Economic contractions by no means confined to gardaí and taxi drivers

SYMPATHY for the financial plight of others is something not easily found these days, even when it is deserved. Almost everyone seems to have their own worries.

While clearly there are some cases of gross hardship and utter inequity in suffering the consequences of the economic fall, you can’t blame people for thinking their fate is worse than anybody else’s, even when it might not be.

For example, it is easy to understand why public servants are so bitter about the pension levy because it is having major implications for their standard of living. But it is also understandable that those who have defined contribution instead of defined benefit pensions are less sympathetic (the latter having lost a fortune in recent times while the public sector outcomes remain guaranteed).

And that’s not taking into account those who have lost their jobs, with the number on the live register at 340,000 (and rising fast). They would love the security the majority of public sector workers (though not all) enjoy.

Two groups in particular have been to the forefront in recent days for different reasons, one a group of self-employed people, taxi drivers, and another important public servants, the gardaí. The taxi drivers have been holding street protests while the Garda Representative Association has launched a provocative and eye-catching poster campaign.

Taxi drivers, for example, believe they are deserving of some sympathy, as well as help, such is the massive drop in income they are claiming. From all over the country I have received text messages from taxi drivers who say they can’t earn enough to pay their way.

This is not surprising. There are masses of cars at the ranks. Put out your hand to hail one of the passing cabs and there’s the danger of a pile-up, such is the hunger of taxi-drivers to get business. There’s a new phenomenon in parts of Dublin in the early hours at weekends as people leave the pubs: traffic jams made up almost exclusively of taxis.

These text messages give examples of earning e60 for 10 hours of driving and the like. That is less than the minimum wage and involves working longer hours than most people do. But people working for the minimum wage don’t have to meet the expenses of carrying out their jobs, such as putting diesel in the engine, meeting the repayments on the car and the insurance costs. They might have borrowed the e6,500 needed to buy a licence, too. Taxi drivers are self-employed and while this means they can offset some of their costs against income, thereby reducing the tax they pay to a percentage of the eventual profit, they are not making enough income to result in a tax bill.

They have a major issue too with the emergence of new drivers, many of whom are part-timers, cherry-picking business at the seemingly most profitable times and doing something else during the hours the full-time drivers are idle. Some are driving old bangers, a common complaint for the full-timers who have invested in larger, modern, safer cars (although not all full-timers can claim to have spent the necessary money). The taxi drivers want no more new taxi licences to be issued but they are not getting support from either their regulator or the Government.

This week, the regulator published the findings of a report prepared by Goodbody Economic Consultants. To the fury of the taxi drivers it made only a nod towards their claims of more difficult financial circumstances.

“Whilst it does not appear to be the case that earnings have collapsed, there is evidence that drivers have to work longer hours to meet their income expectations. There is also an indication that whilst supply exceeds demand at times and in certain locations, the opposite is also true at peak periods,” it said.

I suspect the latter no longer holds true in recent weeks as the economic depression gripped further: taxi journeys have become a luxury. Yet sympathy from the public is limited for a number of reasons. One is that restrictions do not apply to most other services. Carpenters, electricians and bricklayers, to take just three examples, were in contact with me to point out they have served lengthy apprenticeships, but there was nobody stopping foreign workers coming into the country in recent years, undercutting their wages to get jobs. In fact, it was official State policy to encourage this. So why should an artificial barrier be put on entry to the taxi trade, especially when it is an unskilled job? Why should taxi drivers, who have not served apprenticeships, expect conditions appropriate to those who have spent time learning a trade or acquiring professional qualifications after years of study and expenditure?

Many people still remember the days when it was impossible to get a taxi because it was a closed shop, with a limited number of licences issued. Trade in licences was conducted at high prices because of the anti-competitive restrictive rules that were since abolished. The regulator believes the new free market approach will bring about equilibrium and that supply and demand will match eventually, but this may be more ideological than practical. It is hard not to sympathise with those who have been in the trade for years and who have spent money on providing a good quality car only to see others undercut their businesses by investing less. As for the gardaí, it is hard not to sympathise with an effective wage cut, which is how they regard the pension levy. They cannot strike, so the GRA’s PJ Stone has been a strident voice on behalf of members, even if somewhat Jurassic in the language of confrontation he chooses.

The GRA has put up posters of two gardaí, one male, one female, who have received serious injuries in the course of performing their duties. It is a powerful reminder of the dangers faced by the guardians of civility on our streets.

BUT again, the sympathy shown by many of listeners to The Last Word was limited. This is part of the job, they argued in text messages. Gardaí know they face these dangers when they sign up.

GRA president Michael O’Boyce told me the average pay of a garda was e35,000, about 5% below the European average, which is why they are fighting the pension levy. But CSO figures show the average pay to gardaí in 2007, once overtime, allowances and other things were taken into account, was e62,000.

Clearly, statistics can be misleading as senior ranking officers make much more than this and newer recruits often make less than the figure O’Boyce quoted. Indeed, the figures for public sector pay quoted in the CSO report for people other than gardaí, the overall cost to the exchequer and the massive shortfall in tax revenues to pay for it all provide more information as a counterbalance to the emotional response to the posters. That doesn’t make it any easier for younger gardaí at the wrong end of the pay-scale, but such facts cannot be ignored wilfully.

People are narky, and for good reason, because they do not believe themselves to be responsible for the mess the country is in, but they are most definitely having to pay for it. About the only consolation to be had is the knowledge that they are not alone… and if they want to really think about it, that there are often many more people far worse off.

The Last Word with Matt Cooper is broadcast on 100-102 Today FM, Monday to Friday, 4.30pm to 7pm.