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Sunday, October 31, 2010

A roadmap to recovery

Tomorrow Sinn Féin will launch its pre-budget submission. The proposals are fully costed by the Department of Finance and leading economists. It is a roadmap to recovery. We are standing against the cosy consensus of the Government and the main opposition parties and their ‘consensus for cuts’. There is another way and a better way.

Our plan will reduce the deficit by €4.671 billion and provide for a financial stimulus of €595 million in 2011 and a three and a half year economic stimulus package of €7.595 billion. The plan exposes the Government myth that cutting social welfare, introducing water charges, bringing the low paid into the tax net, doubling college registration fees and cutting child benefit are all necessary. They are not. They are the choices of a bad government and a poor opposition.

Revenue raising

The Irish economy is like a sinking ship. We all need to work together to get the ship to port. What the Government and the other parties want to do is to throw the weak, vulnerable, low paid and those out of work overboard. Bankers, bondholders, speculators and the wealthy will be safely lowered into the lifeboats. They want to take more from those who don’t have it while protecting those who can afford to pay more.

We are proposing a third rate of tax on incomes in excess of three times the average industrial wage (€100,000), standardising all discretionary tax reliefs, introduce an income-linked wealth tax, increase capital gains tax from 25% to 40%, increase Capital Acquisitions Tax to 35%, increase DIRT tax, reduce the earnings cap for pension contributions for high earners and increase tax on multiple housing units.

Abolish exemptions

There are far too many tax exemptions available to the wealthy in this state. These are regressive in the best of times. They are immoral at a time of deep recession. We are proposing the abolition of mortgage interest relief for landlords, abolishing the PRSI ceiling, abolishing PRSI exemption for share options and abolishing a raft of property tax reliefs. The state cannot continue to subsidise the wealthy as the less well off see their income cut to the bone.

Public Spending Savings

This state is facing bankruptcy and we need radical proposals. Taxing the wealthy is a radical proposal and is right. Cutting child benefit is not radical and it is wrong. Senior civil servants and Government Ministers, TD’s and Senators are overpaid. The Government is considering taking €5 a week from someone on social welfare who survives on €196 a week, while paying the Director of the HSE over €300,000 a year. This is not fair or sustainable.

We are proposing that Ministerial salaries be capped at €100,000, TD’s at €75,000 and Senators at €60,000. We seek to cap the maximum salary of public servants and employees in semi-state bodies at four times the entry level rate (€100,000 per annum). We also propose the introduction of a proper vouched expenses system for all public representatives and senior civil servants and reducing the states professional fees by 25%.

Stimulus

Attempts to address the deficit without providing an economic stimulus is economically illiterate. Government policy to date has been to cut and it has failed. Every time they cut they deflate the economy and the tax take drops. Doing more of the same is not going to work. They are joined in this thinking by Fine Gael and Labour. These are the parties who said a vote for Lisbon was a vote for jobs, investment and prosperity. They all believe that to grow a little, you must cut a lot. We believe that to grow at all, you must invest. Without a stimulus the economy will sink faster and deeper.

We are proposing both a financial and economic stimulus plan. We will use €595 million saved in 2011 to provide a financial stimulus to the less well off. This will include making tax credits refundable to the low paid, return the additional social welfare payment to those out of work, remove all those under the tax bracket from the Government levy and also remove the 50 cent levy on medical card prescriptions.

We would also transfer €7 billion from the National Pension Reserve Fund for a state-wide investment programme. Last year the NPRF invested in a champagne house in France. Why not invest in new schools the new geriatric unit at St Patrick’s Hospital and Waterford Regional Airport instead? Let’s invest in the Irish economy.

An economic stimulus is good as it will create jobs, provide good value for money and position the economy to recover. At the moment the Government is putting our money in the black hole that is Anglo. They are investing in banks. We will invest in the state and people. Let nobody say there is no alternative to the consensus for cuts. We in Sinn Féin are providing it

Tuesday, October 19, 2010

Government sinks to a new low in subverting democracy

On Monday I was joined by party activists in a protest coinciding with the party’s high court challenge to force the outstanding by-elections. Sadly this government is continuing to waste taxpayers’ money defending its refusal to hold the by-elections.

This case is about upholding the democratic rights of the people of Waterford, Dublin and Donegal. Our intention is to force the Government to do the right thing and hold all three by-elections at an earliest possible date. Waterford has been under represented for too long as the Government has been running scared of the electorate.

The announcement from the Government that the by-elections will take place next year is an insult to the electorate in Waterford. The people are demanding an election at the earliest opportunity, not at some vague time next year that suits the Government best.

The Government’s attitude to this case has been arrogant and dismissive and they are now intent on wasting even more taxpayers’ money defending this case when they could easily have avoided it by moving the writs for the elections to take place. Many people on the streets of Waterford expressed their anger at not being able to vote. They feel cheated by a Government clinging onto power.

The truth is that Waterford, Donegal South West and Dublin South are being left under-represented at a time of severe economic crisis, with far-reaching decisions being made and a savage budget being prepared by this Government. As we speak Government departments are busy taking the axe to as many capital projects as they can.

In defending this case the Government in my view has sunk to a new low. To use taxpayers’ money in a desperate attempt to subvert democracy is an affront to the people of Waterford.

Monday, October 18, 2010

Launch of JobFit in Waterford

This week I attended the launch of JobFit in Waterford. JobFit is a new programme funded by the Labour Market Activation Fund of the Department of Education and Skills which provides free support, employability training and recognised qualifications to help unemployed people find a job. JobFit will be delivered by TBG Learning, part of the Rehab Group. The programme provides soft-skills training, work placements, and support into and during the early stages.

The launch was very professional and I was pleased to attend. I spoke to many course participants and they all spoke glowingly of the training provided and of how it lifted their confidence. One of the participants addressed the gathering and spoke about his positive experience and his success in getting a job. It was very satisfying to hear him proudly tell his story.

JobFit is available to people who have been receiving benefits for a minimum of three months who are qualified to Junior Certificate level or below. It may in the future be extended to leaving certificate level. The programme currently operates out of Wallace House in Maritana Gate. I would encourage people who satisfy the qualifying criteria and are interested in improving their job seeking skills to drop in and sign up.

Thursday, October 7, 2010

Should we burn the bondholders?

The Government mantra ever since the banking crisis began was that the debt obligations of all banks would be paid for in full. The extended Government bank guarantee included bondholders and subordinated debt. Minister for Finance Brian Lenihan has always insisted that Anglo Irish Bank’s senior bondholders – those with the lowest ranking debt in the bank – will suffer no losses.

In recent times the language has changed. He seems to be opening the door to cutting a deal with the bank’s creditors, particularly with subordinated bondholders. These are investors at the back of the queue whose debt is paid only after senior bondholders have been paid – who may be expected to share in the “burden” of bailing out the bank. The total state investment in Anglo will reach at least €34 billion and may increase further.

I do not intend to deal with the outrageous nature of this bailout and state ‘investment’ in Anglo. I have done that in other posts. I am however posing questions about the nature of the bank guarantee and in particular the protecting of bondholders. We are constantly told by Government that senior debt obligations rank equally with deposits and other creditors under Irish law. So what – laws can be changed. The total amount owed to bondholders is about €4 billion. Subordinated debt amounts to about €2.4 billion.

I pose this question – would the sky fall in if we burned the bondholders? The Armageddon scenario painted by the Government that it would undermine the entire banking system is without foundation and completely without credibility. The banking system has been undermined anyway despite state guarantees and a recapitalizing of the banks.

I would like to see Anglo wound up as quickly as possible. The terms of the state guarantee should be revisited with the protection of all bondholders removed. This would allow the Government to negotiate with the bondholders on their terms and in the interests of the Irish people. We must remember that Anglo Irish Bondholders invested in a bank that was behaving in a reckless and greedy fashion. Their money was being lent to people to speculate recklessly. The speculators gambled, the bank gambled and in a way so did the bondholders. So why should they be protected from any pain?

Tuesday, October 5, 2010

Renewing faith in politics

I have been canvassing for the last eight months and I have spoken to thousands of people across Waterford City and County. Feelings and emotions are mixed. Some people are angry. Some are scared. Few are optimistic. Most are apathetic. A huge segment of the population has lost faith in politics. And who would blame them. They elected a Government in 2007 that has dumped 300,000 people on the dole, collapsed the economy, made a mess of our public finances and allowed the banks to act recklessly and then bailed them out to the tune of billions.

New Economy:

We need a change. We need a new economy. We need fresh thinking and a fresh approach. We need to have a real national conversation about what went wrong and why. We need to discuss what kind of economy we want and the values which underpin it. I believe in building a strong economy that serves the people and all the people. Not one which protects and represents special interests. Not one which sees greedy bankers and speculators rewarded when they make massive profits by not being asked to give anything back and rewarded again if they mess things up by being bailed out. We also need an economy built on solid foundations. This means going back to our roots, using our natural resources to best effect, tapping into the skills of our people and recognising the critical importance of indigenous industry and sustainable enterprise development.

New Society:

The core values which underpin our economy must also underpin society such as decency, honesty, integrity and a sense of fair play.Sadly these are values which some lost sight of during the Celtic tiger years and were absent in many corporate, banking and political board rooms. A lack of values at the top has a trickle effect and seeps into other sectors of society. One of the big lessons of the last ten years is that we all have a responsibility to each other. That goes for politicians, bankers, developers and speculators as it does for the rest of us. Corporate piracy, greed and irresponsibility are deeply anti-social and scar communities.

Just look at what happened with the banks – greed and reckless lending and speculating is being paid for by ordinary working people and those unemployed. Wages are cuts, jobs are lost, taxes for working people increased and benefits cut. Prescription charges for those with a medical card, cuts to child benefit, water charges, property taxes and social welfare cuts have either arrived or are on the way. Where are the cuts for those at the top? Where is the targeting of wealth? Where is the decency, integrity or a sense of fair play?

New Politics

So it is easy to see why people are apathetic and fed up to the back teeth with politics. They are getting shafted and feel helpless. They know the main opposition parties are not going to be much better. They have no faith in Fine Gael and Enda Kenny to turn things around. They know if anything they will cut deeper and worsen the recession.

We need a new kind of politics. We need to convince people that there is an alternative. What happened in the Irish economy was not as a result of politicians in power making a few mistakes. It was because of deliberate, calculated and thought out policies which delivered for an elite and vested interests. Light touch regulation was no accident. Tax breaks and shelters for the super rich did not emerge by accident. The creating of a property bubble, the driving up of the price of land and political corruption all went hand in hand.

The task of convincing people of the need for a real alternative is not going to be easy. Renewing a faith in politics is going to be a big challenge. In the time ahead the national media will focus on the main political parties and opinion polls. They will attempt to turn the next General Election into a popularity contest based on personalities. The people must not accept this and demand a real debate. Apathy must turn into action. The next election must be about what kind of country we want to build – it has to be about a new economy, a new society and a new kind of politics. It must also be about a new Government but not more of the same. And that is up to the people. As for this Government - their represenatives should read the 1916 proclamation and what it promised and examine what they delivered. I am sure it will be red faces all round..