DEAR Phil, I was going to write about the Mahon Tribunal this week, but your need is more urgent (I know you’ve never asked for my advice, but you’re going to get it anyway — mainly because I agree with what you’re trying to do).
The Mahon Tribunal, in my humble opinion, changes the Irish political landscape for ever, and in the most profound ways. That will become more and more clear as time goes by, and no doubt the like of me will be writing lots and lots about it.
But Phil, you have a deadline to make this week. As things look right now, you’re not going to make it. And as a result, you and the Government are going to look more than a bit damaged.
The deadline I’m talking about, of course, is the March 31 deadline for payment of the household charge. The main reason you’re not going to meet the deadline is because you made a bags of it. It’s one of those classic political no-wins. If you don’t get the tax in, your reputation for competence is damaged. If you back down on it, your credibility is seriously undermined. So is the credibility of the whole government. And so, most seriously of all, is the case of a more permanent system of property tax.
Now, don’t get me wrong. I think if I had your job, I would have made all the same assumptions as you did. I remember when it was announced around budget time, the talk from everyone in Government was “sure, it’s only €2 a week”. That’s certainly what I thought. So I’m not going to do a “holier than thou” piece about what you should have done, because it’s only obvious with the benefit of hindsight.
There were three things that were immediately clear though about the announced household charge. (a) It’s regressive. (b) It’s small. (c) It’s temporary. It’s regressive because it takes no account of ability to pay, but the other two factors make up for that. And it is certainly a step in the right direction — towards a tax system that it better balanced and fairer in the overall sense.
On the basis of those three characteristics, I certainly would not have predicted last December that you’d be in the mess you’re in today. And I wouldn’t have advised you to go about the collection differently. In fact, I like the idea that you can log onto a website and discharge your responsibility in a relatively painless way. I’d have liked it even more if you’d sent me a receipt, but still, it was a smooth and easy operation.
And I certainly would never have advised you to back down in the face of the political opposition that gathered around the household charge. Socialists and social democrats all over the world have long accepted that people who own property should make a contribution to the common good based on that property. Our so-called socialists prefer cheap populism, however, and they certainly don’t deserve to be pandered to.
But it’s a mess, and there’s no getting away from it. By the time you read this, maybe half a million households will have paid up. And by the way, half a million saying OK to the charge, compared with the 3,000 who turned up to a protest meeting on Saturday last, is not too bad. But it’s not nearly enough. You’ll be doing very well to arrive at a point by the weekend where half the eligible population has paid up on time. It will be damn close to a miracle if you reach the figure of a million households by midnight next Saturday.
I’m absolutely convinced, though, that it would be a mistake to assume that the reason people didn’t pay was ideological, philosophical, or political. It was cultural.
You’ve fought a lot of elections, Phil, on your own behalf and on behalf of others. You know as well as I do that the Irish people won’t vote for anyone who doesn’t ask them for their vote. And I’m afraid it’s the same with bills. We don’t pay them if we don’t get them.
Maybe you keep a careful note of when your TV licence is about to expire, Phil, so you’ll never be caught without a licence. If you do (which, I’m sorry to say, I doubt), you’re in a minority of one. The rest of us wait for the renewal. I think if the truth were told, most of us, even though we recognise the importance of the TV licence, wait for several renewals.
And if that’s the case about something that we’re used to, it’s much more likely, when you think about it, that there would be a similar cultural resistance to a new tax — especially a new property tax. Unlike other countries, we don’t do self-assessment in Ireland. If we’re in the PAYE sector, we’re used to seeing it deducted from our wages. Otherwise, we wait for the letter from the taxman.
In short, I don’t think it’s possible to collect tax on the cheap. You have to ask for it, properly, with a letter in the post. If you’d realised that from the beginning (and let me re-emphasise I didn’t either), you’d have spent the first three months of the year getting your ducks in a row. Establishing the names and addresses, distributing the information, and then sending out the bill. And you’d now be waiting for the money to roll in the second three months of the year.
YES, it would have cost a bit, and that would have reduced the yield this year. But it’s really the principle you’re trying to establish, isn’t it? As helpful as the yield from €100 per household would be, the real breakthrough is changing the culture around the principle of a fair property tax.
So here’s my advice, Phil. First, when it’s clear that the arrangements put in place in the first quarter of the year didn’t deliver the goods, don’t blame the people. Take responsibility for any faults or mistakes in the arrangements yourself.
“Don’t blame the people” means that whatever you do, don’t start insisting that everyone who hasn’t paid now has to be hit with penalties and surcharges. It’s too soon for that. Take a step back. Let everyone know that you’re going to spend the next three months making sure that everyone gets a proper invoice (and a receipt if they have already paid).
Sure, there’ll be some short-term embarrassment. But the only way to get everyone signed up is to be reasonable, and to recognise that we have a right to be asked properly. By the end of the year, if you do it right, this present fiasco will be remembered as teething troubles. Of course, if you don’t get it right now, knowing what we know, the phrase “nail in the coffin” comes to mind. And if being reasonable doesn’t work, you could always tell everyone that Bertie Ahern and Pee Flynn are refusing to pay the household charge, and that they’re joining the campaign against it. That ought to persuade everyone else to pay up pronto.
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