IMF orders Irish government to slash dole payments and make cuts to social welfare system. Queue outside a social welfare office in Dublin Photo by: Google Images The International Monetary Fund has ordered the Irish government to slash dole payments, cut child benefit, and take the automatic right to a medical card away from old age pensioners.
The IMF also wants the government to introduce a hard hitting property tax as it seeks a return on its investment in Ireland. The proposals have come from the IMF in a hard hitting directive ahead of the government’s December budget. The IMF is currently bank rolling Ireland’s economic bail-out along with the European Union and their latest orders have been met with harsh criticism from opposition groups and trade unions. IMF bosses, in Dublin for their regular review of the Irish economy, ordered the Government to cut high social welfare benefits to encourage people back to work. They warned: “Dole payments are high by international standards and responsible for low exit rates from the Live Register. Austerity policies in Portugal. One cannot say that the austerity measures in 2013 came as a surprise – all of them were mentioned in the first Memorandum of Understanding (MoU) between the Troika and the Portuguese government, signed in May 2011 by all governing parties (PS, PSD and CDS) |1|.
The MoU imposes profound economic and political changes: transformation of the productive structure;annulment of protective labour legislation and collective bargaining;looting of workers’ funds (pensions, social security);privatization of potentially lucrative public services |2| such as health, education, security, communications, transport, water, energy, culture – and extinction of other public services;increasing transfer (for the private sector and out of the country) of income, capital and human resources;changes in tax policies.
To which we should add the spiralling public debt, although the Memorandum assumes otherwise. Greece: A debt colony, shackled to its lenders. Story highlights The Greek government has hailed the eurozone finance ministers’ latest decision on Greece, requiring the country to lower its debt in return for bailout funds, as yet another political victory.
This was not surprising at all to Greeks, who have often seen their government celebrating decisions that have made life miserable for its citizens. But this time, Greek Prime Minister Antonis Samaras went so far as to call the agreement a “landmark for the country's rebirth”, releasing a video on YouTube entitled “Greece starts now”. Germany's Carthaginian terms for Greece. The EU deal will in theory cap Greece’s public debt at 120pc of GDP in 2020 - at the outer limit if viability - after eight years of belt-tightening and depression, if all goes perfectly.
Since nothing has gone to plan since Europe’s austerity police began to administer shock therapy eighteen months ago, even this grim promise seems too hopeful. The Greek economy was expected to contract by 3pc in 2011 under the original EU-IMF Troika plan. In fact it shrank by 6pc, and is now entering what the IMF fears could become “a downward spiral of fiscal austerity, falling disposable incomes, and depressed sentiment.” Manufacturing output fell 15.5pc in December. The M3 money supply crashed at a 15.9pc rate. Some 60,000 small firms and family businesses have gone bankrupt since the summer, the chief reason why VAT revenues dropped 18.7pc in January. Premier Lucas Papademos pleaded for national unity the weekend. The policy cannot command democratic consent over time. Spain imposes further austerity measures. MADRID (AP) — Spain's government imposed more austerity measures on the beleaguered country Wednesday as it unveiled sales tax hikes and spending cuts aimed at shaving €65 billion ($79.85 billion) off the state budget over the next two and a half years.
A day after winning European Union approval for a huge bank bailout and breathing space on its deficit program, Prime Minister Mariano Rajoy warned Parliament that Spain's future was at stake as it grapples with recession, a bloated deficit and investor wariness of its sovereign debt. "We are living in a crucial moment which will determine our future and that of our families, that of our youths, of our welfare state," Rajoy said to catcalls from the opposition socialists and other parties as he revealed the biggest single amount of projected deficit savings in modern Spanish history.
Spain has had to digest round after round of austerity measures since Rajoy's conservative government took power in December. View gallery.