Friday 15 December 2017

FG would cut dole and create 100,000 jobs

ine Kerr Political Correspondent

FINE Gael will cut the weekly dole by €18 over four years under its plans to hit the ambitious €15bn cutbacks target.

The basic weekly dole rate should be cut by 3pc or €6 in 2011 and rise to an overall weekly cut of €18 by 2014, according to the party's alternative Budget and four-year strategy published yesterday.

Ahead of next week's draconian Budget, Fine Gael leader Enda Kenny last night reiterated support for the Government's target of €6bn in cutbacks and savings, and the overall €15bn target for 2014.

But he pledged to reverse the Government's proposed cut in the minimum wage if his party gets into power in the New Year.

That promise came as the party outlined plans to create 100,000 jobs, while still achieving the 3pc deficit target and €15bn worth of cutbacks by 2014.

Adopting a hardline stance on dole payments, the party's finance spokesman Michael Noonan said the basic weekly payment of €196 should be reduced by €6 per week in 2011.

"We're taking 3pc in year one, then 2pc, 2pc and 2pc. Now, 3pc on the dole, the dole is €196, 3pc is €6, so we're taking €6 off the basic rate," Mr Noonan said.

"We're excepting pensions completely. We're excepting carers' allowance, we're excepting blind pensions, we're excepting disability pensions . . . so we're excluding the most vulnerable."

These cuts would save the taxpayer €216m next year, rising to €648m by 2014, the party said.

At a time of mass unemployment, hiking the standard and higher income tax rates would be counterproductive, Mr Noonan said.

"They would discourage people from working harder, doing overtime and aiming for promotion," Mr Noonan said at the launch of the party's 20-page Budget document in the Shelbourne Hotel in Dublin's city centre.

Instead of hiking income tax rates, the party would focus on narrowing tax bands, removing credits and savaging any remaining tax breaks in the property sector.

Child benefit should be left at the same rates next year but a new system called "child income support" should be introduced by 2014 in an effort to deliver savings of €250m, the party argued.

Exact details of this proposed new scheme remained sketchy last night, but it is understood it would involve a flat-rate payment for families, with a second payment being provided for children in greatest need.

Hard-hitting plans to overhaul the public sector would result in a reduction of 30,000 positions, representing 18,000 more redundancies than what is being pursued by the current Government.

The party also plans to cut the public sector payroll by 1pc each year by reducing the costs of overtime, sick leave, flexitime, special allowances and expenses.

Rather than introduce the Government's property tax, Fine Gael has proposed a capital gains tax on primary residences which sell at a profit.

This levy of between 5pc and 10pc would be charged on the difference between what the property was bought for and the price it is sold for.

Fine Gael claims the charge could yield €350m.

To offset this, the party wants to introduce a reduced stamp duty rate for those trading up or down in the property market.

Stamp duty

The stamp duty rate of 7pc and 9pc would fall to 2pc for at least two years at a cost of €100m.

In the area of taxes, the party wants to increase the rate of Deposit Interest Retention Tax from 25pc to 30pc to encourage higher levels of consumption, to cut the lower VAT rate from 13.5pc to 12pc to boost trade, and to abolish the travel tax to boost tourism.

Outlining his approach on the banks, Mr Noonan claimed the Government's "blank cheques" banking policy must now end.

Anglo Irish Bank should be wound down quickly and all of its investors, including unsecured senior bondholders, should be forced to share in the burden of the bank's wind-down losses.

The finance spokesman also placed huge emphasis on the party's plans to create 100,000 jobs, using the €6bn left in the National Pension Reserve Fund as a basis for growth and jobs.

But Enterprise Minister Batt O'Keeffe claimed Fine Gael's plans were "disjointed and contradictory".

Irish Independent

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