Budget 2019 denounced as ‘a betrayal’

Fine Gael’s Finance Minister Paschal Donohoe has revealed the third and final annual 26 County budget agreed with Fianna Fail as part of their government pact.

Despite a strong financial outlook amid a boom following the crash of a decade ago, this year’s fiscal announcements bring a massive bonanza to high earners, with only routine changes in social welfare rates and the minumum wage.

Despite revealing huge handouts for landlords, there was no assurance that homes will be built, or that the housing and homeless crises will be tackled.

The Minister introduced a 100 per cent mortgage interest relief scheme for landlords -- allowing them to write off their mortgage interest repayments on loans used to buy their rental property.

There is to be a separate tax relief scheme for landlords who buy and retain a rental property, where someone is already living. Another grant scheme will see up to 60,000 euro for landlords to convert properties into smaller units for rental purposes.

A promise of 10,000 new social homes in 2019 provoked scepticism on the opposition benches.

People on the highest rate of taxation will also save at least a thousand euro in tax cuts. The Universal Social Charge, a notoriously regressive tax, is reduced marginally, from 4.75% to 4.5%, while the entry point for the highest rate of income tax will rise by 750 euro.

Controversially, the government has also allocated 12 million euro to fund a planned roll-out of abortions across the state. Following the ‘Cervical Check’ scandal over undiagnosed cancer tests, some 9 million has been allocated to pay for the introduction of a new testing programme.

Social welfare rates are to rise by five euro a week. Among other minor changes, lone parents will see their allowance increase by 20 euro a week. There was an increase in the rate of support for refugees living in direct provision centres, from 22 euro per week to 39 euro.

A rise in the hourly minimum wage was also announced, from 9.55 euro to 9.80 euro.

The low VAT (sales tax) rate on hotels and the hospitality sector is to be scrapped and will return to the standard rate, 13.5%.

The government vowed to recruit an additional 800 police in 2019 and 1,300 more teachers and school staff.

Betting tax is to increase from 1 per cent to 2 per cent, excise on cigarettes is to increase by 50 cent with a related increase on other tobacco products, bringing the price of most cigarettes to 12.70 euro. There was no increases in the tax on alcohol.

There will also be no changes to carbon tax, despite appeals from scientists and environmentalists.

Summing up his announcements, Donohue declared: “This is a caring budget”, to heckles. He said the budget “further confirms the shared progress we have made”.

“It helps those on lower and middle incomes. It improves living standards for those less well off. It balances the books. It builds resilience on our economy and supports long term growth.”

Concluding, he added: “It is a responsible Budget for a modern and caring Ireland that aims to be at the centre of a changing world. I commend the Budget to the House.”

Fianna Fail’s finance spokesman Michael McGrath, whose party has agreed to prop up the government by abstaining in the Dail vote, responded by partially disowning it, but also claiming “progress”.

“We are not in government,” he says. “There are no Ministers over here. We are not in charge of any government departments. But rather than being a spectator, we have sought to use our influence to positive effect. In today’s budget, we have made progress on a number of crucial policy areas on behalf of the Irish people.”

He added that today’s budget is “not a Fianna Fail Budget but it is a Budget that contains some Fianna Fail measures”.

Nevertheless, he accused the government of failing on housing. “We haven’t been short of launches and PR events but we have been short on houses built,” he said.

Fianna Fail’s spokesperson on public expenditure, Brian Cowan, said that his party had “kept faith” with the confidence-and-supply agreement with Fine Gael, often in “difficult circumstances and messy compromises”. He took a swipe at Sinn Fein and the left-wing parties.

“Other parties have been content to sit on their hands. In Brendan Behan’s words their ‘like eunuchs in a brothel; they know how it’s done, they’ve seen it done every day, but they’re unable to do it themselves’.”

Responding with unconcealed anger, Sinn Fein finance spokesman Pearse Doherty accused Fianna Fail and Fine Gael of “laughing in the faces of homeless children”.

“Shame on you,” he said. “It’s a betrayal.”

He raised the case of one girl who is still homeless after the three budgets of the pact.

“How many times must stories like Amanda, a teenage girl living in a hotel room and whose life is passing her by, grip the nation before you finally present a budget capable of addressing this crisis,” he asked.

“When a teenage girl, made homeless by the policies of this government, has to pour her heart out on national radio to get noticed, what can be said of your government?

“When you announced your first Fine Gael and Fianna Fail confidence and supply Budget, Amanda was in Emergency Accommodation.

“During the second confidence and supply Budget, Amanda was in Emergency Accommodation. And now, as you announce your third Budget together today, Amanda is still homeless.

“Minister, there are 10,000 Amandas - and for them Budget Day is Groundhog Day.”

The government was attempting to buy the votes of the people with “scraps from the table”, he said, while the real prizes have been given to landlords and those profiteering from the housing crisis. It was “a Budget for booming banks and vulture funds” and “rooted in the long scam”.

“This is another Budget which ignores the real issues facing Irish society, in the hope that we’ll forget. Unless the people of Ireland decide to bring this scam, and this sham government, to an end.

“Sinn Fein is bringing new, modern leadership to Irish politics, and with it we bring a new set of values, a new and ambitious vision for what our society needs, and what it could be.”

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