Rip-off Ireland: it’s official

IRELAND is the most expensive and least competitive country in Europe.

A major study found that, of 15 developed economies, Ireland was the most expensive for goods and services, alongside Finland, and that price increases are eroding our ability to attract and maintain jobs.

The Annual Competitiveness Review, which is appointed by the Government, found Ireland was fourth most expensive for insurance premiums and the third dearest for electricity and landfill costs. Ireland also has the lowest broadband internet penetration and the second most expensive.

The National Competitiveness Council also warned that unless price increases are tackled, the country risks missing an economic upturn.

NCC chairman William Burgess said yesterday that though the inflation rate has fallen, it was still the highest in Europe and the Government should avoid fuelling it further in tomorrow’s Budget.

He advised against hikes in customs and excise duties and adding to the VAT rate, already amongst the highest in Europe.

“We are not where we were 10 years ago. We are no longer a relatively low-cost country and we have got to position ourselves to make sure we have the right profile to compete,” Mr Burgess said.

Responding to the report, a spokeswoman for Taoiseach Bertie Ahern said the Cabinet had discussed its findings last Tuesday and would make public its observations on the economy’s competitiveness within the next few weeks.

Fine Gael’s enterprise spokesman Phil Hogan said the report sent out a clear warning about Government budgetary policy.

He said Finance Minister Charlie McCreevy must resist the easy option of raising charges in the Budget.

“There is evidence that the global economic upturn is already leaving Ireland behind in terms of our high public utility costs, lack of infrastructure investment and high insurance costs,” he said.

Labour Party spokeswoman on finance Joan Burton was equally critical.

She described it as a “damning indictment” of Mr McCreevy’s policies.

“His decisions to impose a series of stealth taxes and systematically increase the cost of many public services has fuelled the rate of inflation,” she said.

The NCC has proposed a range of measures to tackle spiralling consumer costs and improve infrastructure.

It urged consumers to be more proactive in seeking lower prices and said competition laws must be strengthened to make companies compete on price.

The NCC said one of the reason why competition was lacking in Ireland was because there were no fines for companies breaching competition law.

It also backed Government proposals to fast-track the planning process for national infrastructure projects.