Budget

On Wednesday, 14th July 2021, the Government published the Summer Economic Statement, setting out the economic position prior to Budget 2022. Social Justice Ireland welcomes the commitment to increased capital spending but warns that a focus on deficit reduction over decent services and infrastructure will lead to austerity.

Despite significant progress over the past few months, Ireland remains in a period of enormous uncertainty. Optimistic assumptions point towards a rebound in economic activity and employment from late 2021 or early 2022. Conversely, pessimistic assumptions fear ongoing public health related disruptions and a slow emergence from the Covid-19 crisis. Most likely, the reality lies somewhere in between - but there are limited clues as to where.

How we plan our finances, and what we choose to prioritise, post-Covid-19, will have profound implications for the future of our economy and society. To this end Social Justice Ireland proposed to the Select Committee on Budgetary Oversight that the priorities for Budget 2022 should be adequate social welfare rates and poverty reduction, just taxation, housing for all and tackling unemployment. 

Over the past few years Social Justice Ireland has developed its ability to track the distributive impact of annual Budgets on households across Irish society. Our analysis tracks changes from year to year (pre and post each Budget) and across a number of recent years.  As different policy priorities can be articulated for each Budget, it is useful to bring together the cumulative effect of policy changes on various household types.

In today's article, we examine effective income tax rates for different household-types in Ireland after Budget 2021, and compare them with rates in previous years.

Budget 2021 allocated €867m to Ireland’s Official Development Assistance (ODA) programme; an increase of approximately €30m on the amount pledged in Budget 2020. In these difficult and uncertain times, such a move is warmly welcomed. Time now for Government to publish a pathway towards our UN-agreed target.

Although the potential for a hard-Brexit has been overshadowed by the challenges of Coivd-19 during recent months, the potential for sudden and significant changes in economic activity and living standards from January 1st 2021 remains a major threat.