A budget "for bookies, builders, employers and landlords" was how Mr McCreevy's package was described by one trade union leader last night. The general secretary of the Civil and Public Service Union, Mr Blair Horan, put the average increase in take-home pay for his members at £2 a week. He summed up the feelings of many union leaders.
SIPTU president Mr Des Geraghty said the tax package was worth about £4.17p per week to a worker on the average industrial wage, or 1.3 per cent. He said this would be wiped out by VAT increases.
However, the Irish Business and Employers' Confederation welcomed the Budget, especially the decision to reduce the top rate of PRSI for employers and reduce corporation tax to 16 per cent this year. IBEC had been threatening to withdraw from the Programme for Prosperity and Fairness over Mr McCreevy's decision last year to remove the ceiling on employers' PRSI.
Yesterday IBEC's director general, Mr Turlough O'Sullivan, said the reduction in the top rate of PRSI from 12 per cent to 10.75 per cent would save employers £270 million next year. The move was enough "to sustain employer commitment to the PPF".
While unhappy that bringing forward payment dates on corporation tax would "put a strain on cash flow in some companies", he said its phased introduction would ease the impact. However, the Information Communications and Technology division of IBEC was unhappy that the PRSI ceiling remained. As a high wage sector, its members would have to pay the equivalent on an extra 1.16 per cent on payroll costs next year.
Union reaction to the Budget was uniformly hostile. The greatest disappointment focused on the failure of Mr McCreevy to provide childcare supports for working parents or take everyone on the national minimum wage out of the tax net. SIPTU's national equality secretary, Ms Rosheen Callender, said increases in personal tax credits and child benefit would raise the weekly income of a working mother by about £9.94 per week, if she has one child. The average cost of childcare was £150 per week.
IMPACT general secretary Mr Peter McLoone also expressed disappointment "at the Goverment's continued refusal to introduce paid parental leave or give tax relief for childcare costs."
The general secretary of the Irish Congress of Trade Unions, Mr Dave Begg, welcomed moves to take workers on the minimum wage out of the tax net and improve pensions and child benefit. But this was "very much qualified by our disappointment with the lack of provisions for childcare, the failure to link social welfare increases to the average industrial wage, the refusal to raise the income limit for medical cards and raiding the pay related social insurance fund".
The Minister had "tried to keep everyone happy" in "a Budget where business does disproportionately better than everyone else".