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Financial Resolution No. 5: General (Resumed) (Continued)

Wednesday, 14 October 2015

Dáil Éireann Debate
Vol. 893 No. 1

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(Speaker Continuing)

[The Taoiseach: Information on Enda Kenny Zoom on Enda Kenny] As the end of this Dáil approaches, we are facing a fork in the road. One track points to continued stability and certainty about the future. The signposts along that way are now clear, namely, no booms, no busts but responsible increases in public spending within a reformed public service built on a solid platform of steady economic growth; the completion of tax equalisation for the self-employed and other measures to support job creators; more realistic and affordable increases in the minimum wage to make work pay; the progressive abolition of the universal social charge, USC, to reward work and effort and to make Ireland more attractive for mobile foreign investment and skills, including for returning emigrants; low interest rates for business and home owners, underpinned by further deficit and debt reduction and rising domestic and international confidence; and a robust defence of the 12.5% corporation tax as the linchpin of the Government's jobs policy.

As we face this division in the road, one surely can see that along the other track lies instability and chaos. The siren songs of ending austerity and fairer recovery will, in fact, mean the exact opposite. The stepping stones back towards the economic abyss are well laid out in alternative budgets published by the Opposition, namely, an Oireachtas unable to pass coherent budgets, sapping confidence and undermining economic discipline and job-killing tax increases on work and business to pay for reckless promises. In that context, I am surprised the Fianna Fáil Party has moved so far from where the late Seán Lemass had placed it as a low-tax party that was confident and competent based on competitiveness and exports. Instead, one is faced with job-killing tax increases on work and business to pay for reckless promises coming from Opposition parties, as well as the prospect of confidence-destroying confrontation with our international partners and higher interest rates. In recent months, all Members have seen how quickly fragile economic recoveries unravel in the face of political instability and reckless economic management. The Opposition wants the country to go backwards but the Government of Fine Gael and the Labour Party guarantees that stability and further progress in the interests of all the people. This budget brings the country forward and secures the economic recovery and I commend it to the House.

Deputies: Hear, hear.

Tánaiste and Minister for Social Protection (Deputy Joan Burton): Information on Joan Burton Zoom on Joan Burton This is a carefully designed, responsible, interlocking budget in which different pieces come together to form the overall picture, that is, a picture of a country moving firmly in the right direction and of a society becoming more confident that both society and the economy can be restored. The budget is designed to help people back to work, to raise living standards in all homes, to help vulnerable people in society, to provide better services, to maintain the great progress the Government has made in restoring the public finances to health and to reducing the debt to sustainable levels and to capitalise on the opportunity we now have to deliver an Ireland that is better for all.

The budget is designed to improve the lives and living standards of every person and every family in the country, including the person on the minimum wage who, as a result of these changes, will be more than €700 better off next year and the middle-income family with two children who will be almost €1,000 better off because they will pay less USC and receive more child benefit. Moreover, if they have younger children, they also will benefit from additional early childhood care. It also includes the 66 year old carer who will receive an increase to his or her weekly payment and a 75% Christmas bonus and who will see the respite care grant restored in full to €1,700; the retired couple who will see their pensions increase and receive the 75% Christmas bonus; the jobseeker who desperately wants to get back to work but needs some help to get there; and the nurse, garda or teacher whose take-home pay will increase as the Government unwinds the financial emergency legislation and gradually restores public sector pay.

This budget is about progress and opportunity. It is about the progress that we, as a people together, have achieved in putting this country back on its feet. It is about the opportunity we now have to secure the recovery and raise living standards in a sustained way by continuing to follow the right path, that is, the path set out by the Labour Party and Fine Gael in government. Let me be clear: we are moving steadily in the right direction. The economy is growing at speed. As Tánaiste, Labour Party leader and Minister for Social Protection, my absolute priority is helping people back into work. In this context, 130,000 jobs have been added since the peak of the crisis and unemployment has fallen by more than one third from a rate of more than 15% to one of 9.4% at present. For the second budget in a row, the Government is raising living standards in a responsible and sustainable way that safeguards the public finances. It is investing in essential public services such as the expansion of the early childhood care and education scheme to give children the best possible start in life. In addition, the Government is reducing pupil-teacher ratios in schools to give children the best possible education and is funding the next phase of free general practitioner, GP, care for six to 11 year old children to ensure their parents need not worry about the cost of visiting the doctor.

However, while we are on the right path, we have not reached our destination yet, that is, an Ireland which is visibly better for all. Many people have not yet felt the recovery. They have family members and friends who still struggle with the after-effects of recession. Renewed prosperity has not yet reached all communities and any suggestion here today that the Government has dealt with all problems would be glib in the extreme. The depth and scale of the crisis was far too savage for that. The Government has a way to go, more work to do and significant problems yet to solve. However, it can be more than hopeful of doing so; it can be confident of so doing because the country now has the opportunity to do this and it must be grabbed with both hands. The Government has the opportunity to make this a better country for all, to invest in the services that will make this a reality and to create a strong economy, a decent society and thriving communities. This opportunity has been built on the work undertaken since 2011. Back then, Fianna Fáil had strung a wrecking ball through the economy and society. People’s lives and hopes for their futures and those of their children had been flattened. When the Labour Party and Fine Gael came into government, they had a simple task, namely, to rescue the country from that ruin, to rebuild the economy and to repair society.

This is the Government's fifth budget. The first three, in particular the first two, were immensely difficult for people. However, they were necessary to restore the public finances to health, to help sustain, create and regrow employment and to chart a course towards strong economic growth; not the jobless growth of old recoveries but a job-rich growth which I am pleased to state is what has been achieved. At all times, the Government has sought to protect the most vulnerable in society to the greatest extent possible. Last year, much quicker than most economists had expected in 2011, the Government was able to introduce a budget that began the process of raising living standards and re-investing in communities. The Government kick-started the social recovery and is continuing that process this year. This is a budget for the people made possible by the people. This is a budget designed to help low and middle-income workers, families, retired people and vulnerable groups in particular.

The USC was a dreadful and difficult legacy of Fianna Fáil’s wretched approach to the economy. In this budget, the Government is reducing USC for the second year running; it is reducing all three rates in order that low and middle-income workers benefit and it is capping the gains for the highest paid.

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