The stealth of Labour
At certain times of the year nature is especially kind to us. It provides living signs that all is well with the world. The swallows arrive, the cuckoo is heard, lambs jump around full of energy while flowers take their turn at centre stage. The daffodil gives way to the bluebell, the primrose, the daisy and the foxglove. And in the land of humanity, winter woollies give way to summer shimmies.
Then we learn that an election is less than a year away! Last time out Bertie Ahern said he would go full term, he did. He said the same for this time around. It looks – unless the PDs cannibalise themselves altogether – like it will go all the way this time. That means that come next May we will be in election mode. The signs are emerging that something is in the offing with the press releases emanating from ‘unusual’ quarters. Now that all the selection conventions are done and dusted, candidates for major, minor and non-parties are being groomed for public viewing and listnership.
One candidate who is very busy of late is Labour’s Harry Barrett. He is issuing press releases to save his life, cropping up at several events and functions and is not afraid to speak his mind. He uses the facilities at his disposal, namely the party machine. Every political party has access to researchers and press officers and Harry Barrett is keeping them all busy. One of his most recent press releases shows his prowess at playing the system. He has accused the Government of introducing over 50 tax increases, or ‘stealth taxes’, as he calls them. There is no doubt that he has used the party machine to compile the list, but it makes interesting reading! There are six headings: Household, Education, Health and Welfare, Taxes and Welfare, Utilities and Transport.
A) Household: Rent Allowance – it was capped in November 2002 for social welfare recipients living in private rented accommodation, regardless of rent increases. The First-Time Buyers’ Grant was abolished in November 2002. The grant, €3,810, was a great help to a couple starting out on the housing ladder. It has never been effectively replaced. In the words of Michael Ring it is unfair to have first-time buyers compete in a housing market with people (speculators) who are buying their second, third or fourth house. The Television Licence was increased to €150 (from €107) in December 2002. A year later it rose to €152. Less than a year-and-a-half later it rose to €155. In 17 months the cost rose by over 45% - inflation, Government style, or as opposition parties call it, stealth taxes. Postal charges increased in August 2003 from 41 cent to 48 cent.
B) Education: College Registration Fees increased in July 2002 from €396 to €670 – a 70% increase. Sixteen months later they increased another €80 to €750. State Examination Fees increased €10 in November 2003 for Junior Cert (to €82) and Leaving Cert (to €86). In November 2005 the Junior Cert fee was €86 and the Leaving Cert fee was €90.
Health and Welfare
C) Health and Welfare: The Drugs Payment Refund Threshold (monthly figures) increased in July 2002 from €53.33 to €65. Five months later it increased to €70. It went up t €78 in Budget 2004 and now stands at €85.
Accident and Emergency Charges – In July 2002 it was increased by 26% to €40; up another €5 in January 2004 with another €10 increase in January 2005. In November 2005 it rose to €60, almost a doubling of the pre-July 2002 figure. Hospital accommodation was increased from €36 to €40 per day in January 2003. It went up another €5 in November 2003; up another €10 in November 2004 and another €5 increase to €60 in November 2005 – almost a 100% increase in less than three years.
Health Insurance – VHI, which is Government-owned was granted an increase of 18% in July 2002; 8.5% increase in September 2003; 3% increase in September 2004 and 12.5% increase in July 2005. The company is now seeking another increase of 12.5% this coming September. Overall, the increases in four years amount to almost 55%.
Taxes and Welfare
D) Taxes and Welfare: Indexation of Tax Bands in Budgets - Budget 2003 Tax band failed to be indexed in line with inflation. A total of 53,000 were workers moved into the top tax rate as a result, making 30.5% of workers paying the top rate (42%) of tax. Budget 2004 Tax band again not indexed, raising the number paying the high rate of tax to 50% or 632,000 workers. Stamp Duty – it was increased in Budget 2003 from eight cent to 15 cent per cheque; Laser cards with a combined ATM function increased from €6.25 to €20;ATM cards without Laser increased from €6.25 to €10; Stamp Duty on Credit cards increased from €19 to €40. Value Added Tax – in Budget 2003 the lower VAT rate was increased from 12.5 % to 13.5%.
E) Utilities: ESB price increase of 13.5% approved in September 2002; a further 5% increase in September 2003; another 8% in July 2004; a further 3.5% in October 2004 with another 3.1% in September 2005. In all, this is over a third of an increase in three years, which is 33%.
Gas Charges – CER sanctioned an increase of 9.1% in February 2003; an 11% increase in October 2004; 25% increase in September 2005 – over 45% of an increase in two and a half years. Eircom – our old friends from the great days of Tory inspired privatisation, and the Government still has not learned! In June 2003 line rental increased by 6.3% bringing the standard home phone line rental charge to €270 per year, up from €253.
F) Transport: Motor Tax – increased by 12% in January 2003 and 5% in January 2004. Passports increased in November 2003 - a) Standard 10 year passport €57 to €75; b) 3 year passport for infants €12 to €15; c) five-year passport for 3-17 year olds €12 to €25; d) Emergency fees for adult passport applications processed outside office hours increased from €63 to €100. Fuel Excise - Budget 2003 increased mineral oil tax on auto diesel by three cent per litre (inclusive of VAT); Budget 2004 added another five cent per litre increase (inclusive of VAT) on both auto diesel and petrol. Public Transport - CIE fares increased by 3.5% in January 2005. Drivers – January 2005 also saw a 30 cent increase in the price for the use of M50-West Link Toll Bridge. The NCT increased by 60 cent in March 2005 to €49. VRT – in January 2004 the top two bands of Category A vehicles were restructured. Previously cars of the capacity 1401cc-2000cc were subject to a VRT of 25% and cars 2001cc and over were subject to a VRT of 30%. From January 1 cars 1901cc and over are taxed at 30%, increasing the number of drivers paying a higher rate of VRT.
People only realise how real increases are when they see them written down. Health, stealth and wealth are more than rhyming words – at least for some people!