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Ireland’s top earners ‘do not see themselves as rich’, study finds

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The top earners in Ireland do not see themselves as rich and feel more insecure about their financial stability than their counterparts in other European countries, a new study suggests.

The study, carried out by Tasc, the Think-tank for Action on Social Change, published on Wednesday, examined the financial position and attitudes towards inequality among the top 10 per cent of income earners in four European countries: Ireland, the UK, Sweden and Spain.

The researchers found that despite the higher salaries of the top 10 per cent in Ireland compared to the other three countries, high earners in the State are more likely to feel insecure about their financial stability.

The study found that 24 per cent of Ireland’s high earners said they had “some difficulty” making ends meet, 3 per cent had “difficulty” and 1 per cent had “great difficulty”, resulting in a total of 28 per cent.

Financial commitments

This compared with 15 per cent of the highest earners in Spain, 11 per cent in the UK and 3 per cent of high earners in Sweden, who reported difficulty of some degree in meeting financial commitments.

Younger high earners in Ireland are more concerned about their ability to buy a house, plan a family and settle down, when compared with their European counterparts, Tasc said.

The report states that most younger people who receive higher incomes feel while they may have more disposable income, they do not have the same wealth and quality of life as previous generations, often linked to property ownership, particularly in Dublin.

Despite this, Tasc states that the highest earners in Ireland do not want to pay less tax on their earnings.

The report states that higher earners “overwhelmingly” want to see tax revenue being used by the Government to ensure universal access to high quality public services, especially in education and health.

Dr Shana Cohen, director of Tasc, said policy makers across all parties need to make the case for greater distribution and progressive public services.

“Even before the arrival of the pandemic and new uncertainties about the length and severity of the inevitable recession, many of those who, in principle, should have felt most secure were already struggling financially or expressing uncertainty about their own and their children’s future,” she said.

Super-wealthy

“It is clear that if the current unequal system isn’t working for them, it isn’t working for anyone else either, bar perhaps the super-wealthy top 1 per cent.”

In Ireland, the threshold for the top 10 per cent for those within the workforce starts at a gross personal earning rate of just under €70,000, while the threshold for the top 1 per cent within the workforce is just under €190,000.

The mean or average gross personal earning rate in Ireland is just over €36,000, Tasc added.

Dr Cohen added that public investment in public services would “address the anxiety that this segment of the population, as well as the overwhelming majority of Irish citizens, feel now”.

The overall study concentrated “more accurately” on the top 10 per cent, excluding the extremely wealthy in the top 1 per cent.

It shows that the vast majority of those in the top 10 per cent, not just in Ireland, but across all four countries within the study, do not see themselves as being “rich”.

It also suggests that since the 2008 crash, the top 1 per cent of earners is moving further away from the rest of the population, including the remaining 10 per cent. The vast majority in the top 10 per cent decile are now closer to the median earner (at 50 per cent) than they are to the 1 per cent, the researchers state.

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