As part of that article we took a brief straw poll from people to get an idea of how they would be impacted by any additional charges come December.
We asked would people be able to afford an extra €50 in bills a month and, somewhat worryingly, just 28% said they would be able to. Almost half (47%) said they simply couldn’t while 25% said they would barely be able to cope with an additional €50 going out the door.
We also asked how much money people had for themselves each month after essential bills are paid.
While 24% said they had €500 or more, it was worrying that the next highest tally of 19% was by people who said they had less than €50 per month to spend after bills are paid.
In fact, 58% of people said they had less than €200 to spend a month after paying their bills.
With all that in mind, it is no wonder that figures have emerged today that says the economy is at best flat, if not even contracting slightly.
It is the ordinary worker who drives the economy with purchases of things like clothes, music, hotel stays etc. When they don’t have the cash to do that though industries such as retail suffer and, in turn, so does the economy.
It appears inevitable though that come next year, the little people have to spend at present will be reduced even further.
Moody’s released a worrying report yesterday in which they said that the mortgage crisis will peak next year with one in five home loans defaulting.
They insist the only way out of the crisis will be debt write-offs.
Whether that happens or not remains to be seen but it was interesting to note that, to date, Cork and Dublin – two of the largest population areas in the country – have the lowest default rates in Ireland.
That would suggest that, by and large, the real mortgage arrears crisis has yet to hit the cities but if and when it does there could be major problems on the horizon.
The report by Moody’s said that those who bought in 2006, 2007 and 2008 were most likely to default – no surprise as it is these people who are in the most financial difficulty.
New personal insolvency legislation next year might help but before all then their limited resources will be tested even further by property taxes and any other taxes, charges or cutbacks that come in December’s Budget.
With all that in mind we’d like to hear your opinion on how you would sort the issue out – to relieve the pressure on those struggling, while also trying to get the economy back on track.
Should exemptions be part and parcel of the new tax or would that be unfair on those who are meeting their mortgage repayments each month, negative equity or not?
Let us know your opinion below...
