Sunday 26 January 2020

Thomas Molloy: Budget condemns us to death by a thousand cuts

THERE are many ways to save money. Some families switch to yellow pack cornflakes, scrap the riding lessons and turn down the heating. Others prefer a more radical approach; they move to a smaller home or sell the family car, but keep eating their favourite breakfast cereal. Their philosophy is that it is easier to ignore a few big changes than hundreds of niggling cuts.

Each method has its advantages and disadvantages but yesterday's Budget suggests that the Howlin household has been busy spreading the butter thinner and donning woolly jumpers in recent years. Brendan Howlin's Budget introduced a bewildering array of cuts and modifications, but no benefit, payment, scheme or programme was abolished.

An alternative strategy would have been to make a few, deep cuts. He did not scrap FAS or abolish poorly performing third level institutions, for example.

Here are seven measures that Mr Howlin could have introduced to save a little more than the €1.45bn, which the Government said it would save thanks to yesterday's Budget. They are the equivalent to selling the family car or scrapping the family holiday. You'd miss them, but it might just be better than cutting child benefit for larger families, tinkering with widow's pensions, closing garda stations, hiking college fees, raising bus fares, reducing the cold weather allowance and the hundred other cuts which will pile up misery on the unemployed and low paid next year.

1: Tax child benefit

The Government could also have decided to tax child benefit rather than cutting it for rich and poor alike. This has often been discussed but the Revenue Commissioners and the Department for Social Protection claim that their computers cannot communicate with one another. Mr Howlin could have knocked a few heads together. Making the modest assumption that taxing the €2.4bn paid out in child benefit would return 20pc to the Exchequer, we can assume that taxing benefit would yield €480m a year.

2: Scrap tourism schemes

The Government could save €139m next year (and every year) if it scraped all the Government's tourism initiatives. The sum is too small to make a splash abroad but big enough to matter back home. The tourism sector is bedevilled by turf wars between the various agencies tasked with promoting the country. Much better to get rid of them all. (In reality, Mr Howlin's Budget trims spending by 6pc.)

3: Abolish North South Cooperation grants

Just under €43m could be saved by dismantling the various grants associated with North South Co-operation. These grants undoubtedly support many worthy schemes but they also constitute a gravy train for bureaucrats and help subsidise all kinds of bizarre projects such as the re-introduction of Ulster-Scots through exciting events such as next week's musical showcase in Armoy Orange Hall in Co Antrim.

4: Axe free travel

A further €77m could be shaved off the budget by getting rid of the free travel scheme. The brainchild of Charlie Haughey, the scheme is undoubtedly a lovely idea but it is not obvious why the elderly should be exempted from paying for trains and buses. Why not children? Or commuters? It is worth noting that countries that have a public transport system worthy of the name don't allow vast swathes of the public to travel for free.

5: Kill quangos

Abolish the Property Registration Authority which will cost the tax payer €33.8m next year. Bet you didn't even know that it existed. There is absolutely nothing wrong with the Property Registration Authority, or many other quangos, but it is absurd that it should be subsidised by the population as a whole. The authority, and dozens of other similar authorities, should be paid for by those who use it.

6: Stop repairs to council houses

In a country with hundreds of thousands of empty houses, it is a sick joke that the Government plans to spend just shy of €691m on building and repairing council-owned housing next year. Houses are rotting all over the country and we plan to spend over two thirds of a billion euro building more of them. Let's assume we can cut that figure in half and save €400m.

7 : Slash the aid budget

Half the aid budget from €512m to €250m. It's not pleasant but its not our money anyway.

There was something noble about the relatively large amount of money donated to the developing world during the good times but it makes little sense to be borrowing money from the rest of Europe and the impoverished members of the IMF to hand it over in aid.

At one level, the present and previous Governments deserve praise for their relatively generous aid programmes over the past number of years.

On the other hand, it just isn't their money to hand out.

So there you have it. One possible alternative Budget to yesterday's misery but there are many other alternatives. Lurking in the so-called Comprehensive Expenditure Report -- a long document that accompanied Mr Howlin's speech -- are other savings.

The amount various departments spend on post and communications for example is simply eye watering.

The Department of Health alone spends just over €1bn every year on what is quaintly termed "postal and telecommunications services".

Education spends €300m. Surely they could get a decent email system next year and save the tax payer €1.3bn in 2013?

Irish Independent

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