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The bad old days are far from behind us

Further tales of financial woe continued to pour from Ireland this week with Deputy Joe Carey of Fine Gael claiming that 40,000 people in Ireland are now in mortgage arrears.

This figure, combined with the news that repossessions are on the rise, will make grim reading for anyone with the country’s best interests at heart.
He also reveals that 5% of all the nations’ mortgages are now more that 90 days in arrears with the monies owed totalling €670 million. As the economy continues to wallow and public sector workers numbers look set to be slashed we can only expect this figure to go in one direction.
It is surprising to think that the government is not doing more to tackle this problem given the deep resentment that people tend to feel towards the concept of eviction or house repossession. Of course, losing the house over one’s head is a nightmare for any person to have to endure but, given the Irish attachment to property ownership and the hangover of evictions under British rule, the thing is particularly loathed.
Certainly no Irish politician would want to be associated with numbers such as those quoted above and it is for this reason I am surprised more is not being done to bring them down.
If the public sector is slashed in the way we expect it will in the coming years then it is almost guaranteed that the numbers in arrears will continue to climb. Banks are still businesses and, although they have been proven in recent years not to be the best at managing their finances, they will eventually start repossessing properties.
This leaves the government with the prospect of horror stories of eviction not coming from the poor but from the middle class, formerly comfortable, Irish voter.
From a public relations point of view this could hardly be worse. Again this begs the question as to why the government is not taking a more joined up approach to tackling the economic problems in Ireland.
Most people accept the depth and scale of the economic problems faced by Ireland but reading in recent weeks about the Clare boundary issue being back on the table and reports being carried out with regard to it begs the question as to whether such a project is the best use of public money at such a time. Clearly the environment Minister John Gormley never wants a Green TD elected in Clare.
Another issue that needs to be considered with regard to homeowners is the fact many now find themselves in negative equity. Figures published in the Irish Times in March of this year show that the average shortfall between the total mortgage and the actual market value of the house was running at €40,000.
This, combined with the spiralling number in arrears, paints a picture of a housing crisis so intense that it will take many years to mend.
The same article stated that in September of last year 26,000 people were in arrears in Ireland. One year on this figure has almost doubled. It is also predicted that the number of Irish people in negative equity will have hit 196,000 by the end of this year.
It is easy to forget when quoting figures of this size that each one represents vast numbers of actual people trying to get through their daily lives in the face of extremely harsh economic realities.
Many may be facing the axe in the coming months or trying to survive following a pay cut or freeze. They will be doing this while hearing on the news that our elected representatives in Ireland are among the best paid in the world. Salaries of €100,000 to represent 25,000 people each. This is before the average expenses of over €60,000 are added.
This must be galling in the extreme for those people in the country in mortgage arrears and negative equity. All the more infuriating because when the current government are punished at the next election and dumped out of office those who replace them will continue to accept the same level of remuneration.
They will claim to have the ways and means to help the people and the country to get back on their feet but will accept vast wages to attempt the feat.
This is a wretched inequality at the heart of Irish life and it should be addressed. It will be a brave politician who will attempt to tackle it of course. His or her colleagues will not appreciate any efforts to go beyond gesture politics with regard to TD’s annual salaries.
The inequality has not gone unnoticed with German officials declaring last year that “The Irish prime minister earns three times as much as the German chancellor”.
While Brian Cowen does not earn quite that much I imagine few would argue with their conclusion when faced with the wage bill for Irish politicians, “There is a lot of room for economising”.           
In recent times there have been some positive noises with regard to the Irish economy but it only takes a tiny scratch to the surface to reveal that the nation is still in dire financial straits.
We are told the road to recovery will be long and arduous but it is only in years to come we will realise the full extent of the casualties along the way.

 

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