The Budget 2012: The key points from Howlin’s speech

Brendan Howlin, the Minister for Public Expenditure and Reform, today announced the first half of Budget 2012. Here are the key points you need to know.

- The government is committed to €17bn in capital spending over the next five years until 2016.

- The dole is costing us three times more than what it did in 2006. There are also 500,000 more medical card holders now compared to just a few years ago.

- Pensions will cost the State €4.7bn this year, up from €3.7bn a few years ago.

- Today is not the end of spending cuts according to Howlin. We can look forward to this every year for the next few years.

Public Service

- The public service pay bill will be cut by €400m by next year. A further 6,000 public service jobs will also be cut. “This is a significant reform which poses enormous challenges,” he says.

- Next year, public service bodies will have to cut overtime payments by 10% and premium payments by 5%.

- A new single rate scheme will cut 35% – or €1.8bn – from the public service pension bill by next year.

- Social welfare payments have not been cut, nor has child benefit. Soc. However, welfare payments will be paid on a five-day week rather than a six-day week.

- The government will save €31m by cutting fuel allowance from 32 weeks to 26. Summer better start on time next year.

- €55m is to be saved in rent supplement cutbacks. Minister for Social Protection Joan Burton will outline more on this later today.

Health

- Spending on health will make up 26 per cent of current spending next year. The aging population is already taking its toll on the country.

- In total there is €13.644bn in the Health budget for next year. This includes €35m in extra funds for community mental health and €15m for long-term illness scheme. This is around €3bn more than last year’s spending budget.

- reference pricing for drugs will be introduced increasing monthly threshold for drug payment scheme from €120 to €132 per month.

Education

- €8.6bn will be spent on education next year. That’s 17 per cent of the total Budget.

- New graduates will not receive a grant, however, the government will contribute to postgrad fees for those from low-income backgrounds.

- According to Howlin, education savings of €132.3m next year allows ministers to have enough resources to pursue policy initiatives like Junior Cert reforms and implementing literacy and numeracy.

Finally, public spending will be cut to €55.8bn compared to €57.7bn this year. The?Minister also announced a “spending ceiling” of €54bn for 2013 year, and €52bn in 2014. So more cuts ahead.

Can you comprehend the barrage of figures and make out whether we’re headed up s**t creek with a turd as our only paddle? Or will we coast safely to shore?