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Tuesday Newspaper Review - Irish Business News and International Stories - - May 07, 2013
By Finfacts Team
May 7, 2013 - 7:15 AM
Independent reports that pupils in fee-charging schools and those who receive an
all-Irish education are most likely to go straight to college from school.
At the other extreme, research reveals that pupils attending schools in
disadvantaged areas are most likely to drop out and if they do the Leaving Cert
are least likely to go straight to a third-level institution.
A key finding – that girls are more likely than boys to leave school early –
contradicts the long-held view that this was a predominantly male problem.
The reports confirm much of what is already known about how the system favours
some students more than others – but the level of dropout by girls will trigger
fresh worries about whether the education system is adequately meeting their
Attempts to tackle early school leaving has traditionally focused on boys.
For the first time, the Department of Education has now tracked the progress of
individual school-leavers from a single year, including both those who had done
the Leaving Cert and those who dropped out.
The research was carried out on pupils who attended school in the 2009/2010
year, but were not enrolled the following year.
The department used PPS numbers to track the pupils and, in a ground-breaking
exercise, cross-checked data in a range of government departments and agencies
to establish where the school-leavers were a year later.
One study, 'School Completers – What's Next' looked at what happened to the
54,824 Leaving Cert candidates in 2009/2010.
The other study, 'Early School-Leavers – What's Next' looked at the destination
of the 7,713 pupils (out of a total second-level enrolment that year of 257,060)
who left school in 2009/2010 at any point before sixth year
Among the key findings were that 50pc of those who completed their Leaving Cert
went straight into higher education. An additional 28pc went on to further
education, such as a Post Leaving Certificate (PLC) course; training, such as a
FAS course; or repeated the Leaving Cert.
A total of 10pc of the class of 2009/2010 took up employment; 7pc were claiming
social welfare; and 5pc were 'other', such as emigration.
A closer analysis of the average 50pc who went straight to college shows a wide
variation in progression rates, depending on school sector:
• Fee-charging schools (66pc).
• All-Irish schools (57pc).
• Non-fee-charging secondary schools, generally those run or previously run by
the religious (47pc).
• Comprehensive schools (42pc).
• Community schools (38pc).
• Vocational sector schools (34pc).
• Schools in designated disadvantaged areas (24pc).
Overall, early school leaving is much less of a problem than it was, with 11,498
dropping out of school in 2001/2002.
The biggest dropout rate, 3.9pc, was in schools in designated disadvantaged
areas, known as DEIS – double the rate of a non-DEIS school and four times that
in an all-Irish school.
Although followed closely by 3.8pc in fee-paying schools, many of these pupils
may have gone on to a grind school.
The research shows that more females consistently exit the second-level system
earlier than males.
This is true both in absolute numbers and in the percentage of the entire male
and female school populations.
About 55pc of early school-leavers went on to further education – such as a PLC
course, or FAS training – or continued their second-level education in a private
institution such as a grind school, as 22pc of them did. Another 14pc were
enrolled in further education or training outside the State, while about 6pc
were working and 7pc were claiming social welfare.
The remaining 17pc fell into the 'other' category, which includes emigration.
Education Minister Ruairi Quinn said the reports "would fill data gaps and
enhance the information used by the department to plan for the future education
needs of our school-leavers".
Data was matched with agencies such as the Revenue Commissioners, the Higher
Education Authority's Student Record System, FAS, the Department of Social
Protection and the Further Education and Training Awards Council.
The Irish Independent also reports that some bank
customers are paying four times more in current account fees than they would if
they had shopped around, a survey by the newspaper reveals.
The annual costs for a typical bank customer now range from €28 to €136 a year
as free banking becomes a thing of the past.
Ulster Bank offers both the cheapest and the dearest current account deals,
depending on the option you choose.
But it is soon set to hike the charges on its standard account by €48 a year
with the introduction of a €4 monthly account charge from July.
And Ulster Bank's uFirst Current Account came out as the dearest in our survey,
costing customers €136 a year.
Of the country's big two banks, AIB is the most expensive at €106 a year for the
typical customer, but Bank of Ireland isn't far behind at between €95 and €102.
And while Permanent TSB charges add up to €93 a year, you could cut this to €45
a year if you lodge at least €1,500 per month.
Bank of Ireland offers no quarterly or transaction fees if you keep a balance of
€3,000, while AIB charges no transaction fees where a balance of €2,500 is
EBS offers five free transactions if you keep a minimum balance of €500.
But while it clearly pays to shop around for a cheaper deal on your current
account, the latest figures show that hardly anyone does.
While Irish consumers are keen to get the best deal on their gas and electricity
bills and will hop between suppliers to do so, the number switching bank
accounts remains at a negligible 2pc, the latest survey by the National Consumer
Agency (NCA) shows.
New NCA chief executive Karen O'Leary said it had received over 180 complaints
about bank charges in the last year, a period when most banks had reintroduced
fees or put stringent qualifying criteria in place.
It also had queries from customers who have found it difficult to switch banks
even though there's a statutory code, which puts the onus on the banks to manage
the process smoothly within 10 days.
Problems included customers being hit with overdraft fees or surcharges or
getting a bad credit rating because of delays in the switchover process.
The NCA also said it had found major gaps in the information provided by banks
on how to switch accounts, and said Ireland should look at allowing people keep
the same bank account number when they switch banks to prevent disruption to
However, the Central Bank, which had been reviewing new ways to encourage people
to switch bank accounts, said it would now await new proposals being drawn up by
the European Commission on the issue.
Dail Finance Committee chairman Ciaran Lynch called for restaurant-style menus
outside banks to make customers aware of the costs of using an ATM or
withdrawing money in the branch.
"We are calling on banks to advertise their charge costs at the front door in
much the same way that pubs and restaurants are obliged to display costs of
drink and food outside their premises," he said.
Our survey is based on a Central Bank profile of a typical bank customer making
a standard number of transactions, and with an authorised overdraft and a few
out of order charges each year.
The Irish Times
reports that Minister for Jobs Richard Bruton sought to introduce generous tax
breaks for executives in multinational companies in the run-up to Budget 2013,
The budget, published last December, contained controversial measures that allow
executives on high salaries to move to Ireland and pay lower income tax rates,
as well as benefit from relief on expenses such as trips home and private school
The move prompted serious concern from the Revenue Commissioners, which felt it
could be seen as unfair by the wider taxpaying population.
New documents show Mr Bruton sought to make the provisions more generous again
in Budget 2013.
He requested Minister for Finance Michael Noonan to reduce the income tax rate
to 23 per cent for eligible executives earning up to €500,000 per year.
This works out at an effective tax rate of 30 per cent, when the universal
social charge is included. It would have cost the exchequer about €5 million to
In a letter dated November 20th, 2012, Mr Bruton said the existing tax break was
a very welcome addition to Ireland’s tax offering and constituted a valuable
The key benefit, he said, was that senior executives within multinationals could
be attracted to locate in Ireland.
‘Clear wins for Ireland'
“The multinational will then locate the jobs
supporting the roles of senior executives and product/services leaders within
“These follow-on jobs are clear wins for Ireland, as they represent additional
internationally mobile jobs which would not otherwise have been located in
Ireland,” he wrote.
Mr Bruton added that these supporting roles were typically filled by Irish
workers and that additional taxes would mitigate the cost of the move.
The request, however, was not acted upon by Mr Noonan in last December’s budget.
Other documents released under the Freedom of Information Act indicate the
sensitivity within Government circles over the perception that Irish tax laws
are allowing multinationals pay tax at well below the official 12.5 per cent
corporation tax rate.
Briefing material acknowledges that some large companies are able to pay little
if any tax due to so-called “double Irish” tax structures.
But officials insist the Government has no role in facilitating this.
“It is not part of the Irish tax offering,” one Department of Finance briefing
note reads, “ and it relies on arbitrage between the different tax rules used in
The Irish Times
also reports that European Central Bank president Mario Draghi departed from a
prepared speech yesterday to reiterate the central bank’s readiness to cut
interest rates again if the euro zone economy deteriorates further.
The euro hit session lows against the dollar and the yen after Mr Draghi said in
Rome the ECB would monitor incoming data and would be ready to cut rates
further, including the deposit rate currently at zero.
“We stand ready to act again,” Mr Draghi said.
The ECB cut its main interest rate to 0.5 per cent last week after euro zone
inflation fell sharply in April and unemployment hit a record high in March. It
signalled then that it was ready to do more should the euro zone economy
deteriorate further. ECB executive board member Benoit Coeure said as much on
Another cut could drive the deposit rate below its current level of zero. The
ECB would then charge banks for holding their funds overnight, a step which
could have major implications on funding markets.
“There are many complications and consequences to take into account that need to
be studied carefully, and the council has decided to study them, to analyse
these consequences in order to be able to act if necessary,” Mr Draghi said,
referring to negative deposit rates.
Highlighting the opposition Mr Draghi may face from some ECB policymakers to a
further reduction, board member Yves Mersch, a hawk close to Germany’s
Bundesbank, said there could be limits to the effectiveness of instruments such
as interest rate cuts.
Data released yesterday pointed to darkening growth prospects. The first reading
of the euro zone’s first quarter economic performance is due tomorrow, and
economists polled by Reuters estimate output fell 0.2 per cent.
Yesterday European purchasing managers’ indexes (PMIs) suggested the euro zone’s
downturn dragged on in the current quarter, with Germany now suffering a
contraction in business activity that has long dogged France, Italy and Spain.
The Irish Examiner reports that employees of Irish
firms can expect pay rises of 1% to 2.5% this year, according to Mercer’s Salary
Movement Snapshot which surveyed about 150 companies.
According to the report, which surveyed Irish companies in February, 20% of
businesses in the life sciences sector can expect a pay rise this year. Other
sectors set for pay hikes include consumer goods (17%), hi-tech (13%),
finance/banking (10%), insurance (8%), and energy (5%), said Mercer.
Noel O’Connor, senior reward consultant with Mercer, said: “Businesses in
Ireland are still keeping a tight rein on salary increases.
“While private sector employment has grown modestly in recent quarters, the
economic situation remains precarious and organisations remain cautious with
their fixed costs, such as salaries. Our survey suggests there are some signs of
movement in specific industry groups like insurance, energy, and hi-tech.”
The survey also includes responses from a range of companies in industries such
as durable services, retail, and others.
The survey participants typically include local subsidiaries of multinationals
and leading indigenous multinationals, it added.
The Mercer report is part of a much broader survey of 570 companies across 76
countries in Europe, the Middle East, and Africa.
The countries where wage freezes have been most common are in periphery eurozone
countries, including Ireland.
However, most of the companies surveyed in this country are in the high-end
multinational sector, where there is a demand for highly skilled personnel. It
is these sectors that are seeing the highest level of salary increases, Mr
In western Europe, the UK, Germany, Austria, Norway, and Sweden are predicting
median salary budget increases of 3%.
The survey provides guidance to employers, across a range of sectors, on salary
planning and salary forecasting. The data provides information from
multinationals on median base pay increases across all employee groups including
blue and white collar workers up to management and senior executive level, said
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