Expenditure and taxation proposals for the 26 Counties unveiled by Sinn Féin this week have presented a serious challenge to the Dublin government’s own plans ahead of its annual budget announcements early next month.
The Sinn Fein document calls for a total adjustment, including new savings and increased revenue, of 3.5 billion euro for 2013. That amount is in line with the plans of the Fine Gael/Labour coalition and the requirements of the international ‘bailout’ lenders to the insolvent 26 County state.
However, there are sharp differences in approach: Sinn Fein is backing a new 1% wealth tax on certain assets over one million euros, as well as salary reductions for certain high-earning public servants such as hospital consultants, city and county managers, TDs, senators and state agency chiefs. It also plans to reverse cuts already implemented by the current government, such as the reduction in the number of home helps and other ‘frontline’ public services, as well as to reduce tax on petrol and diesel.
Pearse Doherty, Sinn Féin’s finance spokesman, said the coalition had a choice ahead of next month’s Budget to target struggling households or the most well-off.
“We believe there are people in society that can afford to pay a bit more,” he said.
“It is not just about the fairness and justice of that, it is also, in our view, good for the economy.”
In its proposals, Sinn Féin said it would make up most of the €3.5bn in necessary savings through new taxes, raising €2.75bn.
These would also involve changes to tax reliefs, tax hikes on “super-pensions” and a new 5% levy on all gambling.
Other measures include charging the full cost of private care in public hospitals, bringing in more generic alternatives to branded medication and capping hospital consultants’ pay at 150,000 euro for three years.
There would be an emergency ban on paying public and civil servants more than 100,000 euro, also for three years, with state agency board fees slashed by 25%.
TDs’ basic pay would be reduced from 92,672 euro to 75,000 euro. A number of parliamentary allowances would also be abolished.
In Sinn Fein’s plans, the savings will allow a reduction in excise on petrol and diesel by 5%.
It would also allow other key measures: free school books to all children, double spending on school meals, increase the fuel season welfare allowance by six weeks and cut the cost of attending emergency hospital appointments by 10 percent.
Sinn Féin’s plans include lifting the public sector recruitment freeze to take on 3,500 badly needed frontline service staff in education, health, policing and social protection.
“This alternative Budget is about protecting the low and middle income earners,” said Mr Doherty.
“It’s about asking those on the top end to pay a bit more and we believe it is modest.”
It was too modest for some progressives, who described the 1% wealth tax as “too small” in light of the rapidly increasing divide between the poor and the rich in Irish society. There was also some surprise among socialists that Sinn Fein backed the drastic 3.5 billion euro adjustment to the economy that has been demanded by the IMF and the EU.
However, there was a wave of support for the party on social media networks, with praise for the document’s goals of setting out an alternative financial plan which addressed social injustice.
For some, the party was pushing on an open door -- the coalition government faces mounting public anger over its failure to tackle the extremely high pay of government Ministers and their senior public servants. The so-called ‘L’Oreal generation’ receive up to €250,000 per annum in basic salary, and can expect to receive pensions worth several million euro when they retire.
The Tanaiste (Deputy Prime Minister), Labour party leader Eamon Gilmore is also facing particular scrutiny this week after it was revealed his wife has just been appointed by a fellow Labour minister as an ‘advisor’ on an annual salary of almost 100,000 euro.
Meanwhile, the 26 County Minister for Finance Michael Noonan has been strongly condemned for repeated declarations that he is powerless to stop bankers in Ireland’s failed banks from helping themselves to salaries -- paid from public funds -- which rise to more than €500,000 per annum.
THE PEOPLE HAVE ‘HAD ENOUGH’
Announcing its recommendations for an alternative approach, Mr Adams made reference to the “five gruelling, cruel austerity budgets” that have gone before.
He said that it was Sinn Fein’s “strong view” that citizens had “had enough”.
Deputy leader Mary Lou McDonald said that another objective of their alternative proposals was “to protect children.”
Making reference to the recent children’s referendum, she said that “government talked up its commitment to the children of the state. We’re saying to them very clearly that with this budget, they now have the first test of their commitment to children.”
Finance spokesperson Pearse Doherty said that budgets were “about choices”.
“Do you introduce a property tax that calls on struggling households to pay more, or do you introduce a wealth tax that asks the most well off to pay more?
“Do you cut Child Benefit or do you cut politicians’ and high paid civil servants’ wages?
“Do you protect tax reliefs for those who can afford to avail of them or do you reduce the cost of petrol and diesel for everyone?
“These are the choices the government has before it. For my party the choices are obvious.”