Sir, - Do any other readers share my scepticism that there is an unsavoury taste of demagoguery in Mrs Mary O'Rourke's enthusiastic advocacy of the imminent Telecom flotation? The message that "there's one for everybody in the audience" comes across very strongly from her public utterances on this subject: In a recent Rodney Rice RTE interview, for example, she painted the picture of dropping into her "local" at the weekend and overhearing the regulars discussing the current price of their Telecom shares instead of the odds on the horses.
Pitching the minimum bid at the farcically low amount of £250 makes no financial sense whatsoever, other than as viewing the flotation cynically as some sort of National Lottery in which every participant is more or less guaranteed a trivial prize of a few pounds, on selling the shares immediately upon receipt.
Any suggestion that the one-for-25 "loyalty bonus" at the end of a year represents a 4 per cent rate of return on the shares is, at best, inexcusably ignorant and, at worst, duplicitous. Any child of 10 can readily comprehend that substituting X pieces of paper for Y pieces of paper does not change the underlying value of the company one whit, and to suggest that it does so is utterly irresponsible.
If Mrs O'Rourke and her Cabinet colleagues wish to promote widespread share ownership among the general public they could, at a stroke, instead of the current cheap PR promotional activity, introduce two very simple fiscal innovations: (i) treat a private individual's capital losses on equity sales as tax-deductible, just as they treat capital gains on equity sales as taxable; and (ii) permit switching between different equities as non-taxable. The current capital-gains tax legislation mitigates severely against the private investor ditching an under-performing share and moving to a better one. As long as such anomalies continue to persist, no amount of populist cajoling by Government Ministers will induce widespread public share ownership - which is to be greatly regretted. - Yours, etc.,
Terence Ryan, George's Street, Gort, Co Galway.