Budget should reverse Christmas bonus cut, say Sinn Féin

national | consumer issues | news report

Wednesday December 02, 2009 12:40

by cirrius

bonus helps local economy

People who used to get the Christmas payment include those on the blind pension, Invalidity pension, widows allowance, long term unemployed people, people on carer's allowance, state pension, and the families of those in prison. Contrast their treatment with the pensions paid every week to former government ministers like Ray Burke and Bertie Ahern, or the billions ploughed into the budgets of banks and developers.

This year, the Fianna Fáil/Green Party coalition, backed by various Independents, has axed the Christmas payment to pensioners and those on the dole. Yesterday Sinn Féin held a protest outside Leinster Houses demanding that the payment be restored.

Aengus Ó Snodaigh said: “Economic recovery will not be achieved by driving people into poverty. The recession will deepen if the government persists in taking money from those who spend it on everyday necessities. If these cuts are not resisted we face a prolonged recession with more and more people living in poverty.”

Apart from annoying people and subtracting any sort of cheer from the Christmas season for those on benefits and pensions, stealing the extra payment - the so called bonus- makes very little economic sense. Pumping money into the economy at this time of year helps create jobs and fiscal activity, which has knock-on effects right through the country's economy.

Wealthy people simply squirrel away money they get in tax cuts, which benefits the economy of places like Lichtenstein, but has very little effect on small businesses like shops, pubs, or taxis. Poorer people tend not to save much of their money (they can't afford to) so there is a stark difference in the way they use anything extra which they get.

The Christmas payment (which has been paid to people on extremely low incomes since 1980) is quickly dispersed- pensioners can afford to buy toys and sweets for grandchildren, have bottles of booze in the house for visitors, even put a bit of extra coal on the fire for the long days when the community centre is closed. Unemployed people can afford to buy small presents, a turkey, a tree, maybe a few pints in the local, and a taxi fare to see relatives on Christmas day.

Bonus payment money moves around the economy, staying local, but providing extra business for all sorts of small enterprises.

The revenue saved by axing the Christmas payment is a tiny amount (a fifth of it would go back to the state in VAT anyway) and the overall effect on the economy will certainly be negative. Shouldn't the government be creating jobs, building infrastructure and investing in the people, not kicking the poorest and undermining the local economies?

But, as Aengus Ó Snodaigh said: “The Government has decided that those dependent on social welfare are a soft target. They have made a callous calculation that those who will bear the brunt of these cuts don’t have access to power or the media and will not mobilise to fight the cuts."

Another cynical move from the boys and girls in the Green Party and Fianna Fáil.