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Personal Finance

Still Paying the Paddy Tax

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Simon Moynihan

Simon Moynihan

Staff Writer

There are a few companies in the UK that do what we do here at You may have seen their ads on cable channels and I’m sure you’re familiar with stuff like Aleksandr the Meerkat and that daft opera singer bursting out of cars singing “Go Compare!”

I’ve got to give credit where it’s due though. The Meerkat campaign is marketing genius and in the months after it launched, traffic to almost doubled. Not only that, but they set up a mirror site at and got truckloads of traffic there too. It’s what drove GoCompare to launch their opera singer campaign. Well, they had to come up with something; they lost over 30% of their traffic in the Meerkat’s aftermath.

The UK comparison market is incredibly competitive and the UK public sources most of their personal finance, insurance and home utility products through comparison sites. And this in turn has made suppliers more competitive. If credit card companies and electricity suppliers want to get new customers, they need to be the cheap. Why? Because that’s usually how results are listed - cheapest first. And how often do you go to page 2 on Google?

So where the heck am I going with this? Well, I thought I’d do a little like with like comparison between the cost of UK products and Irish ones. Our national meltdown has taken up so much of our time that it’s been a while since anyone’s done it and I wanted to see whether anything has changed since the old Rip-off-Republic. I got the idea from an email I received from Uswitch, one of the smaller UK comparison sites. They were showcasing the Tesco Clubcard credit card and it practically jumped off the screen at me because it was so much better value than it’s Irish equivalent. So that’s where I’m going to start.

Here’s a little table with the headline rates for Tesco’s UK and Irish Clubcard credit cards.


 Tesco Clubcard credit card






 0% on purchases

 8 months

 13 months

 0% on balance transfers

 6 months

 9 months


The UK card is better in every category that matters. Now I’m not picking on Tesco in particular here, I just wanted to check the difference between what Tesco offers to the Brits are what they offer to us. And there it is; their rate is 2.2% better than ours, they get 63% more time on introductory purchases and 50% more time on balance transfers. Sadly it’s not all that surprising. Travelers heading north for their shopping will tell you that Tesco is much cheaper for groceries there too.

Electricity is another product we all need and lucky for us, we have Airtricity operating in Ireland. They are owned by Scottish and Southern Energy (SSE) in the UK and are one of the “big six” British domestic energy suppliers. So is there a Paddy Tax for electricity as well?

The only way to really measure the cost of electricity accurately is to base our sums on how much we use. The average Irish household uses about 5,600 kilowatt-hours (or units) of electricity a year according to Bord Gais… so that’s what we’ll use in our calculations.

If you were to buy 5,600 units of electricity from Southern Electric (SSE’s cheapest brand in the UK) it would cost you £658. That’s about €784 at today’s exchange rates. Buying the same amount of electricity from Airtricity’s cheapest deal would cost €884. So there it is again. Paddy Tax number two. We’re paying an extra hundred a year from the same company for electricity compared to our neighbours across the water.

Now Airtricity may argue that tariff structures are different and economies of scale enable lower pricing in the UK etc. etc. but I think it’s really just down to competition. There are a huge number of suppliers in Britain, most households switch for a better energy deal once a year and most of those use comparison services to do so. And here’s what’s very interesting. Airtricity is neck and neck the cheapest electricity supplier in Ireland but Southern Electric is nowhere near the cheapest supplier in the UK. You can actually buy 5,600 units of electricity in the UK for £542 which is only €646 – a savings of €238 or 37% a year over the best Irish prices. Now that’s a big Paddy Tax.

Here’s another one. Line rental from Eircom is currently €25.36 and even if you make your calls or get your broadband through another company, you’re still going to have to pay it to have a working phone line in your house. Across the water, line rental from BT can be had for £11.54 or  €13.73. So we’re paying a whopping 85% Paddy Tax on line rental.

How about current accounts? You guessed it. You can get a much better one in the UK too. How’s this for a great example: Santander is offering new customers £100 to open a current account and will pay 5% (really!) on anything you keep in your account up to €2500. So potentially you could earn £225 or €267 in year one from your current account! Blimey as they might say over there.

Back in the Auld-Sod, the best current account will net you only 1% interest on balances up to €1500 which will earn you just €15 per year. That’s from AIB’s High Interest Current Account. Yup, that’s what they really call it.

One thing that is more or less on a par between the two countries is savings rates. You can get a good 3.5% on a 10 grand one-year term in the UK and you can get the same rate in Ireland. There is one major difference though. You’d want to have guts of steel to go for that one-year term in the Irish bank that’s offering 3.5%, whereas you could put your 10K away in a British bank and your palms wouldn’t sweat and your heart rate wouldn’t race every time you thought about where you’d put your savings.

While we’re talking about savings, there is one bank that gives better rates in Ireland than it does in Britain. Nationwide UK is offering Irish savers 3.4% on a one-year term account. The equivalent UK account will get you 2.75%. Not bad, and there are rumours that Nationwide UK and a certain Dutch bank are extremely busy at the moment.

I know I haven’t done anything new here, we all know we can get booze and groceries cheaper in the North but it’s interesting to see that the stuff we need and have no choice but to buy at home is so much more expensive. That’s why it’s worth taking those few minutes to find the best electricity deal, the best gas deal and the best communications deals. It’s only if you switch that companies take notice and think about offering better prices. And God knows, come December 6th we’re going to need to save every penny we can.


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