The big squeeze: pay cuts piling pressure on households
FIFTY grand. It is not a huge salary, and certainly would not allow a family to live a lavish lifestyle.
But that is the typical gross salary of a family in this country, according to official figures.
Unfortunately, the purchasing power for those on this modest salary has fallen faster than stone in a well in the last three years.
Pay cuts, income tax hikes and a range of other stealth charges, at a time when prices are rising, have seen to that.
We have just had Budget number five since the 2008 one, which was brought forward to October that year. We had two Budgets in 2009.
All this means that our family on €50,000 was taking home €3,155 a month after the October 2008 Budget. That works out at €37,860 per year.
Assuming a pay cut of 5pc, and taking account of a slew of income tax changes, the monthly take-home pay has dropped to €2,828. This works out at €33,936 a year.
All told there is a hit of 10pc, or almost €4,000 a year, to the household income.
Many workers have been hit for far more than 5pc in pay cuts. Thousands have been put on shorter hours. And they are the lucky ones who have avoided losing their jobs.
Pay cuts in the public sector have amounted to an average of around 14pc, when the pensions levy is included.
Hammer blows to household income have also come from the introduction of the income and health levies, later to morph into the universal social charge.
And reductions in the tax credits have meant everyone has ended up paying more income tax.
There have also been changes to Pay Related Social Insurance, cuts in pensions tax reliefs, hikes in savings taxes and restrictions on the amount of money families can claim back for medical expenses.
A string of levies have also put the squeeze on household incomes. These include a levy on private healthcare policies, a levy on pensions in the public and private sector, and a levy on life policies.
Many families have also lost mortgage interest tax relief.
What all this means is that the disposable income of the average household has shrunk faster than an ice cube on a radiator.
Not only have households less money to spend, but their outgoings have shot up. It's a maths problem that is being experienced in homes up and down the country.
Struggling households are paying almost €1,300 more to clear their bills than a year ago.
Electricity, gas, insurance and mortgage costs have all soared in the past year.
In the last few months ESB customers on the standard rate have been bashed with an increase of €126 over a year. Bord Gais customers recently saw gas prices go up €150.
General insurance costs have shot up, with insurers blaming adverse weather for a series of premium rises.
One of the sharpest rises has been for health insurance. A succession of hikes imposed by the VHI, Quinn and Aviva have meant that 110,000 families have been forced to give up paying for private health insurance in the last two years.
President of the Irish Tax Institute Bernard Doherty said: "The capacity for people to bear more pain is running out as we approach an overall tipping point in terms of the money that can be taken from them in tax."
Families know only too well what he means.