Swingeing Budget makes few friends

Swingeing Budget makes few friends

Nell McCafferty, journalist and writer, has said of today's Budget: “If you leave aside the elderly, the women and the children, no-one else feels any pain. That makes Brian Lenihan a bully.

“I think Brian Lenihan should have inflicted on himself the same pain as he did on people over 70. He is giving up his pocket money and expects the elderly to give up medical care.

“I’m shocked at what he’s doing to older people. He’s putting unnecessary worry on them. Old age is not something to look forward to under his rule.

“There is nowhere for elderly people to go except downhill and he is kicking them all the way.

She added: “The stand-off between him and Enda Kenny on who is giving up the most pocket money is obscene, all it is is pocket money. These men will still be earning about €150,000 a year plus expenses.

“And I think it’s all meaningless until he sorts out the banks. We are wandering around in the dark as usual. He should have opened up the banks’ books to see how much bad debt they have before the Budget and see how much they are going to cost the taxpayer.”

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Fr Peter McVerry, who has dedicated his life to working with the homeless in inner city Dublin, criticised the amalgamation of Combat Poverty into the Government’s Department of Social and Family Affairs.

“That’s appalling,” he said.

“They will have no independence and they will not be half as critical, certainly of state policies, as they have been in the past.

“All it could do was make recommendations but some of the recommendations were very hard hitting.

But Fr McVerry offered some praise for the ministerial pay cut.

“I’d maybe give them credit for that – though they are not exactly going to feel the pinch. I think it was simply a symbolic gesture.

“But I think the income levy, that’s a good idea. But I would have gone higher taxing the wealthiest by 3% or 4%.”

And on ending automatic medical cards for the over 70s, Fr McVerry said: “That was a Charlie McCreevy stunt. There are many over 70s who are millionaires getting a free medical card. It was simply a welfare payment for the very rich.”

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Don Nugent, centre director of Dundrum Town Centre in south Dublin believes retailers will have to work harder to provide value for money for customers in the lean times ahead.

“The perception is that the Budget could have been far worse,” he said.

“However it looks like there will be less cash in people’s pockets so they will be looking for more value for money.

“This will put more pressure on retailers to adapt to the changing economic circumstances.”

Mr Nugent also said he expected the Budget forecast of 2.5% inflation in 2009 to be positive for consumer spending in the months after Christmas.

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Business woman Gillian Bowler said the Budget was targeted at those who benefited most from the Celtic Tiger over the last 10 years.

The Chairman of Irish Life & Permanent plc felt the Government sent out a strong signal of determination on how to deal with what is a sharp, but hopefully short, recession.

“Difficult decisions had to be made,” said Ms Bowler.

“Positive actions have been done for the less well off in society.

“Over the last decade, those who did really well over the Celtic Tiger will pay the price and I think that’s right.”

Ms Bowler said it was clear the overall tone of the Budget was to hit the big ticket earners.

Moves include rising Capital Gains Tax, scaling back of tax breaks, reducing medical expenses, charging owners of rented accommodation and holiday homes and adding air travel tax and levies for car parking places.

“I think a drop in stamp duty on commercial property was directly aimed at getting rid of a logjams,” she continued.

“The 2% rise on capital gains tax means that people by in large who pay capital gains tax can afford to pay more.

“Overall I’d welcome it because I think it’s clearly aimed at targeting the resources of the well off.

“It sends out a strong message that he is protecting the less well off of society and aiming the increases at the better off.”

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Professor Richard Conroy, of Conroy Diamonds and Gold who uncovered what is believed to the UK and Ireland’s biggest ever gold mine in Co Monaghan, said the Budget was harsh but fair.

“It’s basically a fairly severe budget but to me it sounds like a very sensible one,” he said.

“I think it has to be taken in conjunction with the measures in relation to the banks, as decisive and quick action.”

The former senator thought the 1% and 2% levy on income is an unusual measure but necessary in the circumstances.

“I’m surprised that they have kept the corporation tax as it is, they must have been very tempted to raise it. But that would have been negative development as it’s very important,” he said.

“The abolishment of the automatic entitlement was a severe measure but what is essential is that those who need health care get it, irrespective of age.

“Overall, it’s a very decisive budget, very tough but very necessary. It really is belt-tightening right across the spectrum and it was important for those involved to take pay cuts themselves to set an example.

“We are facing a very severe financial situation, like everybody else, and it’s good that we have acted decisively and quickly.”

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Pensioner Paddy Craddock, 73, a life-long runner who was voted Ireland’s fittest grandparent, said: “It’s a disaster for senior citizens. I’ve voted for the government for years and I’m thinking twice about ever doing it again.”

The school warden said the €2 rise in fuel allowance and €7 hike in pensions were an insult to the elderly.

“The people they are hitting hard are the people who can’t fight back,” he said.

“Two euro for fuel isn’t much good, it’s a bit of an insult to senior citizens and the people who are relying on it.

“Every couple of months the price of both coal and oil is going up.”

And neither did the abolishment of automatic entitlement for medical cards for over 70s impress him.

“It think that’s the worst of the whole lot,” he said. “ The senior citizens haven’t the energy to fight this or do anything about it.

“The grant won’t go very far for tablets and doctors. There’s no reason to interfere with senior citizens. I’m very disappointed in that.

“Brian Lenihan has done nothing for the elderly people at all.”

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Paul Sweeney, economic advisor to unions umbrella, Ictu said the Budget has cut and diced the incomes of most families struggling to make ends meet.

He said the measures look like a short-term fix rather than a medium-term strategy to kick-starting the economy.

“The income levy is a very inequitable tax because it will punish those at or under the average industrial wage of €34,000 much more severely than those at the upper end around €100,000.

“Mr Lenihan spoke about a three-year strategy in his speech but this is not evident from the measures he has introduced.”

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Dr Constantin Gurdgiev, economist and TCD lecturer on finance, believes the Budget will drive down consumer spending which is exactly what the Government didn’t want.

“This Budget will hit the PAYE sector hard and it could lead to people dropping out of the labour market and foreign workers returning home.

“It has done nothing to curb the spending on the public service.”

Mr Gurdgiev also warned that all the taxes and indirect taxes will serve to drive down consumer spending in the months ahead.

“Consumer spending was one of the biggest factors that created the boom,” he added.

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Chartered architect Joan O’Connor said there was no great hope offered to construction professionals.

But she revealed that the Government’s plan to plough funding in to the building and refurbishment of schools, affordable housing, and into making homes more energy efficient would be good news for the small scale builder.

“It’s good news for the small scale craftsman builder,” said Ms O’Connor, project manager on Sean Dunne’s ambitious Ballsbridge scheme.

“There were a couple of things that could keep the industry busy if they were focused properly.

“The capital expenditure on schools went up to €889m, so there will be a lot of work to be done there.

“Also, the commitment of €1.65bn for housing, and the local authority scheme reforms are a good initiative.”

Elsewhere she felt the drop in stamp duty on commercial property from 9% to 6% “might stimulate some movement in the market if the demand is there”.

But Ms O’Connor said the Budget will do little for the thousands of builders, architects, engineers and project managers who have already lost their jobs.

“I don’t really see a lot of hope for them in what has been announced... there is no magic wand there,” she added.

“All in all it doesn’t really hold out any great hope, especially for the professional end of the industry.

“It is going to get a lot worse before it gets better. There’s no light on the horizon for us.”

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Donal Caulfield, Director of LM Developments, praised the Minister for resisting temptation to interfere heavily with the property market.

“It’s the sensible thing to do. I think if you take where I’m coming from and look at it from a personal point of view it’s the right thing to do. If I was him I’d have done the same thing.

“The market needs to reach its natural bottom. That’s why it’s in the mess it is because of the tampering that went on before.”

And like others Mr Caulfield was glad to see ministers leading from the front when the country as asked to tackle the pain of recession.

“That’s leading by example,” he said.

“It’s a very positive thing. I suppose it’s symbolic and if that’s the way they are going that’s a good thing and you can only be impressed by that.”

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