2010 Survey of Income and Living Conditions

The CSO have now released the full results of the 2010 EU-SILC.  The report gives lots of detail on income and poverty in Ireland.  One graph immediately stood out.

Care has to be taken when interpreting this as different households are surveyed each year and the composition of the households in each decile will also change.  Detailed tables can be seen in the report which can be compared to those in the 2009 release.

When looking at the annual change by household composition the following can be seen.

The largest drops are seen for households with one adult aged under 65 and no children under 18, and “other households with children”.  Drops are also recorded for other categories.

37 replies on “2010 Survey of Income and Living Conditions”

Think it is about time we placed a ban on all ‘regressives’ in the Irish Constitution.

Of much greater importance than wrapping Herr Bund & Ms d’Estag’s fiscal corsets around the drooping backsides of the lower-echelon citizen-serfs.

It looks like the bank bondholders are not the only winners in this recession.
One wonders if this was a result of policy choices or did it happen by ‘accident’.

EU 15,000 is lowest. Boucher gets 800,000 => x 53 times. Kenny gets x 13 times. Very nice. What’s that song: “Hard Times, Hard Times, Come Around No More”.

Very, very sad reflection on the negative leadership we do not deserve.

@All Lower Deciles – Time to cop yourselves on!

@ALL

Now we have international bankers preaching to the Irish citizen-serfs!!!!

‘The institute, which draws its directors from Deutsche Bank, Commerzbank, Goldman Sachs, UBS, HSBC and Morgan Stanley, has told its members to be on alert for three strands of news from Ireland: economic performance following a new wave of fiscal austerity; opinion polls on the referendum; and “the rise of Sinn Féin” in polls.

“One of the things we notice is: Sinn Féin is quite supportive of taking a tough line on the promissory note issue. That’s something which will make international investors nervous,” Mr Suttle said.’

http://www.irishtimes.com/newspaper/breaking/2012/0328/breaking7.html

Text from Blind BiddY:

Who the fu*k do Commerzbank, Goldman Sachs, UBS, HSBC and Morgan Stanley and other matrizsQuidesque financial system banking elites think they are to get the idea that they can Force-fear Fiscal Corsets around the ar*es of Irish citizens? Patricia the Irish-Sovereign-in_Exile is absolutely livid.

@ Seamus
Thanks for bringing this graph to the attention of this blog.
It must surely make for uncomfortable viewing for politicians economists and insiders.
I noticed this table on Page 11 of the Survey and the first thing I did was forward it to Eamonn Ryan on twitter.
He had been rabbiting on on VB that the GP-FF budgets were progressive.
The truth is the 2010 budget more than undid any progressiveness gains made in previous budgets.
2010 was the time when owners of shares (predominantly the top decile) made a killing due to the QE in the US
Looney left calls for a once off wealth tax in this climate/time seem less looney than normal.

I think the big decrease for single people without children showed that these were the type of group who were more likely to lose their jobs.

The Vat increase of 2012 will no doubt exacerbate this inequality.

Shame on the government for ignoring the reality that the burden is being born disproportionately by the least able to pay.

In order to reverse these measures we should introduce
A third tax band, Progressive property tax based on site valuation, increase in capital gains taxes and closing loopholes that allow owners of capital to offset gains against previous losses need to be on the cards for the next budget. Insisting the full 12.5% Corpo profit tax is paid by all.

Anyone who wants to argue against the call for a higher tax band have the decency to not use the word marginal. Effective rates in this country are flat once you go over a certain income.

@Seamus (and others) – You are correct that “care has to be taken in interpreting this [Fig 1.g]” but be assured that care will not be taken. Explaining decile-sorting effects in a changing panel sounds politically challenging. I suppose that the top decile sorts the selection of those among relatively high earners who did not experience income declines? Due to scaling it looks like an increase rather than a non-decline. The bottom decile captures the increase in the unemployment rate — is that a correct interpretation? What about “the 99%” versus top 1% which is an important policy issue in the US any insight on changes to that income ratio in Ireland?

I wonder why we are reporting a fall in retail sales this morning? Those that are doing well in this crisis are clearly not pulling their weight and getting out shopping enough.

Or is it because those who earn less and basically spend all they get into the economy have simply got less to spend?

Don’t eat the rich, just make them shop/spend more. As well as tax bands, we should set spending bands. Those on more than 40k have to spend 800 in Dundrum every month…. oh, they already do.

@ Gregory Conner
“I suppose that the top decile sorts the selection of those among relatively high earners who did not experience income declines?”
Would it not just be a standard weighted average?

“What about the 99 v 1%?” good question.

@PR Guy
For further evidence of this take a look at the growing proportion of high end cars sold last year and this year. Dork from Cork had the figures a while back.

And those wonderful folk on Easter Island gazed fixedly at their wonderful Maoi (with the wonderful red caps), but when they turned around to survey their landscape … …

What in Hell’s name has changed? Apart from the latitude and longitude, that is?

@Eamonn
Well it looks like 50%+ maybe 55% of new cars could be in the A range this year which will be a record.
However given the huge unprecedented increase in Diesel sales many of the B / C class could be higher end vehicles.
I have called for a 2CV like culture to be built via fiscal policey around perhaps 2 /3 reliable , cheap but extremely thrifty vehicles but it will probally fall on deaf years.
en.wikipedia.org/wiki/Citroën_Ami
Goverments not only must get the nod from banks these days but from Industrial corporations also.

Out of curiosity………Total new cars sales Jan – Feb :25,500
Diesel :18,717 Wow ! ( A class :10,475 Wow again! / B class :6,315 / C class :858 / D class : 504
Petrol : 5,959 ? (A class :2,392 / B class :3,348 / Class C :166 – notice the huge drop / Class D : 20

Theres clearly a market for a A+ vehicle with perhaps 90 g/ KM (the skoda fabia greenline & Fabia G. Combi has official emissions of 89g/KM

The combined effect of five budgets 08-11 and of the public sector pay cuts was strongly progressive while budget 2012 was strongly regressive.
The graph from the ESRI report “Distributional Impact of Tax, Welfare and Public Sector Pay Policies: 2009­2012” is clear:

http://img163.imageshack.us/img163/256/24022012080837.png

Disposable income is not solely determined by budgets and public sector pay levels but these are the main tools under the state’s control. Perhaps 2012 was an anomaly and the cumulative effects of later budgets will be redistributive.

@eamonn moran – This type of percent changes in the values from repeatedly-resorted-deciles of panel data creates complicated statistical problems especially when there are large and disruptive income shocks. Not sure what is going on myself to be honest and surprised about the 8% increase in the top decile income. Presumably many specific-individual incomes that were in this decile last year fell in absolute terms, but it seems that these individuals were replaced with others from other deciles with large income increases. The bottom decile decrease is not surprising given the increase in the unemployment rate? Needs further analysis… but not by me.

FYI Michael Taft on these figs (to complement Seamus

We are now starting to get data to assess just who in society is getting hit and who is getting by. Of course, we know about unemployment rates, deprivation rates, and income inequality rates. But the CSO’s 2010 Survey of Income and Living Conditions gives us an insight as to who has lost how much in the first two years of the crisis, namely 2009 and 2010. Let’s take a particular look at three deciles – the lowest, the highest and the middle 6th decile.

First, what levels of income are we discussing within these groups?

The lowest decile includes households with gross incomes of less than €13,249 or less; or approximately €10,000 per adult in the household.
The middle decile includes households with gross incomes between €37, 467 and €46,561; or approximately between €18,000 and €21,000 per adult in the household. (Question: is this the squeezed middle that the Irish Times series was recently chronicling?).
The average for the highest household is a gross income of over €171,000; or approximately €62,000 per adult in the household.
For the lowest decile, income levels are extremely low while in the middle decile, incomes are extremely modest. Incomes at the higher level are in another place altogether.

Now, let’s look at disposable income – that is, income after tax.

http://www.irishleftreview.org/2012/03/28/inequality-cycle/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+irishleftreview%2Ffeed+%28Irish+Left+Review%29

contd.
In 2009, the lowest decile experienced a minimal impact. It was the middle decile that took the biggest hit with the highest income earners also experiencing a significant decline. However, the picture changed in 2010. The lowest income groups experienced substantial income decline – in this year social transfers were cut. The middle income group suffered further decline. However, the highest income groups returned to growth.

The SILC data shows that income inequality experienced a large rise in 2010, rising from a ratio of 4.3 to 5.5 (the ratio of the income of the top 20 percent to the bottom 20 percent). This was the biggest single year jump in income inequality experienced in any country since the EU started recording this data. In 2010, Ireland ranked 9th in the EU-27 for income inequality.

These trends are likely to continue and may even accelerate. The 2011 budget saw further cuts in social transfers combined with highly regressive tax measures (the USC and the reduction in personal tax credits). The 2012 budget – which the ESRI described as the most regressive of all budgets introduced since the crisis began – will further exacerbate this.

So we have a new cycle to discuss – alongside the deflationary cycle, the debt cycle and the long-term unemployment cycle: the inequality cycle. And this is likely to be as vicious and socially degrading as the others.’

@DOD
Your earlier post on the IIF beat my little rant on same. I suppose bankers have always interfered in politics but mostly did it covertly. They are getting Bolder.
I suppose it really doesn’t make much difference now that the Oireachtas is a mere subsidiary of the Bundestag.

Any word on the Great Bond Swap (for dodgy paper) ?
Less than 72 hrs to technical default.

@ceterisparibus

Expect the Note of Conflation in time for the leader’s speech so as to take attention from the Regressive €100 Note on property tax …

On the Dictates of the MatrixsQuidesque Elite ….

Blind Biddy even beat me to it ……. Date is crazy anyway … debate ongoing within Herr Bund & Ms d’Estag … and to hold it before final on French election …. makes no sense in terms of negotiations … and now, while delay on cash-flow welcome, serious that The Conflatonist Fallacy now has the gates open on the rest of it …. and full sov default down the line. What type of negotiators throw away flexibility for peanuts? Rhetorical …. no real improvement on the last lot …….

@David
There is also the concept of end use income – if I drive to work with a static 20,000 income in 2009 I will be worse off in 2010 as more money tokens is needed for the same BTU consumption.
These figures are based on 2009 /10 data – the input costs have risen substantially since then.
With the whiff of a full scale energy crisis brewing in the UK(North sea gas leak and oil tanker strike) & political shenanigans of Sarko trying to release strategic reserves before the election we must try to get our heads around this disaster.
Goverment policey withen the Euro should orbit around a policey of Good & service substitution using tax mechanisms.
On a practical level this would involve fiscal transfers / fare reductions to CIE(To hell with the disastrous EU competition laws) and higher taxes on Petrol & diesel (at least to the UK level)
Goverment policey should have a simple goal of near empty highways & full Trains & buses to maximise limited resourses.

Increasing poverty is forcing changes in eating habits and food choices.

Far from being a bitter pill to swallow, it can be regurgitated as further evidence of the Irish recovery – which the whole world seems to have heard about but few in the indigenous private Ireland seem to be experiencing.

The Troika will look at these numbers and wonder. The Germans will wonder even more.
*top two deciles still receive about 11% of income in form of transfers of various sorts, the 5th decile is 55%. You can see why the Troika told our lads to cut SW.
*statutory deductions (tax and insurance) on deciles 5 as a % of total income is 6%, average at top decile is 28%.
*all bar the top 2 deciles appear to receive more in transfers than they pay in direct contibutions. The 6th decile pays 80 per week and receives 350 per week.
A good chunk of this lifestyle depends on borrowed money.

Care has to be taken when interpreting this…

NO. NO CARE IS NEEDED. AT ALL.

These results stand. The people of Ireland are being ripped off by a wealthy elite in the banks, civil service, and politics. We are being ripped off and the perpetrators are laughing at us as they reap their reward.

We are all being made fools of. We are the fools who must pay not only for the losses and failure of the top 10%, but now also the additional rewards they’ve granted themselves besides. This chart sums up everything that has been done wrong over the last 5 years.

I am tired of economists making excuses for injustices and defending the completely and utterly indefensible. This graph is indefensible. We don’t need to take care, compare the figures, or consider any other factors. These results stand.

The rest of us are paying for the rich.

Nothing really.
When private cars disappear the highways will be almost empty.
However there is nothing wrong with using the existing fixed capital & depreciating transport machinery while you can but we must accept it was mal invested – much like some late 19th century railways in this country but on a much larger scale.
–
Remember transport oil use only collapsed in Ireland because of a road freight collapse (carrying building materials is very resourse intensive) & declines in international air travel.
Private car fuel consumption has not collapsed yet(2010) – although it has declined – it is the next to fall into the pit.
Y2008 : 2,117 KTOE (peak)
Y2010 : 1,986 KTOE
Road Freight :
Y2007 : 1,255 KTOE (peak)
Y2010 : 733 KTOE
We either have a rational transport tax policey which reduces oil imports or we wait for economic collapse to do the dirty work for us.

At these oil prices at least half of the private vehicles need to disappear with the remaining vehicles the most efficient of these.
At higher prices……….more private vehicles need to disappear and so on.

Cars , suburban & sub rural houses are creations of credit which depends in this monetory ecosystem on excess oil.
People need to understand the “wealth” created / spent? certainly since 1987 is no longer available – private car drivers in 2010 were merely experiencing a Wille E Coyote anti gravitational moment in time.

@Seamus Coffey & Others.

In addition to the straightforward reason of regressive or at least non progressive taxes there is a possible contributing reason for the very large increase in the ‘top decile’.
Household sizes that a few years ago would have contained dependent students who have now emigrated would have reduced household size and thereby increased the income of the remaining household.
As third level graduates come in the main from middle and upper middle class households, their emigration could be a contributing factor in the top decile increase (or non reduction).

But the data confuses me.
How does a non-economist (like me) reconcile the fact that GDP in 2010 was ~zero(?), GNP was +4.8% (?) , yet we have what appears to be a huge reduction in overall household incomes?
Where does the non-household income that makes up the balance reside if not in a household and where are the ultimate beneficiaries of the increase in non-household incomes?

@ Tull

“top two deciles still receive about 11% of income in form of transfers of various sorts, the 5th decile is 55%. You can see why the Troika told our lads to cut SW”

Pension contribution relief is probably responsible for a big chunk of the transfer to the top deciles .They are like L’Oreal.

With so many people down disoosable income and only a few up this begs the question of why there is less money during a recession.

Are people aware that digital money is deleted as loan repayments are made to financial institutions? The total of all current accounts, and hence the money supply, is lower after debt to a bank is settled.

Shay,
The top two deciles are still the only 2 contributing net cash to the Exchequer from direct taxes. We clearly need to be rid of this Kulak class.

@Ossian Smith

No, This is the 2010 Data. Expect more regression/inequality for 2011 and 2012.

@OMF

Absolutely 100% correct. These figures are enough evidence in themselves to implement a once off wealth tax for the top decile

@Gregory Conner
2010 was a bumper year for those who invest in the stock market.
This is the explanation for the upper decile increase of 8%.
Those of us who do so indirectly through our pensions didnt see comparable gains. How convenient.

I would imagine that the 8% gain is also Top heavy with the top 1% making most of the gains.

We are starting to become more like the US where the top 1% have made the majority of income gains in the last 30 years as details from Michael Hennigans finfacts have shown.

@ Paul Ferguson.

Paul, I move in a circle of aquaintenances who one might describe as, ‘not lacking’. Their collective and individual understanding of ‘money’ is abyssal! Their eagerness to be less ill-informed is close to zero. Monorail thinkers. The destruction of money equates to incineration of worn notes. “And sure the Mint just prints new, replacement ones!” “No problemo!”

Money, is cash in their purses and wallets. Credit is? … … “Pardon? Are you OK there Brian?”. Debt is? … … ???? I have lost them at this point.

However, a few did persist. After a while they became very quite. Enlightnment does that.

It clearly illustrates the distributional implications of the ‘technical adjustment’. Not only is inequality on the rise (i.e. people are carrying the burden of reckless private market behavior) it was a core factor in causing the economic crisis. Credit replaced real wage growth and public debt was privatized. A financial transaction tax should be implemented immediately to offset the maniacs who run finance. The state should step in to ensure productive investment and the macro-economy (i.e aggregate demand) should be anchored in real wage growth. Instead we have the baloney idea that aggregate demand will be improved by fiscal austerity and wage restraint… the power of ideas, quite incredible really.

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