Budget 2014 is one that requires much renovation. That’s according to SIPTU President, Jack O’Connor.
O’Connor says: “Granted, a €2.5bn budget is better than the €3.1bn originally projected. However, the Government could have got away with taking out a couple of hundred million euro less again while still safely undercutting the 5.1% deficit target for 2014.”
He adds: “The decision to abolish tax relief on pension contributions for very high earners is long overdue. However, in the budget speech last year it was envisaged to yield €250 million in a full year. It is not at all clear from the way that it is being implemented that it will meet this target. The proposed bank levy to yield €150 million is positive as are the other measures to raise revenue from capital and wealth but there is considerably more space to increase the contribution from those who can most afford it. Regrettably, the Fine Gael party’s continued insistence on protecting the rich will mean further unnecessary suffering for low income pensioners and struggling families.
“The abolition of top slicing relief in redundancy situations is an utterly regressive measure dressed up as progressive. The proper approach would have been to reduce it by half to a maximum of €100,000. It will aggravate the misery of redundancy for a great many people on quite modest incomes and we are totally opposed to it.
“We are bitterly disappointed at the failure to put some mechanism in place to offset the effect of the abolition of the Transitional Pension on 65 year olds retiring from employment. It is estimated that there are only 1,400 people involved per year. They are the only group in this age category who will actually experience a reduction in their income as a result of the change. Even if all of them were to claim in respect of adult dependents, which obviously would not be the case, the total saving will be less than €5m per annum. We will continue to campaign to persuade the Government to change its mind on this measure which is so detrimental to elderly workers who have been paying their tax and Social Insurance contributions all their working lives.
“We are strongly opposed to the decision to abolish the pensioners’ telephone allowance completely. This should be means tested so that lower income pensioners would retain it. We welcome the introduction of free GP care for children under five as a tiny first step towards the achievement of a universally free health service. We do not go along with the spin that this is being done at the expense of medical card coverage for low income families. The estimated €37m involved could easily be raised by slightly increasing the tax take from the better-off.
“Trade union members will not be too severely affected by the decision to extend the waiting time for social welfare sick pay from 3 days to 6 days because we will be insisting that the employers pay it in all instances. We do acknowledge that the basic rates of social welfare have been maintained throughout the life of this Government. However, a slightly higher tax contribution from the better-off would have obviated the need for many of the other measures.”
New claimants under the age of 25 should not have their job seekers allowance reduced unless they had turned down a decent job or good quality training or apprenticeship. The apprenticeship system should be extended to include new occupations such as child minding, care of the elderly and occupations in the hospitality and other sectors.
O’Connor concludes: “On a preliminary examination, there seem to be a number of good announcements in relation to capital infrastructure projects which will generate some jobs. However, the really key question is as to how rapidly the €6.6bn which has been finally re-designated from the National Pensions Reserve Fund into the Strategic Investment Fund can be leveraged into the economy to generate thousands of jobs. We in SIPTU have been calling for this since Mayday of 2011. If it had been done then it would have speeded up the recovery and avoided a considerable degree of unnecessary misery and suffering. That being said, it is never too late to do the right thing.”