Wednesday, February 29, 2012

Irish referendum to cost €30 million

Ireland is to hold a referendum in May or June to test public opinion about the European Stability Treaty after the Government was advised by the Attorney General.  The AG pointed out that the Treaty is outside the scope of the architecture of the EU.  But referendums do not come cheap.

The cost of promoting the two referendums on the Lisbon Treaty each cost close to €5 million.

The Referendum Commission was established in 1998 to oversee the information campaign connected to any referendum.  The legislation providing for the establishment of a Referendum Commission is the Referendum Act 1998 as amended by the Referendum Act 2001.

Under the Referendum Act 1998 the Commission initially had the role of setting out the arguments for and against referendum proposals, having regard to submissions received from the public. Since the passing of the Referendum Act 2001 the Commission no longer has a statutory function in relation to putting the arguments for and against referendum proposals. The 2001 Act also removed from the Commission the statutory function of fostering and promoting debate or discussion on referendum proposals.

The direct costs of informing the electorate about the Lisbon Treaty in 2008 and 2009 were:


Advertising, excluding press 1,535,545 1,148,331
Legal cost      59,530      51,170
Press and PR 1,901,331 1,286,558
Postal and distribution 1,042,317    265,519
Design and printing of publications    357,821    180,603
Other administrative costs      70,199    140,263
Translation        5,713        2,921
Office supplies        2,827        7,356
  €4,975,283 €3,082,721


The returning officer apparatus to actually conduct the vote will cost in the region of €15 million and postal charges to distribute information and ballot details will add another €12 million.

All told it is a day out that will cost as close to €30 million as makes not difference.

Ó’Snodaigh’s rapacious appetite for printer cartridges is implausible!

The value of the printer cartridges that Aengus Ó’Snodaigh TD of Sinn Féin is alleged to have taken from the Oireachtas is stated to be of the order of €50,000 and to have been sufficient to print 3 million pages. 

The Labour Party and Fianna Fáil spent less than €52,000 between them on the 2011 campaign, so how could second tier TD manage to use so many cartridges? 

There are 80,268 voters in Dublin South Central.  This printer cartridge trawl had the capacity to produce 3 million pages.  Is this delirious buffoon seriously alleging that each voter received 37 pages of text from him?  Ó’Snodaigh’s ranks eighth among Sinn Féin TDs after Adams, Doherty, Ó’Caoláin, MacLochlainn, Ellis, Crowe and Ferris - when the votes won are expressed as a percentage of quota.

Ó’Snodaigh spent a total of €14,061 in the 2011 general election campaign, of which €8,700 was reimbursed by the State.  He spent €23,500 in the 2007 campaign but he managed to win 2,000 more votes last year despite spending less money.

His spend in 2011 was equivalent to an average of €2.07 for each of the 6,804 first preference votes he won (80.2% of quota in Dublin S Central). The average expenditure by successful Sinn Féin candidates in that election was equivalent to €1.73 per vote won.  McDonald spent €4.51, Tóibín €3.02 and Colreavy €2.69 per vote won.

The breakdown of his spending in the 2011 campaign was:


Election Posters 6,103.91
General Printing 6,198.68
Office Stationary 688.75
Transport and Travel 220.00
Campaign workers 44.65









All the political parties spent a total of €68,975 on general printing in the 2011 campaign, of which Sinn Féin accounted for just €3,793.

Apart from his TDs salary of €92,672 he also received, tax-free allowances and reimbursements amounting to €52,565 (election expenses reimbursed €8,700, Parliamentary Standard Allowance €31,865 and Travel and Accommodation expenses of €12,000).  On top of that Sinn Féin received a Party Leader’s allowance last year of €893,432 as well as substantial funding under the Electoral Acts.

And he has the audacity to say that the Oireachtas is to blame for him taking so many cartridges because nobody cried ‘halt’!  What a wimp!

Sunday, February 26, 2012

Irish politicians spent 47% more on electioneering than Ulster counterparts

This weekend marks the first anniversary of the election of the 31st Dáil, an election that attracted 566 candidates to contest the 165 seats (the Speaker/Ceann Comhairle is returned automatically)

The election cost the political parties and candidates a total of €9.27 million, – 16% less than the €11.08 million spent on the 2007 general election, even though 100 more persons contested the election

The following table summarises the spending by party and the cost of each first preference vote:


1st Preference Votes

Total Expenditure€

Spend per 1st Preference Vote

Fianna Fáil




Fine Gael












Sinn Fein




People Before Profit








Christian Solidarity




Workers P




S Kerry All













A total of €2.36 million was spent reimbursing 327 candidates who obtained a quarter of a quota, or more.  This accounted for 28% of the total expenditure during the regulated period – which started the date the Dáil was dissolved on 1 February 2011 until the date of the general election, 25 February 2011.

The cost of each vote in the Northern Ireland Assembly election last year was €2.21, 47% less.  The 218 candidates contesting the 108 seats in the Northern Ireland Assembly spent a total of €1.17 million electioneering during the regulated period – which extended from 25 March 2011 to election day on 5 May 2011.

Wednesday, February 22, 2012

Britain’s diplomatic footprint in the EU cost €139.7 million in 2011

The net operating cost of the United Kingdoms 26 embassies in the European Union was €139.7 million in the year to April 2011.  There are 1,610 staff employed in them and a further 190 in other outlying offices. The combined value of the Estate they occupy is €620 million, equivalent to 28% of the value of the entire British global diplomatic real estate.

The details are as follows:

Member State

Net Cost €


Trade Balance
€ Million

















Czech Republic
























































The Netherlands




































The EU accounts for 54% of global exports and 51% of global imports but Britain ran an adverse trade balance in 2011 with 20 of the 27 member states of the EU.  The combined value of her positive trade balance with Bulgaria, Cyprus, Estonia, France, Greece and Malta was €1,911 million.  But her positive trade balance with Ireland was a whopping €4,605 million.

Ireland accounts for 11% of Britain’s exports to the EU and Ireland supplies  6% of Britain’s import from the EU. 

The entire British global diplomatic enterprise consists of almost 270 offices and a staff of 10,500 persons located outside the UK. A further 3,000 are employed in the UK.

The estate of the Foreign and Commonwealth Office was estimated to be worth €2.2 billion on 30 September 2010, of which property worth €1.93 billion is located outside the UK.  The IT infrastructure alone represents an investment of €38 million while the embassy network is home to antiques and silver worth an estimated €10 million.

The largest investment in embassy offices is in France €43 million, Hong Kong €30 million, New Delhi €17 million, Rome €19.75 million, Dublin €16 million and Moscow €13 million. The most valuable official residences are located in Paris €33 million, Rome €25 million, Athens €13.5 million and Washington DC €8 million. The British Ambassador’s residence in Dublin is valued at €5 million.

The British have closed their embassy in Mali, El Salvador, Honduras, Nicaragua, Madagascar, East Timor and Paraguay. The have closed consulates in 18 locations around the world. Seven embassies and six consulates have been opened since 1997.

The budget for Ireland’s overseas missions this year is €53 million, figure comparable to the cost of ‘free’ television licences purchased by the Department of Social Protection.  Ireland’s diplomatic force employs a total of 555 persons.

Thursday, February 16, 2012

What a difference a century makes!

One hundred years ago the population of Ireland was 4,390,219 - of which 1,250,531 lived in what is now Northern Ireland. There were 202,810 persons in receipt of old age pension which cost the State £2,588,600 (€3.29 million). This meant that the amount received annually was €16.20.

Today, the population of Ireland is 6,380,269 - of which 1,799,000 live in Northern Ireland. There are 608,825 persons in receipt of old age pensions (contributory, non-contributory, transition) in the two jurisdictions which cost both governments €4,662,442,600. an average of €7,658 per recipient.

pension regulations were austere a century ago and if a pensioner had to be hospitalised his, or her pension was stopped. The Kilkenny County Pension Committee, for example protested against the hardship caused to old age pensioners obliged by illness to go temporarily into the local infirmary or hospital by the stoppage of their pension, under an amendment to Old Age Pensions Act, before the question is entertained by the committee. One typical case of a pensioner who on leaving the infirmary had, through the stoppage of his pension, to return to the workhouse as an ordinary inmate, thus incurring fresh disqualification for the pension, and being thrown unfairly for support on the ratepayers.

Another example of rigour concerned John Wilson, of Knockmanoul, County Fermanagh, who claimed an old age pension in September, 1910, and was recommended by the pension officer for a pension of 3s. a week (€0.15), and that on such recommendation his case was considered by the pension committee of County Fermanagh, who knew his circumstances and the house and locality in which he lived, and who decided that he was entitled to a full pension of 5s (€0.25). But this decision was reversed on appeal by the pension officer against the granting of a higher pension than 3s., when the Local Government Board decided that his yearly means exceeded £31 10s. (€40) and that he was not therefore entitled to any pension. Wilson's only means were £100 (€127) in the bank at 2½%., and his free support and residence in the house of a relative, who is a farmer. The Local Government Board decided that his support and residence in an ordinary farmer's house were valued over £29 10s. (€37.50) a year.

Hiscase was examined by an inspector who concluded that the farm in question comprises 60 acres of land, of which 25 acres were under tillage, and the remainder were being used for grazing. On the farm the inspector found 11 cows, 11 yearlings, 7 calves, 2 horses, 1 foal, 4 pigs, and 100 fowl. The house was deemed a very commodious and neatly furnished residence. The total valuation of the house and land is £86 (€109). Having taken all these circumstances into consideration, in conjunction with the fact that the claimant had £100 standing to his credit in the bank, the Board could not regard him as entitled to any pension.

Wednesday, February 15, 2012

Britain pays Ireland over €1 billion for the healthcare of British pensioners in Ireland

Under a European Union Directive introduced in 2004, if someone is in receipt of a state pension from two or more members states but not from their member state of residence, the member state where that person has the longest record of contributions is liable for their state healthcare costs.

The United Kingdom has paid €1,202.1 million to Ireland from 2007 in compliance with this regulation in respect of UK pensioners living in Ireland while Ireland paid the United Kingdom €98.2 million in respect of Irish pensioners living in the UK.

The annual sums paid to Ireland were 2008 €450 million; 2009 €108.1 million; 2010 €353 million and 2011 €290 million.

The annual sums paid by Ireland were 2008 €25.4 million; 2009 €24.4 million, 2010 €25.4 million and 2011 €22.8 million.

Claims are made in arrears, sometimes several years in arrears. Payments made in any one year will therefore relate to claims for previous years and do not reflect the value of claims made in that specific year. The timing of payments can therefore vary significantly and have a bearing on the totals paid or received.

A person who is ordinarily resident in the UK is entitled to access National Health Service treatment free of charge. Nationality is not a criterion in establishing ordinary residence. This EU Regulation enables a member state to claim the cost of healthcare for posted workers, pensioners and their dependents and the dependents of workers who have registered as residents in another member state to that which is liable for the cost of their healthcare. A British person resident in Ireland, for example, should hve the same entitlement to access the Irish healthcare system as other residents of the country

Tuesday, February 14, 2012

Irish Aid - €6 billion spent in an unregulated sector with low standards of accountability

The media controversy in Ireland surrounding the boutique charity GOAL has drawn attention to the standard of public accountability and transparency of its principal sponsor Irish Aid, the State’s Overseas Development office. GOAL is one of a small number of Irish charities that participate in a Multi-Annual Programme Scheme intended to provide long-term funding to alleviate distress in a small number of countries. This programme was started in 2003 and by the end of 2011 it had spent over €477 million out of a total Irish Aid spend of over €6 billion during that time.

Ireland ranks ninth in the world after Norway, Luxembourg, Sweden, Denmark, Netherlands, Belgium, UK and Finland in terms of the proportion of GNI committed to overseas aid. The tax revenue of these countries expressed as a percentage of GDP is significantly higher than in Ireland. Its is 42.4% in Norway, 38% in Luxembourg, 48.5% in Denmark, 39.5% in The Netherlands, 46.4% in Belgium, 37.4% in the UK and 42.3% in Finland. The corresponding figure for Ireland (in 2010) was 29.8%.

But Ireland is also the 8th most indebted country in the world in terms of the ratio of General Government Debt to GDP, currently at 110%. When it comes to debt burden Ireland follows Zimbabwe (238.8%) , Japan (208.2%), Sint Kitts & Nevis (185%), Greece (165.4%), Lebanon (137.1%), Iceland (130.1%), Anigua & Barbados (130%) and Jamaica (126.5%).

The year 2003 is significant in the sense that Irish tax receipts then broadly mirrored those of last year (€32 billion versus €34 billion). The Irish Government committed €445.7 billion to overseas development aid in 2003 and the exchequer deficit was €979 million. The ODA budget in 2003 was equivalent to €360 from each income tax payer, who also carried a €35,000 share of the General Government Debt that year.

GOAL obtained €8 million to spend on its multi-year projects, but did not publish audited accounts then, or subsequently to inform the public how it spent State money and how much it cost to deliver the services it provided.

The Irish Aid Programme carried out an internal audit of the taxpayers’ money GOAL spent in 2009, which was of the order of €12.8 million on MAPS toward which it was to have added €4.26 from voluntary public donations. The GOAL expenditure that year was €1.5 million, well short of its 25% matching criteria. The audit took four months to complete but it took GAOL six months to respond to the preliminary findings of the audit, a critical feature of which concerned the sharply declining funding levels that GOAL was capable of providing through donations.

It is noteworthy from the perspective of accountability and transparency that this audit did not publish the audited accounts of GOAL. But the 2010 Annual Report of Irish Aid did not publish a list of the recipients of the €675.84 million that it dispersed in 2010. There was plenty of financial pebble-dash about the relationship of Overseas Development Aid to Irish Gross National Income; the various initiatives and sectors toward which bilateral aid was directed. There was a geographical analysis of where Irish taxpayers money was spent and the nature of the projects it was spent on but no comprehensive list of the recipients and the cumulative amount of money each received from Irish taxpayers.

The annual contribution of taxpayers to Irish Aid has increased by 67% from €360 per capita in 2003 to €600 in 2009. But General Government Debt per income tax payer increased from €34,969 to €86,929 in 2009 and upwards to €136,654 in 2011 with the prospect of increasing further to over €154,000 by the end of 2013. Ireland's exchequer deficit was over €24 billion last year, over €6 billion higher than in 2010.

Where to for overseas development aid? Where to for public accountability and where to for transparency and governance? At what cost will the Irish Government contain its GGD/GDP ratio to 3% by 2014?

Monday, February 13, 2012

Public service broadcasting in Ireland is doomed if its financing is not removed from An Post

When it comes to the funding of public service broadcasting the Irish postal service, An Post, is in the dark ages with an appalling, insular incapacity to curtail television licence evasion compared to its UK counterparts and it imposes significantly higher collection costs.  It displays all the hallmarks of a complacent, apathetic public bureaucracy, even though the guy running it is paid €500,000 per annum. The consequences are that the television licence fee is higher than it need be and the sector is losing tens of millions of euro in funds that it is legally entitled to.

Current television licence sales appear to be of the order of 1.4 million per annum.  They ought to be in the region of 1.8 million, given the rise in the occupied stock of houses and considerable scope to increase television licence take-up in institutions and businesses.

RTÉ is the recipient of approximately 90% of the television licence fee which is worth approximately €200 million per annum. The balance goes in collection costs (5.8%) and to the Broadcasting Authority of Ireland.  If An Post was effective RTÉ would be getting another €30 million from licence fees without any increase.

Advertising is the largest component of commercial revenue at RTÉ but advertising revenue declined by 34% to €134 million from 2007 to the end of 2010. Total RTÉ revenue has declined from €405 million in 2006 to €371 million five years later.

Sole responsibility for selling of television licences rests with An Post, which seems to approach this task from an insular,  candlelit Dickensian back office. 

The BBC direct and control the television licence activity in the UK. Approximately 26.4 million British households (97% of all households) have a television licence that costs £145.50 for a colour television. They provide annual revenue of £3.56 billion to the BBC, of which 66% goes to its ten television channels; 17% to its seven national radio stations and a plethora of local radio stations; 8% is spent online and the remaining 11% goes on ‘other costs’. Television licence fee evasion in the UK has been 5.3% for the past decade. The cost of collecting British television licence money is 5.3% compared to over 9% in Ireland.  The scale is much larger obviously but the approach is more professional.

British television viewers must have a valid TV Licence if they or record television programmes as they're being shown on TV. It makes no difference what equipment they use - whether it’s a laptop, PC, mobile phone, digital box, DVD/video recorder or a TV set – they still need a license. There is no such simplicity in Ireland.

Irish law requires households, businesses or institutions which possess a television set, or equipment receiving a television signal – and that includes a ‘broken’ television set. But a viewer in Ireland does not require a television licence to watch television on a computer or mobile phone, unless the computer is used with another apparatus to receive a signal.

There are approximately 1.4 million television licences sold in Ireland at €160. Approximately one quarter of these (348,000) are paid for by the Department of Social Protection and issued as a component of their Free Television Licence scheme.

An Irish television licence is required by a householder and a business operator, although the web site of An Post is so slovenly that no mention is made of ‘business’ or ‘institution’, nor is there a different approach to meet the needs of business owners – be they shopkeepers, in the hospitality business, nursing homes, hospitals, clubs and communities, residential landlords, schools and colleges etc.

Preliminary estimates from the 2011 Census indicate that, despite there being 294,000 vacant houses in Ireland, the housing stock in Ireland has risen since 2006 by 14% to 1,709,000 residences. An Post also has over 500,000 businesses and institutions on its data base, a substantial number of which are likely to have television sets.

If any headway is to be made by An Post it must radically overhaul how it communicates to those obliged to have a television licence, or some other competent entity must take on this role, perhaps RTÉ. It functions on a one-size-fits-all basis and there is no provision for the needs of, or information for business people or those in charge of institutions. Who at this monolithic organisation is responsible for generating television licence revenue?  Who is responsible for customer relations? Other data including the number of television licences in issue ought to be readily accessible; the number of holders of more than one television licence; the numbers of television licence holders in the business and institutions’, community; the number of licences held by those with second homes and caravans. Deals ought to be available to those with volume requirements.

The public need to know what a single television licence will cover and what a single television licence will not cover; what the position is with respect to television licences covering multiple sites

Sunday, February 5, 2012

Twelve one-man-band ‘leaders’ among a 60-person Irish Senate

The Oireachtas (Ministerial and Parliamentary Office) (Amendment) Act 2001  provides that members of a political party elected to Seanad Éireann at the last preceding general election or a subsequent bye-election, or nominated to it after the last preceding general election, as members of that party may qualify for the following allowances as parliamentary leaders —

(i) an annual allowance of €31,743, where not more than 5 members of that party are so elected or nominated, and

(ii) an annual allowance of €15,872, where more than 5 members of that party are so elected or nominated.

This allowance, which is free of income tax, maybe spend as follows:

(a) the general administration of the parliamentary activities of a qualifying party

(b) the provision of technical or specialist advice likely to be required in connection with legislative proposals or potential parliamentary initiatives

(c) research and training

(d) policy formulation

(e) the provision of consultants’ services, including the engagement of public relations consultants

(f) polling or public attitude sampling in connection with parliamentary debates or initiatives

(g) the purchase of support services for a parliamentary party from the party

(h) the payment to a parliamentary leader of any salary or honorarium in respect of duties arising from his or her activities as such leader as distinct from those of a member of Dáil Éireann or a holder of a ministerial office,

(i) the payment to another person of any salary or honorarium in respect of duties arising from the person's activities in a parliamentary party,

(j) the provision for, or recoupment of, transport and personal expenditure incurred by a parliamentary leader, officers or a parliamentary party spokesperson as a result of their parliamentary party function,

(k) entertainment

Seanad Éireann #24 convened for the first time on 25 May 2011 and met on a subsequent 67 days in 2011.  It has emerged that among the 60 senators twelve are being paid a parliamentary leader’s allowance – although not one of them is apparently representing on of the 18 political parties listed in the Register of Political Parties in November 2011.

The 68 sitting days have cost €2,339,883.05 in direct remuneration, €1,322,093.95 paid free of tax in respect of travel and accommodation and €169,181.64 to pay the ‘12 parliamentary leaders’.  Those receiving the parliamentary allowances include 7 nominees of the Taoiseach:


Parliamentary Leader’s Allowance

Travel & Accommodation


Barrett, S




Coughlan, E




Crown, J




McAleese, M




MacConghaill, F




Mullen, R




Norris, D




O’Brien, MA




O’Donnell, ML




Quinn, F




vanTurnhaut, J




Zappone, K








Friday, February 3, 2012

Independent TDs and senators pocket over €1 million in tax-free allowances in ten months

By the end of 2011 the General Government Debt in Ireland was equivalent to 107% of GDP and is forecast to reach 115% of GDP this year. General Government Debt was just €47.4 billion in 2007 (24.9% of GDP).

Despite this trend and cutbacks across the spectrum of public spending the annual tax-free allowances paid to Irish parliamentary leaders of ‘qualifying parties’ has increased by 10.3% since 2007 to €8,410,899.

The ostensible purpose of a parliamentary leader's allowance is rather broad and includes administation of parliamentary activities, research and training, entertainment, the payment of an honorarium to the parliamentary leader in respect of duties arising from his, or her activities as a leader (of a one-man-band), as distinct from those of a member of Dáil or Seanad Éireann and the provision of transport for the leader and the recoupment of expenses.

The outcome of the 2010 general election has meant that there has been substantial change in who gets what. The amount paid to the Leader of Fianna Fáil has reduced by €1,056,437 per annum since 2007 while the disappearance of The Green Party and the Progressive Democrats has ‘saved the State’ €655,306.

But Fine Gael are pocketing an extra €243,025; the Labour Party has an extra €390,132 and Sinn Féin is being paid an extra €787,033 while the Socialist Party has scooped an extra €143,040.

The really big change, which accounts for the bulk of the additional overall expenditure goes to Independent TDs who reaped a total of €897,876 last year and People Before Profit who are now paid €143,040 – a combined total of €1,040,916 to 'new boys' since 26 February 2011. The only Independent TDs who was not personally paid an additional €34,783.20 was Mick Wallace, Denis Naughten,

Independent senators pocketed a total in €169,180 last year, although true to his word, Senator Martin McAleese was not paid this allowance when his wife was President.

The Independent TDs have almost been as politically incoherent as Fine Gael backbenchers – the posse whose preferred candidate that captured 6% in the presidential elections. Their iconic contribution to the political enterprise has been to organise a campaign to subvert the legislation governing the Household Charge and to waffle about a Constitutional referendum in connection with the already signed treaty that underpins the fiscal compact.

Thursday, February 2, 2012

Lower UK Corporation Tax rate raised tax receipts from manufacturing companies

Corporation Tax (CT) is a direct tax charged on the profits made by companies. The Irish Revenue Commissioners collected €3.5 billion (10.3% of all taxes) in 2011. CT also represents 10% of all taxes in the UK. The Irish collected €6.4 billion in CT receipts in 2007 when the Celtic Tiger was in full gallop and that represented 13.5% of all Irish tax receipts that year.

Ireland charges CT at the rate of 12½% on trading income and 25% on passive income. The main rate of CT in the UK was reduced from 30% to 28% from 1 April 2008 and to 26% from 1 April 2011.

The impact of these changes was that British Corporation Tax receipts rose in 2011 by 18% to £42.1 billion and the industrial and commercial sector accounts for 61% of the total.

UK Corporation Tax receipts in the past decade peaked at £46.4 billion in the year ended April 2008. This sum included £5.7 billion in respect of North Sea oil companies; €4.4 billion from manufacturing companies; £5.7 billion from the Distribution Sector; £18.1 billion from other industrial and commercial companies in Britain and overseas companies; £10.2 billion from the Financial Services sector and £700 million from life assurance companies.

The impact of lower CT rates since 2008 has subsequently increased CT receipts from manufacturing companies to £5.3 billion – a record high level of receipts throughout the past decade. The number of manufacturing company taxpayers remained in the region of 25,000+ during this period. But CT receipts from the other sectors, except life assurance have declined since 2008 with the Financial Services sector reducing by almost 50% from £10.2 billion to £6.1 billion.

There are 1.25 million companies with trading profits and of those, 892,000 companies pay CT in the UK and these earned chargeable profits of £185.5 billion. 34 pay CT of more than £100 million per annum and another 34 pay over £50 million in CT per annum. Banking, finance and insurance is the largest sector in terms of Corporation Tax followed by Business Services and Energy and Water Supply. Over 95% of all profitable UK companies paid tax at the 21% Small Companies rate or were granted marginal relief. 40,000 companies were charged CT at the main rate (28% or 26%).

While wider economic conditions influence profit levels CT liabilities are also influenced by other factors, such as rate changes, payment dates and changes in CT in other jurisdictions – all of which can lead to large multinational companies increasing or decreasing their level of operations.

Taxable profits for CT include income such as trading profits or investment profits; capital gains, known as chargeable gains for CT purposes. A system of capital allowances can give rise to a difference between the pre-tax profits published in annual accounts and taxable profits liable to CT. There are other reliefs, such as group reliefs which arise when companies are owned or own 75% of another company(ies) and some components of that group suffer trading losses.

Wednesday, February 1, 2012

Irish households - drop in loans and deposits

At the end of November Irish households had credit liabilities of €110.2 billion and deposits of €91.3 billion. There was a decline of 4.1% in loans since November 2010. Lending for house purchase was 2.5% lower while lending for consumption was 8% lower.

Some 78% of this credit (€80.3 billion) was in respect of loans for house purchase while consumer loans outstanding amounted to €16.6 billion and other undefined categories of loans to Irish households amounted to €13.2 billion.

There has been an overall reduction of €27.3 billion in credit advanced to households and almost all of this reduction is in the ‘loans for house purchase category. Some €15.4 billion of this credit was securitised. There are approximately 786,000 mortgages outstanding.

The total amount of deposits held by Irish households stood at €91.3 billion at the end of December 2011, a drop of €2.6 billion in the previous twelve months.

The currency in circulation in Ireland at the end of 2011 amounted to €12.4 billion, €755 million more than a year earlier. At the end of 2005 the value of the currency in circulation was €6.1 billion. The total money supply at the end of 2011 was €206.8 billion compared to €157 billion at the end of 2005.

The profile of the currency in circulation comprises 60,000 €500 notes; 25,000 €200 notes; two million €100 notes; 174 million €50 notes; 114 million €20 notes; €50 million €10 notes and approximately sixty million €5 notes. There are approximately 176 million coins with a value of around €14 million in circulation.

There are 2,137,000 credit cards in issue in Ireland which carried an outstanding credit balance of €2,78 billion. This is equivalent to an average amount due on each credit card of €1,305. Approximately 35% of the amount outstanding is paid by the end of the month so a significant portion of this debt is bearing very severe interest rates. There were 91,000 few credit cards in issue than at the end of 2010.

New spending on credit cards in December 2011, at €967 million, outstripped cumulative credit card payments by €45 million. During December 2010 new spending on credit cards outstripped payments that month by €24 million – so, while there are fewer credit cards now in issue there was a greater reliance on them to fund Christmas spending.

The outstanding level of borrowing from the Eurosystem by Irish resident credit providers was €108.4 billion at the end of December and €72 billion of this is owing by the domestic retail banks. This means that the Eurosystem is providing 72% of Ireland's private sector credit.