Why is Ireland so Expensive?

Ireland is officially the most expensive country in the EU

Cost of Living Crisis: Time to Bail out the People

The reason why Ireland – and Dublin in particular – is so expensive is because corporations are protecting their profit margins by further hiking up their prices which they can do as competition here is weak and consumer protections are poor.

At the start of July 2022, EU Eurostat published a report on 2021 price levels for consumer goods and services which found prices in Ireland are 40% above the EU average.

Our housing costs (rents, mortgages, gas, electricity) are the most expensive in the entire EU, 89% above the EU average, with Dublin the most expensive.

Our health costs are the most expensive in the entire EU, 72% above the EU average.

Our food and non-alcoholic beverage costs are the third highest in the EU, as are our communication costs.

Corporate Profits and Shareholder Dividends are Booming as We are Struggling in the most expensive country in the EU

When it comes to trying to make ends meet week to week, month to month, it is becoming increasingly difficult. Everything is going up except our wages and social transfers.

Living in an already very expensive country which is now experiencing record inflation at a 38-year high of 7.8% is further squeezing the life out of families on middle and lower incomes whilst profits in the corporate sector boom.

The combined annual profits of the five biggest energy utilities doubled to €560 million in a year, while profits at the five largest Irish food companies increased by €174 million.

The government, whose wealthy politicians are highly networked with the boards of these companies, says they will do nothing to help struggling families and tackle corporate profiteering.

The taoiseach receives €217,000 a year              The tanaiste receives €200,000 a year Every Minister receives €183,923 a year      Every TD receives €101,193 a year Meanwhile 630,000 people in Ireland are living below the poverty line. The median average wage in 2021 was €35,500.[1]

These politicians live in a different world to us. We have to force them to care.

We need:

• a windfall tax of 10% on the excess profits of Irish energy companies
• Scrap the carbon tax, which hits lower income families the hardest
• Introduce a new annual tax that targets the wealth of the Ireland’s millionaires & billionaires
• Pay increases of at least 10% as well similar increases in social welfare payments
• Maximum unit price cap on electricity, gas and home heating oil
• State-led building programme of social & affordable homes on state lands, nationwide retrofitting programme, rent freeze and a ban on evictions.

The government narrative about why Ireland is so expensive is that high prices are caused by global shortages for which they have no responsibility. There might be some truth in that for particular cases but it is absolutely not true for the disproportionate expense of housing and childcare, which arise from government policy. As the Irish Congress of Trade Unions have noted, Ireland is about €14bn a year behind peer European nations in per capita expenditure on public services.

Imagine what a difference it would make to the expense of living in Ireland if childcare were free. Well, that would be possible with €2bn of government expenditure. Or imagine if a huge public housebuilding initiative went ahead to provide tens of thousands of genuinely affordable homes and high quality, low-rent projects. This happens in other countries and the fact it doesn’t happen here is because the voice of Irish workers means a lot less to Fianna Fail and Fine Gael than that of global businessese lobbying for low taxes and property investors.

Why is Ireland so expensive? Because of the lack of public expenditure and the lack of price regulation in the private sector.

[1] This figure is deliberately obscured by the way statistics on wages in Ireland are collected, in which incorporating small volumes of very high earners distorts the picture. Using Felim O’Rouke’s technique (assuming that mean average wages are 26% above median average wages) and taking the 2021 CSO figures for mean average weekly earnings, Independent Left calculate the median annual wage to be approximately €35,500.