Budget 2013 – Case studies

‘They don’t help the ordinary man, they just take more from us’

Less than an hour after Michael Noonan had finished his budget speech, Kenneth Collins had worked out he and his wife Debbie will be down €1,130 next year. 

The couple, who live in Farranree on Cork City’s northside, are both working full time. Kenneth is a truck driver and Debbie an accountant.

They will see their PRSI allowances abolished next year, they will be paying about €315 on property tax, will face increased tax bills for their two cars, and will also be €20 down on children’s allowance. They have two children, Katie, 4, and Grace, six months.

“I am disgusted really that they didn’t bring in a third rate of income tax for the higher earners. Why is it the middle earners that they are hitting time and time again?

“People with money always get richer in a recession and they can avail of value, but for us in the middle, it’s just constant cuts to any bit of disposable income,” Kenneth said.

The couple bought their house 11 years ago so say they avoided the worst of the excessive property prices that characterised the boom.

“I’ve a friend with a mortgage of €1,400 a month on a house that is now worth half his mortgage loan. How can they expect him to pay further property taxes when he paid enormous stamp duty and is in huge negative equity with big debt?” Kenneth asked.

“I’m shocked that once again they ignored the plight of people in negative equity. They are pretending it’s not happening.”

In recent weeks, Diageo raised the cost of a pint by 10c and Kenneth feels they did this as the Government had tipped them off an excise hike was coming. “To me that was the boys’ club helping the boys’ club. It was ‘get your price hike in fast, boys as you won’t be able to do it after the budget’. They don’t help the ordinary man though, the Government. They just take more and more from us”.

Kenneth welcomed the fuel rebate for hauliers saying fuel prices naturally impact significantly on the company he works for. Diesel and petrol prices were not increased in this budget.

“The price of diesel is already astronomical. I put in about €1,400 per week in diesel into the truck so you can imagine any increase in the budget would have had a significant knock-on effect.”

— Claire O’Sullivan

Respite care allowance to autistic Alex’s parents cut

Just over a year ago, in Nov 2011, three-year-old Alex Davidson was diagnosed with autism.

Yesterday, his parents’ respite care allowance was cut by more than €300 and the family’s child benefit by another €120 a year.

The hits are two of the most troubling his family were forced to take by Finance Minister Michael Noonan, meaning the already struggling Cobh household will be almost €1,500 out of pocket next year as a result of Budget 2013. After battling for a year to force the State to overturn an initial refusal to give her son €309 domiciliary care support a month, Alex’s mother Yvonne says the latest cutbacks go too far.

The 35-year-old — who has been on sick leave since January due to the stress caused by her son’s condition — said the fact that the budget axe fell after the successful children’s referendum makes a mockery of the promise to protect the most vulnerable.

“The €325 [respite care cut from €1,700 to €1,375 a year] is a big hit, and for it to happen a month after the referendum is ludicrous. It’s the same as the cut to child benefit — to take that away from families like us in the place we’re in doesn’t make sense,” she said.

“That respite money is needed to give the family a break, to give me and my husband Ian a break. We haven’t had a holiday in three years, no break whatsoever,” she said.

Since her son’s diagnosis, and the initial concerns which were raised two years ago, Yvonne said she and her family have got almost no help from the State. However, while she and her husband are struggling, the mother-of-one said it is children like her son who ultimately risk suffering the most.

“Alex is four in February and like most children with autism he’s non-verbal right now. We haven’t been given any idea how severe he is [on the autism spectrum].

“When we went for an initial assessment, we were given eight hours occupational therapy by HSE North Lee for March-April.

“They said if we were paying privately they would see him again tomorrow, but they didn’t have the funds publicly.

“Myself and Ian are paying a private occupational therapist €80 a week to help Alex because he had sensory issues that needed to be progressed before his speech, and we’d do anything for Alex.

“But we’re getting no help. We have another €405 to pay on the property tax, €264 or so more on PRSI and the drugs payment scheme has gone from €90 when Alex was born to €144 now.

“We are in serious negative equity and obviously we’re paying the lion’s share to the banks. It just seems the hits are coming to the same people all the time,” she said.

— Fiachra Ó Cionnaith

Carbon tax will hurt those in older houses

Paddy Fawl, 74, knew he wasn’t going to get an increase in his State pension, but was at least pleased it wasn’t being reduced.

However, the former Environmental Protection Agency worker said he was concerned by the planned introduction next May of a solid fuel carbon tax of €10 per tonne of coal.

This will further rise in May 2014 to €20 per tonne.

“I burn a certain amount of coal, but I have the oil as well so I’ll fill up on that a month before it’s introduced,” said the Leixlip man.

However, he said he could see the carbon tax hurting a lot of pensioners.

“It will affect the ordinary pensioners on social welfare,” said Paddy.

“Unfortunately, a lot of them live in older houses and they burn a lot of solid fuel. It’s going to hammer them.”

He was also glad the budget didn’t significantly hit medical card holders, but was annoyed that the Government had decided to treble the prescription charge, from 50c to €1.50.

“This could prove very costly to somebody who is elderly and not well. It’s a [200%] increase and it will hit the people who are most vulnerable,” he said.

The monthly cap for a family is being increased from €10 to €19.50.

Brendan Howlin, the public expenditure and reform minister, is also planning to save money on some benefits enjoyed by those in receipt of pensions or disability benefit.

Under the household benefit package he intends to reduce subsidies of €23m next year on electricity and gas.

The minister also wants €61m in savings on the telephone allowance.

“We’re waiting to see exactly what is proposed there. If the reduction is small I can live with that,” he said.

“I’m glad they haven’t removed the TV licence for the over-70s. When you get to that age you watch a lot of TV.”

Paddy said he wasn’t against the plan to remove the medical cards and replace them with a GP-only card for single people with an income of €600-€700 per week and married couples on €1,200-€1,400 per week.

Paddy, who is married, said anybody with that kind of money could afford to take a hit.

“We knew this budget was going to be hard on people. Hopefully it will be the last austerity budget,” Paddy said.

— Sean O’Riordan

‘This was for our son’s future, now it’s a noose around our neck’

By Sarah Stack

A working mother has said she is frustrated at struggling month to month while trying to keep a roof over her son’s head.

Lola Hynes is in severe mortgage arrears on a two-bedroomed home which she bought just as the property bubble burst.

The 37-year-old lone parent said that it was an insult for the Government to ask people to pay a 0.18% property tax when huge stamp duty was paid on homes which are now in negative equity.

“Losing €10 a month in children’s allowance is not going to change my life dramatically,” she said.

“But paying €50 to €60 a month on a property tax will.

“I could be looking at €100 less each month when everything is added up, which is a lot when my disposable income is so low.”

Ms Hynes, a jewellery valuer who drives to a part-time job with a Dublin city auction house, lives in Sallynoggin, south Dublin, with her 5-year-old son Reuben Gotink.

She is in mortgage arrears on her two-bedroom end terrace, which cost €400,000 when she bought it with her ex-partner at the end of 2007.

She has a 38-year mortgage on a home that may be worth just €200,000 now.

“I try to put the mortgage out of my mind because when I think about it I really stress out, but it’s always there.

“This was a dream that turned to dust.

“It was something that was meant to be for our son’s future.

“Now it’s like a noose around our neck.”

Ms Hynes’ monthly income of €2,500 includes an after-tax wage of €1,660, €140 in child benefit and €300 for jobseekers’s allowance.

However, she revealed that some months, depending on interested rates, her mortgage had peaked to €1,900 a month.

“Every six months, we do a financial statement with the bank and they go through every single outgoing and incoming and they calculate how much is left over to pay our mortgage.

“I pay what I have to pay, what I can afford, usually between €500 to €700 a month, so there’s a massive difference between what’s owed.

“That’s why I’m in so much arrears.”

Other monthly outgoings before Budget 2013 hikes included €180 on her car — petrol, tax, and insurance — €240 on childcare, while food, utility bills, and insurance added on another €600.

Luxuries include an internet and TV package, mobile phone, and 10 rolled cigarettes a day — which she has vowed to give up in the new year for financial and health reasons.

“It all adds up.

“I really am struggling month to month compared to 2007 and it’s frustrating.

“My car is about to die and I can’t afford a new one.

“At this stage, I should be able to buy a decent car, pay my bills and look after myself.

“But my wages have gone down, I’ve a lot less money coming in and I’m on my own now so more money is going out.”


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