Politics

Budget 2015: How constitutional is the behaviour of our Minister for Finance?

Opinion: ‘Ireland needs a poverty strategy. It needs a wealth tax. It needs a social housing programme. It needs a regional policy. It does not need tax cuts for fat cats. The Constitution directs as much’

‘The proportion of people being unable to afford two from a list of basic necessities (the deprivation rate) fell from 14.1 per cent in 2004 down to 11.7 per cent in 2007, but it too has risen thereafter, reaching 26.9 per cent in 2012. This translates into some savage economies that poor people must impose upon themselves.’ Photograph: Getty Images
‘The proportion of people being unable to afford two from a list of basic necessities (the deprivation rate) fell from 14.1 per cent in 2004 down to 11.7 per cent in 2007, but it too has risen thereafter, reaching 26.9 per cent in 2012. This translates into some savage economies that poor people must impose upon themselves.’ Photograph: Getty Images
Gerry Kearns
Wed Oct 08 2014 - 00:01

The 1937 Constitution enjoins the government “to safeguard with especial care the economic interests of the weaker sections of the community”. As we anticipate a budget in which, it is rumoured, the better off will be allowed to keep more of their income, and in which there may be an acceleration of the trend towards regressive taxation, such as with the property tax and the water charge, we might ask how constitutional is the behaviour of our Minister of Finance.

According to Eurostat, for the 27 countries of the European Union in 2005, the proportion of the population deemed at risk of poverty was 25.7 per cent, by 2009 23.2 per cent, but it has increased since and reached 24.8 per cent in 2012 (the most recent date for which we have data for all these countries). The comparable figures for the Republic of Ireland were 25 per cent, 25.7 per cent, and 30 per cent. Consider, also, that in 2005, 10 per cent of households in the EU-27 reported having difficulty making ends meet, in Ireland, that was 9.9 per cent. By 2008 the EU-27 figure was 9.7 per cent and in Ireland 9.3 per cent. The relative immiseration of Ireland thereafter is evident for, while in the EU-27 the proportion of households reporting having difficulty making ends meet was 11 per cent in 2012, in Ireland the proportion had leapt to 17.4 per cent. It is clear, then, that a decade ago Ireland's poverty levels were at the European average whereas now they are considerably above it.

Poverty in Ireland is deepening. Ireland's Central Statistical Office measures poverty and deprivation in a slightly different way to Eurostat but the trends are the same. The CSO report the proportion of the population at risk of poverty to have fallen from 19.6 per cent to 14.1 per cent between 2004 and 2009, but to have risen since to 16.5 per cent in 2012. The proportion of people being unable to afford two from a list of basic necessities (the deprivation rate) fell from 14.1 per cent in 2004 down to 11.7 per cent in 2007, but it too has risen thereafter, reaching 26.9 per cent in 2012. This translates into some savage economies that poor people must impose upon themselves. The CSO estimates that in 2012 some 12.9 per cent of households have had to without necessary heating of their home at some time in the year, up from 6.3 per cent in 2008, and reports that 23.3 per cent of households surveyed had not been able to afford a morning, afternoon, or evening out in the previous fortnight, up from 11.1 per cent in 2008.

The geographical gap within Ireland is stubborn and worrying. In 2004, the region with the least poverty was Dublin, where the proportion at risk of poverty was 62 per cent of the national average. The region with the highest level of poverty was the group of counties (Cavan, Donegal, Leitrim, Louth, Monaghan, Sligo) that the CSO call the Border. In 2004, the proportion of the population here that was at risk of poverty was 54 per cent above the national average, or two-and-half-times the level in Dublin. Although the gap between this region and the national average narrowed for a while, for the years of austerity it has grown again and in 2012, the Border region was 48 per cent above the national average with Dublin again 38 per cent below the national average. The recession is hitting hardest where poverty was already worst. A CSO report on the quality of life in Ireland's regions showed that over the period 2005-2010 the biggest decline in the Gross Value Added per person was, once again in the Border region, down from €24,510 to just €17,770, a decline of 27.5 per cent, a collapse almost matched by the Midland region which saw a fall of 24.2 per cent.

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This economic catastrophe is reflected in the population figures with the Border region seeing a decline of 2.3 per cent from 2011 to 2014 at a time when the country as a whole, despite net emigration, yet saw a modest increase of 0.8 per cent. Some of this regional decline may reflect movement within Ireland but much must surely be emigration and here we must note one further twist of the screw.

For long Ireland was known as an emigrant nursery, well, it must now be counted an emigrant college. The emigration of third-level students from Ireland is estimated to have been 12,500 in 2009, 14,200 in 2010, 17,600 in 2011, 19,500 in 2012, 20,200 in 2013 and 29,000 in the year to April 2014. Emigration now follows graduation and thus the regions that are hit hardest by recession are likely also seeing the most dramatic brain drain.

Ireland needs a poverty strategy. It needs a wealth tax. It needs a social housing programme. It needs a regional policy. It does not need tax cuts for fat cats. The Constitution directs as much and the Minister should pay it more heed.

Gerry Kearns is Professor of Human Geography at Maynooth University and with David Meredith and John Morrissey has edited Spatial Justice and the Irish Crisis, published in September by the Royal Irish Academy, .