Sir, – Don Mullins (Letters, February 21st) doubts that inflation is a significant influence on house prices, asserting that "incomes did not rise by an average of 3.5 per cent" over the past 20 years. That may well be true for some individuals, but appears to be untrue for most and untrue for the population as a whole. On a large scale, we can look to income tax records for evidence. Income tax generated €26.7 billion for the year 2021. The Statistical report published by the Office of the Revenue Commissioners 20 years ago shows that income tax (including income levy) raised €10.5 billion for the year 2001, less than half the current figure. Even allowing for additional taxes introduced during the financial crisis, and for population growth, these figures suggest that average income levels are roughly double what they were 20 years ago.
For specific examples, we can look at the weekly State pension which was €95.89 (£75.50) in 2002 and is now €253.30, or unemployment benefit, which was €118 per week in 2002, and is now €208, or the national minimum wage, which was €6 per hour in 2002, and is now €10.50.
On the other hand, a McDonald’s Big Mac (a favourite cost of living barometer for economists) cost €2 in 2002, and now costs more than €4, proving that houses are not the only commodity to have doubled in price in that period. – Yours, etc,
JOHN THOMPSON,
:fill(white):background_color(white)/static.themebuilder.aws.arc.pub/irishtimes/1647534191476.png)
Dublin 7.
Sir, – I was tidying out a friend’s attic and found some stuff wrapped in The Irish Times of February 22nd, 1971. The price of The Irish Times then was 7 pence (about 8 cents). I came across some stamped envelopes dated February and March 1971. The price of a stamp was 4 pence (about 5 cents).
On Saturday last, I paid €3.70 for The Irish Times and €1.10 for a stamp to post a letter to Dublin. In that time The Irish Times has become 46.25 times more expensive and a stamp costs about 22 times what it cost 51 years ago. (Your readers will be aware that the price of a stamp is due to increase to €1.25 in March).
So I looked up the journal that I have been keeping since I was a poverty-stricken student and found that I earned £17.05 (about €21.65) after tax in the week ending February 27th, 1971. At The Irish Times rate of inflation, I’d have taken home €1001.31 that particular week; however, with An Post’s inflation rate, I would have made a mere €476.30. – Yours, etc,
PATRICK CAVANAGH,
Mullingar, Co Westmeath.