Dear Michael Noonan: can you spare us the budget blues?
Five years of austerity budgets have reduced disposable income for average families by €300 a month and doubled the tax they pay
Michael Noonan outside the Dáil before delivering last year’s budget. Photograph: Dara Mac Dónaill
Not long to go now and, while it would be a lie to say we were looking forward to it, we hope your third budget goes well for you. More than that, we hope it goes well for us.
Thanks for moving your big day to early October – our summer holidays and all that unseasonal sunniness in September meant we could ignore most of the blackest kites sent up by your ministerial colleagues about dire cuts to social welfare, pensions, education funding and the rest.
The switch from early December should also give us a couple of extra weeks to digest your cuts before Santa starts loading his sleigh. The promise last week by Enda that there would be no new taxes is good news too, although forgive us a little scepticism, as official definitions of what amounts to a tax are quite loose – one man’s universal social charge is another man’s penal tax after all.
We know all the austerity angles have already been agreed by our overlords in Frankfurt and Brussels, but is there any chance you could give us a couple of breaks this time out? After all, we have had to bear five years of horrendous news from your department already, and many of us have nothing left to give.
You may have seen just how little a lot of people have, from a survey last month that showed almost 40 per cent of Irish adults have less than €25 to spend per week once all essential bills are taken care of. A good chunk of the 40 per cent have nothing left.
Is it any wonder? Six horror-show budgets on the spin have cost us dearly.
Last year you cut children’s allowance by €10 to €130 a month. Remember when it was €166 a month per child? Good times.
The most recent cut took €240 out of the pockets of a household with two qualifying children. The property tax was rolled out in July, and, over the course of a year that household, living in a modest home, will be worse off by about €250 a year. Car tax changes announced last December took about another €120 from this typical household. PRSI changes meant another fiver a week was taken from them if they were lucky enough to have a job. That amounts to €254 a year. All told, these changes are just shy of a grand, Minister.
It was well over a grand for people who had a child in college, as they had to come up with an additional €250 to cover registration fees. Anyone who drank two bottles of wine a week was hit with another €104 in tax a year. And your last budget was supposed to be one of the good ones – an “easy” year without any tax increases for PAYE workers.
Reduction in child benefit
And yes, Michael, we know you said last year that you didn’t accept this figure and you suggested it wasn’t “typical”, but a family of two adults and two kids doesn’t seem extraordinary.
Your first budget in December 2011 – actually it was a double-header between you and Brendan Howlin – wasn’t great either. Among the highlights were reductions in child benefit payable to families with three or more children; reductions in the amounts payable under the rent supplement scheme; restriction of the fuel allowance to 26 weeks; reduction in the amount of earnings “disregarded” in the means test for one-parent family benefit; reductions in the amounts payable under the back-to-school scheme. All these combined led to a fall of between 2 per cent and 2.5 per cent for the poorest 40 per cent of households. The household charge was also introduced and set at €100.