Current Account

  • Beeb impresses as techies mangle mother tongue

    October 31, 2008 @ 9:03 pm | by John Collins

    Now that the dust has settled somewhat on Microsoft’s Professional Developer Conference (PDC) in LA this week, where the software giant made significant announcements about WindowsOffice and its approach to the web, it is possible to absorb some of the other interesting developments that may have been dwarfed by the big news.

    Microsoft asked a variety of customers to come along and show how they were using its technology. One of the most interesting of these was the BBC, who showed off what it is doing with its iPlayer at the end of the Windows 7 keynote on Tuesday. Although still only at the demo stage the Beeb is using Microsoft’s Mesh and Live Services as well as its Sliverlight authoring software to create a compelling offline application with real social elements built in. It pulls in your MSN Messenger contacts list and shows you what your contacts have been watching and how they have rated it. It’s also easy to share content with your friends and the man from the BBC said licence payers would be able to synch their content to all their different devices. I’d happily pay a licence fee or watch some adverts to be able to access the BBC’s treasure trove of TV and radio programmes in this way.

     For various reasons I’ve been covering less technology of late so this was the first major tech gig I’d been to a for a while. As a result I’d forgotten how much the industry can garble the English language even when there’s no need to. Sure there’s a lot of jargon in the sector but was there any need for Mike Nash, corporate vp for windows product management to say in the history of Windows Microsoft has never been as “planful” as with Windows 7. Surely you’ve just done a lot of planning Mike?

  • BBC’s Dragon sees value in distressed property and shares

    @ 5:28 pm | by Simon Carswell

    James Caan, one of the five investors on BBC’s Dragons’ Den programme, told the Irish Auctioneers & Valuers Institute (IAVI) lunch in Dublin last week that he was investing in two things - property and shares - because he saw values in both in these distressed times.

    His reference to property generated a little round of applause from some of the gathered estate agents.

    Caan told the auctioneers last Friday that he was that afternoon exchanging contracts on a property in the upmarket Mayfair area of London - Grosvenor Street, to be precise, where prices have fallen 50 per cent.

    “What you can buy now a year ago you would have paid double,” he said.

    “Even in this market, if you are mentally in tune with what is going on and you are looking at opportunities slightly outside the box, there are as many people who make money in these markets as there are when the markets are growing.”

    He told the estate agents that they should try to sell “based upon the value of the opportunity, not necessarily the way you have come at it before”.

    He was also flipping UK bank shares as the British government was taking stakes in some financial institutions creating short-term value for investors.

    “We have seen such a good run for so long that this market is slightly scary. For me, as an entrepreneur, I am not afraid. My philosophy is: Observe the masses and do the opposite.”

  • Who will represent the taxpayer on Irish bank boards?

    @ 4:53 pm | by Simon Carswell

    The State’s €440 billion bank guarantee scheme gives the Minister for Finance, Brian Lenihan, the power to appoint at least one but no more than two non-executive directors to the boards of the covered Irish banks to represent the taxpayer’s interest.

    Mr Lenihan and the Department of Finance are compiling a panel of individuals from which the banks must choose one or two to appoint to their boards.

    No names have been announced by the department yet, but two former chairmen of the Revenue Commissioners, Dermot Quigley and Frank Daly, have been mentioned as possible appointees.

    Former central bankers and regulatory figures are also likely to figure on the panel. The former chief executive of the Irish Financial Services Regulatory Authority, Liam O’Reilly, is already on the board of Irish Life & Permanent.

    Expect other former senior public servants and ex-department secretaries to appear on this panel, which the Minister is thought to be planning to announce shortly.

  • How big are Ireland’s ghost towns?

    October 29, 2008 @ 8:26 pm | by Laura Slattery

    The lights are off and there’s nobody home – permanently. From the unsold apartment blocks that loom on the sides of roads like citadels to the ghost housing estates that are creepily undressed by curtains or cars or any of the paraphernalia of everyday living, Ireland’s “house of cards” economy has left thousands of “vacant dwellings”, as the Central Statistics Office (CSO) calls them, dotted and clustered around the country.

    Exactly how damaging this is for the social fabric is a subject best left for another blog. But how many of these vacant dwellings are there? Eager to hammer home the idea that the collapse of the property market is near completion rather than hanging precariously mid-demolition, the Construction Industry Federation (CIF) is unhappy that Goodbody Stockbrokers has estimated that the number of unsold new homes is close to 50,000. The CIF says the real figure, totted up from its “direct dealings with the companies responsible for building these units”, is 35,000.

    So how did Goodbody economists arrive at their number? And given how high both numbers are, does it really matter which one is right? (more…)

  • Soros warning bodes ill for the IFSC

    @ 7:23 pm | by John McManus

    George Soros breaking the good news at the Massachussetts Insititute of Technology

    Picture: George Soros breaks the good news at MIT today

    Legendary fund manager George Soros has predicted that the global financial crisis will reduce the hedge-fund industry to as little as a third of its current size and he should know as his Quantum Fund was the grand daddy of them all.

    Addressing an audience at the Massachusetts Institute of Technology, Soros (78)  did not specify if he was talking about the number of funds or the amount of money invested in them but given that some 4,000 odd people work in hedge fund administration in the IFSC and another couple of hundred work in hedge fund management, its hardly good news.

    Indeed some argue that the impact on the IFSC of the credit crunch is the equivalent of Intel closing its plant in Leixlip.

    As one reader succinctly puts it:

    “The business is based on fees derived from the assets under administration and these assets have been declining spectacularly since the start of the year. Over the past 2 years salaries and demand for employees have inflated the markets and costs have exploded. Now many of the principal administrators are faced with a serious shortfall and many many jobs are at risk.”

  • Mr Windows happy in his natural environment

    October 28, 2008 @ 8:28 pm | by John Collins

    Steve Sinofsky, the Microsoft executive drafted in to get Windows back on track, was in top form in LA today at the Professional Developers Conference (PDC), when he gave the first public demonstration of Windows 7, the next release of the world’s most popular operating system and Microsoft’s cash cow.

    Sinofsfsky visibly smiled as the assembled developers spontaneously clapped and cheered the announcement of new features such as the ability to control the taskbar, turn off the highly annoying user account controls (UAC) which debuted in Vista, and the new touchscreen features. The highly regarded exec, who previously oversaw Office, was even cracking jokes - “we’ve decided once every 15 years or so we are going to redesign the applets in Windows” he said, as the updated Paint application was shown. (more…)

  • The future looks cloudy for Microsoft

    October 27, 2008 @ 8:45 pm | by John Collins

    So Microsoft today confirmed what technology watchers had been speculating for the last month - that it would introduce an operating system for cloud computing, the model of accessing software services over the web, which has been pioneered by everything from Apple’s iTunes to Salesforce.com.

    Microsoft’s platform that will enable its customers to create innovative new web services is called Windows Azure, although the relationship between this platform for developers and the operating system that runs on almost a billion PCs is up for debate. Ray Ozzie, the software giant’s chief software architect, who had the enviable task of filling Bill Gates shoes, made the announcement at Microsoft’s Professional Developer Conference (PDC) in Los Angeles today. (more…)

  • Home Choice Loans, another stupid State intervention

    @ 8:02 pm | by John Collins

    OPINION: AS THE wheels come off the Government’s Budget, the lack of a coherent economic policy at its base has become plain for all to see, writes John McManus

    The numerous unpopular measures in the Budget are hard to defend because none of them seems to be grounded in any sort of long-term economic planning which could be used to justify them.

    They are turning out to be exactly what they seem: a wildly disparate series of savings aimed at balancing the books.

    The overriding factor in the decisions as to where the cuts were made seems to have been political judgments as to whether or not the electorate would wear them. Where that judgment has been found wanting, the cuts have proved impossible to defend. (more…)

  • Medical card fiasco a prime example of what not to do in PR

    October 23, 2008 @ 10:45 pm | by John Collins

    MEDIA & MARKETING: The past week has been a media disaster for the Government. How did it turn out so badly, asks Siobhán O’Connell?

    PUBLIC RELATIONS is the practice of managing the flow of information between an organisation and the public. It’s as much about managing relationships and reputations as about publicity. But despite an estimated annual budget of €10 million for special advisers and PR handlers, the past week has been a PR disaster for the Government.

    The announcement in the Budget that medical card eligibility was to be capped was always going to be controversial. So how come Brian Lenihan and his colleagues handled the issue so badly? Veteran PR consultant Ronnie Simpson says the crisis management textbook recommends that organisations can regain and enhance their reputation in a disaster if they respond correctly. (more…)

  • Dermot Desmond on investing, property and enjoying life

    October 22, 2008 @ 5:13 pm | by John McManus

    desmond.gif

    Interesting interview with Dermot Desmond on www.businesslunch.ie….

    http://www.businesslunch.ie/#cb=video&ids=56

  • Throw the Blackberry away and enjoy life…

    @ 12:26 pm | by Laura Slattery

     In an astonishing example of how to quit the day job in style, Los Angeles-based hedge fund manager Andrew Lahde has cut his ties with the industry with a missive that takes swipes at the “stupid” traders who helped make him rich, before going on to call for a new meritocratic government (led by financier George Soros) and - “while I still have an audience” - the legalisation of marijuana.

    One of the funds managed by Lahde’s $80 million firm made a reported 866 per cent return last year by betting that the US subprime mortgage market would collapse, suggesting a long (Lahde is 37) and comfortable retirement ahead, as he repairs his stress-damaged health. In case you missed it, here is the text in full… (more…)

  • Will high-tech Cinderella will have a fairytale ending?

    October 21, 2008 @ 2:36 pm | by John Collins

    BELFAST BRIEFING: Andor has huge potential but has yet to deliver on its promise, writes Francess McDonnell

    THERE IS the promise of a hint of drama tomorrow in west Belfast when shareholders in Andor Technology get the opportunity to vote on a proposal to take the company private.

    Andor is not only one of the North’s best-kept secrets; it is also one of its most frustrating.

    On paper, the Northern Ireland company’s potential appears limitless. But Andor has been in operation for nearly 18 years and has yet to deliver on its early promise. (more…)

  • Mac vs PC vs mac vs PC

    October 20, 2008 @ 1:21 pm | by John Collins

    Apple’s ads with a straight-laced PC character talking to a funky “mac guy” have been hugely successful for the iPod and iPhone maker. Latest analysis shows that it has about 18 per cent of US retail computer sales, but because they sell high end systems their revenue share of the US PC market is 31 per cent. 

    No wonder Microsoft responded with a $300 million ad campaign featuring Jerry Seinfeid and  Microsoft founder Bill Gates. Predictably enough Apple have now hit back, accusing Microsoft of spending more money on ads than fixing the issues with the Vista operating system.

     

  • Allegations by ICG merit full investigation

    @ 11:20 am | by John Collins

    John McManus/OPINION: THINGS ARE starting to warm up at Irish Continental Group (ICG) as the clock ticks down on the 12-month moratorium on bids imposed by the takeover panel, writes John McManus.

    The presumption until now was that not withstanding the current state of the market one or other of the three potential suitors would try and unlock the stalemate next month. The most likely outcome was seen as Moonduster, the consortium led by Philip Lynch’s One51 group, which owns 25 per cent, or Aella, the management consortium which owns 16 per cent, buying Liam Carroll’s 29.8 per cent stake with a view to having another go at taking control. (more…)

  • Polar bears welcome bicycle BIK initiative

    October 17, 2008 @ 9:26 pm | by Barry O'Halloran

    Barry O’Halloran

    It was the Budget’s cycle to work scheme that gave it away. It’s one of a number of measures designed to help cut greenhouse gas emissions. You can imagine the scene, the last of the polar glaciers, complete with cute polar bear cubs and furry seal pups, is about to slide forever into the sea, until, at the last minute, Brian Lenihan pants to the rescue on his mountain bike waving a plan to make bicycles for workers a “tax-exempt benefit-in-kind”. Phew … day saved! (more…)

  • Mini-budget misery?

    @ 5:38 pm | by Laura Slattery

    The dust hasn’t even settled from what our colleague Miriam Lord called a “cluster bomb budget” earlier this week, and already the number crunchers are saying that the Government will have to (and should)  have a “mini-budget” early next year. (more…)

  • Safe to get back in the water?

    @ 4:41 pm | by John McManus

    Billionaire investor Warren Buffett is buying U.S. stocks, he wrote in an opinion column in the New York Times.

    “A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful,” Buffett wrote in the paper.

    Buffett acknowledged the economic news was bad, with the financial world in a mess, unemployment rising and business activity faltering.”What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up,” he said. “So if you wait for the robins, spring will be over.” (more…)

  • Dundrum to open a dozen new doors

    @ 4:02 pm | by John Collins

    Posted by Ciaran Hancock

    THERE ARE no signs of hairshirts in Dundrum where Joe O’Reilly’s town centre continues to expand its footprint, recession or not.

    Twelve store openings are planned before the end of this year, including upmarket UK toy store Hamleys, which will open with much fanfare next Thursday. (more…)

  • BAI looks set for March 2009

    @ 4:00 pm | by John Collins

    Posted by Ciaran Hancock

    THIS WEEK’S Budget gave the clearest signal yet that the much-talked about Broadcasting Authority of Ireland (BAI) will actually come into being in 2009.

    The Broadcasting Commission of Ireland (BCI) has had its 2009 budget slashed by 26 per cent – from €6.4 million to €4.7 million.

    This is in the expectation that the BAI will be running by the end of March next, with a scheme agreed shortly thereafter for an industry-wide levy to fund day-to- day running of the super-regulator. This will relieve the taxpayer financially in relation to broadcasting regulation. (more…)

  • Irish property bubble was Governments’ fault

    @ 2:54 pm | by Colm Keena

    The ESRI economist Prof John FitzGerald was speaking at  the Society of Chartered Surveyors conference in UCD today and once again had harsh words to say about the Government’s handling of the economy, and in particular the property market, in recent years.

    He made the rather obvious point – though one that recent governments obviously didn’t find attractive politically – that the low interest rates that prevailed in the eurozone during the Irish property boom, could have been counteracted by fiscal policy, eg the imposition of taxes that would have increased the cost of mortgages, thereby militating against the development of the property bubble that has now burst.

    On the budget he was of the view that it wasn’t hard enough. People were ready for something hard and perhaps now was the time to really do the job, he argued, because the quicker matters were stabilised, the better. The government has said there will be further harsh budgets in 2010 and 2011 but a slide he displayed showing in which years over recent times the Government put money into the economy, clearly showed a pattern where budgetary policy was following political rather than economic cycles.

    It was mostly, though not all, gloom. Land prices are falling as fast as property prices, meaning that the infrastructural projects in the national plan, should now become a lot cheaper. Tom Costello, managing director of John Sisk & Son Ltd, was of the opinion that you could get up to 40 per cent more road for your euro in the coming market conditions as compared with ten years ago, what with decreased land and other costs. Furthermore, the use by the Government of the “world-class” construction industry that now exists in Ireland, he said, would help prevent it being lost as a resource over the coming few lean years. “Use it or lose it,” he said.

  • Late fees on BoI credit cards

    @ 1:25 pm | by John Collins

    Posted by Ciaran Hancock

    NO SOONER had the credit market crunched than Bank of Ireland was writing to customers informing them that, from October 20th, they will be subject to a late payment fee of €7.50 if they don’t pay off their credit card balances on time.

    They are advised to allow four working days for a payment to reach their account, which in itself seems a bit much in this electronic age.

    Customers will also have to pay the same amount if they breach their credit limits.

    If they were Budget measures, the Opposition would be decrying them as stealth taxes. (more…)

  • Britvic sales losing their fizz

    @ 1:24 pm | by John Collins

    Posted by Ciaran Hancock

    BRITVIC’S TRADING update yesterday shows that the fizz hasn’t just evaporated from the Irish economy: it’s left the soft drinks market, too. (more…)

  • Aviva shortlisted for Lansdowne rights

    @ 1:18 pm | by John Collins

    Posted by Ciaran Hancock

    A computer generated image of the new Landsdowne Road stadiumBRITISH INSURANCE group Aviva is one of the shortlisted parties for the lucrative naming rights for redeveloped Lansdowne Road stadium. It is understood that Aviva is one of five groups in the mix for the 15-year contract.

    The rights are being jointly sold by the IRFU and the FAI, which are thought to be seeking a hefty €50 million-€100 million from interested parties.

    All sides are being tight-lipped about the process and it is understood an announcement is likely around the turn of the year.

    Speculation had mounted this week that Aviva had won the race for the naming rights but this was premature.

    Nabbing the naming rights to Lansdowne would certainly be a coup - albeit an expensive one - for Aviva, which is planning to rebrand its Hibernian subsidiary here from January 2009. It also owns a majority stake in Ark Life, which was previously wholly owned by AIB.

    Given the heritage and resonance of the Hibernian name in this market, rebranding to Aviva won’t be easy.

    The insurer has put together a substantial marketing war chest for its rebranding project and securing the rights to Lansdowne would no doubt help its cause.

    It’s not clear who else is in the running for the rights. Aviva is thought to have competition from another insurer - thought to be Zurich - another financial group and a telecommunications group.

    US-based Wasserman Media Groups and Slattery Communications here are handling the negotiations for the Lansdowne Road stadium redevelopment company.

    Wasserman put together the deal for Arsenal’s Emirates Stadium in London, which incorporated a shirt sponsorship deal.

    The new 50,000 all-seater Lansdowne is due to be completed in April 2010. The Ballsbridge venue is on a shortlist to host the prestigious Uefa Cup Final in either 2011 or 2012.

  • Scammers embrace banking chaos

    @ 10:37 am | by John Collins

    It may be a cliche to say it’s an ill wind that blows nobody any good but internet scammers have always adapted their pitches to current events. From the original Nigerian 419ers who just wanted to “rest” some money in your account to the phishers with a little more tech know-how looking to get your online banking details, the dodgy emails hitting in-boxes have started to get more sophisticated and topical.

    Software security firm eSet now warns that phishers are using the banking crisis as the basis of their scams. The emails  look like they come from a reputable bank who has just taken over a smaller rival and ask you to “update,” “validate,” or “confirm” your account information.

    Here’s some sample messages:

    “We recently purchased XYZ Bank. Due to concerns for the safety and integrity of our new online banking customers, we have issued this warning message… Please follow the link below to renew your account information.”

    “We recently acquired the mortgage on your home and are in the process of validating account information. Please click here to update and verify your information.”

    “During our acquisition of XYZ Savings & Loan, we experienced a data breach. We suspect an unauthorised transaction on your account. To ensure that your account is not compromised, please click the link below to confirm your identity.”

    With the current fear and loathing in the markets, particularly amongst US consumers who self-manage their pension plans, the scammers could well find they are mining a rich seam. 

  • Ad agency steps up to the plate with Donegal Catch campaign

    October 16, 2008 @ 5:53 pm | by John Collins

    MEDIA & MARKETING: Irish International BBDO has just won a top award for Donegal Catch ads that cast a net around consumers, writes Siobhán O’Connell

    CREATING A captivating advertising campaign for packets of frozen fish is not the kind of brief that would excite most creative types. But advertising agency Irish International BBDO stepped up to the plate when Northern Foods came calling with Donegal Catch. (more…)

  • Cash is king

    @ 2:55 pm | by Fiona

    You know it’s time to forego all thoughts of investing in the stock market when even the hedge funds have given up. Despite the ending of the short-selling ban on financial stocks in the US, The Wall Street Journal this week reported that hedge fund supremo Steve Cohen of SAC Capital, who was one of the top hedge fund earners last year, making $900 million, has turned to cash. Cohen, who usually invests in everything from vanilla equity investments to credit markets, convertible bonds and emerging markets, has moved half of his firm’s assets, or $7 billion, into money market and other short-term securities. According to the paper, he intends to sit on the sidelines for the rest of the year, just trading a small portfolio himself. The move is bad news for brokers and the market alike – Cohen’s SAC Capital is said to account for 3 per cent of the daily trading on the New York Stock Exchange.

  • What a difference a letter makes

    @ 1:09 pm | by Simon Carswell

    International debt ratings agency Moody’s, whose aim is to assess risk, rowed in today with its opinion on Brian Lenihan’s first Budget as Minister for Finance.

    The agency said: ”Despite the announcement of wide-ranging fiscal reforms, the public deficit is expected to be more than double the EU limit (no more than 3 per cent of GDP) next year, with a negative balance of €14.8 billion, up from an expected €11.5 billion this year. Until the economy picks up, or unless drastic fiscal reform occurs, the public deficit will prove an increasing burden on Ireland’s economy.”

    Fair enough, but it’s hard to agree with the subject line on the email from Moody’s issuing the statement: “Moody’s Economy.com: Fiscal Prudence for Iceland.”

    Getting Ireland mixed up with Iceland is not good given the current financial state of the Nordic country. Moody’s offered sincere apologies for the slip when it was pointed out.

    A misplaced letter could be costly in these highly turbulent times.

  • How the markets work

    @ 12:07 pm | by John McManus

    Below is one possible theory:

    It was Fall, and the Indians from an Native American Reservation asked their new Chief if Winter would be too harsh or if, on the contrary, it could be softer.

    Being a modern times Indian Chief, he couldn’t really interpret the signs that allowed him to predict the weather; nevertheless, in order not to expose himself to too high a risk, he conceded that yes, they should prepare and cut enough wood to sustain a cold Winter. But, as he was also a practical and pragmatic Chief, a couple of days later he had an idea.

    He went to the nearest public phone, and dialled the National Weather Centre (NWC) and asked: “Is this coming Winter going to be cold?” “I think this coming Winter is really going to be cold” replied the weatherman on duty. The Chief went back to his people and ordered that more wood be cut.

    A week later, he called the NWC again: “Is it going to be a very cold Winter?” “Yes,” was the renewed response from the other end of the line, “Winter will be really very cold.”

    Once again the Chief went back to his people and ordered that they gather all the wood they could, sparing not even the small twigs.

    Two weeks later he dialled the NWC again: “You guys really sure this Winter will be exceptionally cold?” Absolutely,” answered the weatherman, “Will be one of the harshest Winters of all times.” “How can you be so sure?” asked the Chief.

    The weatherman answers “The Indians are gathering wood like crazy.”

    Now you know how the stock market works.

  • Gender balance; Budget Families

    @ 11:57 am | by John McManus

    A reader writes:

    Once again I scan the budget family profiles in the Irish times to see if you will break tradition and feature a family where the woman earns more than the man, but once again I am disappointed. Surely madam editor has pointed out to you by now that such a rara avis does occur in
    Ireland!

    Applications for inclusion next year on a post card please

  • Bailout offers respite for beleaguered Brown

    @ 11:11 am | by John Collins

    LONDON BRIEFING: UK premier was praised for rescue plan, but winning the next election may be tougher, writes Fiona Walsh  

    FROM ZERO to hero . . . as stock markets around the world rebound on the back of the co-ordinated bank bailout schemes, Britain’s lame-duck prime minister is enjoying a rare moment of glory.

    Slammed for his dithering and virtually written off a few weeks ago, Gordon Brown is now being hailed as the driving force behind the global financial rescue plan - the man who helped haul the world back from the brink. (more…)

  • The soft option?

    October 14, 2008 @ 5:06 pm | by Laura Slattery

    Mr Lenihan indicated in his budget speech opening remarks this afternoon that he wasn’t going to go for “the soft option”. But in pulling back the Government deficit to 6.5 per cent of GDP, there are some who will claim that that’s exactly what he did. (more…)

  • Pain relief

    @ 4:48 pm | by Laura Slattery

    The cost of being sick is going up from next January, judging from Budget 2009. First of all, the medical card for over 70s introduced in 2000 has been abolished and will now be subject to means-testing, with a €400 annual cash grant to tide over those pensioners who fail to satisfy the income limits. Secondly, tax relief on medical expenses (that have not been already reimbursed by private health insurance) will only be available at the standard rate of 20 per cent i.e. if you spend €200 a year on GP fees, you can claim back €40.

    Before the change in today’s budget, higher rate taxpayers were able to claim back at the 41 per cent rate, or €82 for every €200 in expenses. In other words, they could benefit more from the relief than lower income workers - who are less likely to be covered by private health insurance anyway - which is why the Minister is right to say that this particular change will make the system more equitable. (more…)

  • A levy on all our incomes

    @ 4:26 pm | by Laura Slattery

    Take-home pay in 2009 is going to be hit by a 1 per cent income tax levy, with people earning more than about a €100,000 becoming subject to a 2 per cent levy on the balance, Minister for Finance Brian Lenihan has confirmed in his Budget 2009 speech. The levy will be kept under review in light of the economic conditions, he said, and will ensure that taxpayers “pull together” to in a proportionate manner to help reduce the alarming exchequer deficit.

    So why didn’t he just raise the higher rate of income tax? The top rate was only reduced to 41 per cent two years ago - bringing it back up to 42 per cent would hardly have raised too many political eyebrows. But because this rate only applies to income above the standard rate cut-off point - up €1,000 to €36,400 for a single person next year - it wouldn’t have raised as much revenue (or therefore cost taxpayers as much money) as applying a 1 per cent levy to all income.

    Unfortunately this means that lower income workers - those who pay tax only at the standard 20 per cent rate - will also bear the brunt of the levy.  The standard rate tax band is there for a reason: to minimise the tax paid by the workers who can least afford to pay it.  The Minister’s measure may be “proportionate”, but is it fair?

  • Lenihan to lead by example?

    @ 2:27 pm | by John Collins

    Posted by Simon Carswell

    Leading by example in what is expected to be one of the most severe Budgets of recent years with significant increases in taxes, Minister for Finance Brian Lenihan is expected to announce some reduction in pay to ministers and juniors, in the order of 10 per cent, we hear.

    This would trump last week’s surprise move by Fine Gael leader Enda Kenny who is taking a 5 per cent cut in his TD’s salary of €106,581. Kenny’s gesture received a lukewarm response from Fine Gael frontbenchers - it will be interesting to see how Fianna Fail and fellow government ministers respond to the announcement of a pay cut by Lenihan this afternoon.

  • Budget doom

    @ 1:31 pm | by Laura Slattery

    Special income tax levies. Health cuts. College fees… The recession-struck nation will be listening attentively for these trigger words when Minister for Finance Brian Lenihan gets up to deliver Budget 2009 in the Dáil at 3.45 pm. In a bid to alleviate the gloom, the bookies are as ever taking bets on the length of the speech, the number of sips of water, the colour of his tie, etc. But what the The Irish Times will be keeping its ears to the screen for is the number of occasions that Mr Lenihan blames international factors for Ireland’s economic doom. (more…)

  • Executive deadlock seen as threat to Northern economy

    @ 11:20 am | by John Collins

    Francess McDonnell/BELFAST BRIEFING: THERE IS a potential collector’s item just waiting to be snapped up today in the Assembly shop in Parliament Buildings at Stormont in the North. On sale at £5.95 (€7.60) is a genuine, pristine Northern Ireland Assembly business card holder. (more…)

  • The old reliables

    October 13, 2008 @ 8:37 pm | by Laura Slattery

    Get your round in now, because the price of a pint, a shot and a six-pack is almost certain to be hiked in Budget 2009 – for the good of our health, of course, not the good of the decimated public kitty. (more…)

  • Government investment in the banks?

    @ 3:08 pm | by John Collins

    Markets are reacting positively to the series of measures being announced by European governments to shore up their banks. In London the FTSE is up over 5 per cent, the Paris Cac 40 is ahead over 7 per cent, while in Frankfurt the DAX has added over 8 per cent. Dublin’s ISEQ is in positive territory (+3.32 per cent) but the ISEQ Finanical - which tracks the four quoted banks plus FBD insurance and IFG - is down (-1.85 per cent).

    Tomorrow’s business pages will feature full details of the packages today in Britain, France, Germany and Italy. Simon Carswell will analyse the thinking behind the joint European approach and asks if it is now inevitable that the Government will have to take stakes in the banks here. The business team will also be contributing to a preview of tomorrow’s Budget 2009, on what is always our busiest day of the year.

  • Be careful what you wish for when it comes to State ownership of banks

    @ 2:48 pm | by John Collins

    John McManus/OPINION: MANY PEOPLE - if they are honest - are probably quite happy with the idea of the Government owning stakes in Irish banks. The concept is not out of tune with the public mood that the banks need to carry at least part of the can for the mess we have got ourselves into. (more…)

  • Dermot Gleeson’s legislative gem

    October 12, 2008 @ 12:07 pm | by Laura Slattery

    Posted by Simon Carswell
    The subject of public sector reform injected a little levity into the annual Kenmare economic conference yesterday in talks by Minister for Transport Noel Dempsey and the quick-witted and eminent lawyer Dermot Gleeson SC, chairman of AIB.

    Mr Dempsey started by saying: “When I talk about reforming the public sector, I am not including all the bankers that are in the public sector now!” (more…)

  • Where’s my pension gone?

    October 11, 2008 @ 8:19 pm | by Laura Slattery

    Anyone with a penchant for watching 24-hour news channels for, well, 24 hours will have noticed that anchors are under strict orders to regularly relate the current market turmoil back to the ordinary man or woman on “Main Street”, as the US parlance goes, presumably in case viewers decide that these Wall Street woes have nothing to do with them and switch off.

    In doing this, they are greatly assisted by the frightening trend in pensions over the last decade that has seen employers make en masse retreats from guaranteed pensions where they shouldered all the investment risk. These days, it’s much more likely that you’re on your own. 

    So on-screen tickers showing how far the FTSE has fallen are unlikely to be a boon to take-up among younger workers, regardless of how many times we’re reminded that pensions are a long-term thing. Irish group managed pension funds have lost a quarter of their value over the last 12 months. But what happens if you’re automatically enrolled in a pension when you start work? Investment risk is “one of the stickiest points” with “opt-out” rather than “opt-in” pensions, admits Cormac O’Dea of the Institute for Fiscal Studies, who was among the economists who argued for their introduction at the Kenmare economic conference today. Certainly, a world where vast swathes of workers who don’t consider themselves “investors” are signed into stock market investments as part of Government pensions policy does seem politically messy at best.

    Sadly for those who believe that these so-called soft mandatory pensions are the only way to avoid mass-scale pensioner poverty, the global financial crisis means they will be impossible to flog any time soon.

  • Gallows humour in Co Kerry

    October 10, 2008 @ 9:20 pm | by Laura Slattery

    Gallows humour abounded at the opening session of the Annual Economic Policy conference in Kenmare tonight, as economists competed with each other to tell the attendees how bad things really are.

    “Today Ireland stands as one of the world’s greatest economies,” said Rossa White, chief economist of Davy Research. No, he has not lost the plot, but was quoting the Fianna Fail general election manifesto from May 2007, to a ripple of nervous laughter in the conference hall.  (more…)

  • Irish Times business editor on Fox Business News

    @ 4:27 pm | by John Collins

    Business editor John McManus was a guest on Fox Business News this morning. He was part of a panel on fixing the global economy and talked about the state of the Irish economy in particular. The good stuff is just after 4.00 minutes.

  • Hello world

    @ 4:14 pm | by John Collins

    Welcome to the latest blog on the Irish Times block, a group production brought to you by the paper’s business and finance team. What better time for us to make our first steps into the world of blogging, given the unprecedented global market turmoil we are experiencing. On top of that Ireland’s economy has it’s own unique challenges, so we expect there should be plenty for us to write about here.

    Over the next few days we’ll be focusing on the run up to Budget 2009 next Tuesday, one of the most aniticipated in recent history. Drop back regularly for our news and views from the world of business.

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