Ireland: A government of Stealth taxes and savage cuts

Rent allowance cuts may make 4,000 homeless

Last December saw a plethora of increased stealth taxes, cuts in essential services and more broken promises from this government. The Voice reviews the consequences of these cut-backs for working class people and communities and looks at who benefits from the government’s policies. cwi online.

A government of stealth taxes and savage cuts

Up to 4,000 people a year could be facing homelessness because of cuts in rent allowance made by the Government according to the housing agency Threshold.

This Government is giving new powers to health boards to refuse rent allowance to anyone not already renting for 6 months.

This means that someone with rent of 150 euro a week would need to fork out nearly 4,000 euro before a rent allowance might kick in. The Socialist Party challenges any Government TD to explain where an unemployed person, a lone parent or a woman escaping a violent relationship is meant to find that kind of money.

Ms Frances Byrne, manager of the One Parent Exchange and Network (OPEN) accuses the Government of effectively phasing out rent allowance: "There is not a community officer in the country who will give someone rent allowance if you manage without it for 6 months".

The Government have made several other changes in the rules for rent allowance recipients. They include a ruling that rent allowance will not be paid anymore to a household where one member is in full-time employment, i.e. if one of a couple are working both are now to be excluded from rent allowance.

This is to happen in the context of a 12% cut back in investment on local authority housing between 2002 and 2003. The local authority waiting lists are longer than ever. 85% of households on the waiting lists have incomes below 15,000 euro. These people end up in the private renting sector, with virtually no protection against racketeering landlords who are free to charge as much as they want.

This government has made a shambles of its promises to build more local authority housing and they are now making the victims of their policy pay again.

Government freeze CE schemes

Community Employment jobs provide training and work to those who hold them, and are vital to the provision of many services in communities. Meals on wheels, community centres etc are often dependent on CE workers.

The government so values this work that it has been slashing funding for some time. In the two years to the end of 2003, 10,000 of these jobs were to have been cut, with an inevitable impact on services.

This year the FF/PD crew allocated 351 million euro for 25,000 positions – a freeze on the previous year. So inadequate is this measure that 40 FFers, terrified of electoral consequences, briefly demanded funding for 5,000 extra jobs before ultimately obeying their master’s voice.

28 euro per week is what is required to fund a CE job – 5,000 jobs could be funded with 7.5 million euro, and many worthwhile projects would benefit.

McCreevy & Co. rejected this option but saw fit to funnel 15 million euro into an equestrian centre in Punchestown!

The stark reality in the communities

Carman’s Hall Parish Centre off Francis Street is one of the thousands of community centres around the country hit by the cut backs. For years it has provided activities for young and old in the community, as well as meeting rooms and halls for local groups and campaigns. Now it has been instructed to sack one CE scheme worker, which will pose problems for the opening hours and activities calendar of the centre. As well as that, the CE schemes have provided an opportunity for many people to learn new skills and to get back into the labour market, as well as to provide essential services to the community. If anything the government should finally start to properly value the work CE scheme workers put in and reward it with more than just a top-up on their allowances. Instead, community services around the country face crisis because of petty and mean cut backs.

McCreevy sets poverty trap for lone parents

The cut-back in lone parents’ allowance will mean many lone parents will be caught in a "poverty trap".

This cut-back now means that a lone parent who takes up employment which pays over 293 euro per week (7.55 euro p/hr – barely above the minimum wage) won’t receive the 1/2 rate lone parents benefit (77.05 euro p/w) that was previously paid during the first year of employment.

With rents averaging 230+ euro p/w nationally, and childcare costs the highest in Europe, the government have shown with this cut how out of touch with the lives of ordinary people they are.

"The truth is that no government in the history of the state … has presided over such a shift of wealth from working people to the wealthy, capitalists and financiers."
Joe Higgins TD in the Dail, 4/12/03

And the winners are…

  • Land speculators whose taxes were slashed by 50%
  • Big business, whose tax bill was reduced by 634 euro per year through reductions in corporation tax over the last two years
  • Stud farm owners who continue to enjoy tax free status
  • Multinationals who sent over 15 billion euro profits out of this country in 2002 alone.

In the words of the Irish Times editorial:

"Mr McCreevy has sucked up to the business community big time"

From Socialist Voice, paper of the Socialist Party, the cwi in Ireland

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January 2004