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Financial Resolution No. 2: General (Resumed) (Continued)

Wednesday, 12 October 2016

Dáil Éireann Debate
Vol. 924 No. 2

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(Speaker Continuing)

[Deputy Catherine Murphy: Information on Catherine Murphy Zoom on Catherine Murphy] Listening to the radio, I heard a man describe how his landlord sought a €400 rent hike, bringing the rent for his two-bedroom apartment up to €1,800 per month. Families come to my office every day to say their landlords have hiked up their rents. They have no choice but to sign further leases, which is completely unsustainable. It is a choice between doing that and homelessness. In many cases, people are agreeing to unsustainable rents. In December, the current so-called "rent certainty measures" are due to expire but there was no indication yesterday as to whether they will be extended. As that will affect HAP and rent assistance, it is a budgetary matter. There was also no mention as to whether the measures would be improved, which is what is actually needed. Renting has become the sole housing option for people and families across all demographics. It is no longer an interim measure or a student issue. Families find themselves for many reasons reliant on the private rented sector. If we are going to stem and, indeed, reverse the crisis in the sector, we need to adopt a different mindset. We must see rental as a valid housing choice not just in the short term but as a longer-term measure. There has to be some vision into how we do that. It has to be a sustainable choice not something that is at the whim of the market when there is a shortage as we are seeing now.

The policy on under 26 year olds who find themselves unemployed is ageist. Of those on the live register, 16% are young people under 26 years of age. There are 12,000 young people among the long-term unemployed. Given that this is a means-tested payment, there is a huge cohort who are not even counted as they do not qualify to go on the live register. That problem was actually widened by yesterday's decision.

There is a lack of ambition in the transport area. Indeed, we saw yesterday the announcement of Luas cross-city. For goodness sake, were we going to cancel it? Does the Government not see the holes in the streets all over town? To announce and announce again the same projects in the budget is nonsense. We need to see where the ambition will be. Congestion is one of the most significant issues in terms of competitiveness. Indeed, it is part of the reason DART and the first round of Luas were funded by the European Union. They were seen as measures that would deal with congestion, which was making Dublin very uncompetitive. Here we go again donkey's years later, but we have not seen things like DART underground, which would actually be a game-changer. We need to see that kind of ambition being stated. The problem with the budget is that it is short-term, lazy and bitty and fails to set out a strategic vision. As such, transport is one of the biggest disappointments in the budget.

Deputy Róisín Shortall: Information on Róisín Shortall Zoom on Róisín Shortall 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.

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