5 main reasons for our improving economy none of which are Fine Gael or Labour

macraignil

If the development charge postponement until after the housing units are sold leads to more developments being started then I can not see how you still regard this as a cost. I agree cash flow is effected and that is why I suggested that the EU funds for such developments might bridge the gap in short term cash flow. The EU is currently reported to be actively buying bonds etc. in a process of "quantitative easing" and in effect is shoveling out money to anyone who asks contrary to what you are saying.

I did not suggest tax penalties for holding on to development land as it would unfairly effect people financially unable to complete developments that would suit their property. I was suggesting a tax break for a limited time to encourage more sites to be sold and developed when they were seen to be in an area suitable to people's housing needs.

I think people on housing lists should be able to refuse an offer if it does not suit them. Some units were built in very poorly serviced areas and as long as someone accepts the home what is the problem?

Councils selling their housing units to the existing tenants sounds like a great way to get cash flow going for developing more new housing.

golfwallah

@ Macraignil,
We have government plans for social housing and water infrastructure that patently aren’t up to the job or at best are only barely scratching the surface. Further fiddling around the edges of this problem, with stuff like delayed development charges, is like trying to drain the ocean two spoonfuls at a time instead of the current one.

The reality is that Government spending is hemmed in by EU restraints on deficit spending and borrowing. Non-exchequer solutions such as Irish Water have not delivered, or will take a lot longer than originally hoped.

Got a magic wand? You’ll need it because more government spending isn’t happening or likely to start anytime soon, options to turn down social housing offers are likely to persist as are sales of council housing. Moreover, we are still waiting for the “new funding models”, much vaunted by government, to come to the rescue.

This Irish Times report further illustrates the issue:

Inadequate water, sewage and transport infrastructure is holding back the development of about 20 large sites across Dublin that could provide 50,000 new homes.
State or State agency investment of about €240 million is needed to bring these lands into use. More than half the sites need infrastructure controlled by Irish Water before they can be developed for housing.

According to the government’s Infrastructure and Capital Investment 2012-16: Medium Term Exchequer Framework (published Nov 2011):
Executive Summary, S3:

NEW PRIORITIES FOR INVESTMENT: Given the reduced level of resources available, sharp prioritisation of investment is paramount. This requires difficult trade-offs, but is mitigated by the enhanced quality of infrastructure across a range of areas. The last major review of capital investment was published in July 2010. The present review represents a significant reprioritising of investment plans.

The reduced spending in the Framework assumes structural reforms to the water sector, thereby placing a high dependency on Irish Water. And we all know that the capital spend by Irish Water has been significantly curtailed or pushed out into the future (see also Page 26 re Irish Water):

ENVIRONMENTAL INFRASTRUCTURE: Alongside structural reforms to the water sector, water services investment will be an important element of the Public Capital Programme. In the years to 2016, almost €1.6 billion of Exchequer resources will be committed.

On Page 32, it talks about

There will be restructuring of the social housing investment programme to allow for the delivery of new social housing through more flexible funding models

macraignil

golfwallah wrote: »

@ Macraignil,
We have government plans for social housing and water infrastructure that patently aren’t up to the job or at best are only barely scratching the surface. Further fiddling around the edges of this problem, with stuff like delayed development charges, is like trying to drain the ocean two spoonfuls at a time instead of the current one.

The reality is that Government spending is hemmed in by EU restraints on deficit spending and borrowing. Non-exchequer solutions such as Irish Water have not delivered, or will take a lot longer than originally hoped.

Got a magic wand?

Sorry you think my suggestions would be like trying to drain an ocean two spoonfuls at a time, and no I do not have a magic wand. I did concede earlier that it would take more than one measure to improve the supply of new homes here faster. I agree the government have made a very poor effort at sorting Ireland's water infrastructure and new housing is another essential element of a growing economy that will suffer as a result.

golfwallah

macraignil wrote: »

Sorry you think my suggestions would be like trying to drain an ocean two spoonfuls at a time, and no I do not have a magic wand. I did concede earlier that it would take more than one measure to improve the supply of new homes here faster. I agree the government have made a very poor effort at sorting Ireland's water infrastructure and new housing is another essential element of a growing economy that will suffer as a result.

I agree - there are lots of things that will suffer from lower government spending than is needed to fix things quickly. But with state spending still ahead of income (despite “austerity” cut-backs and higher than expected tax revenue), the only realistic alternatives for freeing up money for these good things are to re-structure over time so as to reduce day-to-day spending or increase either taxes or borrowing. And we all know of the EU constraints on more borrowing. We’ve also seen the resistance to water charges, household charges and property tax. And just how many people are prepared to tolerate higher USC?

Just like any business or household, there are limits on spending – no matter how good the cause. You just can’t spend money you haven’t got without putting your entire future financial security in jeopardy. Isn’t that was caused the last financial crash?

All that being said, there are positives, such as growth in GDP, lower charges for oil, interest, etc. It’s also good to hear reports of cut back moves that are actually beginning to produce positive results. For example, this Irish Times article shows how government’s new shared services unit will reduce public spending by €50M a year, when fully implemented within the next 4 years.

The problem is we need loads more initiatives like this to produce the vast amounts needed to bring not only our water but also road, rail, communications and other infrastructure up to the levels needed for continued economic growth. But softly, softly ...... we’ve seen what happens when spending grows too quickly ahead of income!

golfwallah

Here’s an interesting article by Noel Whelan in the Irish Times pointing out the fallacy of Fine Gael’s, UK Conservative inspired election mantra that voting FG will “keep the recovery going”.

The key decision-makers who have the power to determine whether the Irish recovery can be sustained are not on the ballot paper in any of our 40 constituencies. You’ll not see any posters from them next month. They are not even Irish.
The reality is that the Britain election last year and the US elections this year are more important in determining whether we can keep our recovery going than anything which happens at Irish polling stations.
Ireland is one of the most open economies in the world. We are dependent on foreign trade and foreign direct investment to a greater extent than almost all other countries.

He names the overseas decision makers who do, in reality, have the bulk of influence over our macro economy – and none of them are in Fine Gael – and concludes with:

This election should be about whether we keep things going the way they are.
It needs to be about whether or not we are going to keep our health services weak, whether or not we are going to keep our emergencies departments overcrowded, whether or not we are going to keep our education system underfunded. It should be about whether we can keep towns and homes from flooding.
This election has to be about whether people can buy an affordable house, whether the trend towards higher rent is going to keep going, and whether we are going to keep our high level of homelessness.
Repeating a simplistic election slogan over and over is no substitute for real policy debate.
This election is not about choosing who can keep the recovery going because those choices are not made here in Ireland.

PeadarCo

Noel Whelan makes some good points. While no party can guarantee recovery as places like Greece and Venezula show you can certainly mess things up. In Greece things were finally turning a corner and then Syzria decided to have a game of Bluff with the Eurozone and lost badly.

Remember Syzria is what Sinn Fein and the far left advocated. What Fianna Fail, Fianna Gael and Labour all deserve credit is not falling for all the populist hubris.

It is disappointing that Fianna Gael are offering election give aways. But what party out there is prepared to go the poles on the counter cyclical tax policies(i.e maintaining and increasing tax rates and range of taxes)

The biggest myth of the austerity debate was that the measures were temporary. The should be permanent unless we want to either cut public services or go back to living off property bubbles. For those who oppose austerity they should be calling out for counter cyclical tax rises to give the government room for tax cuts when the next downturn comes.

johnnyskeleton

Mod note:

Two threads merged because they seem to be the same core issue. PM me if people think they should be kept separate.

BoJack Horseman

Noel Whelan..... Noel Whelan..... rings a bell.

Ah yes, that would be Fianne Fail's Noel Whelan?

He is correct in that Ireland (like every economy except North Koreas) is affected by external factors.
However, his implication that our choice this spring matters little, cos it's all abroad anyway, is quite wrong.

People always have a choice & that choice can impact things greatly.

I'm sure Noel thinks we should have stayed the course & became a mighty nation once again under the stewardship of the mighty Biffo..
I can't see it myself though.

Noel will remember how the budgetary & public service calamity started....
Public expenditure increased under his colleagues in FF by 330% from them entering office in 97 to its peak in 2009.
I can't find the stat but I read recently that the cumulative CPI inflation rate for this period was 40%
Please, may a government never be this feckless again.

emo72

BoJack Horseman wrote: »

cut income taxes for each of the last two years, helping to ensure that work pays & providing confidence that workers can spend more of their money.

when i pay property tax, usc and water charges, im worse off. what extra money are we talking about?

BoJack Horseman

emo72 wrote: »

when i pay property tax, usc and water charges, im worse off. what extra money are we talking about?

Your income tax has been cut twice in the last two budgets.

The opposition want to raise this, they don't hide the fact, they are open about it.

As I said, it comes down to choices....
All our parties are 'big state' tax & spenders.... its just some are 'tax-ier' than others.

emo72

BoJack Horseman wrote: »

Your income tax has been cut twice in the last two budgets.

correct. but im not on a huge wage anyway. im still worse off though. i have less money than i ever had.

just trying to correct the idea that i have more disposable income. however if i was on say 60 to 100k a year, yes agreed i would be much better off.

BoJack Horseman

emo72 wrote: »

correct. but im not on a huge wage anyway. im still worse off though. i have less money than i ever had.

What is your wage?

Taking the common enough example of a single income family: Dad, Mom & 2 kids... average income of €35k.

The last 2 budgets improved their lot by a cumulative income tax reduction of €740.

Taking the average house value and its associated tax & add in IW charges, they are still being taxed less now than they were 2 years ago....not by much, but not more than the alternative promises.

Villa05

PeadarCo wrote: »

Remember Syzria is what Sinn Fein and the far left advocated. What Fianna Fail, Fianna Gael and Labour all deserve credit is not falling for all the populist hubris.

While agreeing with most of your post surely there was middle ground in the case of placing private banking debt on the shoulders of taxpayers. Even the EU admit this policy is never to be repeated

golfwallah

BoJack Horseman wrote: »

Noel Whelan..... Noel Whelan..... rings a bell.

Ah yes, that would be Fianne Fail's Noel Whelan?

He is correct in that Ireland (like every economy except North Koreas) is affected by external factors.
However, his implication that our choice this spring matters little, cos it's all abroad anyway, is quite wrong.

People always have a choice & that choice can impact things greatly.

I'm sure Noel thinks we should have stayed the course & became a mighty nation once again under the stewardship of the mighty Biffo..
I can't see it myself though.

Noel will remember how the budgetary & public service calamity started....
Public expenditure increased under his colleagues in FF by 330% from them entering office in 97 to its peak in 2009.
I can't find the stat but I read recently that the cumulative CPI inflation rate for this period was 40%
Please, may a government never be this feckless again.

Also rings a bell – a familiar ad hominem attack, which is a logical fallacy. But then, I suppose it’s easier to attack the person making the argument or presenting uncomfortable facts, when it’s a bit awkward to attack the argument or facts themselves.

The source of the argument, in this case Noel Whelan, is almost always irrelevant to its truth. Even if the ad hominem attack is true, that fact has no bearing on whether the disputant's argument is logically sound.

The point made in Noel Whelan’s IT article is that our national politicians, whether Fine Gael, Labour or Fianna Fail, have a history of claiming credit for externally driven factors only when they are positive but never when negative. He concludes that this is simplistic and that our own politicians should concentrate the national debate on things they can control, such as housing, quality of healthcare, flood protection, education funding, etc.

Personally, I feel it would be a lot healthier for our nation, political and economic systems if we backed off the “us V them” slogans and propaganda and concentrated on the real issues and how problems could be solved.

But, then I guess, that’s hard work – much easier to demote such awkward arguments under “too hard to do” and get back to good old propaganda, hype and simplistic election mantras.

Instead of such simplistic marketing hoopla, I’d much prefer to see our government elected representatives having the courage to appear before the public to account for themselves on TV programmes such as The People’s Debate. They would get a lot more respect for that than treating people as naïve swallowers of political flimflam.

BoJack Horseman

golfwallah wrote: »

The source of the argument, in this case Noel Whelan, is almost always irrelevant to its truth

Of course it is!
Noel Whelan is no more an impartial contributor to national discourse than Mary O'Rourke, the tone of his writing cannot get away from his own partisanship.

The point made in Noel Whelan’s IT article is that our national politicians, whether Fine Gael, Labour or Fianna Fail, have a history of claiming credit for externally driven factors only when they are positive but never when negative

This is a truism like saying that the sky is blue and water is wet.
Of course it is so & is so everywhere & will always ever be thus.

However, where Noel's logic slips, is that if he's right & our political choices & our domestic politicians have no relevance or are powerless wrt improved economic performance, then surely the converse is true?
That Ireland's economic downturn could not possibly be the fault of Fianne Fail? Sure, t'was all Fanny Mae & Lehman Bros & what not?!
After all, if Noel was right, his colleagues, Bertie & Biffo were helpless bystanders as the governments budget deficit exploded around them?

No, of course not.
Noel is too clever to admit that, however it is the obvious logical conclusion from his argument...
If governments cannot be praised for positive improvements, then they cannot be blamed for the opposite..

I argue the contrary, that our choices as an electorate & the choices made by the government do indeed play an important part in Ireland's economic performance.

He concludes that this is simplistic and that our own politicians should concentrate the national debate on things they can control, such as housing, quality of healthcare, flood protection, education funding, etc.

That would indeed be wonderful.
However I doubt Noel would really want that.
After all, it would be a bloodbath for him & his colleagues trying to defend exploding public expenditure by 300% in a decade, with very little return for the the nation at large (other than a property collapse) & the largest budget deficit in the western world.....

I'd love for FF to be honest & have that debate.

We probably won't get that though.... after all, Noel says, the politicians have nothing to do with it!
It's all international :rolleyes:

golfwallah

@BoJack Horseman,

You’re still attacking the person – not the issues.

But then, maybe that’s why we end up being more concerned about who runs the country rather than how it is run (i.e. with national policies, debated in public and then implemented).

And we’re talking about now – not what happened under our dysfunctional, partisan, “us v them” system before the last election, the very causes of which are being perpetuated into the next general election. Political hype, spin and personal attack may be the order of the day but are no substitute for debating the real issues.

Granted there is no perfect system of representative democracy, but there has to be something better than the approach of claiming credit for the benefits of external events, blaming them when it doesn’t suit and not debating the issues that are of primary interest to the electorate and are controllable internally.

In Germany, for example, focus is much more centered on issues rather than political parties and personalities, through the election of representatives on local constituency issues on the one hand and national issues on the other. Our Constitutional Convention considered this as a basis for electoral reform, but finally opted for a bit of tweaking around the size of constituencies under the existing multi-seat PR system.

If you prefer political patronage for the in-crowd coupled (for all the rest of us) with fixing potholes, doling out grants of our own money and a parliament dominated by an Economic Management Council, all dumbed down with hype and propaganda – then we need to change nothing!

BoJack Horseman

golfwallah wrote: »

You’re still attacking the person – not the issues.

I'd like to know how I'm attacking the author.
He's a FF lackey.... its a fact, it isn't a slur or misrepresentation, it's like calling a dog a dog.

And if you want to go through any issues, I'm more than happy to take FF to town over any of them.

johnnyskeleton

emo72 wrote: »

when i pay property tax, usc and water charges, im worse off. what extra money are we talking about?

Usc was brought in by FF and both FF and FG plan to scrap it by the end of the next govermment if reelected.

Water charges were part of the memorandum of understanding, althhough FG/Lab were responsible for the bungling bohemoth of waste and profilgste spending that is Irish Water Ltd. Most of Europe, including NI have water charges

Property taxes were on the cards anyway although I cant remember if they were part of the memorandum or not.

So, given the context of the thread, the things this government is being blamed for were out of their control. And its unclear whether any other party would have been able to do any different.

PeadarCo

Villa05 wrote: »

While agreeing with most of your post surely there was middle ground in the case of placing private banking debt on the shoulders of taxpayers. Even the EU admit this policy is never to be repeated

I'd agree but at the time no one had a clue to a large degree. The fact there's now at least a thought process going on how to close down bust banks. My feeling was they went for the safe option. Burning bondholders sounds great. But many of those bondholders told peoples pensions, fund the governments working capital even in times of budget surplus. My point would be its very easy in hindsight but was it was very different at the time. I'd agree though that unsecured bondholders shouldn't have got any money back. They were in a mess and afraid of making a bigger one. The Eurozones admission is hopefully a sign that lessons have been learned.

At same time the people of Ireland endorsed the policies that caused the banking crisis when they elected Fianna Fail in 2007. Most of the damage had been done by that stage.

My last point would be that most of debt built up over since the crisis was not banking debt but was borrowing to keep the country going. The banking crisis cost in the region of 64 billion. Given that the government deficit was 20 billion and still hasn't hit breakeven on a yearly basis, I'd feel going on about the banking debt is a bit of a red hearing as it distracts from the real reason for the built up in debt. i.e. Relying heavily on transaction taxes like VAT, capital gains, stamp duty etc that will dry up the minute the economy tanks is a bad idea.

That's what would disappoint me about so called left wing parties,they could run on the basis of a sustainable tax system to fund government services. But they oppose things like water charges, property taxes not mentioning the relatively large dependence on higher earners in the Irish tax system do to very low effective rates of tax at lower incomes, especially compared to more socialist countries like the Nordic states. The only difference between them and Fianna Gael, Fianna Fail is their hatred of high earners and private enterprise.

To bring it back to the Ronan Lyons article grand theres a lot of the government to be thankful for but theres plenty of house keeping for who ever is charge that would make a big difference.

Villa05

PeadarCo wrote: »

I'd agree but at the time no one had a clue to a large degree. The fact there's now at least a thought process going on how to close down bust banks. My feeling was they went for the safe option. Burning bondholders sounds great. But many of those bondholders told peoples pensions, fund the governments working capital even in times of budget surplus. My point would be its very easy in hindsight but was it was very different at the time.

The IMF were against it and the EU were coming around to the same thought process, with the ECB dragging their heels. Their was scope to get a deal and the opportunity was wasted by yes men/women in Government

Has anyone ever questioned this mantra that pension funds were the holders of these bonds.

I would doubt it. Pension funds have safeguards built in to sell when there is collapse. This is how people like Roman Abramovich were picking up these bonds at 40c in the euro taking a gamble that the Irish Government were stupid enough to give him the full face value for the bonds.

Missed opportunity and the difference between sustainable debt and unsustainable debt should the excrement hit the fan again, not to mention a return to normal interest rates on debt

PeadarCo

Villa05 wrote: »

The IMF were against it and the EU were coming around to the same thought process, with the ECB dragging their heels. Their was scope to get a deal and the opportunity was wasted by yes men/women in Government

Has anyone ever questioned this mantra that pension funds were the holders of these bonds.

I would doubt it. Pension funds have safeguards built in to sell when there is collapse. This is how people like Roman Abramovich were picking up these bonds at 40c in the euro taking a gamble that the Irish Government were stupid enough to give him the full face value for the bonds.

Missed opportunity and the difference between sustainable debt and unsustainable debt should the excrement hit the fan again, not to mention a return to normal interest rates on debt

For most bonds with a 10 year life span I'd imagine by and large pension funds are going to want to deal with stuff that doesn't give a high return but is relatively safe. I think one of the reason the stock markets have recovered is due to the very low return on bonds. Pension funds are relatively risk adverse or should be.

I'd agree with you point more should have been done. But to say it was a simple decision would be misleading. The ECB made a mess of things but at the same time it was the first time it had to go into crisis mode. Its a very new Central bank in a relatively unique position. Never mind the German resistance which only seems to have broken when countries like France, Spain and Italy came under pressure. I'm not disagreeing with you per say just I don't think its as black and white as you make out particularly with regard bondholders. I think at the time there was some under certainty over hitting senior bondholders as that might have meant hitting depositors. I'd always been thought that they were of equivalent rank when it came to getting their money back. i.e. you can't hit one without hitting the other. Personally I'd see smaller depositors requiring/deserving greater security by the virtue that they don't have same resources as large depositors/bondholders to analysis banks

In an Irish context most of our debt has come from funding the deficit(i.e. government services) not the banks. A better solution to the bank debt would have eased the pressure to a degree But I don't think it would have made any difference to what had to be done Austerity wise and what still needs to be done.

Your perfectly free to keep discussing banks and bondholders but for me its a side issue in terms of austerity and even in terms of recovery. A lot of it has been despite the banks.

golfwallah

BoJack Horseman wrote: »

I'd like to know how I'm attacking the author.
He's a FF lackey.... its a fact, it isn't a slur or misrepresentation, it's like calling a dog a dog.

And if you want to go through any issues, I'm more than happy to take FF to town over any of them.

You’re still name calling – read your own post!

As regards the issues - these exist regardless of whether you support Fine Gael, Fianna Fail or Labour. You don’t have to take anyone to town over them – just say what has been done to address them during the lifetime of the present government and what needs to be done about them – regardless of what political party in in office.

Housing: Social housing need has remained around the 90,000 mark during the government’s lifetime with responsibility for provision effectively dumped onto private developers, the private rental sector and voluntary agencies. There is a separate thread on this subject outlining the issues involved.

Health: Again awash with unaddressed legacy issues that have been around for years – to such an extent that nurses are threatening strike to get action on accident & emergency facilities. The HSE has been talking about implementing much need IT support solutions to get better use of doctor and nurses time but progress is painfully slow.

Water Infrastructure: just look at the mess made of implementing Irish Water - even government has given up defending it.

Private Pension Funds - Still being plundered unfairly by Labour inspired taxes to such an extent that pensioners, who have contributed over many years, are denied increases now being promised to state and public service pensioners.

Transparency and Accountability: Decisions are still being made in secret by the Economic Management Council (EMC) consisting of the Taoiseach, Minister for Finance, Minister for Public Expenditure & Reform and the Tanaiste. The Cabinet has been considerably weakened, effectively replace by the EMC and a coterie of unelected advisors. As for the Dail, debate is a mere formality – it’s effectively a meeting forum for voting fodder to rubber stamp decisions made by the EMC.

An example lack of accountability / transparency at local government level is the highly summarised and aggregated format of accounts agreed between the minister and County Council Managers. This is a legacy issue for FF, FG and Labour that has remained unaddressed for many years. Such highly summarised information make life very easy for both minister and county managers as it’s almost impossible for citizens to find out or discuss anything meaningful about local issues without detailed FOI or Councillor questions (that take months to answer).