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Financial Resolution No. 2: General (Resumed)

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Financial Resolution No. 2: General (Resumed)

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Snippet Contents:

As Deputy Catherine Murphy has said, the main aim of a budget should be to set out a long-term strategic objective for the country. Unfortunately, there was no indication that the Government took that approach yesterday. It was much more about keeping all the Government-supporting Deputies on board. There is a little bit for everybody to try to keep Fianna Fáil and the Independents sweet while predominantly serving the Fine Gael base. Because of that hotchpotch of proposals, there is no coherent vision set out in the budget in its totality. One of its worst aspects is the lack of concern to deliver on the promise of fairness which Fine Gael and so many other parties made in the general election earlier this year. We all accept that resources are finite and remain limited. For that reason, we should be very clear about prioritising the objectives in the budget, setting clear objectives and ensuring that fairness underpins them.
We tend to pride ourselves on the fact that our income tax system is progressive. It certainly was very progressive, but we have seen over the last six years, including yesterday's budget, a shift from progressive to regressive measures. There are changes to the tax system with the reduction in USC. Certainly, the Social Democrats would have argued that we should not erode the tax base. We would have been much better off to use that €335 million to invest in our public services and repair some of the awful damage that has been done to housing and health in particular during the austerity years. Unfortunately, that is not the approach the Government has taken. It decided to cut the universal social charge, but did so in a way that was extremely regressive. A couple with two children who earn €20,000 and pay tax under the PAYE system get a benefit of €103 per year as a result of yesterday's changes. I contrast that with a similar couple with two children who earn €175,000. That very wealthy couple gets a benefit of €453 from yesterday's budget. That cannot be described as fairness by any yardstick. The situation in relation to self-employed people is even worse. A self-employed couple earning €20,000 get a benefit of €253 per year while a self-employed couple earning €175,000 get a benefit of €753 per year. How can the Government talk about trying to achieve fairness when it introduces regressive measures like that?
The budget should have been poverty proofed. I do not know if there are plans to do that in the coming weeks, but the Minister of State, Deputy Dara Murphy, might say so if there are. There is no evidence of any attempt at poverty-proofing in this. There are further regressive proposals in the budget. The help-to-buy scheme is one which will assist people to buy houses up to the value of €600,000. Given the huge problems with which we are dealing, how can the Government justify making a €20,000 grant to people who can afford to buy a house worth €600,000? In that scheme, the bigger the house one buys and the better off one is, the bigger the grant one will get from the Government. It is another regressive measure for which there is no justification whatsoever. I appeal to Fianna Fáil, whose members are supporting this proposal, to at least insist on seeing a cost-benefit analysis before signing up to it in the Finance Bill.
Speaking of regressive measures in the budget, I note the mealy-mouthed change to prescription charges. This is a regressive move. Prescription charges started off at 50 cent per item. In 2011, Fine Gael promised to abolish prescription charges. Rather than abolishing them, Fine Gael actually increased them five-fold. We are now in a situation where many low-income families must make a decision about whether to take necessary and important medication or save money for some other expense. People should not be put in that situation where they have low incomes. Rather than tackle this across the board, the Government has, in a very mean way, reduced prescription charges by €5 for over-70s. I do not know if the Minister of State, Deputy Dara Murphy, appreciates the fact that poor families, as it is only poor families who qualify for medical cards, are the people who can least afford to pay the prescription charge.