Cost of living

ART6

I'm not sure if this has been done before. If it has then I'll go back down my hole. However....

The papers seem to be full nowadays of how the cost of living has rocketed in the last two years or so, and the consensus seems to be that it is the fault of (a) Brian Cowen or/and (b) the EU. Brian should "DO SOMETHING ABOUT IT".

Fuel prices have escalated as the price of crude oil has. Food prices have surged due to a shortage of basic foodstuffs, partly blamed on the Green Lobby's demands for bio fuels where countries are now growing biofuels instead of food (the law of unexpected consequences?).

The government is being told that it could deal with the situation, at least in Ireland, by reducing tax and duty on fuels and by reducing VAT. The argument is that doing so would stimulate the economy and get us out of the self-dug hole. I believe the tabloids call it "doing a McCreevy".

The EU does not have the same problem. Food prices are much less in many other EU countries, so the Union has no reason the get too excited about the problems of a small island on the periphery.

So, what's the general opinion? Can the Government really do anything about it bearing in mind that they are presiding over a significant budget deficit and need all the extra taxes they can squeese from the lemon? What should Brian do?

Imposter

That's not really true about the rest of Europe. Prices may be lower than Ireland but they are rising rapidly with the high fuel prices.

silverharp

ART6 wrote: »

So, what's the general opinion? Can the Government really do anything about it bearing in mind that they are presiding over a significant budget deficit and need all the extra taxes they can squeese from the lemon? What should Brian do?

the gov is responsible for alot of the inflation here, so the first canditate should be to cut spending. I deal with some some gov. organistaions in my job and I must say organisations like FAS are grossly innefficient and self serving. other then that don't borrow and dont raise taxes.

eoin5

I saw a council worker paint a bin and then literally sit and watch the paint dry for hours before painting the gold stripes to finish it off. We pay for that. We also pay greedy business people who profit on the back of our useless public services. This country needs a giant kick up the hole.

The_Minister

AFAIK food is already VAT free in Ireland.

Also, without competition, any decrease in the VAT on goods would most likely lead to the shops just taking the difference. They (briefly) tried it before, and it failed AFAIR.

IRLConor

The_Minister wrote: »

AFAIK food is already VAT free in Ireland

Some food is 0%, some 13.5% and some 21%. Here are some examples from the biscuit section of the list that the Revenue publish on their website:

Category|VAT Rate|Comment
Food, Biscuit Assortment|13.5% or 21%|Where the weight of the chocolate biscuits does not exceed 15% of the total weight of the assortment then 13.5% applies.
Food, Biscuits - Chocolate|21%|
Food, Biscuits - Chocolate Chip|13.5%|
Food, Biscuits - Chocolate Mallow Tea Cakes|21%|
Food, Biscuits (Non-chocolate)|13.5%|

1. Other than choc. covered or decorated or choc. substitute.See Schedule
2. Zero % on certain baby biscuits(liga etc.)
3. Value of moisture content-up to 12%-per State Chemist.Over that value applies to cakes.

It must be a right pain in the arse for shopkeepers.

The_Minister

Can you cite the source?

I'd like to have a look, at that, that seems rediculously complicated.

guinnessdrinker

The price of food issue is difficult to sort out quickly.

As the world's economy increases, the demand for food will increase. Someone pointed out that a lot of land previously used to grow food is now used to grow biofuel so there may be a scarcity of good land (unbelievable but possibly true) to grow food on for the increasing global population.

In the future I think we will as a nation have to be a lot more self sufficient in food production. As other countries are going to want to use their own resourses for themselfs or to sell to the highest bidder.

So, I can't really see the price of food drastically decreasing unfortunatly. I seen a report on the news a few weeks ago about food scarcity and how food was rationed during WWII, worst case scenario, in a couple of decades there could be a reintroduction of rationing for certain food items, unless we start to learn how to be more resourseful in the short term.

IRLConor

The_Minister wrote: »

Can you cite the source?

I'd like to have a look, at that, that seems rediculously complicated.

http://www.revenue.ie/services/tax_info/vatrate/vatrate.htm

It's quite mad. There are different VAT rates on hot and cold takeaway meals. Does that mean if your pizza arrives late you're entitled to a VAT refund?

The_Minister

LOL, there's me laying altraps on the road to slow the delivery guy down.:D

sovtek

ART6 wrote: »

What should Brian do?

Brian should get the competition authority to raid pretty much every industry in ireland and break up the cartels that pass for businesses here. That'd be a start

ART6

sovtek wrote: »

Brian should get the competition authority to raid pretty much every industry in ireland and break up the cartels that pass for businesses here. That'd be a start

I'm begining to think you have a point. Since my original post I have been reading about how the UK companies trading here are charging us anything up to 50% more in real terms for goods than they charge in the UK. Fact remains, however, that business charges for its products what the market will bear, and irish people have been prepared to pay excessively for too long.

As long as we all flock to Tesco instead of the local shop for our groceries I suspect this will continue whatever Brian does.

silverharp

ART6 wrote: »

however, that business charges for its products what the market will bear, and irish people have been prepared to pay excessively for too long.

As long as we all flock to Tesco instead of the local shop for our groceries I suspect this will continue whatever Brian does.

irish people are not price consious so we are easy pickings. however local shops are even more expensive. maybe a bit of negitive equity will encourage a saving culture again , and not a continual debt binge

oscarBravo

silverharp wrote: »

however local shops are even more expensive.

Surprisingly, this doesn't seem to be the case.

IRLConor

oscarBravo wrote: »

Surprisingly, this doesn't seem to be the case.

My nearest shops which stock food are Tesco, Spar and Donnybrook Fair. I'd really love if Donnybrook Fair (arguably the most "local") was the cheapest.

What are these "local shops" people are talking about which are cheaper? Anywhere I've lived the local shops have tended to be substantially more expensive for food than a supermarket.

ART6

oscarBravo wrote: »

Surprisingly, this doesn't seem to be the case.

Our local village shop and PO is generally little more expensive than the large stores, and for many items is the same price or cheaper. That's why I shop there as much as I can, particularly now that fuel is so expensive. By the time I have driven 8 miles to Tesco I will have used up much if not all of the price savings I get from them over the local guy.

jmayo

The Sunday Business Post had interesting article showing how much we are being ridden in this country.
Sorry but I can't describe it any other way.

http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=NEWS-qqqs=news-qqqid=32988-qqqx=1.asp

Recently I was pricing two Creative MP3 players.
One of them had a price differential, between high street store in Dublin shopping centre and what was available on the web, of the order of 33%.
Now that is one hell of a difference and can't surely all be down to staffing costs and tenancy costs.

Some people think the likes of Argos is ok but why are their prices much higher in Ireland than UK?
Has anybody asked why Easons have not decreased the prices of imported British magazines even though the currencies are almost on parity in comparison to a year ago?

The sad thing out of the above newspaper article, is that the only advice to consumers is to boycott the offenders, but from my experience that includes just about everyone.
Maybe when the downturn really hits home will enough people become price consious again and will these shops get the kick in the ar** they richly deserve.

guinnessdrinker

In a lot of cases the demand for goods mean the price stays high. Shops know people will pay for the goods so they don't feel the need to lower them. In other cases it could be described as too much money chasing too few goods, which is a contributer to inflation.

As the money supply dries up, the price of goods will come down because there will be less demand.

It is in the consumer's interest to shop around but in reality that is sometimes easier said than done. If anyone notices a lack of competition or suspects a cartel they could contact these guys. Not sure how effective they are but they may be able to do some sort of investigation into an issue.

Tea drinker

IRLConor wrote: »

My nearest shops which stock food are Tesco, Spar and Donnybrook Fair. I'd really love if Donnybrook Fair (arguably the most "local") was the cheapest.

What are these "local shops" people are talking about which are cheaper? Anywhere I've lived the local shops have tended to be substantially more expensive for food than a supermarket.

Wow - Donnybrook fair is a pretty expensive example! But good quality at least. Spar etc are expensive but OTOH are open late.

Food costs will contibue to go up same as oil / energy costs. We should keep all our gas / oil deposits until we can get decent money for them.
We have house prices coming down so that is excellent news for the economy. (Despite all the government efforts to keep high cost housing)
If we can get them down a bit more at least the following generation will get a fresh start.

ART6

Tea drinker wrote: »

Wow - Donnybrook fair is a pretty expensive example! But good quality at least. Spar etc are expensive but OTOH are open late.

Food costs will contibue to go up same as oil / energy costs. We should keep all our gas / oil deposits until we can get decent money for them.
We have house prices coming down so that is excellent news for the economy. (Despite all the government efforts to keep high cost housing)
If we can get them down a bit more at least the following generation will get a fresh start.

Couldn't agree more TD. If the big deveoplers and banks get a hiding maybe my son and his wife will be able to afford a home of their own, and maybe Mr. Tesco et al will stop trying to inflate our food prices to 150% of those they charge in the UK. We also need to stop our so-called government giving away our small oil deposits for peanuts and do a UK -- get our pound of flesh. We are a little country, but we need to start kicking big time.

silverharp

ART6 wrote: »

We also need to stop our so-called government giving away our small oil deposits for peanuts and do a UK -- get our pound of flesh. We are a little country, but we need to start kicking big time.

can I ask a question, how much oil has been produced in Ireland? and how much have oil companies spent in exploration? remember that there is a shortage of resources in the oil industry so if the gov. makes it unattractive, no money will be invested.

ART6

silverharp wrote: »

can I ask a question, how much oil has been produced in Ireland? and how much have oil companies spent in exploration? remember that there is a shortage of resources in the oil industry so if the gov. makes it unattractive, no money will be invested.

How much oil? None to speak of to date I imagine, but from what I read in the media there is an expectation of fairly substantial quantities in the near future. Also, again only from what I read, our government did a very bad deal on it but I freely admit to knowing very little about it. But still, the UK did very well out of North Sea oil and their taxes didn't dissuade the oil companies from drilling, did they? However, I take your point silverharp.

Fleming15

You lot are missing the point.

We are in the transition from one way of life into another.

That is why we have manufactured crisis after manufactured crisis.

"Order out of Chaos"

Read "the first global revolution".

Tells you all you need to know.

http://www.scribd.com/doc/2297152/Alexander-King-Bertrand-Schneider-The-First-Global-Revolution-Club-of-Rome-1993-Edition

Tea drinker

I'll check your link later fleming... I guess it's something along the lines of the little people being manipulated by higher powers, either gov or corp for profit? E.g. expect water to get expensive?

As regards the oil, silverharp - who cares if no money is invested? Isn't it better to keep that oil or gas in the ground until we CAN ask a decent price for it? as it happens the margin has been raised this past budget (I think) but before it was so low it probably cost us money to have it taken from us (provision of services/infra to these companies).
Unless of course we don't say what happens in our own country - that couldn't happen, could it?

At this stage, TBH, only reform (of public and private business) will see protection for the majority of people. Cowen seems somewhat willing to tackle the public systems, given that there is only one answer it's difficult NOT to make this choice.

Looks like we are in for a long, steady increase in living costs, and heavy extra taxes would worsen this substantially, to the point of the the R word.

lostexpectation

droughts in australia etc are having a much bigger effect then biofuels.

anywhay coughlan told us to shop around

CerebralCortex

IRLConor wrote: »

Some food is 0%, some 13.5% and some 21%. Here are some examples from the biscuit section of the list that the Revenue publish on their website:

Category|VAT Rate|Comment
Food, Biscuit Assortment|13.5% or 21%|Where the weight of the chocolate biscuits does not exceed 15% of the total weight of the assortment then 13.5% applies.
Food, Biscuits - Chocolate|21%|
Food, Biscuits - Chocolate Chip|13.5%|
Food, Biscuits - Chocolate Mallow Tea Cakes|21%|
Food, Biscuits (Non-chocolate)|13.5%|

1. Other than choc. covered or decorated or choc. substitute.See Schedule
2. Zero % on certain baby biscuits(liga etc.)
3. Value of moisture content-up to 12%-per State Chemist.Over that value applies to cakes.

It must be a right pain in the arse for shopkeepers.

Food hee, hee

silverharp

Tea drinker wrote: »

As regards the oil, silverharp - who cares if no money is invested? Isn't it better to keep that oil or gas in the ground until we CAN ask a decent price for it? as it happens the margin has been raised this past budget (I think) but before it was so low it probably cost us money to have it taken from us (provision of services/infra to these companies).
Unless of course we don't say what happens in our own country - that couldn't happen, could it?

firstly, there are no proven/recoverable reserves, you need to find the stuff first, hence you need to make it attractive to companies to take the RISK. there is no North Seas off the coast of Ireland, if there is oil it will be in deep water and it will be very expensive to find and recover so either the state puts up the money or it encourages the oil companies to come here.BTW I'm of the opinion that Corrib should be bought out and plugged as a reserve and Kinsale should be refilled if technically possible for the same reason.

Blush_01

IRLConor wrote: »

Some food is 0%, some 13.5% and some 21%. Here are some examples from the biscuit section of the list that the Revenue publish on their website:

Category|VAT Rate|Comment
Food, Biscuit Assortment|13.5% or 21%|Where the weight of the chocolate biscuits does not exceed 15% of the total weight of the assortment then 13.5% applies.
Food, Biscuits - Chocolate|21%|
Food, Biscuits - Chocolate Chip|13.5%|
Food, Biscuits - Chocolate Mallow Tea Cakes|21%|
Food, Biscuits (Non-chocolate)|13.5%|

1. Other than choc. covered or decorated or choc. substitute.See Schedule
2. Zero % on certain baby biscuits(liga etc.)
3. Value of moisture content-up to 12%-per State Chemist.Over that value applies to cakes.

It must be a right pain in the arse for shopkeepers.

As far as I know: Basics are VAT free. Luxury goods are 21%. The things that fall between (like plain biscuits - you don't need them, so they're not basics, but they're not chocolate covered and so aren't luxury products) are 13.5%. In the same way, if you buy a fitted kitchen, you pay 21% VAT on the kitchen, and 13.5% VAT on the service cost for fitting it.

Almost forgot, all baby products (foods, toiletries, clothing, shoes etc.) are supposed to be VAT free.

juuge

The biggest scandal of the lot is petrol & diesel prices.
As soon as there is a mention of stock-exchange oil prices rising the local garages are out there on their little step-ladders putting up their prices the next day. I've been noticing the three or four petrol stations that I pass each morning on my way into work and each one is increasing their prices for both petrol and diesel every couple of days. This is just profiteering. Increased fuel prices affect everyone so I believe we need to have the government intervene and fix the price of fuel and stop these greedy b*asta*ds making a quick buck !.

silverharp

juuge wrote: »

The biggest scandal of the lot is petrol & diesel prices.
As soon as there is a mention of stock-exchange oil prices rising the local garages are out there on their little step-ladders putting up their prices the next day. I've been noticing the three or four petrol stations that I pass each morning on my way into work and each one is increasing their prices for both petrol and diesel every couple of days. This is just profiteering. Increased fuel prices affect everyone so I believe we need to have the government intervene and fix the price of fuel and stop these greedy b*asta*ds making a quick buck !.

this is pure opinion which I assume is based on little knowledge of how the oil industry or trading markets work. as for your solution , the Chinese tried that recently and there were fuel shortages soon after.

Tea drinker

Looks like Brian Cowen is taking some affirmative action. Don't have a linky yet but he made a statment to the effect the will be entering correspondence with UK suppliers to explain the disparity between Irish and UK prices. And exacting some leverage if they don't get a suitable response

Well done.