Yesterday, the Minister for Finance went on the TV news to claim that today’s exchequer returns would indicate that the economy has stabilized. If the Minister believes his own claims, it can only mean he is dangerously in denial about the real situation in the national economy
The actual figures released today show no sign of recovery. Income tax receipts remain extraordinarily weak with a year on year fall of 8.2%. While VAT and other headings are in line with Government targets, they are also very significantly below the yields for 2009. Capital spending is now € 803 million below target and the repeated excuse that this is due to timing factors is looking very threadbare indeed.
This Minister has been proven wrong time and again in his assessments of bank losses and his repeated claim of imminent recovery. It has come to a point that his personal credibility is at an all time low and nothing he says can be believed with confidence.
Today’s figures have to read carefully in conjunction with a whole series of depressing data released this week that indicate an economy that remains mired in recession with few signs of a stable recovery. If there is growth, as the Minister claims, then how come that retails sales are so anaemic, that the jobless figures continue to increase and income tax and VAT returns are so far below the figures for the same period in 2009.
This week we found out that already in 2010 over 1000 companies have collapsed. This means four companies a day are closing down at present, hardly a sign of economic confidence. Nor do this week’s retail sale figures offer any comfort to the beleaguered Minister. The latest CSO figures show both the value and volume of retail sales fell in July when compared to June levels. As many as 10 out of 13 retail sectors experienced declines in sales. The underlying trend of recovery in retail sales that was evident earlier in the year has stalled suggesting that consumers do not believe a word that comes out of the Minister’s mouth about imminent recovery.
Employment is the most important indicator of all and here again the Minister’s statement defies reason. The labour market remains very weak as was confirmed by yet another increase in the Live Register for August, and the unemployment rate rising to 13.8 per cent. One in three of those on the register are out of work for more than a year. Until there is a serious pick up in employment that enables consumers to become more confident about job prospects, then spending will remain restrained.
Today’s exchequer returns simply confirm the evidence of all the available data. The Irish economy remains in a stagnant state. For Brian Lenihan and his fellow Ministers to suggest otherwise is an act of deliberate deception and means they are unfit to hold office at such a dangerous time for our country.