Business Features

Fears grow for the poor in Ireland as EU/IMF deal nears (News Feature)

By Fiona Smith Nov 26, 2010, 12:27 GMT

Dublin - With the EU/IMF deal on the multi-billion rescue package for Ireland expected at the weekend, the domestic focus is on whether ordinary people could or should shoulder the enormous burden incurred from risks taken by investors.

'There's a limit to how much ordinary Irish people should be expected to suffer, to pay for the risk-taking of investors,' said Irish Congress of Trade Unions (ICTU) leader Jack O'Connor in the wake of the government's four-year austerity plan aimed at making 15 billion euros in cuts.

At least 6 billion euros of those cuts will be implemented in the 2011 budget which is to be announced by December 7.

A cutback in social spending of 3 billion is budgeted for up to 2014, with a decrease of 5 per cent in 2011.

Socialist MEP Joe Higgins has called the plan a 'declaration of war' on the poorest people in Irish society.

'The weak, the sick and the working poor will take an unfair proportion of the hit as Ireland struggles to recover from the reckless actions of greedy bankers, incompetent regulators and an inept government,' said Sean Healy, director of campaigning organization Social Justice Ireland.

The plan will result in cuts in social welfare payments of up to 40 euros a week for single people, the organization claimed.

Social welfare rates for a married couple could fall by up to 64 euros a week by 2014 if the projected 3 billion in cuts are implemented, the organization said.

Cuts in minimum wage and welfare payments 'clearly demonstrates that it is the poorest in society who are to bear the brunt of cuts' Mike Allen of Focus Ireland, a charity that helps the homeless, told The Irish Times daily newspaper.

'This will have consequences for everyone in society as these cuts will deflate the economy and increase inequality in our society,' he said.

With talk of default creeping into the national debate on the banking crisis, many have pointed out that the figures in the government's plan do not factor in the amount to be paid for bailing out the banks.

After the cost of the EU/IMF 85 billion euro (113 billion dollars) loan to recapitalize the banks and fund the public finances becomes clear, it is feared that the cuts and tax increases will be even more stringent, having a disastrous affect on the poorest in society.

'Working class people should not be expected to pay for the mistakes of the wealthy,' said Higgins, who launched Thursday a new alliance of left-leaning political parties, United Left Alliance.

The ULA which comprises The Socialist Party, the People Before Profit Alliance and the Workers and Unemployed Action Group plans a 'campaign of sustained resistance on the streets.'

The ULA will also field 20 candidates in the early election promised in the New Year.

Councillor Richard Boyd Barratt said that it was time for people to revolt.

'We're not talking about extremism, we're talking about standing up against the extremism of the IMF and this government,' he said.

'You couldn't get more extreme than what this government is proposing to do to the majority of Irish people.

'So we're saying let's stand together. People power can bring change.'

The ICTU is expecting tens of thousands of people to take to the streets of Dublin on Saturday to protest the cuts in the austerity plan.

The four-year programme is required for the EU and the IMF bail- out which is expected to offer the Irish government an 85-billion- euro loan to recapitalize the banks and fund the public finances.

The package would see the level of capital in Irish banks being increased from 8 to 12 per cent in a move to bolster the confidence of depositors in the financial system as the Irish debt crisis threatened to destabilize the euro.

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