Government urged to address poverty as economy improves

The Government must take “deliberate action now” and intervene in the economy to ensure improved economic conditions do not result in the poor remaining poor while the wealthy get wealthier, an independent think tank has warned.

Social Justice Ireland, in its socio-economic review titled Steps Towards a Fairer Future published yesterday, says Ireland is in danger of repeating the "boom and bust" sequences of the past.

“A shared commitment is needed to building a fairer future that prioritises the well-being of this and future generations,” says the review.

It says politicians must recognise a rising tide will not lift all boats, and a fairer future demands an integrated approach to five key areas – taxation, social protection, governance, sustainability and macroeconomic stability.

It says almost 732,000 people – over 232,000 children – are living in poverty. This is 16.5 per cent of the population, and represents a proportion which has not changed in a year.

"The social welfare system is not fit for purpose in the 21st century and should be replaced with a basic income system," it says, calling for a social impact assessment to be carried out before any policy is implemented that is likely to impact on low-income households.

Radical departure
A basic-income system, says the review, would be a "radical" departure, but would ensure everyone benefitted from economic recovery. It would replace social welfare and tax credits, guaranteeing an income above the poverty line.

On taxation, the review says all tax reliefs and expenditures should be made available only at the standard rate of 20 per cent, and the tax base should be broadened and increased to take the total tax take to 34.9 per cent.

It says high levels of long-term unemployment are once again a feature of Irish society.

"Government should create a major investment programme focussed on creating employment. This would stimulate the domestic economy and should prioritise initiatives that promote social infrastructure – such as schools, social housing and broadband....Government should resource the upskilling of those who are unemployed, and at risk of becoming unemployed, through integrating training and labour market programmes."

Negative impacts
It says the priority given to spending cuts over increased taxes has had "serious implications for public services", with negative impacts on low and middle-income households.

It also points to the increased pressure on community and voluntary organisations at a time when they too have had funding cuts.

On housing, the review says Government must move “immediately” to ensure an adequate supply of social housing.

“Ireland has 90,000 households on waiting lists for social housing and no credible plans to address this issue...32 per cent, or 28,218, of all the households on waiting lists had been there more than four years.”

It says the Government must move to ensure a supply of social housing including through co-operative, voluntary and non-profit housing organisations.

The review also calls for targeting investment in primary healthcare, pre-school education and in renewable energy sources.