The Stability Programme Update which accompanied that budget documents reveals a story that the government are not telling the people about the public finances. They show that government is going to spend the exact same amount on day to day services in 2014 as they intend to in 2010. What this means is that irrespective of any increased demand for services, and any inflation in the interim, they are not going to increase nominal current spending in the next 5 years.
So the real story here is that, nominally at least, there will be no public sector pay increases, social welfare increases, or services increases over the next 5 years. Indeed further cuts to pay and social welfare rates are on the cards if demand rises. Of course there could all be changes within these areas of spending but the overall envelope stays the same irrespective of inflation or demand in the interim.
Also the figures indicate that the government intend to raise an additional €7billion in taxation in 2014 than 2010. Inflation and any return to growth will go some of the way but taxation increases will also have to feature.
Why are they wasting time…? Why plan for several years of falling living standards, with borrowing delaying the evil day when further falls must happen?
Constantin Gurgdiev was on Vincent Browne the other week. It was comical to watch him when topics like Jedward came up. He sat silently looking like he was going to blow a head gasket while the others waffled around him. He’d be a total savage if he were running things, but it would be better to cut out the cancer now before it’s terminal. 1 euro in and 1.70 out is a recipe for penury.
Left or right, tax rises or cuts, it has to happen sooner or later.
We’re going to get a pasting with the new social tax. It’s already been said it will be progressive (as opposed to the current PRSI and levies). This budget was, in part, a softening up operation.
In fairness budget projections for 2014 are marginally more useful than Lenny saying he is going to phase out mortgage interest relief in 2017. He will not be around to see either in operation.
These figures are bunk and not worth head scratching.