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Laissez-faire Enda fiddles while Rip-off Republic Returns – Tóibín

21 April, 2016

Sinn Féin’s Peadar Tóibín has responded to a report by the National Competitiveness Council which warned of the possibility of a return to boom time risks to the economy because of the property market.

Deputy Tóibín said:

“The average rent in Dublin is €1,431 for a house and €1,313 for an apartment. This is 0.4% higher than peak Celtic Tiger levels. A person on the minimum wage living in Dublin working 40 hours a week will earn €1,586 a month. That means for thousands of families in the Dublin area on the minimum wage the average house rent is 90% of their pre-tax wage.

“For someone on the average monthly wage of €2,980 living in Dublin the average rent for a house in Dublin will swallow up 48% of their pre-tax wage. This is up from 43% last year. In real terms this is a 5% reduction in their disposable income in one year. This is an astounding erosion of families’ ability to provide for themselves.

"These rent increases along with increases in the prices of houses are creating a humanitarian crisis. These increases and their associated lack of housing supply are also the genesis of an economic crisis. 

“Any family that is spending nearly 50% of its income on rent will be forced to seek a pay increase. These pay increases will have no net benefit to families as they will be further swallowed up by unproductive rent. If these increases persist they will erode competitive advantages and increase industrial unrest.   

“Business in Ireland borrowers are paying 80 per cent more for business loans than their euro zone counterparts. The banking industry in Ireland is an oligopoly with two main players that determine price, location and supply. The new ecosystem of state backed lending that has been created has not created competition or driven down lending costs.

“Sheltered legal costs are driving up insurance costs and all the while eroding the competitiveness of Irish Enterprise.  And the elephant in the room with regards future competitive is the lack of capital investment.  Ireland has the youngest population in Europe and is forecasted to be its fastest growing over the next 30 years. Despite this we have the second lowest level of public capital investment in the EU.

“These cost pressures are within the direct control of government. The response to this by Fine Gael and Labour is to sit on their hands and refuse to intervene, putting Ireland’s future at risk.”

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