Madam, – I find Alan Ahearne’s argument against nationalising one or more of our banks a bit weak (Opinion, April 25th). Why would the wholesale international money markets be less inclined to fund our banks if controlled by the State as opposed to the fine gentlemen who have presided over affairs for the past 10 years?
He argues that some banking decisions might be political rather than commercial if nationalised. Does he really think that our banks have been immune from political decisions? My experience as a developer has been different.
The State Bank of China is currently playing a major role in rejuvenating the Chinese economy with a huge investment in infrastructure – the smart money bets that they’ll probably deal with the recession better than most.
I’m amused to find Dr Ahearne praising a government that he spent so much time ridiculing not so long ago. But then it does pay his wages now. American economist Paul Krugman has noted that “people in power prefer to take advice from those who make them feel comfortable rather than those who will force them to think hard”. Pay, Pipers and tunes come to mind. – Yours, etc,
MICK WALLACE,
Lower Ormond Quay,
Dublin 1.
Madam, – Your paper (Business Today, April 27th) carries a report of a speech made by the Minister for Finance Brian Lenihan at the Irish League of Credit Unions conference at which he said that our EU partners were “amazed at our capacity to take pain”, – a direct reference to the punitive pension and income levies recently imposed.
Mr Lenihan well knows that the ordinary taxpayer has had no choice but to take the imposed financial pain unlike the “long service” TDs and ex-government ministers who, despite pronouncements to the contrary in the Budget, have been assured that their pensions and “long-service” increments are safe.
The taxpayer’s day, however, will come in the forthcoming local and European elections when hopefully the oppressed taxpayer will inflict electoral pain on those who dare to mete out financial pain and yet protect themselves and their colleagues from financial loss. – Yours, etc,
A KEHOE,
Castleknock,
Dublin 15.
Madam, – The Government’s intention to provide a cheaper mechanism for pension annuity purchase is welcome. However, the announcement by Minister for Social and Family Affairs Mary Hanafin makes no reference to the thousands of people who are on defined contribution schemes and who, in many cases, have made substantial voluntary contributions in an effort to secure a reasonable pension.
The problem in the defined benefit sector is the severe write down in fund values, primarily as a consequence of equity performance. The write-down affects both defined benefit and defined contribution scheme members alike and voluntary contributions have been as severely affected. If it is correct to provide a scheme that will enhance annuities for defined benefit scheme members by as much as 20 per cent, should those in defined contribution schemes not be offered an identical option in terms of annuity purchase on retirement?
The scheme as announced is intended to be cost neutral. Therefore, its extension to the defined contribution sector would not cost the State a great deal. Although some additional administration might be required to deal with such pensioners on an individual basis, as opposed to the group schemes for which the scheme as announced is currently intended, this cost could be realistically factored in to any solution.
Failure to amend the scheme to include defined contribution scheme members might result in the State facing a challenge on the basis that it is not treating all citizens equally as required under the Constitution. Failure to amend would also suggest the scheme is another example of knee-jerk governance. – Yours, etc,
ALAN COOKE,
Cypress Downs,
Templeogue,
Dublin 6W.