It amazed me this morning, when this Bill was under discussion, that there were only two or three Deputies in the House. It is packed out now. It shows the little interest there is in the implications of the provisions of this Finance Bill and the power and strength of an Opposition——
Finance Bill, 1983: Second Stage (Resumed).
Question again proposed: "That the Bill be now read a Second Time."
There is a lot of bluff in what the Deputy is saying too.
——if they wish to oppose a Government, as was demonstrated here this morning very well by the main Opposition party, Fianna Fáil. I would have hoped that they would have shown the same strength and power on issues such as the Bill before the House at present which will crucify the majority of working people for the next year or two and which has far-flung implications for the whole of the economy, in fact for people like the Telectron workers whom we have been discussing for the past half hour. It would be good if we did have a strong Opposition by Fianna Fáil to the implications of the budgetary statement and of the provisions of this Bill.
On a point of order, may I draw the attention of the Chair to the fact that we do not have a quorum in the House.
Notice taken that 20 Members were not present; House counted and 20 Members being present,
(Dún Laoghaire): This is a disgraceful waste of parliamentary time particularly in view of the professed need for Dáil reform.
The Deputy is talking about Dáil reform and he cannot provide a quorum.
(Interruptions.)
Deputy Mac Giolla. Order, please. Order for Deputy Mac Giolla, please.
The Government Chief Whip is objecting to providing a quorum and he talks about Dáil reform——
I think it is only right that there should be a quorum for every debate.
Deputy Mac Giolla, being a Member of a small party, finds it difficult to get the floor and, when he does get the floor, there should be order for it.
(Interruptions.)
A Cheann Comhairle, I feel those remarks of yours are addressed to this side of the House.
They are addressed to the House as a whole.
I want to point out to you, Sir, that on this side of the House we always afford Deputy Mac Giolla every opportunity to speak. I want to protest, now that I am on my feet, about the remarks of the Government Chief Whip, who seems to think that it is an onerous obligation on the Government——
That is not a point of order.
No, I am replying——
The Deputy is not on a point of order.
Then I ask you, Sir, to rule the Government Chief Whip as being out of order.
I have called for order several times.
I want to name the Government Chief Whip as being disorderly.
A good try.
(Interruptions.)
Deputy Mac Giolla.
We did have, some time ago, a long debate on procedures. After this I would hope the Government would take some decisions in regard to changes of procedures. I have been here only a few months. The Deputies who have so well used the procedures of the House this morning had quite a long time here. Probably the procedures should have been changed by now. Probably it should be a matter for the Ceann Comhairle to call for a quorum and not for individual Deputies to decide. There should be a quorum at all times in this House. Certainly Government Deputies should not object to a quorum being called.
This morning we had a very disappointing speech from the Minister for Finance. My understanding of finance and taxation, and the purpose of taxation, is that it concerns the manner in which the State can raise finance for the running of the economy, for injection into job creation, the planning of the economy and of the public sector, health, education and so on. It is my understanding also that when a Minister is bringing a Finance Bill before the House he should give us some idea of what are his plans for the use of this money, why he wants to raise so much money, what is the purpose, what he is going to do about jobs, health, education and all the other Departments of State. He did not give it to us in the budget. His speech this morning was a most disappointing one. It told us absolutely nothing about what the Government have in mind. He spent quite a time telling us about his tax evasion measures, how he will put people in jail if he catches them. He will not catch anybody. Nobody will go to jail for not having paid their taxes. In the earlier part of his speech the Minister referred to "the unavoidably high tax rates which are necessary to support a high level of public expenditure which have focussed unprecedented attention on the issue of tax equity". Attention has been on that issue for the last five years. I do not know where the Minister for Finance has been. He calls his Bill revolutionary. It is the most unlikely revolutionary thing I have ever seen in or outside this House. He spoke about the welcome new awareness of the need for a better distribution of taxation because he said he believed there is scope for considerable improvement. Where was the Minister in 1979 and 1980?
Where is he now?
Where is he? He certainly is not in touch with what is happening in relation to the taxation area or in relation to any other area of the economy. It is regrettable that the new found interest in tax equity has led to widespread confusion and exaggeration about evasion and uncollected taxes. That has been the Minister's line now for the past three weeks where, obviously under pressure, he is now trying to scale down the obvious facts which have been put before the House by himself, his Department and by various people over the last three or four months. He tries to deny the facts as he did in his speech a few weeks ago also.
On a point of order, could I ask who is representing the Minister or the junior Minister for Finance in the House at the moment?
That is not a point of order.
The Minister of State could have fooled me.
The junior Minister for the Environment is representing the Minister for Finance.
This is on the first day of the debate.
It indicates a grave lack of recognition of the effect this Finance Bill will have on the vast majority of people when the Minister for Finance or anybody connected with that Department is not present to listen to the debate and take any note of worthwhile contributions. It shows a lack of interest in what other Deputies have to say when he is not here today.
The Finance Bill must be seen in the context of the economic crisis that engulfs the country at the moment. It is the most important Bill that will come before the House this year. No matter how you look on it the implications of the Finance Bill are the implications for the whole economy. What we have been talking about over the past half hour and what we will be talking about for many months to come—jobs, unemployment, welfare, health and education — are all in the context of this Bill.
This Finance Bill is a right wing conservative Bill and puts forward one type of solution to the problem. The left wing solution, which my party put forward, is a completely different solution to the one put forward by the Government. It is a right wing Government despite the insignificant presence of the Labour Party in it. The Government are putting forward the type of policies which have been put forward in Western European countries and across the Atlantic over the past few years. The policies being pursued by those Governments have pushed the economies of Western Europe and the United States into depression and almost back to the thirties stage. This is bad for other countries in the west. Our economic position is particularly perilous because of our rapidly rising population and the foreign debt burden which has been put on the national finances. Ireland, within this context, is on the brink of being plunged into a monetarist crisis of depression by the policies now being enunciated by the Coalition Government.
The monetarism which this Finance Bill reflects is simply a repackaged formulation of the old laissez faire capitalist policies of the Victorian Age. The age of the Industrial Revolution in Britain found its expression best in the crude capitalism of the British mine owners and in the proponents, later in this century, of the Treasury view of the British Civil Service of the twenties and thirties. This is now being brought back into the treasury view of the Department of Finance here. The argument then was that employment in public works diverted labour from the private and the so-called productive sector and also from cuts in wages and Government expenditure and the unfettered working of the market economy. It was a diversion.
The implementation of those policies in Europe and America plunged the world into the great depression of the thirties. The proponents of the laissez faire capitalism of the twenties were arguing for an increase in unemployment aimed at cutting workers' living standards through the market mechanism. They also called for a reduction of the role of Government, which is precisely what is being done now, a sentiment which has its roots back in the eighteenth and nintheenth centuries for the simple purpose of impoverishing the mass of the people and increasing the wealth of the wealthy. It was simply a naked cash grab.
Today the new language of monetarism was necessitated by the fact that over the last few years capitalism indulged in the welfare state, and in this new language the false gods of private sector efficiency were created. The new doctrine calls for the sole role of Government to be that of control of the money supply. All the Minister for Finance has talked about since last January has been money, money supply, books and budgets — in reality a reduction of the State's role in the economy to the absolute minimum — also public expenditure cuts, that is, cuts in the social wage of which health and educational expenditure are the most important.
The policies of laissez faire and monetarism, even in the most advanced capitalist countries, have been shown to be unworkable, at least for the vast bulk of the population. Over and over again it has shown that, left to its own, the market economy will produce chaos, unemployment and slumps. If that has been the case in the most resilient capitalist economies — for instance, the United States — how much more is it true in countries like Ireland whose capitalist sector is weak, puny and inefficient. You could also add the word “stupid” if you refer to the comment of the President of the Self-Employed Association when he talked about reducing the number of public sector employees by 72,000. He only wants a health service for himself and his family and for those of other self-employed people. Presumably, he wants to stop the Forestry Department and the fire brigades from operating. What does he want left? Nothing, except a few self-employed. This type of stupid comment gets amazing coverage in the mass media, when in normal circumstances one would imagine that any normal person would just laugh at it and throw it in the basket.
It is not surprising that the international application of monetarism in the second half of the seventies has led the world to the brink of a thirties-like depression. It has imposed enormous burdens on the workers in the broad mass of societies in the advanced industrial nations. It has put intolerable strains on the poorer, debt-ridden countries such as ours. As a result the gap between the Northern Hemisphere and the Southern Hemisphere has grown, and it is a problem which is almost as great as the risk of nuclear war. This is pointed out in a book published yesterday or the day before by the Irish Commission for Justice and Peace. The foreign policy of the Reagan administration, with its increasingly naked intervention in its client region of Central America and in its nuclear brinkmanship, finds its economic counterpart in the economic policies of monetarism called Reaganomics. On this side of the Atlantic it is called Thatcherism.
Monetarism is becoming increasingly discredited, and I hope it will continue to decline in credibility. However, it would be a mistake to underestimate its potential for harm, especially in Ireland. Nowhere is its influence more evidently seen than in Fine Gael, although Fianna Fáil's The Way Forward also bore a monetarist imprint. Monetarism first made its appearance in the 1981 Fine Gael election manifesto. This had an unmistakable monetarist thrust at its centre, and to shift the tax base from direct to indirect taxation was one of its main features. The Fine Gael list of priorities before the November election was filled with the doctrine that the market must be the final arbiter. Unfortunately, at some stage last year, around July or August, Fianna Fáil seemed to suddenly adopt the monetarist approach of Fine Gael, which was a change from the approach they had adopted earlier last year. I do not know under what pressures they did so, but this was revealed when they put their policy forward in the November election.
The Way Forward was marked by an almost total reliance on the private sector, cutbacks, balancing the budget and other monetarist's formulae, such as cutting back on health, education, unemployment benefits — all the well known elements of Thatcherism. It is now clear, to judge from the statements made since the budget by the Minister for Finance and the Taoiseach, that the 1983 budget is only the first step in a campaign to impose monetarist doctrines on an already crisis-ridden economy. The path blazed by Margaret Thatcher is to be slavishly followed by the Government. It falls particularly into perspective in the light of the speech delivered by Deputy Dukes at the monthly lunch of the Confederation of Irish Industry on 13 April last. That was the day 150,000 workers took to the streets to express their dissatisfaction with the Government's tax policy. On that day the Minister stated the facts as he, and presumably the Cabinet, saw them, and his remarks annoyed Deputy Spring. Obviously he was only annoyed at the timing and tone of the Minister's comments, not the content. The Labour Party then went through the usual Coalition ritual dance which we have got regularly when Fine Gael members of the Cabinet put the boot in. As soon as a Member of the Labour Party says how horrified he is, it quietens down and things go back to normal.
Deputy Prendergast made an excellent case this morning against the Finance Bill and explained what its effects would be. He put forward Congress policies which are totally in opposition to those of the Finance Bill; and then one realises, with amazement, that he is on the Government side of the House. However, I suppose we have to go through these rituals to allow people to express one view for the media and do something else when they walk through the lobbies to pass the Finance Bill.
The Finance Bill is the legal manifestation of what has been the most unfair, anti-working class, inegalitarian and mean budget that has ever been introduced, although I am well aware that recent budgets take some beating in that respect. It is a definite step backwards towards dismantling whatever elements of the welfare state we had by use of the tax system to promote inequity in wealth distribution. We are moving back to a Victorian or Dickensian Age. For the first time in several years social welfare benefits have been increased by less than the rate of inflation, resulting in a real cut in pensions and other social welfare payments. Benefits were cut when unemployment has never been higher and PAYE tax bands and allowances have not been indexed against inflation. Exemption limits from tax have been put up by less than the rate of inflation. Through the imposition of an additional, regressive tax in the form of the 1 per cent levy, and by VAT and other indirect tax increases, the Government have ensured that the standard of living of the lower paid workers has been reduced by not less than that of the higher paid. This is unprecedented.
In their approach to expenditure, both capital and current, the Government have shown that they fully intend to erode the welfare state, which will hurt the less well-off people in society. On the capital side they were fully prepared to axe productive capital spending that could lead to self-sustainable jobs in future. The anti-tax evasion measures and the general tax increases apply to all classes but they are merely an irritant as far as the wealthy are concerned.
Debate adjourned.