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Budget 2014 had greatest impact on low-income groups

A new look at budgets from 2009 to 2014 by the ESRI shows that the lowest impact of next year’s budget was on some middle income groups.

A NEW ANALYSIS of Irish budgets from 2009 – 2014 showed that the greatest impact Budget 2014 had was on low-income groups.

The paper, from the Economic and Social Research Institute, looks at the distributional impact of tax, welfare and public service pay policies in Irish budgets from 2009 – 2014.

It analyses the available evidence on the impact of Budget 2014, and of the series of budgets from October 2008 up to and including October 2013.

Results

The results show that Budget 2014 had its greatest impact, which was a reduction of 2 per cent, on low income groups.

Meanwhile, the lowest impact was on some middle income groups (a loss of 1 to 1.25 per cent) while the top income group lost slightly less than 1.75 per cent.

It noted that the results for 2014 are quite different to those of the full period from 2009 to 2014, as over that period, all income groups experienced losses.

Income loss was in a narrow range of between 11 and 12 per cent for most income groups.

The greatest losses were for those in the highest 10 per cent of household income, as this group saw losses of about 15.5 per cent. These losses were mainly from tax increases and reductions in public service pay.

But at the other end of the income scale, policy-induced losses were somewhat higher than average (about 12.5 per cent) for those with the lowest incomes.

The ESRI said that these results “do not conform with either a progressive pattern (losses increasing with income) or regressive pattern (losses declining with income)”.

Over a substantial range the pattern is broadly proportional – similar percentage losses for each income group. But this does not extend to whole income distribution. Contrary to some perceptions of a sharper squeeze on middle income groups, the greatest policy-induced losses have been at the top of the income distribution, and the next greatest losses at the bottom.

To read the full document, click here.

Read: Concern over Budget 2014 weakened consumer sentiment last month>

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82 Comments
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    Mute David Dineen
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    Sep 6th 2022, 2:04 PM

    Who?

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    Mute James Johnson
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    Sep 6th 2022, 2:21 PM

    How the heck can you have joint leaders of a party, tripe at its best and do shortsighted no wonder they are on the edge of collapse

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    Mute Fiona Fitzgerald
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    Sep 6th 2022, 3:15 PM

    Makes sense to me that there’s more than one party flexible enough to rotate work without worrying about inflated notions of egos and leaders. More to the point, I think it’s in our best interests to support people who have worked out how to work together – it’s pretty much the definition of politics.

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    Mute Rochelle
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    Sep 6th 2022, 4:08 PM

    @James Johnson: Róisín and Catherine clearly have a shared vision for the party and if they can lead effectively by sharing responsibilities together then I have no idea why anyone would see it as a problem.

    We live in a time of fractured multi-party governments anyway so it’s essential for party leaders to be able to work together and share governance with others. The days of a single leader controlling everything are long gone.

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    Mute John McCann
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    Sep 6th 2022, 4:35 PM

    @James Johnson: Don’t we already have Leo and MM, joint leaders of FFG

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    Mute Paolo Fandango
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    Sep 6th 2022, 8:40 PM

    @Rochelle: the sentiment of what you say mostly makes sense but the days of single figures leading organisations are clearly not gone or in any large decline either.

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    Mute James Johnson
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    Sep 6th 2022, 9:06 PM

    @John McCann: my point exactly

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    Mute James Johnson
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    Sep 6th 2022, 9:07 PM

    @Rochelle: to be fair they won’t even make a dent in any government, I do like them but if you have no clear leader in anything it will never last

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    Mute Kárl
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    Sep 6th 2022, 5:25 PM

    Soc Dems in government?? The crowd we have are bad enough.

    It’s like tunnelling out of Joseph Fritzl’s basement only to find you’ve come out in… Fred West’s living room.

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    Mute Declan Edward
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    Sep 6th 2022, 6:20 PM

    @Kárl: lol

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    Mute Toon Army
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    Sep 6th 2022, 5:56 PM

    The small party nobody really cares about that had a slightly odd set-up, still, has the same slightly odd set-up. “Quick, let’s get to press with this!!”

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    Mute Garreth Byrne
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    Sep 6th 2022, 5:38 PM

    A third joint leader and it will be a troika.

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    Mute Conor Kirwan
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    Sep 6th 2022, 9:17 PM

    @Garreth Byrne: They tried that before with some lad named Donnelly. Never heard of him
    since…

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    Mute Don Moore
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    Sep 6th 2022, 11:36 PM

    There can be only one leader otherwise it won’t work .but two great woman

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