Inflation once again. What can Gov do about it?

Sam Russell

As far as I know, the ESB was a non-profit semi-state enterprise since its foundation.

The EU considered this anti-competitive as it prevented commercial companies that needed a profit from competing with them (what? Surely competing is to reduce costs and enterprises that cannot compete on price just do not try).

As a result of that, ESB had to start making a profit. So to increase competition to reduce prices, the ESB had to increase prices to produce profits (- really? Well that is EU logic).

Once the ESB started reporting profits, the workers said 'We'll have some of that' - so wages climbed and prices rose to where we are now. Even electricity that comes from wind has risen with the cost of gas.

Could not make it up.

Podge_irl

The oil companies are not profiteering. Russia was a massive source of refined products as well as crude. There is suddenly a lack of refining capacity which means oil margins go up - no one is deliberately cutting production for this.

Which is not to say a windfall tax should not be looked at.

Sam Russell

Has the Gov got it right with the budget 2023? Can they compensate for inflation without adding to it?

Of course the opposition say we would have done more for everyone, and the Gov must create certainty (how - nothing is certain with Russia going more rogue by the day) - they would say that.

There are always edge cases that are quoted in the media, like the woman with three children with special needs and no public transport and she cannot afford the diesel, etc. etc.

However, there is something there for everybody. Some measures are targeted and some are universal. The carbon tax on fuel has been neutralised by a change in excise, but that money is ringfenced for reducing carbon - so that is a win for the Greens. New tax rate at 30% in next years budget so a win for FG.

All in all - not bad and could have been worse. Even some money reserved for the rainy day fund.

Hotblack Desiato

New tax rate at 30% in next years budget

I'll believe that when I see it and not before.

Sam Russell

The problem with a 30% rate is that half of those caught by it would be better off if the 40% was moved up by half the 30% band. Those above the 40% are not affected if the 40% band is moved or the 30% rate is introduced.

The 30% rate is needed to reduce the sudden transition from 20% to 40%.

Difficult one and can only be done in a largely give away budget, but not in our inflationary time.

We will know that inflation is here to stay when price rises are explained as 'because of inflation'. Inflation is a curse that has become embedded in our economy, but in recent times has been at a low level - less than 2%. In the 1970s it was at 22%. Controlling inflation is like trying to control the tide.

beggars_bush

putting a 10% levy on concrete is madness

when every building material is already spiralling in cost

and justifying it about the mica problem having to be paid for - you know it wasn't an issue affecting those in Dublin or around the Pale

Sam Russell

https://www.boards.ie/discussion/comment/119699911#Comment_119699911

It is a nonsense.

However, if it was used to fund a Building Control Office for the whole country - to make sure building standards are properly supervised - then it could be justified.

Mica problem should be funded by revisiting the banks that have provided mortgages for these houses, by holding the block supplier liable, by revisiting the insurance companies who covered these buildings at any time, and also the builders who built these houses should carry some liability. The state should only cover the original construction - not the extensions.

Perhaps some of the redress should be by way of low cost loans.

fash

https://www.boards.ie/discussion/comment/119700012#Comment_119700012

The block suppliers are limited liability companies without assets;

The builders are bust/have no liability - and it would be time barred anyway (and retrospectively changing the law to make stuff that was a contractually agreed disposition of risks & costs to something else is problematic to say the least);

This risk was not covered in insurance policies (home bond etc) - and in any case expired.

There is something of an argument in relation to banks with mortgages - but only a little - the major beneficiaries are those with mica houses whose bad luck has been backstopped by the state.