Garda wife: 'There are weeks I can't put food on the table'

[Brendan Burgess]

I would leave MABS out of this unless they comment themselves, which they would not.

I think that MABS is realistic and would have sorted her expectations out fairly quickly.

There are many MABS advisors and she may have got a poor one, but it's much more likely that she is misquoting MABS.

Brendan

 

[DB74]

Unless a cut in Gross Pay has been applied (and AFAIK there have been no cuts to Gross Pay in the public service from 2011 to 2012) then the figure of €75,000 still stands as the Gross Pay for 2012

 

[orka]

Unless a cut in Gross Pay has been applied (and AFAIK there have been no cuts to Gross Pay in the public service from 2011 to 2012) then the figure of €75,000 still stands as the Gross Pay for 2012

His gross pay this year as a year 6 sergeant is 51,034. The rest is made up of allowances (which probably haven't changed since last year - yet) and overtime (which could have changed quite a bit).

..

I do have a lot of sympathy for the family - it is very easy for spending to increase to match increasing income but it is very difficult to go back the other way, especially when you have children.

 

[bugler]

I would leave MABS out of this unless they comment themselves, which they would not.

I think that MABS is realistic and would have sorted her expectations out fairly quickly.

There are many MABS advisors and she may have got a poor one, but it's much more likely that she is misquoting MABS.

Brendan

The IT article goes to the trouble of laying a lengthy schedule out, which it directly claims is that of MABS. While this story generally would not inspire much confidence in the journalistic standards of the IT, I find it hard to believe the IT would be looking at a generic piece of paper and taking it for granted that it came from MABS. That would also involve considerable deceit on behalf of whoever was claiming it was from MABS.

Now, the family’s total weekly income, including child benefit, is €807 net, according to Mabs. The following is its projected weekly expenditure, according to a schedule prepared by the same agency :

It doesn't state if this is a statement of what they are currently spending, or what they might reasonably be expected to spend.

 

[wbbs]

MABS will document what they are taking in and what they are spending, they will advise where cutbacks can and should be made but cannot compel anyone to make them, the client is responsible for what they choose to spend their disposable income on. It's fascinating what some people consider essentials!

 

[dereko1969]

In fairness to KS, that was mentioned. That was the only mention of 75K.

Yes but today she's implying that there has been a reduction in the €75k that was not implied in the original piece.

 

[orka]

Would anyone like to do a comprehensive piece debunking the story?

This isn't a debunking as such but I've had a good look at the income side as this is where the problem has arisen.

Looking at the income side, the MABS income figure of 807 net looks about right if they are just looking at his basic salary (51K) plus children’s allowance (I can’t get it to match exactly but it looks like they either have 3 or 4 children getting children’s allowance – there is mention of a ‘large’ family which I suppose is at least 4 children).

A couple of things worth commenting on:

• Increments have cushioned the impact of levies and paycuts a bit – year 6 on the sergeant’s scale is 10% higher than the starting pay.
• The family has probably lost one child benefit in the past year if they have a child who has finished his leaving certificate.
• The marginal tax rate for public sector workers at these levels of pay is about 62% - ie he only keeps 38% of his gross additional income (compared to 48% for a private sector worker). [As an aside, this is something the government should bear in mind when looking at the savings to be gained from removing allowances – they may only achieve a net 40%-ish of their topline number...]
• Yes, he gets a good pension but that doesn’t help his family today – I’m sure he would sacrifice some comfort in retirement to provide for his family today (and this is a choice a lot of private sector workers are making – short-sightedly perhaps but often out of desperation but at least they have the choice).
• I looked back at previous sergeant pay scales (as they went up in 2006-2008 and then down...) and put them into taxcalc’s prior years calculator. Obviously a lot depends on how much overtime he did but I reckon the family has gone from a peak (2008-2009) monthly income of 4.6K-5.1K down to 3.5K-3.9K. That’s a big drop.

Yes, there are money management issues that need to be addressed and in the grand scheme of things they are not badly off and if they had always had nothing but this level of income, they would probably be fine. But if you take away fixed expenses like the mortgage, utilities, house insurance – their ‘living’ income has probably almost halved – that is a lot to have to cope with, particularly with school-going children involved.

I think the article was poorly approached and structured – there are some valid points to be made about how/why people will struggle (hopefully just for a short time while they adjust to the lower income) but this has been completely and utterly lost in the controversy surrounding the article.

 

[DerKaiser]

Would anyone like to do a comprehensive piece debunking the story? You should take into account Kathy Sheridan's update on the figures.

I think we can argue on the income side all we like, it's the annual expenditure side that really interests me (I've multiplied the weekly figures by 52):

Mortgage (interest only): €14,560
Food/Housekeeping: €10,400
Transports costs: €6,630
Other Expenditure: €4,368
Educational costs (college registration fees, children’s uniforms): €3900
Medical costs (insurance): €3,808
Clothing/Footwear: €3,120
Credit Union: €2,600
Telephone/Other utilities: €2,236
Electricity Usage: €1,300
Heat/Fuel Usage: €1,300
Repairs & Maintenance: €1,040
Mortgage Protection Insurance: €780
Buildings/Contents Insurance: €364
Waste Charges: €260
TV licence: €200

Total: €56,874

First off, I don't think their spending is outrageous by any standards - it's middle class spending. I fail to see, however, why they could not comfortably live on less.

A number of issues need to be answered:
1. They listed €4,000 p.a. under additional pension - why not stop this?
2. 'Other expenditure' of €4,368 - This really needs to be broken down
3. Transport costs at €6,630 look high - car maintenance including insurance for 2, tax and 10,000 miles petrol should cost no more than €3,500
4. Having medical insurance costing €4k would surely be seen as a luxury a family living on cornflakes could do without - Quotes of less than €1.5k are available for 2 adults and 3 kids
5. Clothing and footwear of €3,120 is possible if you buy brands, but on the high side for a family looking to economise
6. There's no explanation of whether the Credit union is savings or loan repayment - if it's a loan, what was it for?
7. How is the telephone €2236? Broadband, phone & TV bundles are available for just over €800 p.a. Smart bill phones for each family member could bring the cost up to over €2k - but that seems again like excessive luxury if you are on the breadline.

Finally, and most importantly, €10,400 managed correctly should feed a family of 5 without any skimping.

Don't get me wrong, I do not object to their lifestyle and can see how they would spend €1,000pw, but there's plenty of areas you'd tighten up on if the money was a bit tighter, you certainly wouldn't be rushing to SVdeP.

 

[itsallwrong]

Tell you what.
Let Mr. Guard live on what I do.
Me and my family would be very happy to live on €75k a year.
He shold be given a smack and shown what tens of thousands of people live on.
Time wasting reporting.
€240 spent on clothes and footwear a month !
Give me a break....

 

[Protocol]

A number of issues need to be answered:
1. They listed €4,000 p.a. under additional pension - why not stop this?
4. Having medical insurance costing €4k would surely be seen as a luxury a family living on cornflakes could do without - Quotes of less than €1.5k are available for 2 adults and 3 kids

The pension levy is compulsory.

Unless they are referring to AVCs???

The Gardai have their own health insurer, maybe it's compulsory for Guards to join it?

 

[ajapale]

The Gardai have their own health insurer, maybe it's compulsory for Guards to join it?

Its not compulsory to join St. Paul's Garda Medical Aid Society

SUBSCRIPTION RATES FROM 1ST JANUARY 2012.
1. Comprehensive Scheme: Subscription before Deduction from pay/pension
.......................................................Tax Relief.................... After Tax Relief
Single Adult....................................... €32.21 p.w.................. €25.77 p.w.
Couple...............................................€64.42 p.w...................€51.54 p.w.
Couple with children under 18..................€77.98 p.w. ................€62.38 p.w.
Widow/er with children under 18..............€45.77 p.w.................. €36.62 p.w.

2. Over 18 Scheme: ............................. €13.56 p.w per dependent..... €10.85 p.w.
To a maximum of ................................... €27.12.............................. €21.70 p.w. per family

3. Over 23 up to 27yrs Scheme............... €32.21 p.w ........................... €25.77 p.w.
The Society claims the Income Tax Relief element of the Subscription direct from the Revenue Commissioners.

 

[Dermot]

The AVC's is probably the answer and as the name suggests they are voluntary but attract tax relief so is the €4000 p.a gross or after tax. There is 41% tax relief plus a PRSI relief on the contributions The health insurance indicates that one of the children is over 18 otherwise if the child was not over 18 it would be €550 less. I just researched this on the internet. Health insurance is completely optional as it is for everyone else.

 

[Clamball]

I think this Garda's spouse is suffering from an inability to budget.

It would appear that with the deductions from her husband's salary at source of €528 she is looking at her budget as being what is left over plus children's allowance. "Her" income has been severely cut to €109.22 plus the children's allowance and she now cannot budget.

She has rightly gone to MABS but perhaps she has not sat down fully and looked at every element of her expenditure and looked at the expenditure for savings. She just sees that the government has cut "her" portion of the wages and she is suffering badly.

I would recommend that she and her husband look at this jointly.

1 Stop the deductions at source so they can feel more in-control of their expenditure. Her husband should look at his pay-slip and stop every "optional" deduction. Social club, charity, AVC, Gym, etc. if they are there and stop them straight away. If the Garda’s wife sees €800 on wages slip she may feel a lot better.

2. Then look at net income and decide how to spend it. Many of the fixed expenditures are listed above, mortgage, Mortgage, Food, Transport, Education, Clothing/footwear, Telephone, Television, Waste, Broadband, Heat, Electricity, Insurance, Car Tax, Household Charge, Car Insurance, House Insurance, Life Insurance (Mortgage).

3. Each of these fixed expenditures should be evaluated and re-costed and reduced where possible. Mortgage has gone interest only so they are making a start. And for each of these they need to be really realistic, do they need a second car, where is cheaper to shop for clothes, shoes, household goods, telephone. Do they need smart phones, mobiles, etc. Can the health insurance be reduced to the minimum; they need to eat healthily to keep healthy. Eating should take priority over future potential health issues.

4 Now they should look at discretionary spending and determine where it is important for them as a family to spend and where they can make savings; this is Credit Union, Repairs, Maintenance, and Other as listed above. Are these GP visits, medicine, dentists (orthodontic work) charity contributions, school payments, sport, gifts, parties? I think with kids especially as they become teens it is a constant list of hand-outs, needs, requirements etc.

5 From the savings in 3 & 4 above they should start their rainy day funds, emergency pot of money, exceptional spends, car replacement, etc.

6 Then the future, reduction of income plans, more tax plans, water charge, house tax etc etc. They now have another adult in the house and he/she will need to be able to help by either reduction in expenditure or by earning to add to the available pool of money.

If this lady considers it her job and responsibility to save money for her family, make lunches, grow vegetables, walk rather than drive, look for bargains, barter, etc etc then she will feel more in charge of her families future and current costs and will know instantly what can be cut and saved and how to have fun and live a life on less.

With 18 years+ left on the mortgage and her husband over 50 and perhaps approaching retirement they both need to start planning for the future and living for the present. If they can make savings can they go back to paying their mortgage and eventually be debt free. The two negatives they have at the moment is that they have a large mortgage and large outputs with the size of their family of 6. So it is not going to be easy and it is going to cause them pain as they move from a middle class status to frugal living but it is possible.

There is a lot she can do and with her husbands and children’s help she is in a position to make great savings and still live well and put lots of healthy nutritious meals on the table and have an enjoyable family life. The solution will lie with her not the government. She needs to consider it her full time job to manage the money they have and manage it well.

 

[DerKaiser]

Here are my suggestions for the family to cut out not only the €300pw shortfall to get back in the black, but over €400pw!:
1) Move to a basic health insurance plan and save €35pw
2) Cut out the €80pw AVC to save €50pw net of tax
3) Get rid of one of the cars, save €60pw
4) Everyone makes do with a prepay mobile, save €25pw
5) If the kids want to buy expensive clothing/shoe brands let them do it out of a part time job, save €30pw
6) Switch to porridge instead of cornflakes, switch to Aldi/Lidl for groceries, save €30pw
7) Be ruthless about the €80pw "other" expenditure - save €40pw
8) If the credit union payment is savings stop it, if loan repayments it should be paid off within a couple of years anyway - save €50pw

 

[Brendan Burgess]

John Burns has a full page article on the issue in today's Sunday Times entitled A Cereal Mystery.

He quotes extensively from this thread.

The reported details of her budget were dissected on Askaboutmoney.com and derided.
Why were they spending €75 a week on health insurance?
Why wasn't the wife working part-time?
No money to buy meat, yet they could spend €127.50 per week on transport and €60 on clothes and footwear.
...
As one contributor put it, "Presumably is a sergeant's family has these problems, then a regular garda's family must be destitute."
...
The suspicion that [we were not being told the full story] caused a great deal of online anger.

...
"on a salary of €75,000, this family is in the top 20% of incomes in the country "according to Brendan Burgesss, founder of Askaboutmoney "The Nevin Institute is proposing to raise taxes on people like these. The story looks like nonsense to me. And as such it damages genuine cases. It screws it up for people who are genuinely in trouble"

...

The sergeant's wife rung her hands over a €100 repair bill for the diswasher. There was no shortage of internet wags to point out that a bottle of Fairly liquid costs less than €2, and the "large" family could be pressed inot wash or dry service at the sink.

 

[Marion]

I agree with this statement in the final paragraph of the ST article.

"It is a concern to ensure accurate information is being given, because we don't want borrowers fighting with borrowers."

Nor do we want to see public-sector bashing to the fore again in the media.



"Meanwhile the private sector and the media were baying for blood."

Says a lot.

Marion

 

[ajapale]

This is what the IT journalist Kathy Sheridan has to say in her defence on the IT site

In a post on Thursday evening, Kathy Sheridan added the following:


A few points are worth repeating about the article and the background to its publication. My first duty was to protect the family’s anonymity, so significant details such as the number of children were withheld.

Verification of the garda’s weekly income was available in the form of his payslip and we had permission to publish it in its original form, with name and identifying details redacted. A view was taken by senior editors, however, that certain other details might have identified the payee so this too was withheld.

The family has been characterised by some as foolishly clinging to “middle-class” fixations, such as private health insurance. The wife has explained that her husband is over 50 and in stressful work. They do not smoke or socialise. She is acutely aware that buying a house at the height of the property boom was a poor decision in hindsight. As other have argued here, they are hardly exceptional in that.

The payslip and the Mabs analysis of weekly expenditure confirm that there is no financial “black hole”. There have been efforts to supplement their income.

The point of the article was not to defend the past or present choices of any individual but to provide an insight into how the timing of that decision to buy a home and the cuts in public service pay and overtime have affected one middle-income public servant’s family. Contrary to some of the comment here, I have often written in the past about the difficulty of persuading such people to give interviews. The harshness of some of the criticism directed at this family explains why perhaps.

I accept that the figures could have been better explained in the original article.

To clarify : the garda sergeant earned €75,000 gross LAST year, including allowances and considerable overtime. That was clearly an exceptional year.

Now, the family’s total weekly income, including child benefit, is €807 net, according to Mabs. The following is its projected weekly expenditure, according to a schedule prepared by the same agency :

Mortgage (interest only): €280.00
Mortgage Protection Insurance €15,00
Buildings/Contents Insurance €7.00
Food/Housekeeping €200,00
Electricity Usage €25.00
Heat/Fuel Usage €25.00
TV licence €4.00
Waste Charges €5.00
Telephone/Other utilities €43.00
Transports costs €127.50
Educational costs (college registration fees, children’s uniforms) €75.00
Clothing/Footwear €60.00
Medical costs (insurance) €73.23
Repairs & Maintenance €20.00
Other Expenditure €84.00
Credit Union €50.00

Total €1,093.73

Not included are weekly pension-related contributions of around €80

 

[ajapale]

There are a lot of cheap nasty shots being made surrounding the story. But I think the cheapest nastiest shot has to be the Sindos attack on the Mabs Advisor/Mabs. The indo oped takes 4th hand information attributed to the maps advisor and proceeds to bash the service with statements like "What exactly are these people being paid for if they cannot even do that?"

If nothing else, the Irish Times story was a terrible advertisement for the financial advice service being offered by Mabs, whose representative, as quoted in the original article, "saw no way of getting their outgoings below €1,100 a week".Say what? So spending €3,120 a year on clothes and shoes and €4,368 a year on unidentified "other expenditure" simply cannot be reduced?
This is a financial service which is run by the Citizens Information Board under the remit of the Department of Social Protection to help struggling families manage their debts, and it does not know how to help a family manage with a food budget of €200 a week when thousands of families do so on much smaller budgets? What exactly are these people being paid for if they cannot even do that? In many ways it was the most shocking part of the whole story. It may sound harsh to rake over a family's finances with a fine toothcomb in this way, but when you put your story out there -- like the garda wife or Joe Purcell, the actor who told Liveline last week of being arrested for shoplifting for food for his children -- then of course your words will be scrutinised. Especially when it involves such an emotive subject as children. That was the thing. The garda's wife didn't say she couldn't feed her children because she was spending €240 a month on clothes. That wouldn't have elicited so much sympathy. She told us her children went hungry because she didn't have money for food. As parents, that stirs the strongest possible emotions. Nothing could be worse than not having food for your children. The narrative would generate the most powerful visceral response from readers, and when it became apparent that there was more to the situation than met the eye, then naturally that sympathy would evaporate.

 

[ajapale]

Is medical insurance at €73.23/ week in line with other schemes? (semi private/all hospitals in state)

Couple with children under 18................€62.38 p.w.
Over 18 Scheme per dependent.. ........€10.85 p.w.
I reckon the family have several children under 18 and one dependant (child ?) over 18.

When advising the family to drop or reduce the level of health insurance we must consider whether there are any health problems in the family or pre existing conditions such as heart disease, diabetes etc.

Is there an element of day to day expenses in the St Pauls scheme? If so is the family claiming this?

Is the family claiming its med1 expenses?

 

[ajapale]

... pity the the lady in question didn't come on here in the first place to do a post in the money make over section, she would have been sorted in no time.

I would hope that if the lady (and people like her) posted here she would get a civilised helpful response.