The morning after the Budget, the Taoiseach reminded listeners to Morning Ireland that it was the first to be based on the fact that Ireland, in terms of wealth, was now an average European Union society.
With a projected surplus of over £6 billion to play with, it seems reasonable to expect that Ireland can attain European levels of social equity. When all the hoopla has died down, the simple fact will be that Charlie McCreevy made a deliberate decision not to attain such levels.
A few days before the Budget, the EU's statistics service, Eurostat, issued a report comparing expenditure across the EU on what it calls "social protection" (welfare and anti-poverty measures).
Right at the bottom is Ireland. Sweden spends twice as much on creating a just society than we do. While countries like Sweden, Denmark and Germany spend around 30 per cent of Gross Domestic Product on social protection, and the EU average is 28 per cent, Ireland spends just 16 per cent. The next-worst performer, Spain, is still far above us at 22 per cent.
Even taking into account demographic factors and the inflated nature of our GDP, the picture is stark. We may have reached average EU levels of wealth, but we are far above average in terms of meanness, injustice and the ability to turn away from misery. The basic message of the Budget, in spite of a few gestures of social solidarity, is that this situation is just fine.
Ireland is more unequal and has higher poverty rates than comparable EU countries. The poorest fifth of Irish households gets just 5 per cent of national income. The richest fifth gets 44 per cent. The haves earn five times as much as the have-nots.
On a broader canvas, the bottom 60 per cent of households gets just a third of national disposable income, while the top 40 per cent gets the other two-thirds. This year's UN Human Development Report ranks Ireland 17th of 18 industrialised countries on its poverty index. Every other major European country does better.
A quarter of children and a fifth of adults live below the poverty line. And the gap between those in poverty and the rest of society has been growing ever wider, not least because social welfare rates have fallen from 48 per cent of average income in 1991 to 38 per cent in 1999. Yet again this week, in spite of having the resources to lift everyone out of poverty, the Government has chosen to spend the money in other ways.
The generally accepted poverty line for a single person (50 per cent of average income) is £92 a week this year and, for 2001, around £100 a week. Yet many of the key social welfare payments, even after April 2001, will be much less than £100. Payments like disability benefit, unemployment assistance, invalidity pensions, carers' allowance and the blind person's pension will all remain around £15 short of the poverty line.
So while, in percentage terms, the increases in social welfare may seem generous, they need to be put in perspective. The increase of £8 a week for most social welfare recipients is about what a TD (or a journalist) would expect to leave as a tip in a restaurant after a nice dinner. And that's essentially what it is, a nice little tip.
In the overall scheme of things, the £384 million extra that the Exchequer will spend on social welfare in 2001 is perhaps a third of what the State will save multinational telecoms companies by not auctioning off third-generation mobile-phone licences, and over £200 million less than the National Roads Authority is getting.
EVEN the most socially progressive measure in the Budget, the increases in child benefit which go beyond what was sought by the Child Poverty Initiative, has to be seen in context. The basic cost of rearing a child in Ireland is at least £36.50 a week. The new, vastly improved rate provides about £17 of this.
Even with the child dependant allowance that is added to social welfare payments, this still leaves a situation in which the State is consciously and deliberately leaving children with less than the basic income they need to grow up with dignity.
The top level of child benefit, besides, is still £14 short of the £100-a-month level to which the Government committed itself in the PPF. In his Budget speech, Charlie McCreevy got over this problem by announcing that this year's increase is part of a "three-year programme". Given the likelihood that the current Government will not introduce another Budget, and the certainty that it will introduce no more than one more, this is almost meaningless.
The sense of priorities that underlies all of this emerges from a few simple comparisons. The Government is spending £30 million on abolishing probate tax; £140 million on capital allowances for cars used in business; and £350 million on reductions in VAT and excise duty on diesel. These three benefits to well-off people cost £520 million.
By contrast, £28 million extra for services to people with intellectual disabilities; £15 million extra to tackle the drugs problem in deprived communities and £13.5 million extra for hospital cancer services amount to £56.5 million, - not much more than a tenth of what is being spent on reliefs for the well-to-do.
In the past, it might have been possible to argue that poverty was a sad inevitability which the Government would end if it could. Now we know the truth. The Government could have done it but chose not to.
fotoole@irish-times
