This follows an increase of 8,500 in February. Since December alone the number of claimants has gone up by 30,000
The Exchequer figures reveal that after just three months, tax revenue is €600 million behind Budget day projections and €727 million down on the same time last year. The fact that nearly all taxes are significantly behind predictions (Capital Gains Tax and VAT at €311 million and €253 million respectively) suggests the downturn in the house building sector has now spread across the economy. Fine Gael Enterprise, Trade & Employment Spokesman Leo Varadkar TD has said, "In contrast to previous months, when new arrivals on the dole queue were mostly men, the 12,000 increase in March was split evenly between men and women. This confirms that the housing downturn has now spread from the male-dominated housing sector to the wider economy, discrediting Mr Cowen's assertion that what we are witnessing is simply a 'housing sector adjustment'.
House completions in 2006 were 93,419. Completions for 2007 were 78,027. Brian Cowen estimates house completions for 2008 at 55,000. However it is more likely to be closer to 45,000. Failure to tackle the Stamp Duty issue promptly damaged confidence. Also a 2% rise in interest rates helped to burst the bubble.
With inflation stubbornly high at 5%, high interest rates, rising fuel costs and falling house prices, 2008 is shaping up to be a very difficult year for the economy. According to Fine Gael the cost of Government-regulated services has risen by 45% since 2002 and accounts for one half of all non-mortgage inflation.
The Government has sought to blame external factors. This is only partially true. The Government itself opened the purse strings in 2006 and 2007 and allowed an unsustainable escalation in public expenditure. In 2007 it rose by 13%. This poured petrol on the flames and over inflated economic growth leading to a feel good factor, which enabled the Government to win the 2007 General Election. Now the Government must endeavour to reign in public expenditure at a time when the economy could benefit from a stimulus.
Gradually growth projections for the year have been revised downwards. The country could face an Exchequer deficit of over €6 billion for 2008.
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