Further tax increases and spending cuts expected in Ireland

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The Irish government is due to present its sixth hard-hitting budget since the collapse of the country’s Celtic Tiger economy. It is expected that the government will propose a further tax rise and spending cuts as they hope to save another 3.5 billion euro.

Since the bailout of Ireland in 2010 the government has been forced to adhere to strict spending limits set by the EU and International Monetary Fund. By continuing the adhere to the guidelines the country  has earned the reputation as Europe’s, “poster boy of the recovery,” with Prime Minister Enda Kenny featuring on the front page of a recent edition of Time magazine.

Despite the gloomy outlook of the country’s economy there has been no violent backlash against austerity in Ireland. Life has continued to get tougher with unemployment levels well above the national average of 15%.

Mother-of-two Aisling Devine-Hutchinson commented that the overwhelming feeling in Ireland after the financial meltdown was shock rather than anger.

She said, “It just gazumped us.”

“We’re probably not quite as vocal as Greece. It’s two different cultures, two different countries.”

“We kind of sit back and just see what happens. But I don’t think we’ve given up fighting yet.”

Tax partner at PwC in Dublin Joe Tynan believes that the chances of a full recovery are reasonably good.

He stated, “I think it’s on a reasonably fine line, but the markets at the moment do believe that Ireland can survive.”

“If you look at the 10-year money, it’s at 4.5% in terms of the yield. That’s at a level where Ireland can borrow, so at the moment we can certainly survive without a second bailout.”

Many local communities remain optimistic and attempt to make the situation more positive. Community development company, Northside Partnership runs a jobs club in Dublin and work with people at the sharp end of the recession.

Head of the club Trina O’Connor said, “These people may be angry but they are doing something about it.”

“I think that’s why we don’t have anger on the streets. People are trying to get back to work.”

“I think Irish people generally are very optimistic people. On the whole, I think they look for the positives in life.”

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