Sunday, 12 April 2009

Press Release - Scandalous Budget an Affront to Working People – Looney

Dermot Looney, a Labour Party candidate in the Tallaght Central ward in June’s local elections, has slammed April’s ‘emergency budget,’ saying that it targeted PAYE workers and those on welfare instead of hitting the rich. Looney, 26, said that the budget featured, at its heart, a callous and right-wing political imperative which underlined the failed politics of the Fianna Fáil government.

“I have been talking to hundreds of local people since last Tuesday who are fiercely angry about the tack taken by Minister Lenihan,” said Looney. “Instead of hitting tax reliefs for their developer pals and millionaire tax fugitives, 81% of the €1.8 billion in tax increases is to come from the PAYE sector in an affront to working people.”

“A single worker on €40,000 - just over the average industrial wage - will lose €1,200 or €23 a week through the new levies, after already losing €400 last October. If they have the misfortune to be a teacher, a nurse or any other worker in the public sector, they were also hit from March by an additional pension levy of €2,103, or €40 a week. Yet despite these shocking, anti-progressive levies, there was no levy on wealth or unproductive assets which could have yielded hundreds of millions.”

“Let’s take another example – a married couple on €45,000 each, with 2 kids and a standard €250,000 mortgage. They will pay an extra €900 per year on the income levy – on top of the €900 they began to pay in January – and €1,800 on the health levy. They will lose €1000 in the early childhood payment for their two kids, and €900 on the abolition of mortgage interest relief – on top of the €300 they lost in January.”

“In total, after April’s budget, this couple are down almost €6000 a year. If either works in the public sector there’s an extra €1600 – or, if both are public servants, that’s almost €10,000 wiped off their annual income since January.”

“The abolition of mortgage interest relief will also hit working families hard, particularly those who were forced to pay through the roof during the Fianna Fáil-backed boom. At the same time, a landlord with a portfolio of properties can still claim tax relief of 75% against interest repayments.”

“Rent Supplement changes leave tenants at the mercy of landlords. Existing tenants will be hit with an 8% cut, meaning that all 80,000 current rent supplement tenants are going to have to ask their landlord for an immediate rent reduction or make up the difference themselves. Although some rental prices have been falling, this measure was crude and does not take into account the individual circumstances of tenants.”

“Attacks on welfare are the lowest of the low, and the abolition of the Christmas welfare bonus, and the halving of dole for those under 20 – with no requisite employment or educational supports – are particularly heartless.”

“Even where the Government looked to make the correct decision, it botched it. After years of following the US-style privatisation of hospital land for Harney’s crazed co-location policy – including at Tallaght Hospital – they have rolled back. But there is no word on how the 1,000 hospital beds promised under the scheme will now be provided. Labour first proposed the abolition of the early childcare supplement, but only when the details had been ironed out on a national pre-school scheme – something the Government have yet to do.”

“Perhaps most scandalous of all was what the Government refused to include in the budget. There are no cutbacks on special tax breaks for the pensions of company directors. There is no change in the status of tax exiles who, despite their claims to ‘patriotism’, claim to reside outside Ireland for part of the year to avoid paying taxes here. The 440 ‘high worth’ tax fugitives, who are worth an estimated €30 million each, will not contribute a penny more under this rich-man’s budget.”