Fionnán Sheahan: Making Child Benefit untouchable hasn't benefited children in the best way possible

The last time a reform of Child Benefit was seriously looked at, the proposals were so unpalatable that they were buried. An examination of Child Benefit was demanded as part of the IMF-EU bailout. After all, it is a universal payment to all families, regardless of income. Millionaires continued to be paid almost €1,700 a year by the State for each child – the same as those on low incomes.

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Irish Independent

2 hours ago

• Irish Independent

Louth fishermen treated like second-class citizens – ‘We have been absolutely screwed since Brexit'

Prawns are their bread and butter, yet their prawn quota has dropped by 30 to 40pc in the past five years. But they are also not allowed to fish for Squid around the lucrative Rockall fishery because of Brexit - and Royal Navy warships have been patrolling to keep them out of the area. Niall Connolly whose family are synonymous with fishing in Clogherhead revealed: "We have been absolutely screwed since Brexit and the truth is we have been treated like second class citizens by the EU for years. "What is going on is criminal. Prawns are our main catch in Clogherhead yet our quota is down by 30-40pc in the last five years and we are struggling to survive. "We can't fish for Squid around Rockall which makes matters worse. "Our prawn quota for July is 16 tonnes while a year ago it was 24 tonnes. The squeeze is on especially for fishermen in the south-east. "They traditionally fished for Sole but can't because Belgium has most of the quota and then they in turn are now going after prawns to survive which is putting pressure on the rest of us." In the last few years the Dept of Marine brought in a decommissioning scheme to remove some of the fleet so the rest could earn a living with the quotas they had. But Niall Connolly said: "Because our quota is so low many are fishing for scraps. "We are lucky that we are in the prawn game and we are just about getting by. ADVERTISEMENT Learn more "But the Irish Mackerel quota for instance has been slashed and there are big boats around the country tied up for nine months of the year because they have no quotas, which is wrong." He called on the Government and the new Minister for Fisheries Timmy Dooley to up their game in Brussels and negotiate the EU Common Fishery Policy so Irish fishers get a better deal. He added: "We need a better deal for Irish fishermen, there are so many livelihoods depending on it." The CEO of the Irish Fish Producers Association Aodh O' Donnell revealed that Irish Fishermen are facing a 15pc cut in their quotas over the next six years and something urgent needs to be done to stop it.

Irish Times

8 hours ago

• Irish Times

Developers are bluffing when they say lower prices would undermine viability of house building

With full employment and buoyant public finances, Ireland has never been wealthier. Affluence, rather than insufficient home building, is the true source of our housing challenges . Recognising this, and adopting more appropriate policies, is crucial to avoiding a deeper housing crisis. In the popular debate, housing demand simply equals population growth. However, the economic definition of demand is the quantity of housing that society is willing and able to consume at each price. Population growth is relevant to this. It creates competition that influences consumers' willingness to pay. But willingness does not translate into demand unless there is also an ability to pay. This explains why the world's most densely populated cities , which are in countries such as Bangladesh and Somalia, do not have the highest house prices. READ MORE Further emphasising the imperfect relationship between demography and housing demand, Bulgaria and Poland had the EU's hottest housing markets last year, despite contracting headcounts. [ Residential construction fell 10% in first quarter of 2025 compared with last year, says CSO Opens in new window ] In Ireland, rising prices and rents signify that housing demand currently exceeds supply. Contrary to the mainstream view, this does not stem from demographic growth outstripping housing supply. Between 2011 and 2022 the number of households in Ireland rose by 187,000. The housing stock only rose by 117,000, but the perception that this left a backlog of unmet housing need is mistaken, because 67,000 vacant homes were also reoccupied over the same period. Together, these sources provided 184,000 units of accommodation – closely matching the growth in household numbers. Our economic definition helps explain how demand can exceed supply even when we are building enough homes for everyone. This is possible because multiple factors, besides the number of bodies seeking beds, influence a society's willingness and ability to pay for housing. These include consumer preferences and wealth, with rich societies typically preferring, and having the resources, to live in smaller households. All of this suggests that excess capital, rather than insufficient building, is the source of Ireland's housing challenges. This raises fundamental questions about the Government's fixation with increasing housing output. Rather than striving to boost supply, Government should desist from fanning the flames of demand with subsidies such as Help to Buy and the First Home Scheme. The unspoken purpose of these is to incentivise building by driving up property values. This is unnecessary and self-defeating. The State should subtract capital from the market by tightening credit conditions. The Local Authority Home Loan is a flawed concept, while the Central Bank of Ireland 's 2023 decision to relax mortgage rules unnecessarily fuelled demand. As a dominant buyer and renter of property, the State should also exercise its market power to pay less. Government is frightened of flexing this muscle by the tacit threat of a developers' strike. Industry's trump card - which it recently played to have rent controls relaxed – is to scare up a panic that suppressing property values would undermine construction viability, causing the Government to miss its housing targets. This is bluff. Developers only earn when they build, and development costs would adjust to reduced sales price expectations if the Government called it out. Moreover, as outlined above, we are already constructing enough homes – regardless of what the industry-led targets say. Six months ago, nobody was contemplating a global recession or plunging corporation tax receipts. But both are now clearly possible Unfortunately, given the powerful interests that profit from housing development, none of this is likely. For now, the subsidies will remain and the State will continue competing against private households in the property market. Consequently, house prices and rents will rise further. This is clearly negative for consumers. But higher rents and prices will draw out more supply and, somehow, this has become a greater political priority than providing affordable homes. With population growth now slowing, increased housing output will unfold in one of two ways. If the economy remains strong, the additional homes will be occupied. By making sacrifices and taking on bigger mortgages, wealthier tenants and buyers will manage to fund themselves. For the growing remainder, the State will simply increase the subsidies. The cost of this, and the environmental costs associated with excessive building, mean everyone will face higher taxes. In this best-case scenario, the average household size will fall. Ireland currently has the EU's third-biggest households, and some consider this incongruous with our prosperity. [ Median value of homes bought by first-time buyers has risen to nearly €372,000 Opens in new window ] However, while Ireland's citizens aspire to small households like those in other wealthy countries, we also have the EU's highest proportion of children and teens. This makes larger households natural for us. A salutary lesson can be learned from the last time affluence and ambition seduced us into overruling this reality. Between 1996 and 2011, the average household size plunged from 3.14 to 2.73 persons. This was funded by prolific mortgage lending that facilitated a sharply reduced proportion of 18- to 34-year-olds living with their parents. However, the debt proved unsustainable when the economy turned, the banks failed, vacancy surged, the housing market crashed, the boomerang kids returned home and the average household size abruptly stopped falling. We are in danger of repeating this mistake. This time, however, the State, rather than the commercial banks, is bankrolling the appetite for smaller households with its subsidies and schemes. Six months ago, nobody was contemplating a global recession or plunging corporation tax receipts. But both are now clearly possible. In this scenario, the State would be unable to underwrite the occupancy of homes produced by excessive building targets – and we should know what follows. Dr John McCartney is a lecturer in property economics at TU Dublin and adjunct associate professor at UCD

Irish Times

8 hours ago

• Irish Times

There are several ingenious tacks we can take to help cut our emissions

In 1990, the OECD highlighted the vital importance of halting climate change and suggested a tax on greenhouse gases as a key policy to bring this about. Two years later, the EU proposed that a carbon tax be implemented in each member state. That never went ahead, as it would have required unanimity – Ireland at the time was one of the countries that opposed such a policy. This proved very short-sighted. If for the past 30-odd years we had taxed emissions, by now the EU and Irish economies would have largely decarbonised, at minimum cost. Instead, we still have a long way to go. To reach net-zero emissions requires major investment, taking many years to plan and construct, even if adequate funding is available. The delayed implementation of climate action, including taxes on carbon pollution, means that we have a bigger problem today. READ MORE A recent paper by Brian O'Gallachóir of UCC looked at the progress we have made over the period of our first carbon budget, from 2021 to 2025. While we will probably exceed the legislated limit for emissions over the period, the overrun is likely to be less than 5 per cent. Under the `polluter pays' principle, we should raise the cost of fossil fuel cars through higher taxes The three sectors where most progress has been made are electricity, agriculture and the household sector, all coming close to our targets for 2025. Electricity generation has benefited from a big expansion in renewables, mainly wind energy. Another major factor in reducing emissions from electricity has been the increased interconnection to Britain. The emissions from imported electricity from Britain are counted as British, and thus as zero for Ireland. Most of our electricity exports to Britain come from wind, a zero-emission renewable. Further electricity interconnection would add to this favourable exchange. This, as well as major investment in zero carbon technologies, will now be crucial in meeting our target for 2030. In farming, the main progress achieved has been a by-product of the war in Ukraine. This raised EU gas prices and, in turn, the cost of fertiliser, an important source of greenhouse emissions in agriculture. This led to a major reduction in fertiliser use by farmers. As a result, agricultural emissions have fallen, so that for the period to 2025 they will be close to target. To reach net-zero emissions requires major investment, taking many years to plan and construct, even if adequate funding is available Despite higher fertiliser input costs, and lower fertiliser use, farm incomes and output have risen. This shows that appropriate price signals for farmers can result in significant behavioural change, without seriously affecting farmers' living standards. Natural ways to raise soil fertility, like clover-rich grassland that fixes nitrogen in the soil, are also important. The Irish household sector, which has experienced rising energy prices, has moderated its energy use and emissions, showing that higher prices do change behaviour. The biggest overrun in emissions has been in transport. We haven't seen a major switch from fossil fuel cars to electric ones, which are still a tiny share of the national fleet. Today's cars last about 20 years, so that decisions on buying fossil fuel cars today will drive high emissions well into the 2030s. To rapidly change the composition of the national fleet would mean scrapping many of the petrol and diesel cars on the road today, which would be very expensive. So we need to ensure that most new cars bought are electric ones, and make that attractive. That's why the Climate Change Advisory Council has proposed a much more rapid deployment of charging stations, where we lag behind our EU neighbours. The council has also suggested a large subsidy for cheaper electric cars. In my view, this is the wrong approach. Instead, under the 'polluter pays' principle, we should raise the cost of fossil fuel cars through higher taxes. Electricity generation has benefited from a big expansion in renewables, mainly wind energy We have spent €1.25 billion to date on encouraging active transport. The result has been a tiny increase in cycling's share, but offset by a somewhat larger fall in pedestrian journeys – people have switched from walking to bikes, not out of their cars. Investing in public transport is a much more cost-effective way to get people to switch from private cars. Progress in reducing emissions from industry has been slow – it can be difficult to achieve. In particular, it's hard to reduce emissions from cement production, a very carbon-intensive process. We will need to switch away from housing mainly based on concrete blocks, towards the timber-framed alternative, which locks in the embodied carbon in the wood long after it has been harvested. If done at scale, shifting to timber for building new homes can also achieve the desirable outcome of cutting building costs.