Chapter 1: What is the main topic discussed in this episode?
The Clare Byrne Show on Newstalk. With Aviva Insurance.
The Irish state collected €106 billion in taxes last year. Not €106 million, €106 billion. And we've heard recently about the half a billion euro earned in fuel taxes that had yet to be spent. Only yesterday we heard about the bumper carbon tax revenue that will be collected this year. So the big question we're asking today is, is our tax money being well spent?
And I'm joined in the studio by Albert Dolan, who is Fianna Fáil TD for Galway East and on the line by Dan O'Brien, Chief Economist with the Institute of International and European Affairs and columnist with The Currency. And you're both welcome to the programme.
Chapter 2: What is the total amount of tax collected by the Irish state?
Albert, I'm going to begin with you because you've taken on this project where you're trying to show people exactly how the money is being spent. Tell me how that works.
Yeah, so essentially over the last two years, Clare, I've recognised that the spend in this country, and as you highlighted there, there's a huge amount of money coming in, but the spend is increasing at a rapid rate. And when your spend is increasing as a country at such a rate, you can be sure that...
The government wants to spend money, but how can you ensure that it's being spent properly, spent efficiently and spent effectively? So we said, well, what gets tracked gets managed. So we set up, myself and Matthew Fenlon, set up the public spend tracker.
And essentially what it does is all of the information that's available on state websites, on state entity websites, we've pulled all of that data together.
Chapter 3: What is the significance of the half a billion euro in fuel taxes?
And just in the last week, we've crossed 100 billion euros worth of spend tracking since the state started publishing purchase orders online. So we're primarily focused on procurement spend. And for anyone listening, procurement spend basically means when the state can't do something itself, it goes out and gets somebody else to do it and we pay them, i.e.,
building a school or, you know, hiring in advisors or hiring consultants or something like that. That's what public procurement spending is. We've tracked 100 billion of it and we're going to use that information to force efficiencies and to bring clarity.
That's key that you say force efficiencies. So you've come at this from a place where you believe the system is not efficient, that there isn't accountability and that there is wastage.
Yeah, well, I think the biggest frustration for somebody listening at home who's working hard paying tax, the biggest frustration for them is to see money not being spent what they would believe properly. And you have a two-tier system here. You have a civil service who is adamant about following process and making sure that the process is followed.
And then you have the public and the public want to ensure that they are getting value for money. And the questions that the public would ask themselves is, why? Would it have cost me this much if I was to do it? And did it need to be done? And that is where the frustration is coming, is that there can be needless spending and that there can be spending that doesn't make sense.
And I think that's why when you talk about the likes of the bike sheds, that really hits home with people.
And I see that you've written a Substack article about this and you have juxtaposed those two questions that the public would say, is this value for money? The civil servant will say, did I follow the processes? Now, they are wildly apart, aren't they? They're completely different questions.
Yeah, and that's why it's so important that us as public representatives, you know, the one thing I will say about the work we've been doing over the last year, we wrote to over 200 state entities. And as a result, you know, the Children's Hospital, wasn't publishing their spend data online. We got them to do that. The TII was spending billions, not publishing it online.
So who was looking at this over the last few years? I'm on the Public Accounts Committee. We look at the accounts, we look at the audit report, but we don't get into the nitty gritty of auditing.
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Chapter 4: How is public spending tracked in Ireland?
what was achieved. And I think government needs to show the public that we are concerned with function over form. We want to see delivery and we want to see delivery at speed.
And I think that's why this work is so critical because my belief is that if I was able to make the state just 1% more efficient, we would be able to help a lot more people because right now the spend growth is growing rapidly and yet people aren't seeing that increase on the ground and they aren't seeing it in their pockets.
Well, let's bring in Dan on this. And Dan, I know that when the state wastes money and you suspect that it does it quite a bit, it drives you around the twist as it does so many people who are listening to this. So do you welcome this project that Albert Dolan has taken on?
Music to my ears, Clare.
A long time coming.
Oh, it is so good to hear young politicians do exactly what politicians are elected to do, and that is to hold the state to account. You know, the amount of state spending that's happened since we got out of the recession more than a decade ago has been absolutely phenomenal. We've increased spending pretty much more than any other European country. Now,
Inevitably, once the fiscal constraints are eased, there's a tendency in the system just to sort of let budget overruns happen, you know, without impugning politicians and civil servants. You know, you've got to put yourself in their position and say, what are their incentives? It's not their money. So let's take something like public sector pay.
You know, a government, no government wants nurses and doctors to go on strike in January. That is a very powerful tool that those workers have. And it is much easier for a government to say, look, let's give them what they want rather than have a strike and have all this conflict. So the taxpayer is really not considered in this.
So just specifically on that area, I think other countries have these mechanisms. where they have groups that advise on public sector pay rather than leaving it to politicians and civil servants negotiating directly with unions.
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Chapter 5: What challenges are faced in ensuring proper spending of tax money?
Look, the more transparency you have in how taxpayers' money is spent, the more efficiently, generally, it'll be spent. You know, this information has to be kept for all sorts of reasons. The information is available there. So get it out. Allow the public. Allow journalists. Allow academics.
Chapter 6: What frustrations do taxpayers have regarding government spending?
access to it the more people that are able to look at this and scrutinize it the more that those spending the money will know that they could be pulled up if they're not doing it not not spending it as effectively as possible not maximizing the outputs because in in this country we tend to sort of a journalist will ask a politician are you doing enough are you spending enough
We tend to ask more about the inputs rather than the outputs. Are you getting more procedures done in hospitals? Are you adding to hospital beds? We need to focus on the outputs rather than the inputs. So this sort of information is really helpful in scrutinising what happens to taxpayers.
Are we in this place though, Dan? Is it a symptom of having too much money?
It partially is, Clare. Like, that's, you know, it was, Deputy was about, I think, eight or nine years of age when our taxes went up during the crisis and the crash. And, you know, for 18 years, we've had these very high personal income tax rates. And the amount of personal income tax the government's been raising has gone from 15 billion to 45 billion. It's tripled over the past 15 years.
When you have that amount of money to play with, any government becomes a little flow look and the sort of the constraints ease. So all extra scrutiny matters, particularly at a time. when we have income tax and corporation tax rolling into government coffers, they hardly know how to get it out the door again.
But it is really important that there's as much scrutiny as possible because this is money that comes out of people's pockets.
Some listener reaction to this, there's zero accountability when it comes to spending. It doesn't matter how much they waste because if they run out, they could just hit the taxpayer for more. We hear politicians boasting about how much they're spending like it is a medal of honour but never seem to have to show how the money is being spent.
I work in the private sector and if we don't meet our budgets the heat comes on you. Then we have an example from Stradbally in County Leash where the main street was resurfaced less than two years ago and has been dug up twice since. So the new surface is all full of patchwork tarmac and has become uneven again. That is not a good
example of public spending and another this is Ireland nothing is anyone's fault no one's to blame no one is taken to task onto the next disaster and more squandering of taxpayers money do you think Albert to finish on this that this is a symptom of having too much money
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