The Budget that never was

When people look back at Budget 2004, they won't remember the social welfare cuts, or the absolute nothingness it delivered. The story of last week was the coup of the Dublin Government's spin-doctors. Decentralisation was the white elephant used to divert attention away from what was a disappointing, empty budget.

While decentralisation is welcome, it has been promised by Charlie McCreevy since 1999. A cynic might remark that the looming local elections played a role in the decision that the time was right to transfer departments around the country, where they will be more than welcomed.

Outside of decentralisation, the budget was a disaster. In what has become a miserable Christmas tradition, Fianna Fáil broke its own promises to deliver substantive increases in social welfare to levels that would meet the National Anti-Poverty Strategy.

Children fared worst, with the government refusing to increase the Child Dependent Allowance, a payment aimed at children from the poorest homes. Minister for Social affairs, Mary Coughlan said the allowance couldn't be increased because it would be a disincentive to work and would ensure social welfare recipients remained on the dole.

The Back to Education Allowance was cut, as was rent allowance. Unemployment was put up by a miserly €10, bringing the grand total to €134 a week, not even near a sustainable living level.

As usual, the annual increases on petrol, cigarettes and alcohol, were put into force on the night of the budget, while welfare payment increases will not come in until next year. So people will struggle to manage Christmas with the increased cost of living on what they have until they get their increases, which will then be completely swallowed up.

Nothing was done to end the gross inequality of the taxation system. Last year, top Irish executives awarded themselves 50% pay increases, yet the highest earners still pay tax at the same rates as ordinary PAYE workers.

Tax benefits for the lower paid in the Budget were totally inadequate and are undermined anyway by stealth charges, and health charges like the raising of the ceiling for the Drug Payment Scheme and the increased charges for A&E. This has especially hit those whose incomes are only slightly above the qualifying level for the medical card — the 200,000 people who were promised by Fianna Fáil that the medical card would be extended to them. This Budget spurned that promise because it was totally silent on Health.

Despite a clever decoy, in the end Budget 2004 was, as Caoimhghín Ó Caoláin put it, an empty package wrapped in tinsel paper marked 'decentralisation'.