Pension levy deeply unfair on low-paid workers
Issued : Tuesday 17 February, 2009
Speech by Roisin Shortall TD
Minister of State, Department of Health with responsibility for Primary Care
There are so many aspects of the proposed pension levy that are worthy of discussion tonight.
- The way the levy was presented to the Social Partners at the 11th hour.
- The way the public service has been singled out by Government and some of the media.
- The anomalies within the proposed system.
- The way that those who are actually to blame for the economic mess will be unaffected by this proposal.
- The fact that most public servants already make very significant contributions to their pensions and their pay is reduced to take account of their pensions.
But what I want to focus on is fairness - Because fairness is at the heart of this.
Everyone together
The Government has made great play of the fact that "we are all in this together". But clearly this is not the case.
If we are all in this together, then why is the public service alone being asked to clean up the mess left by Fianna Fáil, the financial institutions, and property developers?
If we are all in this together, then why have the executives and boards of those banks engaged in fraudulent accounting not been removed and referred to the fraud squad?
If we are all in this together, then why does Brian Goggin still get a salary of almost €2 Million, and how come he doesn't have to pay a levy while a public service worker earning one eightieth of his salary has to pay €1,000?
If we are all in this together, then why is the Government not touching the 6,500 self-administered pension schemes in the private sector that attract huge tax breaks?
The truth is that unless a national consensus can be reached on how our economic difficulties can be solved, there is no prospect of recovery for this country.
Ability to pay
I want to read one of the several hundred e-mails I received from public servants in the past week. For me this one best sums up the unfairness of this levy:
"I work mornings in Dublin City Council earning the princely sum of 20,000 a year and my husband is a cleaner in the VEC. We have a mortgage of 1,500 a month, we have no car, we don't go on holidays, all our furniture has been donated to us - because all our money goes on our mortgage for our three bedroomed house - courtesy of the greedy property developer who pushed the prices up so high that it is now a noose around our neck. We have a young child and if this pension levy goes ahead we will lose out on around 300 a month - which means we can't afford our house.
I know that a lot of people are losing their jobs but how is our family losing our house going to help anyone? I have never claimed one penny from this country and neither has my husband, we are responsible, decent, tax-paying citizens and we don't deserve this."
For this family and many like it, the levy is unfair and downright reckless - because it takes no account of ability to pay.
Yes, civil and public servants have, in most cases, secure pensions. But a secure pension in the future doesn't necessarily mean that they can afford to make extra contributions now.
Yes, civil and public servants have, in most cases, secure employment. But they have based their mortgages and outgoings on this employment, and security is worthless if the wages don't pay the bills.
Picking on easy targets is not the act of a leader; it's the act of a bully. The Labour Party motion urges the Government to call a halt to this proposal and go back into talks with the social partners. An agreed, unified and fair approach is the only way forward for the country.
