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Minister, jobs for all won’t end the poverty trap 17 December 2003

Minister, jobs for all won’t end the poverty trap

by Fr Sean Healy, S.M.A. , Director, CORI Justice Commission
This article was published in The Irish Independent, December 17, 2003.

When a Government minister attacks “critics in clerical collars” and bases his attack on a caricature of the position adopted by one of the most prominent critics in that category, then some questions suggest themselves.
Did the attack by Minister for Justice, Michael McDowell (Irish Independent, page 1, December 5th, 2003) have something to do with the fact that the CORI Justice Commission’s analysis and critique of Budget 2004 was published only hours before the Minister’s attack? This critique had exposed the Government’s failure to honour its commitment, contained in the present National Agreement Sustaining Progress and in the National Anti-Poverty Strategy, to benchmark the lowest social welfare rates.

It also exposed the fallacy contained in the Minister for Finance’s Budget speech where he argued that job creation was the solution to social exclusion. Likewise, the Commission’s critique pointed out that the Government was investing in infrastructure at the expense of social protection.

It is not true to suggest, as Minister McDowell did, that his critics “were not really concerned about prosperity”. It would, however, be very accurate to say that they were equally concerned with the distribution of that prosperity so as to ensure a reduction in Ireland’s rich/poor gap which is the worst in the European Union. The recently published ESRI study on poverty adds further weight to our emphasis in this context.

In our response to Budget 2004 the CORI Justice Commission acknowledged the social welfare increases were well ahead of what pundits had forecast. We also acknowledged the Minister’s statement that he will implement the social welfare commitments contained in Sustaining Progress. However, we pointed out that Government has left itself with a very substantial bridge to cross. If it is to meet its social welfare commitments by 2007 as promised in the National Anti-Poverty Strategy (NAPS) and in Sustaining Progress then the lowest social welfare rate will have to rise by €47.90 over the next three budgets.

We went on to show that the Minister’s claims on a range of issues indicated an approach that will ultimately fail to address social exclusion despite his claims to the contrary.

For example, his claim that job-creation is the appropriate strategy if we are to achieve real social inclusion simply fails to recognise the present situation where almost 60% of those living in poverty are in households headed by a person outside the labour force. These people are retired, ill or have a disability that keeps them out of the labour market or they are in the category ‘on home duties’. This fact was identified as “striking” in the latest ESRI poverty study. As they are not in a position to take up a job the minister’s response to their situation is simply adding insult to injury. At the same time we emphasised our support for ongoing job-creation. Our activities in the past decade have demonstrated our commitment to creating meaningful jobs in a variety of areas.

Likewise, the Minister’s comments on the appropriate level of taxation would mean that Ireland’s Exchequer would never have the resources to tackle poverty and social exclusion in an effective way. He criticised those who argue that Ireland’s total tax take should be moved “towards the levels of some other states in Europe”. The Minister failed to point out that Ireland has the lowest total tax-take of any EU country. He also failed to indicate how he proposes to bridge the present social provision deficits which are endured by Ireland’s poor and excluded people every day of their lives.

Despite the efforts of apologists for the better off in Irish society to convince us to the contrary, the present level of taxation is not sufficient to bring Ireland’s social provision anywhere close to EU average levels.

In fact, what the CORI Justice Commission has argued is that the total tax-take should move from being the lowest to being the second lowest in the EU, nothing more. This would provide the necessary resources to ensure social provision was given the required priority in the Budget.

The Minister is also misguided in the way he deals with the huge surplus in the current budget. The current budget is projected to be almost €3 billion in surplus for 2004. Government refuses to use this surplus to bring Ireland’s social services (e.g. education, social housing, and social welfare) up to average EU levels. We believe that infrastructure development is important but it should not be at the expense of social provision.

Ireland is no longer a poor country. Its per capita income is now one of the highest in the EU. Yet Ireland’s infrastructure and social provision are far below the EU average. Our growing poverty rates, unequal income distribution, growing rich/poor gap and under-equipped health and education systems represent the most visible signs of the extensive gaps in our social provision. The insufficient supply of social housing and the huge problems with public transport impact on poor people every day. In the context of continued economic growth and per capita income well above the EU average, the opportunity to address these deficits remains available. Yet Government has chosen to put the resources elsewhere.

When a Government Minister caricatures his critics’ positions on various policies and then attacks the caricature it is time for people to check for themselves whether or not these critics have something to say that is so close to the truth that a Minister would be happier if people did not hear them. Our positions on a wide range of issues, as well as our analysis and critique of Budget 2004, are available on our website for all to see at www.cori.ie/justice. We welcome responses to our policy positions from anyone, including from Government Ministers.

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