SPECIAL REPORT DAY 3: Is austerity working - the social impact

Organisations that deal with people in need see the direct effect of the cuts on their clients. Noel Baker finds that they are hoping for a move away from the short-term approach that has left many on the brink.

EVERYONE has felt the nick of the knife, but the fear is death by a thousands cuts.

They know all about it in the Ballyfermot Star project in Dublin. At the start of this month, the charity of the shopkeeper who rented out the premises for the organisation’s family support service came to an end.

It was understandable — he’d already given them two months’ free rent in the rooms above his grocery. Now this aspect of the service, called Realt na Clann and which dealt with 110 families last year, is homeless.

Sunniva Finlay of Ballyfermot Star said the decision by the Department of the Environment to pull €148,000 worth of funding in Dec 2011 was the catalyst for the service event-ually vacating its home location.

“It’s been having a huge effect. We cut salaries, rent was not being paid, we’ve struggled with overheads, but we have not cut the quality of service and we will continue to do so.”

It’s a mantra repeated wherever you look. Since the crash of 2008 and throughout the recession, austerity has moved from being a temporary measure, a sticking plaster, to something which has entered the nation’s bloodstream.

After six austerity budgets, the soundings indicate at least one more economic drubbing this October, with many support organisations facing a battle for survival at a time of almost unprecedented demand. The cry, familiar to many, is that the cure is killing the patient, and that the accumulative impact of the cuts spread across the past six years is taking its toll.

Carers, the elderly, the unemployed, people with disabilities, children, the poor — everyone’s had a dose. Head of social justice at the St Vincent De Paul, John Mark McCafferty, believes austerity as a pathway to recovery is a busted flush.

“I find it very, very hard to justify it other than it balances the books and brings some kind of fiscal rectitude to historical over-spending,” he says.

“Really, what our members are saying on the ground is that there are increasingly complex situations that people find themselves in, with families and individuals under severe pressure, bills, substantial arrears, dealing with payment plans, and a feeling that poverty is being exacerbated.”

He says that what people spend most money on — energy, food and household costs, and education — have not become less expensive and in many ways have increased, at a time when people are on reduced social incomes. Along with the new clients — including some families in negative equity, thereby making it harder for them to utilise the “safety valve” of emigration — there are the older ones who were in the same boat when times were good. Times are considerably tougher now.

“It’s lone parents and families with children, it’s very much people with kids coming to us under severe pressure,” he says.

“There is a lot of need in the commuter belts of Dublin, Cork, and elsewhere, and it’s not new. What is important to remember is that the vast majority of people we assist are on social welfare, we continue to meet the people who were taking our assistance during the boom and didn’t break the cycle, so that is why things like the free early pre-school year is such a potential game changer.”

That is one example of a policy of recent years being hailed as progressive; as McCafferty argues, the paucity of innovative thinking from the combined powers of government and troika mean austerity will leave a peculiar legacy, what he describes as “a poverty of aspiration generally”.

“The big drive is jobs and activation in the labour market and that’s great, but it should have been done when we had jobs,” he says, adding that while aspects of programmes such as JobBridge are positive, multiple short-term placements ultimately do little to secure a viable future for people seeking solid employment opportunities.

He wants government to tackle expensive sectors of society and to use savings from the promissory note for infrastructure programmes, school building programmes and the energy and renewables sector.

He also believes money coming into the economy from the first full year of the property tax and the impending water charges also need to be rein-vested, instead of government continuing to “use the word ‘reform’ to cover a lot of cuts”.

“Worry is if you keep cutting to the bone we are going to get a stalemate — books balanced but negative growth for foreseeable future,” he says.

The fact that Ashoka Mody, a former IMF official, recently told RTÉ that he felt austerity policies were now in danger of becoming “potentially self-defeating” chimes with the view of many operating services for the more vulnerable in society.

Governments have consistently trumpeted the idea of dragging people out of disadvantage, but according to Stewart Duffin, director of policy at single-parent support group One Family, there’s little evidence of it. “Regarding the big austerity budgets in 2011 and 2012, those were all about financial cuts,” he says, “they were not policy driven whatsoever. It almost became hard for us to argue against them.”

He argues that One Family’s client base is not a “homogenous group” and so cuts applied across a wide range of government departments will affect them in many different ways — a serious consideration for a group which is statistically at greater risk of living in poverty and has a greater degree of difficulty in securing jobs.

It also puts the welfare of children in those families at risk, he argues, and Fergus Finlay isn’t about to disagree.

The Barnardos chief executive has campaigned long and hard against cuts that he believes will have far-reaching consequences.

“The demands of austerity have treated our children pretty mercilessly,” he says. “In Barnardos, we are seeing every day the growing trauma and stress on children and families who are living with severe financial pressure. Repeated cuts to family incomes, like child benefit, have come at a time when the cost of living has soared — fresh fruit, vegetables, and nutritious food is more expensive, heating and electricity are on the up and up, and new taxes are being introduced, all the while access to services and supports decrease and another door in the community closes.”

THE budgetary constraints have also affected Barnardos and other organisations in terms of the services they provide, with Finlay describing it as “intense”.

“The cumulative impact of repeated austerity budgets means the children and families who come to us now are coming with more complex needs than ever before,” he says.

“One of the hardest things to hear is that for some children and their families their hope for the future is being lost.”

Mike Allen is director of advocacy at Focus Ireland and was formerly general secretary at Labour Party and general secretary at Irish National Organisation of the Unemployed. The organisation, which works with the homeless, has seen an increase in the number of families presenting as homeless, but it remains optimistic that with the right policies a fresh target of ending long-term homelessness by 2016 can happen.

It will need more social housing, especially in the larger cities, which could mean jobs. Not doing that, he believes, will simply lead to a future housing crisis.

“It has been a pruning approach,” he says of the policies. “The theory behind it is that if you cut back then new growth naturally emerges. But the view now is that that is the wrong metaphor. We need to get new ways of doing things.”

The existing way of doing things is “penny wise, pound foolish”, he believes, taking the example of the Government refusing to provide for adequate levels of rent supplement which in some cases leads to homelessness and the use of emergency housing which is more expensive. A lack of joined-up thinking may not be new, but he says, “I have never known it to be so severe. Everybody is in their bunker now.”

As for Focus Ireland itself, donations have remained steady but the fundraising department has had to work itself to a standstill, while different funding strands are curtailed. More cuts are expected.

For Eamon Timmins, head of advocacy at Age Action, one swingeing cut would have been easier to bear that the slow-burn approach of successive budgets. “We have done a lot of consultation around the country and what we are hearing is the cumulative effect of the budgets — it’s ‘slice, slice, slice’.” He says there has been no pension increase since 2008 and yet since then the rises in prescription charges, heating and electricity costs and other charges has meant many pensioners facing stark choices.

“The impact that is greatest is taxes that bear no relation to people’s ability to pay them,” he says. “We are not talking about luxury weekends away, but things they can’t avoid.”

In addition, the impact of emigration is felt in different ways by older people. He tells of pensioners who may now need a little help around the house, a check call from a family member, but all the children are living overseas.

On the other side of the coin there are the carers, people who have dependents and who cannot simply up and leave and must stay behind and bear the impact of cuts. While many organisations might bemoan a lack of innovative thought when it comes to fresh policies that could obviate resource shortages, for Clare Duffy of the Carers Association, some government departments have been surgeon-like with the knife.

“They have got much more creative in how they have gone cutting,” she argues. “Protecting social welfare payments [as pledged by government] means they tinker around the edges, but after the budget there are little time bombs that go off, like altered eligibility criteria and means-testing. That has created fundamental changes in the system.”

She notes that Social Protection Minister Joan Burton mentioned protecting “core” social welfare rates last October, a subtle change from a more general promise to protect rates and one which carers fear may open the way to future cuts that would previously not have been under consideration. Changes to respite care grants and the household benefits package means more stress for carers at a time of increases in expenses.

She says there is “the gap between the rhetoric and the reality”, especially areas that affect carers and those who need care. Summing up, she says: “Carers aren’t stupid, they live in the real world. We are not asking for more but for government to spend more wisely.”

Yet wherever you care to look it is the money that is unavailable that is uppermost in people’s minds. In Castlebar, Co Mayo, a project aimed at helping children caught in the midst of domestic violence is not now going to rolled out across the country — instead it will expire in the coming months, mothballed due to a lack of funds.

The Mayo Children’s Initiative, like many projects, began life due to money from Atlantic Philanthropies. However, while in most cases AP matched money being provided by government, in this initiative, all the money came from Chuck Feeney’s organisation — €1.25m paid over in total.

Helen Mortimer is one of two full-time staff on the project, which AP were so impressed with that they wanted it to be expanded elsewhere.

“Coming from the community and voluntary sector, where you can see banks are being bailed out and it costs a fortune compared to these projects that are dealing with children in families suffering from domestic abuse, it is frustrating.”

The project combats many of the distorted and warped ideas of relationships that young people can get from social media and online pornography.

It targets schools at every level, with many children claiming they find it easier to address issues such as domestic abuse and healthy relationships between teenagers when it’s being discussed by someone outside their school and domestic orbit.

In some cases, a teacher or HSE worker will tell the project a child in a particular school is being affected by problems at home, and the whole class will be spoken to, rather than singling out that individual child. It makes sense on a number of levels, and it will shortly be no more.

“We are governed by the Society for the St Vincent De Paul in Castlebar and the plan is to wind it down over the next four or five months, and after that we don’t know.”

The materials, the knowledge, all of that will lie dormant, awaiting a spark to re-ignite it. The question is who can provide it. Can anyone afford the matches?

Further analysis of the social impact of austerity and all the content from days one and two of this ongoing special report can be found on our special "Is Austerity Working?" section at www.irishexaminer.com/austerity-focus

Austerity belt-tightening

Budget 2009

* Medical cards means-tested.

* Income levy introduced on income up to €100,000/ 2% on higher.

* €10 travel tax.

* 20% hike in hospital bed charges.

* 50c hike in packet of cigarettes.

Emergency Budget 2009

* Income levies doubled to 2% and 4%.

* PRSI ceiling increased.

* Jobseeker’s allowance reduced, under 20s cut to €100 a week.

* New 1% levy on life assurance premiums.

* Capital gains tax — up from 22% to 25%.

Budget 2010

* Jobseeker’s allowance for those under 21 cut to €100.

* Vat rate cut by 0.5%.

* 5% pay cut for public sector workers earning up to €30,000.

* Ministers will take a 15% pay cut; Taoiseach takes 20% cut.

* Diesel up 4.9c and petrol up 4.2c.

Budget 2011

* Charges for private/ semi-private beds up 21%.

* €10 cut to child benefit for first and second child.

* €20 cut in child benefit for third child.

* 4c on petrol, 2c on diesel.

* Third-level student charges rise by €500 to €2,000.

Budget 2012

* Vat increased by 2%.

* €100 household charge introduced.

* Child benefit for 3/4 child cut.

* Cigarettes up 25c.

* Petrol up 1.4c/ diesel up 1.6c.

Budget 2013

* Child benefit cut by €10 per month.

* Maternity benefit to be taxed.

* Property tax of 0.18% up to €1m; 0.25% on houses over €1m.

* 10c rise on spirits, beer and cider.

* 10c on pack of 20 cigarettes.


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