bottle of wine (no change in tobacco)

Will these cuts increase consumption and therefore revenue or is it just another distraction by feeding into the "we are competing with Newry and Bangalore" myth. I suspect the latter but hey who knows maybe this is not a pointless optic. 12 cents off that scrumpy jack might be enough to tempt people to ignore Mary Harney's advice to shop around for the best value. Maybe we can drink our way out of this. Who'll play their part this Christmas? That socialist rag the Sunday Business Post was wondering last year why the Govt. was failing to force retailers south of the border to reflect currency movements in their prices! As they note the south is indeed a more costly place to do business but could that account for differences of up to 50% in some items. Still a year later its apparently better to ignore that type of thing and instead of protecting southern consumers its apparently better to lobby and just mess around with cider prices rather than face up to Rip Off Ireland.

Scrappage scheme announced - VRT relief of up to €1,500 on a new low-emission car, for trade-ins at least 10 years old.

This falls under stimulus apparently. The SBPost were fairly enthused about this over the last few weeks. Apparently is a big boost. Maybe it is! Cheap drink and a new car to prosperity. Gas how shopping in Newry is anti-patriotic( as the economic isolationists argue) but encouraging the purchase of a luxury item produced off the island is not. Is there a better way to have money circulate in the economy for a few more times before it leaks out or is a new car the best way to go? Or is this car scrappage just a malarky to make it look like the govt is trying to kick start the economy and get some spending going. But will the lure of €1500 for your banger traded in for new cars under certain conditions be enough to tempt you to buy a car. As Brian Linehan said

"The scheme will have the environmental benefit of removing some older, potentially less safe and polluting vehicles from the road".

Potentially less safe? Thought the NCT had those things off the road.

But this is a govt. with a green streak in the middle. What input them? Well car wise continued incentives to switch to a hybrid car. I am really curious to see how this works out.

As Brian L said ...

To that end, the VRT exemption for electric vehicles and the VRT reliefs of up to €2,500 for plug-in hybrid electric vehicles are being extended by two years until 31 December 2012

. I would like to see the latest figures but back in 2007 friends of the irish environment said the scheme cost about 8 million for 9 months of the year 2007. But at the time a certian Ciaran Cuffe said:

The rebate was supposed to encourage sales of cars generating less emissions and pollutants than normal models such as the Toyota Prius and the Honda Civic hybrid," he said. "But now it's clearly subsidising sales of expensive, luxury cars that contain green technology, but don't apply it in the same way. No one driving a Lexus hybrid can argue they are helping to save the planet.

Maybe they got that problem solved and its now acceptable to the Greens or maybe the Greens accept anything and everything these days. Is this another gimmick. At 8 million roughly a year then yeah it probably is substanceless. Cuffe used think so anyhow.

Ombudsman to be appointed to review the cases of small businesses who are refused bank loans

If I was a small business man with 10 people struggling to keep afloat the opportunity of entering a bureaucratic paper run between the banks and an ombudsman would not fill me with confidence. Still when it goes belly up and the creditors are ripping apart your tiny business and people have lost their jobs you can keep busy tracking your new national bond.

There are many other items in the budget that are damaging and they will be well covered in the media and on the SF budget analysis site and other progressive media sources.

But these paltry baubles I listed above may end up being touted as the govts stimulus package. For me personally thats hard to credit and I see more an exercise in spin and managing the political narrative than actually contributing anything serious.

I'm Fxcking angry and pissed off!

As a public sector worker in the South I am totally pissed off with the manner in which my union has behaved in relation to the pre budget negotiations.

My union held a national ballot, organised meetings and sent out literature about the position of the union leadership in relation to the planned government cuts to public sector pay. In all of the above the argument was put forward that such cuts were not fair and must be rejected in favour of a fairer tax system whereby the wealthier members of the country would pay more, because they could afford it!

I stood with many others holding official union placards that said no to pay cuts and yes to fairer taxation. It was on this basis that people voted to strike and walked out in their hundreds of thousands. To us the argument was sound and we were taking a principled stand.

BUT THEN

Yet what happened? Our leaders then go into negotiations and put forward a proposal whereby public sector workers would have to take 12 days compulsory leave without pay! This is a pay cut and anybody with a brain can see that.

By taking this step the union leaders had moved away from the agreed principled position already mentioned and accepted that the public sector pay bill needed to be reduced. At one stroke they had undermined their/our position. This was madness!!!

As soon as I heard this was happening I said this will not be agreed and the government will hum ha and then walk away. Which is exactly what they did. SURPRISE!!

The reason they can safely walk away is that they can now simply turn around and say ,"Look you accepted the need for the pay bill to be reduced, but unfortunately your way will not work. So all that is left is pay cuts. Sorry."

And in response what can the union bosses say, "Umm umm No that's not right. We have tried to be reasonable. We don't really believe cutting pay is important anymore."

To which the media will go, "Ha ha ha. Now we have you. Now we have ya."

WHAT DOES THIS MEAN

When I try to understand what has happened to my union since the crisis began, I am left confused.

Firstly we had the behaviour around the pay cuts via the increased pension payments.

When this step was announced by the government the unions took weeks to organise a response. They got over 100,000 people on the streets opposing these cuts eventually got around to organising a ballot for strike action. But what happened? Nothing. One union did not have a big enough majority for strike action and that was it.

In my opinion this was NOT the result of poor leadership on the part of the unions. Rather the union leadership actually accepted the logic of the cuts and that wait. game over.

Secondly we have the farce around the cuts coming up in the budget. For me there is only one explanation for what happened and that is the leadership never believed what they were originally telling their members. they never actually believed in fairer taxation and making the rich pay and one of the reasons for that is possibly the high pay of many of those union leaders. For some info check here http://www.businessandleadership.com/news/article/16895/leadership/paper-publishes-salary-levels-of-trade-union-leaders

SO NOW WHAT?

So now what. Well the only thing for people to do is get active in their union. Every branch member should demand to know why the leadership are behaving as they are. If they believe in the cuts agenda, well be honest about it and convince us. If they don't support the cuts agenda then why are they just rolling over every time the government makes another attack on working people. And if we don't like their answers then we should kick them out of office and put in people who will fight for working people.

Tax Breaks and the Budget

Tax breaks and the budget.


Break a leg is the customary term of encouragement given to actors. As Brian Linehan senior counsel gets ready to deliver his third budget in 15 months we'll all be hoping this master actor gets it right this time

What he comes out with is hard anyone's guess but its likely to be a lot of old hat with maybe, just maybe, one or two good ideas in the middle. If he is looking for advice he should take a look at the Sinn Fein pre-budget proposal http://www.sinnfein.ie/files/Pre-Budget2010_small.pdf
One of the areas that documents recommends focus on is tax breaks as part of the party's argument for a functioning tax system.




Some of the proposals were:


- Abolish mortgage interest relief for landlords – Raises €285 million


- Abolish all remaining property-based tax reliefs (on property development, not principal home mortgage interest relief) - Raises €43 million


The pre-budget submission argued that standardising all discretionary tax reliefs could raise €1.1 billion.





TASC, the economic think tank arguing for a more nuanced approach to the Irish economy have now added some futher details to this discussion with a new report on tax breaks /or tax expenditures as they are officially called. http://www.tascnet.ie/upload/file/TASC%20Pre%20Budget%20Statement%20on%20Tax%20Breaks%20FINAL.pdf





TASC says that tax breaks will cost the southern state about €7.4 billion in 2009. The level of tax breaks in Ireland is exceptionally high. They amounted to € 10.7 billion in 2005 (which are the latest complete figures for the cost of tax breaks in a single year). The OECD Economic Surveys: Ireland reports that tax expenditure on personal income tax in 2005 amounted to €7.2 billion, plus an additional €3.5 billion in tax breaks on corporation tax. This totals €10.7 billion in tax breaks on personal income tax and corporation tax alone (OECD 2009a, pp. 60-62; OECD 2009b).



Big money indeed. But tax breaks are not necessarily bad its just when you use them unwisely they can cause the wrong type of outcome. Like increased inequality of wealth distribution or else stoking the fires of a property boom.But of course they also help people with breaks existing for disabled people or as aids to help businesses and keep people in jobs etc. The southern state is out of kilter with the rest of Europe. If tax breaks on personal income tax and corporation tax were reduced to EU average levels, they would only cost €2.2 billion in 2009, a drop of €5.2 billion. On Progressive-Economy http://www.progressive-economy.ie/2009/12/tax-breaks.html Nat o'Connor notes tax expenditure on personal income tax in Ireland cost three times as much as the average of 22 other EU countries.



TASC has argued that The Government is effectively spending money every time it decides to create or extend a tax break. All these tax breaks should be included in every annual Budget and the govt. would have to justify on an annual basis whether to keep or to scrap or add new tax breaks. Every single break would have a "sunset clause" and their evaluation as a success or not should not include any investments or jobs created that would happen anyhow as noted by the Irish times.




There are a couple of stumbling blocks for Brian taking these ideas up. Specifically the need to justify tax breaks each year, and they need to analyse their specific benefits over and above any investment or jobs that would be created anyhow. These points would require accountability, honesty and the implementation of basic controls. Basic controls that you would have in any business not to mind a state.



But the pre-budget proposal is right not to call for a huge clamp down on tax breaks. Too drastic an action would impact on low and middle earners who cant afford it and would probably harm small businesses trying to keep running and keep people in jobs.


But there seems to be plenty of room to tighten up the system and to help improve govt. revenue.


When it comes to reforming the tax breaks system and demanding accountability on why they exist and a demonstration that they are part of an appropriate economic strategy for the state then There Is No Alternative (TINA).



The Tasc report is http://www.tascnet.ie/upload/file/TASC%20Pre%20Budget%20Statement%20on%20Tax%20Breaks%20FINAL.pdf here and the Progressive-economy.ie site is discussing it at http://www.progressive-economy.ie/2009/12/tax-breaks.html