I am pleased to have an opportunity to speak on this debate. It is hard to understand how the title Building on Reality was arrived at. The one clear observation available from the document is that the Government have failed to grasp the reality of the economic chaos. We have the highest unemployment figures in our history and an escalating national debt. The plan has failed to illustrate this and to create opportunities so that these difficulties can be tackled.
This so-called plan acknowledges that there is persistent imbalance in the public finances, and it states that "this has made a major contribution to imbalance in the economy as a whole". This is patently obvious to every citizen and is mainly due to the Government's failure to grapple with the economic situation.
There are cutbacks in every sector, and this has led to the virtual stagnation of our economy. Every citizen has been affected in some way or other by these horrible cutbacks. In August we had the £56 million mini-budget which axed food subsidies by 50 per cent. This callous, cold, impassive announcement was made after a Cabinet meeting by a civil servant. The Taoiseach, Deputy Garret FitzGerald, the Leader of the Government and the elected leader of the country, decided to turn his back on the people and flew out of this island into the oblivion of a sunny holiday in France. He ran from the wrath of the people and left the Labour Party, the real tail of this Coalition dog, to carry the empty can of heartless impositions on an innocent people who expected the big stage-managed Taoiseach at least to show human leadership. Instead he showed a complete lack of political leadership which necessitated the sudden exit of desperation.
There are now two distinct groups of poor people in this country. Firstly, there are the people at the bottom of the ladder who are unemployed and in a hopeless situation. There are the people on disability, on old age pensions or on widows' pensions. There are the people living in the council houses with big families who see no light at the end of the tunnel. All these people have been the innocent victims of these savage food cuts. But now there are the "New Poor". These are the people in the middle income group, the people who pay for everything. The father is working in a permanent job if his company can sustain the economic pressure and the high taxation being imposed by this Government. This man is paying abnormally high levels of direct taxation in PAYE and PRSI. He has a house mortgage and may have other financial commitments also. He believes in making a contribution to the country through being self-sufficient and providing facilities for himself and his family, thus releasing the State from its duties to him and his family. He has a wife and school-going family and must pay for absolutely everything. He is also a high contributor through indirect taxation and gets absolutely nothing by way of assistance from the State. He pays school transport charges and school fees in regional technical colleges or university as his family members cannot qualify for any grant or aid, due to his income stratum. This family situation is one of total frustration and is typical of many families right across the country. For this family their only joy from life is survival in all its aspects, and they live from day to day.
Right down at the bottom of these two groups of people are a third group, people who are on the breadline as a result of the discontinuation of social welfare, unemployment assistance, the discontinuation or reduction of old age pension or the total discontinuation of disability by heartless, uncompassionate officers aided and abetted by a heartless. inhuman Minister for Health. The Minister seems to have given a directive that anybody on disability should be called before a medical examiner and rejected instantly. There is no account taken of the person or the dependence of his or her family on their income, whether it be assistance, disability or whatever.
There is total chaos in the health services and hospitals are completely overcrowded, wards are being shut down and in some instances entire hospital units are being closed. There is a shortage of qualified nurses to look after patients and old and infirm people who are in constant need of care and attention are being shunted home as if they were goods in a railway station. We have the crazy situation in the Galway Regional Hospital where a new maternity wing has been built and fully equipped and the Minister will not sanction the necessary finance to staff this vitally needed medical asset in the western region.
What hope has the plan for all these people and what opportunity does it create for them? Absolutely none. This Coalition Government, the supposed Government of all the talents, put nothing on the table prior to the last general election but promised that they would create the economic recovery that was needed to stimulate growth and industrial development. The record of this Government is a dismal plethora of silly mistakes since they first entered office. Earlier this year we had the discovery of the £500 million "black hole" in our economy. This was as a direct result of the Government's underestimating our balance of payments to the tune of £500 million. The reaction of the Taoiseach on that occasion was that he was delighted at this discovery, which was an admission of total mismanagement of our nation's affairs. The Government totally failed to read accurately the financial affairs of the nation.
Of course this could be expected of the Taoiseach who, as a member of another Coalition Cabinet from 1973 to 1977, forced that Government into a position that our current budget deficit escalated out of all proportion, from £5 million under Fianna Fáil in 1972 to over £200 million under the Coalition in 1976-77. Further our accumulated foreign debt ballooned from £126 million in 1972 to over £1,000 million pounds in 1976-77, and today with the same common economic depressor involved, namely the Taoiseach, our accumulated foreign debt is in the region of £2 billion.
Recently we were made an international laughing stock by the failure of the Minister for Agriculture to have proper information and figures during his negotiations on the milk super-levy last spring. Just as a civil servant announced the food subsidy cuts in August, again the Department of Agriculture officials are being blamed by the Minister. The fact remains that these figures were confirmed accurately on the fifteenth day of the month on which the negotiations took place and the Minister failed to avail of the confirmed figure and negotiated on figures which were spurious and dubious, similar to the projections and figures in this plan. Irish agriculture and our national economy will be £60 million less well off as a result of the inefficient, ineffective negotiations by our so-called Minister for Agriculture. Where were the handlers on these occasions? Probably arranging an overseas trip for someone who could be relied on to project an image of blue whiteness, which is being eroded daily by inept performance from this Coalition Cabinet.
It is sad that such blatant errors should be repeated by this Government and by key personnel within the Government. Of course the Minister for Finance cannot be exempt from blame either and, particularly in view of his European experience, he should have been in a position to ensure the finality and the accuracy of the figures available to the Minister for Agriculture. He is further to blame as the person responsible for the financial affairs of our country and his failure to ensure that the Comptroller and Auditor General's office has sufficient staff, despite the fact that there have been several requests for same, shows the Minister for Finance's total disregard for public expenditure. It is very serious that a very senior Government officer has been curtailed in his appraisal of State expenditure and that the taxpayer is being denied the necessary confirmation that value for money is being given for every pound of hard earned taxpayers' money which is being spent by this Government. This is totally unjust, unfair, and discriminatory and needs an immediate remedy through the provision of adequate staff for one of our most efficient and respected officers.
We welcome the capital investment in roads and transport services contained in this plan. We have been pioneering this in the past and we are delighted this Government have picked up some of our ideas.
The Government again have failed to create any move in our economy. Last night the Minister for Finance stated:
The Government's plan has two central objectives — first, to increase employment, and especially sustainable employment, and second to halt the rise in taxation, both direct and indirect.
Our national job creating agency, the Industrial Development Authority, will be starved of finance under this plan. The IDA are internationally recognised as an outstanding Irish organisation capable of creating jobs and competing professionally in all aspects of industrial promotion with their many competitors throughout the world. The plan states emphatically that IDA expenditure for the provision of land and buildings will be financed entirely from the proceeds of the disposal of IDA owned land and buildings. Where is the employment generating opportunity being created here, and where is the sustainable employment that this Minister talks about? What hope have towns or areas where there is no industrial base already or where there has been in the past and it has been sold to an existing company which in the interim, as a result of this Government's pressure may have gone into liquidation and may have been disposed of as part of the liquidator's assets in meeting the commitments of the company, thus leaving a town without any industrial base? What hope have these towns or areas of getting any industrial base or facilities during the life of this negative Coalition?
No later than yesterday the Minister for Finance admitted for the record of this House that we have the highest level of indirect taxation in the EC countries. This plan does nothing to ease this burden. VAT is the main source of indirect taxation in this country and the report of the Commission on Taxation recommended in early summer that there should be a single VAT rate in the country. The Minister himself has repeated this several times in this House and outside it. After two years in Government it is now long past the time when this Government should have moved in that direction and ensured that at least from January 1985 a single VAT rate would be available to the business sector of our conmmunity who collect the VAT and to the consumer sector of our community who pay the VAT.
The Minister also has admitted, for the record of this House, that Ireland has the second highest level of personal taxation in the EC countries. This clearly illustrates, I am sure, my earlier remarks about the new poor in our country.
Much ado has been made by the handlers, through the media, of the farm tax situation. This is to appease the Labour Party and the PAYE workers on whom the Government will be depending for votes in the next general election. There is total confusion within the agricultural sector and indeed by professional people vis-à-vis the farm taxation system being proposed, as it is both vague and unclear. The plan states that the level of farm taxation will be expected to yield twice as much in future years. It is estimated that there will be £10 per adjusted acre as a yardstick for collection. Firstly, how will the adjusted acre be arrived at and what guarantee have farmers that this will remain at £10? It is my belief that, if farm taxation is to yield twice as much to this Exchequer, then it will be the small farmers in the 20 to 60 adjusted acre bracket who will make the major contribution. I would like the Minister to clarify in particular the situation whether the farm taxation imposition will have an exclusion base of 20 adjusted acres for all farmers.
This plan fails to recognise the fact that farmers are the biggest indirect taxpayers in the country, and that agriculture, as the bedrock of our economy, needs to be stimulated in order to create jobs, both on and off the farm. I believe that farmers, like every other sector of our community, must pay an equal share of tax; but on the imposition of any tax on any particular sector it must show complete equity. This plan takes no account of a married man with a wife and family on the land vis-à-vis a single man on the land and therefore fails completely in equity. I hope the Minister will clarify all this at the end of this debate and allay the fears of many people in agriculture that they may be forced out of this industry.
We also have the situation in the accounts system where no allowance has been made for capital investment by farmers in necessary equipment, whether it be a tractor and farm machinery or a motor car and trailer or whatever. This again is blatant discrimination towards agriculture and I expect that the Minister will remove this anomaly immediately.
The Government have failed to recognise the ability of the construction industry to lift our economy from its present doomed situation. They have made pious promises regarding their investment in housing and infrastructure, but again it is not quantifiable. Their initiative in a special subsidy of £5,000 per head for local authority tenants who wish to acquire or build their own houses is to be complimented. However, this is going to exasperate an already overloaded local authority housing demand still further and the plan takes no account whatever of the necessity to provide a certain minimum amount of money each year for mortgage finance. Already the Housing Finance Agency have failed to meet their target this year and many people who got loan sanction some months ago are now in serious difficulty on extended bridging finance. Is this the pattern that is going to emerge throughout the life of this plan, or can the Minister or the Government clearly point to the amount of money that will be available to local authorities and finance agencies over the next few years?
The financial cutbacks being imposed by the Government and their own capital programmes through the postponement of projects like the Derryfada briquette factory at Ballyforan are absolute financial lunacy. An office block and a workshop have been built on a large tract of developed bog and progress has been completely halted. One-hundred-and-fifty jobs permanently on the bog are going, and 150 more that could be created after the building of this factory will never be realised if this Government get their way. Millions of pounds are being spent by this Government on professional fees through Government Departments to planners and consultants to design and redesign buildings which the Government have decided they are not going to proceed with. Many of these, particularly in the prison services, were planned under Fianna Fáil. We now have a situation where, rather than build a prison, the Minister for Justice is demanding that the internationally known forestry college at Kinnity, County Offaly, would be taken over as a detention centre. This shows the Government's total lack of support for forestry and their particular trait of short term decisions for political expediency.
This plan falls down completely on job creation. At best it is patchy and scratchy. It juggles with new job terminology and tries to play computer games with unemployed people, school leavers and part time workers. It proposes to create 10,000 part time, half week jobs in 1985. Would it not be better for both the economy and the people if a sufficient effort was made to create permanent jobs for half this number, and quit creating an image of effort for many when the end result is more job frustration?
Prior to the last election this divided two-party Government promised that they would be totally committed to law and order. Extra police were to be recruited, but this has not happened. We now see the virtual breakdown of law and order and the total turn around by this Government on this key State area over the past year. There have been cutbacks as regards manpower and the deployment of manpower, and several times the Minister for Justice has stated that gardaí would be recruited only on a natural wastage situation, that is, through illness, resignation or death. In these days of such turbulence throughout our community, when old people and women fear for their lives in remote rural areas and in highly populated city areas, there should have been more recruitment to our police force.
Our national Army are of credit to our country. Their support for our own civil police force has been exemplary and their record in international peace keeping situations overseas has made us all proud of our great Army. There is now a large volume of educated, intelligent young people unemployed throughout our country. There was an opportunity here in this plan to create some pride in our country through an extension of our Army numbers and the discipline and the training that would be available even on a short-term basis to some of our young people should have been utilised through an extension of the regular Army, or, indeed, the FCA.
The Government have failed to recognise this situation but are prepared to allow our Army to take part in an anti-national controversial British Legion Remembrance Day ceremony. This, despite the fact that the Taoiseach after last year's debacle on the same situation, gave a commitment that the Army would not participate this year and that a National Commemoration Day for all Irish soldiers who lost their lives, irrespective of the cause, would be set up. I hope the Taoiseach will clarify this situation immediately and allay the fears of the majority of Irish people and save our Army from any further embarrassment.
I believe that the main purpose of this plan is to bring two different parties of varying ideologies together again after their mid-summer disintegration. The figures throughout the plan are not quantifiable and cannot stand the test of justifiable economic criteria. Is it any wonder that six economists have left the Department of Finance totally frustrated by the Government's insistence on the inclusion of figures in this document that have not been acceptable to their key advisers? The Government Press Secretary, Mr. Prendergast, has done his utmost to fabricate this statement similar to the fabrication he did in the prison officers situation. He was at pains to name the seventh adviser who moved to the ESRI and, surely, if his other statement was correct he should have named all or none.
It is my view that this plan lacks a straightforward coherent, streamlined, positive economic remedy for the problems facing this country at present and I believe that this Government will founder striving to hold politically together, while there are stark economic realities which they refuse to recognise. This plan could be re-named "Coalition Promotion — starve horse and you'll get grass".