Saturday 24 August 2019

Taoiseach: Free GP care for seven and eight-year-old kids next year

Varadkar defends tax cuts after union criticism

Taoiseach Leo Varadkar. Photo: Niall Carson/PA
Taoiseach Leo Varadkar. Photo: Niall Carson/PA

Anne-Marie Walsh

THE Taoiseach has revealed that free GP care will be extended to seven and eight-year-old children next year.

Earlier this year, it was revealed that free GP care for all children under 12 is to be phased in over three years following a €210m deal agreed with family doctors in April.

Children up to age six are already covered by an existing free family doctor scheme.

Leo Varadkar was speaking at the Irish Congress of Trade Unions biennial conference in Dublin this morning, and touched on a number of topics.

He warned that workers on average wages will end up paying more tax at the higher 40pc rate unless the government revamps the “unfair” system.

Mr Varadkar also told union leaders that lower paid staff including hospital support workers involved in a pay dispute will be hit by the marginal tax rate if they get the increases they want.

He defended the government's tax strategy at after it came in for strong criticism from union leaders yesterday.

Mr Varadkar said there is a low tax structure in Ireland but there is unfairness because people on modest to middle incomes pay some or a lot of their income at the higher tax rate.

“The average person over 25 working full time in Ireland earns €47,000 a year and pays quite a chunk of their income at the higher tax rate and we think that's unfair,” he said.

“We want to get to a point where someone on the average wage doesn't pay any of their income at the higher tax rate and those who earn more pay less of their income at the highest tax rate.”

He said if the government does not do what he proposes more and more people are going to end up paying the higher tax rate because pay increases over time.

Mr Varadkar said this includes not just teachers, doctors, civil servants, and nurses but those involved in the hospital support staff dispute.

He said once the increases recommended in a job evaluation scheme that they are demanding are implemented, those at the top of the pay scale will start paying the highest tax rate.

Mr Varadkar warned union leaders that when they seek pay rises they should bear in mind that 60pc of the increases would be lost because of the very high marginal tax rate and pension levies.

He said the summer economic statement last week showed that the government can afford a  €600m a year tax package.

A total of €3bn for increased spending on public services, pay and infrastructure will still be available, he added.

President of the Irish Congress of Trade Unions Sheila Nunan yesterday accused the government of a deliberate sleight of hand by lower tax rates and said it had superficial appeal for workers.

She said income tax cuts meant workers had to bear the cost of services including childcare or health insurance.

In addition, he said he expects the Low Pay Commission to recommend an increase in the national minimum wage in 2020 so it will pass a “psychological barrier” of €10 an hour.

On the gender pay gap, he said that a citizens assembly will look at ways to close the gap between men and women's pay. This is in addition to gender pay legislation that is being rolled out to force employers to publish details of their pay gaps and how they plan to deal with them.

He said the “breadwinner model” no longer exists in the modern era as many women are now the main earners in many cases.

Mr Varadkar said homeownership should be at the core of housing policy and people in their 20s and 30s should be able to aspire to own their own home.

He denied the government has an ideological preference to buy or lease from developers rather than building through local authorities.

“This is merely a practical issue,” he said.

“Local authorities lost the ability and knowledge to build social housing and we are building that back up again. So every year we will increase the social housing stock, and every year as we can we will increase the proportion of those built directly by local authorities and housing bodies for that is our preference.”

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