Friday, 10 October 2014

Deeply Misleading Irish Times Report of Budget Survey

Nat O'Connor: The Irish Times has given front-page headline coverage to the claim that "Voters want tax cuts over better public services" based on illogical and misleading interpretation of survey data.

The page giving the poll result is here. According to the video presentation by Political Editor, Stephen Collins (top right of the page), voters were asked to suggest what they wanted "unprompted" and the results were compiled. 44 per cent are reported as mentioning something along the lines of net income increase or more spending power, whereas 21 per cent said more spending on services.

It is wrong to interpret these categories as mutually exclusive. Many people would achieve "more spending power" if public services reduced their cost of living. The video explained that anyone seeking more spending power was put into the category of people seeking a net income increase. But this in turn was interpreted as support for tax cuts, as if that is the only way to achieve net income increase, which is facile.

TASC has been making the point for some time that Irish public services often require people to put their hands in their pockets and pay for GP fees, school books, hospital charges, childcare, etc. which would be subsidised or free-of-charge in most other countries.

Services have to be paid for, but economies of scale can make public services cheaper than private services for many people, and those on lower incomes can rightly expect subsidised services based on progressive taxation that requires those with greater income and wealth to pay more. This is part of the basic bargain of public services in a democratic society.

The contradiction in the report of the poll findings is shown in the responses to a list of suggestions:
  • 15% Increase spending on healthcare (nurses, doctors)
  • 15% Reduce/abolish water charges
  • 14% Reduce income taxes
  • 13% Reduce/abolish the Universal Social Charge
  • 9% None of these
  • 7% Increase social welfare payments
  • 6% Widen tax bands
  • 4% Provide a back to work incentive
  • 4% Increase state pension
  • 4% Increase spending on education (teachers, schools)
  • 3% Reduce/abolish the Local Property Tax
  • 2% Increase spending (general)
  • 1% Reduce VAT/excise/direct taxes
  • 1% Reduce abolish pensions levy
  • 1% Reduce tax on businesses
  • 1% Increase capital spending on roads, infrastructure
  • 1% Increase spending on justice (more Gardai etc.)
Looking at the above figures, income tax was mentioned by 14%, USC by 13% and tax bands by 6%. That gives 33% or one third of respondents in favour of income tax cuts.

But 15% want spending on health, plus 7% on welfare spending, 4% on pensions, 4% on education, 2% on general spending, 1% on justice and 1% on infrastructure. That adds to 34%, or one percentage point higher than those calling for income tax cuts.

Stephen Collins's article begins with the claim that "More voters would prefer income tax cuts to improved public services in next week’s budget". But he is not counting social insurance/social welfare as a public service. Is it not obvious that increased spending on welfare or pensions would have to be funded, and therefore runs counter to the call for tax cuts?

One could add the 15% against water charges and 3% against LPT to give 51% seeking some taxes or charges to be reduced, but it is not obvious that someone who personally wants a tax cut or abolition of a charge wishes that to be funded through cuts to health or welfare. For example, a person might reasonably believe the abolition of water charges could be paid for through increased taxes in other areas, or a person might believe that recent economic growth will provide sufficient tax revenue. We cannot assume people's views if they are not asked appropriate questions. The headline that "Voters want tax cuts..." suggests a much more clear cut finding than the data shows.

On the basis of the survey findings, there is a public debate about these issues, not a clear cut view. One third favour income tax cuts, one third favour spending increases and the other third is more mixed or nuanced. Those against LPT and water charges do have to explain how they would meet the funding gap, but it is not clear that they want to reduce total tax take. There are further nuances, as people might seek a tax cut assuming they will benefit, even though a cut to the higher rate of income tax will only benefit a minority.

At best, the interpretation of these responses is debatable. It certainly does not provide a clear result to justify a headline supporting tax cuts within days of the national Budget.

In the Press Council of Ireland's Code of Practice, Principle 1 is Truth and Accuracy: "1.1 In reporting news and information, newspapers and magazines shall strive at all times for truth and accuracy." The Irish Times have failed to uphold this principle in this case and it is damaging for the reputation of both the Irish Times and Ipsos/MRBI to be associated with such biased and misleading reporting of poll results.

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