Wednesday, 5 December 2012
Dáil Éireann Debate
[Deputy Richard Boyd Barrett: ] Instead, the Government made a cold-hearted decision to attack those who have nothing or next to nothing yet again. The property tax will cost ordinary families hundreds of euro, €300 or €400 extra per year. How will the 1.3 million people in this country who have less than €50 a month left over pay the charge? They simply do not have it. How will they pay for the cuts to child benefit? If they have three children, they will lose €38 per month. How will they deal with the €20 per month loss in earnings if they are working, as a result of the abolition of the weekly PRSI allowance? The 1.3 million people with less than €50 a month after they pay their bills will have that €50 and more taken from them as a result of these measures. This will drive them into poverty.
Then there are some of the really nasty cuts. The decision to cut the respite care grant for families with children with disabilities is obnoxious. Some €356 has been taken from families with disabled children or family members when it could give them some respite once a year. It is an outrage to cut the back-to-school allowance by €50 for some of the poorest families in the country. The Government had choices to avoid this suffering and make those who have the money and the profits pay a little more so the poor and the struggling do not have to struggle more than they do. The Government could have marshalled funds by imposing taxes to fund a stimulus and jobs programme to put people in this country back to work so they can contribute to the economic recovery we so badly need. None of that will happen and, shamefully, the Government restated its commitment to selling off our forests and other State assets and enterprises that could be the vehicles for job creation and economic recovery. Shame on the Tánaiste and shame on this Government. This is a recipe for long-term economic depression and suffering for hundreds of thousands of families. The Government had a choice; why did it not take it?
Deputy Stephen S. Donnelly: The entire approach to this budget is flawed. The Government is taking €3.5 billion from the Irish people and handing it to Anglo Irish Bank as payment on a debt we never owed. The Government is taking €3.5 billion from the Irish people but the deficit will fall by less than €1 billion. Why is that? It is because of the payment of almost €2 billion of interest to Anglo Irish Bank on a debt we never owed. The Government will allow AIB to retain a €1.1 billion top-up to its pension fund. The Minister for Finance, Deputy Noonan, stated that tax compliance is a core principle of our democracy. He lectures the people on their obligation to pay a property tax, the entire benefit of which he will hand to Anglo Irish Bank.
The Government brought forward virtually no meaningful investment measures. Instead, it announces a cut to funding in our third level sector. This is madness. What is the result? Yes, GDP is rising very slightly but it is rising because of exports by our multinationals. The profits all get expatriated. GNP, the measure of Irish companies, will rise by less than 1%. The Government makes much play of the fall in unemployment but it is due to emigration. The number of people at work has fallen by 35,000 in the past year. The austerity only approach, which feeds tens of billions of euro to two dead casinos, is doomed to failure. This budget is the latest chapter in that sad approach.
The Government spoke earlier about fairness. Let us examine the numbers. Between 2012 and 2013, if one earns €20,000, income tax will increase by 1.3%. If one earns €120,000, it will increase by 0.2%. There is an increase in tax on a person earning €20,000, which is 32 times bigger than the increase in tax for someone earning €120,000. The property tax, the change to PRSI, cuts to child benefit and the increases to duty, motor tax and carbon tax are regressive. I do not know how the Government can use the word fairness with a straight face. The budget is a massacre of those in the negative equity generation. The Government is cutting their child benefit, increasing their income tax and charging them for homes they despise, which are debt around their necks. If they are renting out their house and renting another house to live in because they cannot afford to buy a bigger house to live in with their children, the Government will charge 7.5% PRSI on the rental income from the house they do not want, which is in negative equity and on which they are now being charged a property tax. It is a joke.
The austerity only approach does not work, a point on which history is unambiguous. Further payments to the banks cannot be justified when this is being asked of the people. The Government makes great play of being 85% of the way there. This is rubbish. One payment of €31 billion was made to Anglo Irish Bank, which is a nominal accounting measure. The deficit peaked in 2009 at €22 billion. Next year, the deficit will be €13 billion so we are less than halfway through correcting the deficit. The Minister for Public Expenditure and Reform, Deputy Howlin, stated future generations will be proud of the work done today. They will not. They will ask why their country was decimated in the name of anonymous bondholders and why their schools and colleges were stripped of teachers and investment. They will ask why they are still paying for the debts of Anglo Irish Bank and Irish Nationwide. No Government should ask its people what is being asked by the Government.
I accept the deficit must be closed if the Government stops the €5 billion payment to Anglo Irish Bank and Irish Nationwide and takes back the €1.1 billion pension top-up from AIB and directs it towards education, job stimulus, investment and protecting vulnerable groups and reversing the most egregious cuts and reducing inequality. Then we can start to a genuine recovery in the economy. Vote after vote in the House tonight will push us further down the failed path of austerity.
Deputy Thomas Pringle: The Minister for Public Expenditure and Reform, Deputy Howlin said, "What the Irish people have endured has been tough and almost without precedent in the developed world". He says this as if we should be proud of it. Is he proud that children, pensioners, medical card holders, the unemployed, low earners and the self-employed will carry the can? How can people look to the future with confidence, as Deputy Noonan exhorted them to do today? This is a most regressive budget that will make people who are already struggling go below the water line.
The introduction of the property tax ensures it will be resisted by many people. The 0.18% rate is deliberately set low so that when local authorities take over the levying of the tax the real increases will kick in. Coincidently, this will only happen after the local elections in 2014. Does the Government think people will be fooled by this? There are very few exemptions from the property tax. Allowing people on low incomes to defer the tax and slapping an interest rate of 4% on them for doing it will be no comfort to them. Forcing people to build up future debts on the back of the property tax is only building further resentment at the targeting of the weakest in society yet again. The opposition to this tax will be fierce and rightly so. The people of Ireland will, through their opposition, force fairness on the Government. Opposition to the tax is not for the sake of it but is opposition to the strategy that the Government is pursuing of making the weakest sectors in society liable for the debts of the European banking system.
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