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Irish budget, 2010

The 2010 Irish Budget refers to the delivery of a government budget by the Government of Ireland on 9 December 2009, its third in fourteen months. It was also the third overall budget to be delivered by Fianna Fáil's Brian Lenihan as Minister for Finance.

The 2010 Budget was described by commentators in Ireland and around the world in unusually harsh terms as €4 billion was removed from the country's national deficit. It was characterised by pay cuts for public sector workers and cuts in social welfare. According to the BBC, social welfare cuts had not been implemented by the country since 1924.[1] The cuts prompted at least one angry outburst in Dáil Éireann, the principal chamber of the Oireachtas (Irish parliament). Among the other initiatives unveiled in this Budget was a car scrappage scheme as well as a new carbon tax.

The post-budget debate was interrupted by a famous use of unparliamentary language by Green Party TD Paul Gogarty, an example which attracted international attention.[1][2][3]

Contents

  • Background 1
  • Budget summary 2
    • Arts 2.1
    • Sport 2.2
    • Tourism 2.3
  • Reaction 3
  • Social Welfare Bill and "unparliamentary language" controversy 4
  • Estimated total receipts 5
    • Estimated tax receipts 5.1
    • Non-tax revenue 5.2
  • See also 6
  • References 7
  • External links 8

Background

The budget for 2010 was occurred in the context of a major recession, which followed the 2008–2009 Irish financial crisis. It also followed the difficult 2009 budget, which led to widespread protests, as well as a supplementary emergency budget in April 2009. This meant that the 2010 budget was the third to be delivered by the Finance Minister in only fourteen months.

Budget summary

The following are the main points of Budget 2010.[4]

  • 4% cut in social welfare payments, excluding the state old age pension
  • Child benefit decreased by €16 each month, although welfare-dependent families remain unchanged
  • 20-21 year-olds Jobseekers' Allowance decreased to €100 per week in the event of these not having any dependents, 22-24 year-olds Jobseekers' Allowance decreased to €150 per week, the latter point also applying to anyone who does not take a job when offered
  • 5-10% cut in public sector pay
  • Carbon tax introduced
  • High end VAT reduced from 21.5% to 21%
  • Each item on medical card prescription to cost 50c after April 2010
  • Higher income tax for PAYE earners (Due to tax credits being cut)
  • A new Universal Social Charge (USC) to replace the Health levy portion of PRSI
  • At least €70 million towards those affected by recent flooding and to the prevention of similar disasters in future

Excise duties on beer and cider were decreased by 12 cent, excise duties on a half-glass of spirits were decreased by 14 cent and a bottle of wine was decreased by 60 cent, with a warning from the Finance Minister that these reductions were open to being recalled if consumers did not benefit.[5] Due to an increase in the smuggling of tobacco into Ireland, prices of tobacco remained unaltered.[5]

A year-long car scrappage scheme was unveiled targeting vehicles which had been in use for more than a decade, with a €1,500 reduction in vehicle registration tax relief available for those who availed of this scheme (but only "under certain conditions").[5]

The salary of the Taoiseach was decreased by 20 per cent on a permanent basis.[6]

Arts

The arts budget decreased by 6 per cent to €166 million from the previous year's €178 million.[7]

Culture Ireland received €4.083 million and the Irish Film Board received €19.31 million, both the same as figures from 2007.[7] The Arts Council received €69.15 million, a decrease of 6 per cent.[7] Section 481's tax relief for film and television production was not affected.[7] The Zoological Society of Ireland's grant of €3 million for funding Dublin Zoo remained the same.[7] However, the National Gallery of Ireland's grant was decreased by 7 per cent leaving it with an annual total of €10.17 million.[7]

Sport

The Government allocated €115 million for sport, a decrease from the previous year's €127 million.[7]

The Irish Sports Council received funding of €49.7 million, a decrease of 4 per cent.[7] €59.2 million was allocated to horse and greyhound racing, a decrease of 13 per cent.[7] The Sports Capital Programme received €48 million, down from €56 million the previous year.[7] Aviva Stadium development funding will increase from €1.5 million to €4.5 million. Funding for Abbotstown's National Sports Campus increased by 20 per cent.[7] The National Aquatic Centre received the rest.[7]

Tourism

The Government allocated more than €155 million for tourism, an increase of 2 per cent from the previous year's Budget.[8] €22 million of this was dedicated to tourist attractions.[8] "Imaginative initiatives", including rail discounts for senior visiting citizens, were announced.[8]

Reaction

[11]

ICTU General Secretary David Begg was "shocked", claiming the Budget would cause Ireland's economy to fall further into recession.[12] IBEC Director General Danny McCoy described the Budget as "a turning point" and one which would place Ireland "on a sustainable path".[12][13]

The [12] IMPACT said the Budget was the same as "sacrificing long-term public service reform for short-term political expediency".[12] The Association of Garda Sergeants and Inspectors said the Budget was an "attack on its members".[12] The Construction Industry Federation said the loss of almost €1 billion was "a blow to jobs in its sector".[12] The Irish Hotels Federation was grateful for the Government's "strong and decisive action".[12] The Irish Hospital Consultants Association later revealed its willingness to agree 15% pay cut announced by the Finance Minister for its members in his Budget 2010.[14]

The National Campaign for the Arts expressed relief and pleasure that it had not been affected very much by the Budget. Youth Work Ireland described the targeting of young people as "pure cynicism [...] a cynical move when contrasted with the 30,000 young people turned away from education courses last October".[12] Drinks Industry Group of Ireland Chairman Kieran Tobin said reductions on the cost of alcohol would be "a great relief" and would "repatriate some of the revenue currently being lost to cross-border trade".[12] Anti-smoking lobbyists ASH Ireland criticised the lack of increase in the price of tobacco.[12] Friends of the Earth described the carbon tax being implemented as "an important piece of the jigsaw in tackling climate change".[12] Oxfam Ireland CEO Jim Clarken spoke of being "extremely disappointed that the Government have piled further cuts on the massive 24% cut applied earlier this year" and accused the Irish government having "yet again, broken a promise to the world's poor".[12]

Political Correspondent for The Irish Times Harry McGee dubbed it "the most austere Budget in the history of the State".[10] The Irish Examiner said it "can only be described as one of the toughest Budgets in the history of the State".[15] The BBC called it "one of the most severe budgets in the Republic's history".[16] The New York Times referred to it as the "harshest budget in generations".[17]

Global investors approved the measures introduced by Brian Lenihan, with Irish government bonds receiving a boost following the Budget.[18] Former President of Ireland Mary Robinson announced two days after the delivery of Budget 2010 that she would be happy to take a 10 per cent reduction in her pension, a further 10 per cent added to what she had previously offered earlier that year.[6]

Former RTÉ Economics Correspondent turned Galway Independent the following week under the headline: "not fair, not clever and not going to fix economy".[19] Lee was critical of the proposed car scrappage scheme, saying it would benefit only the likes of France, Germany and Japan where the new cars would be imported from.[19] He also condemned what he called "the crazy result of this decision [to cut] is that an office cleaner in the Department of Finance will take a greater proportionate pay cut after tax than Minister Lenihan" and that the pay cut for Ministers announced in this Budget included the cut they had given themselves in the previous Budget in April 2009.[19][20]

Social Welfare Bill and "unparliamentary language" controversy

Attempts by the government to quickly legalise the Social Welfare Bill proposed in the Budget before the weekend were met with disapproval from the Opposition.

Fine Gael leader Enda Kenny criticised the Government for "acting in a disgraceful manner" and challenged them, "If you think you can come in here and do whatever you want you have another thing coming".[21] Labour Party leader Eamon Gilmore suggested the Government would "round up its six strays and get here this evening to vote on the measure", in a thinly veiled reference to supporting Independents as well as those within Fianna Fáil who had lost the whip.[22] Jimmy Devins and Eamon Scanlon were specifically referred to by Gilmore as "the two strays from Sligo".[23] Independent Jackie Healy-Rae replied to critics of his and his fellow Independents stance in supporting the Budget that they would be "glad to have us" on their side too if required to pass a vote.[21]

Labour Party deputy Róisín Shortall suggested that "there is no obligation on them [backbenchers and Independents] to support this. They are not under a whip. It's their choice. If they vote for these (measures), well then they have to face the consequences in their constituency".[24] Green Party deputy Paul Gogarty said, "It's regrettable but necessargy [sic]. And everyone on this side of the house is going to stand by it, because it has to be done".[24]

"It [the expletive] was a genuine emotive response to someone questioning your integrity. I said it. I apologised for it [...] it’s probably too much to ask for, but I do hope that what I said in my speech will be covered, rather than just the lyrics of a Lily Allen song".

Paul Gogarty tries to explain the reasons behind his use of expletives in the Dáil Chamber.[25]

Gogarty was later condemned and forced to apologise for his use of "unparliamentary language" after he yelled "Fuck you, Deputy Stagg, fuck you" at veteran Labour Party TD Emmet Stagg during the debate on the Social Welfare Bill on 11 December 2009.[3][26][27][28][29][30] Fine Gael Senator Frances Fitzgerald remarked, "If only Paul Gogarty got as upset about carers, blind pensioners and dole recipients as he does about perceived slights to his ego."[25] Fine Gael deputy Lucinda Creighton called for the expulsion of Gogarty from the House.[22] Ceann Comhairle Séamus Kirk, requesting the need for "decent standards", sent the expletives to the Dáil Committee on Procedure and Privileges.[25] It was discovered that "fuck" was not actually contained alongside such terms as "brat"; "buffoon"; "communist"; "coward"; "fascist"; "guttersnipe"; "hypocrite"; "rat"; "scumbag"; "scurrilous" and "yahoo" in Salient Rulings of the Chair, an 83-page document governing parliamentary language.[2]

Green Party deputies were described as "less than pleased" at Gogarty's conduct.[22] Green Party leader John Gormley later commented on the incident: "It was unacceptable language. He should not have said it. He has apologised and withdrawn the remarks. I have not had an opportunity to speak to him as yet. It is over. He has apologised now."[23] Stagg was not bothered, citing "a thick skin" and the "development of a hide".[25] Gogarty received a positive response from his constituents and went on to feature on Operation Transformation the following month.[31]

The Social Welfare Bill passed by 81 to 75 votes on the evening of 11 December.[23] Government deputies who missed the vote included former Taoiseach Bertie Ahern, former Ceann Comhairle John O'Donoghue and Donegal North–East deputies Jim McDaid and Niall Blaney.[23]

Estimated total receipts

Estimated tax receipts

Estimated of tax receipts for fiscal year 2010 are €31.930 billion(-1.9%).[32]
Rank Category € millions
1 Total 31,930
2 Income tax 11,979
3 Value added tax 10,460
4 Excise 4,525
5 Stamp duties 975
6 Capital gains tax 340
7 Capital Acquisitions Tax 240
8 Customs 200

Non-tax revenue

Estimated of non-tax revenue for fiscal year 2010 are €2.355 billion(+182.4%).[32]
Rank Category € millions
1 Total 2,355
2 Credit Institutions Scheme 1,000
3 Central Bank Surplus Scheme 640
4 National Lottery Surplus 272
5 Dividends 176
6 Winding up of Ulysses Securitisation 140
7 Other Receipts 127

See also

References

  1. ^ a b "Irish MP's F-word outburst sparks parliament review". BBC. 2009-12-15. Retrieved 2009-12-15. 
  2. ^ a b Katie Cassidy (2009-12-15). "MP's F-Bomb Prompts Banned Words Review".  
  3. ^ a b Henry McDonald in Dublin and Larry Elliott (2009-12-11). "Ireland faces bitterness over public sector pay cuts". The Guardian. Retrieved 2009-12-12. 
  4. ^ "Budget 2010 cuts €4bn in public spending".  
  5. ^ a b c "Drink duties fall, scrappage scheme for cars".  
  6. ^ a b "Robinson to take reduction in State pension".  
  7. ^ a b c d e f g h i j k l "In short".  
  8. ^ a b c "More tourism money to promote Ireland".  
  9. ^ "Budget 'well received' insists Taoiseach".  
  10. ^ a b  
  11. ^ a b c d "'"Opposition mourns 'missed opportunity.  
  12. ^ a b c d e f g h i j k l m "'"Budget 'does nothing to create employment.  
  13. ^ "IBEC lauds Budget as 'turning point' in economy".  
  14. ^ "Consultants will accept 15% pay cut".  
  15. ^ "Lenihan delivers toughest Budget in years".  
  16. ^ "Tough 2010 Irish budget unveiled". BBC. 2009-12-09. Retrieved 2009-12-11. 
  17. ^ Sarah Lyall (2009-12-09). "Irish Wince as a Budget Proposal Cuts to the Bone". The New York Times. Retrieved 2009-12-11. 
  18. ^ Pat Boyle (2009-12-11). "Backing for Budget as spread on Irish bonds narrows".  
  19. ^ a b c  
  20. ^ "Lee slams tax measures in Budget".  
  21. ^ a b "Dáil sparks fly over 'fast-track' social welfare bill".  
  22. ^ a b c Michael O'Regan (2009-12-12). "Stunning outburst shakes the House as Gogarty undone by his tormentors".  
  23. ^ a b c d Mary Minihan (2009-12-12). "Dáil passes social welfare cuts after heated debate turns ugly".  
  24. ^ a b "Dáil to vote this evening on social welfare cuts".  
  25. ^ a b c d Mary Minihan (2009-12-12). "Expletive a 'genuine emotive response' to questioning of sincerity, TD insists".  
  26. ^ Michael O'Regan and Marie O'Halloran (2009-12-11). "Gogarty apologises for Dáil expletive".  
  27. ^ "'"Gogarty sorry for 'unparliamentary language.  
  28. ^ Shaun Connolly (2009-12-12). "Green TD sees red and turns Dáil blue".  
  29. ^ "Green TD turns Dáil air blue".  
  30. ^ Michael Brennan (2009-12-12). "Opposition lit his short fuse 24 hours before explosion".  
  31. ^ Kevin Doyle (2009-12-31). "Gogarty's F-word rant wins pat on back from voters".  
  32. ^ a b Department of Finance: Estimates of Receipts and Expenditure for the Year ending 31 December 2010

External links

  • Irish Government Budget 2010 website
Preceded by
2009 (emergency)
Budget of the Government of Ireland
Delivered on 9 December 2009
Succeeded by
2011
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