Deputy Wilson, and he has 30 minutes.
Adjournment of Dáil: Motion (Resumed).
The following motion was moved by the Tánaiste on 18 December 1986:
That the Dáil on its rising on 19 December, 1986, do adjourn for the Christmas recess until 2.30 p.m. on Wednesday, 28 January, 1987.
Debate resumed on amendment No. 1:
"After ‘1987' to add ‘and requests the Taoiseach in the meantime to advise the President to dissolve the Dáil'.".
—(Deputy S. Brennan.)
I would stress the terms of the amendment to the resolution which has been put down by the Fianna Fáil Party asking the Taoiseach to go to Úachtarán na hÉireann and have the Dáil dissolved. In putting down this amendment we are conscious that this is the wish of the majority of the people. It is also the wish of all the organs of opinion in the country. The combined forces of the Opposition over the last few weeks time and time again have been frustrated when they were clobbered by the Constitution. Time and time again the Ceann Comhairle stood up and invoked the terms of an Article of the Constitution and said that as there was an equality of votes, he had to vote with the Government, and thus keep them in office. It is ironic that this side of the House should be clobbered by the Constitution, by a party who show scant respect for the Constitution and who have never tired of attacking certain Articles of that Constitution, even though the people have proved a bulwark in some instances and protected the Constitution against attack. The people are angry with the present administration. They are anxious to get rid of them and are showing their anger increasingly through their actions in both the public forum and at private gatherings.
Why this anger, one may ask? Why are they angry with a Government who, after all, they foolishly trusted in 1982, when they accepted a Government who in accordance with their own statements had expertise particularly in the financial area, to run the country? It is important that we emphasise the plank upon which this Government were elected. In fact, they were not elected, there was a hugger-mugger deal made after the election. What did the principal Government party put before the people in 1982? They claimed that they would wipe out the national debt.
The current budget deficit.
They claimed that they would eliminate the current budget deficit.
That is different from the first thing the Deputy said.
The Deputy should not interrupt. They got a national debt of £10.2 billion in 1981, from Fianna Fáil, after the huge increases in oil prices of 1979. Of that, £3.8 billion was foreign debt. We should not forget that the huge increase in oil prices from about $13 a barrel when we took office in 1977, to $39 a barrel in 1981 had impacted on that national debt at that time. I am here now to attack the Coalition mythology of 1981. They got away with it and they are starting it again. The two chief planks we see emerging relate to financial responsibility and political character assasination. The national debt has now risen from £10.2 billion to £23.3 billion at the latest reckoning and, of that, £9.8 billion is foreign debt. The foreign debt increase is as great as the total national debt when the Government took over in 1982. It is very important to realise that. It is very important that the people should realise that, because people who were not committed to any political party swallowed the line that was given out to them in 1982. That was plank one and it was disastrous.
The national debt is now 145 per cent of GNP and the Government should not put their heads up to talk about national debt or fiscal rectitude again. In order to compound the difficulties of the economy they have now cut capital borrowing — where we might have got some result and where there might have been some impact on employment and development in the economy — by about half, and capital goods imports have dropped. In other words, nobody has any confidence in this economy because of the way in which it is being run.
The second plank in 1982 was the elimination of the current budget deficit — and people believed them. They must feel very foolish now. The Coalition Government said they would immediately eliminate the deficit. Then they said that they would eliminate the deficit over two years and then they increased the period during which they would eliminate the deficit. I sat here, slightly naive, when I heard the Minister for Finance earlier this year tells us that the budget deficit for this year would be £1,250 million. I said it is very big, coming from a party who said they would eliminate it altogether by this time, but I said perhaps they might stay with us. Now we find that they were not even able to keep it at that. Various guesstimates were made as to how much would be added on, from £100 million to £180 million. It may not go all the way to £180 million, but commentators believe that at least it will be £170 million.
If I were a member of a Government who had outlined that programme, and were so unsuccessful on those two major issues, I would not put up my head for the election that will take place next month or in February. I would not be seen in public because my credibility, if not gone, should be gone. We have between £1,400 million and £1,500 million of a current budget deficit from a Government who had charge of the finance for this country for nine out of 13 years, so there is no point in coming out with the old codswallop about Fianna Fáil being responsible for the state of the national finances. Unfortunately business people and manufacturers, and unfortunate private citizens are looking at interest rates of up to 17 per cent. What has been the result? The record of retail sales tells its own tale. Taking 1980 as 100, they are 10 per cent down. Instead of a modest increase per annum from 1982 to at present of 1 per cent or 2 per cent, what do we find when we include petrol and garage sales? a 10 per cent drop in retail sales.
Is it any wonder that the country is in the state that it is in? Is it any wonder our young people are leaving? Is it any wonder that the numbers of unemployed are increasing? Last night Deputy O'Kennedy — our spokesman on finance — and I met representatives of the Chamber of Commerce in Cootehill. I have no doubt at all in my mind that if they could get their hands on people who are talking about a consumer boom they would lynch them. Who was talking about a consumer boom later this year? All the wise economists who were advising the Government. Who put it on the record? The Taoiseach, Dr. Garret FitzGerald, said that there would be a consumer boom. Consumer boom my granny's grunt. Those people are destitute.
One man gave us figures from his books. In 1982, he sold 250,000 gallons of petrol. In the corresponding week in 1986 he sold 249 gallons. He reckoned that the Exchequer had lost about £50,000 on that one deal alone. You may say how can I blame the Government for that but I do blame the Government because the take off from a gallon of premium grade petrol is 72 per cent. That is as a result of direct Government action and they are responsible. The collection of businessmen to whom we spoke with last night are destitute. Their family businesses are bankrupt and they have wives and families and big worries. Furthermore, they told us that the value of their property has gone down.
If the Taoiseach would like to read an account in one of today's newspapers of a speech made by Commissioner Sutherland, whom he appointed, he would see that the Commissioner realises what is happening and what is going on. Quite frankly, those people are very patient. I am not claiming any monopoly of wisdom with regard to that on this side of the House because members of the Fine Gael Party, the Labour Party, The Workers' Party and the Progressive Democrats all know what is happening in the area of Counties Louth, Monaghan, Cavan, Leitrim, Sligo and Donegal. There is a crisis in that area. I do not know why this somnolent Government are not doing anything about it. Perhaps, we have been too decent and too respectful of the rules of this House and that is why it has not impacted on the consciousness of the Dublin establishment the way it should have.
The Government should wake up to see what is happening to a large sector of the community. Businesses are going down. That particular man has the same number of people to sell 249 gallons as he had to sell 250,000 gallons. It cannot go on. He must let people go and he cannot do it unless he is a philanthropist. I am talking about the area of Blacklion, Ballyconnell, Swanlinbar, Belturbet, Cavan town, Cootehill and Clones to Dundalk on the north eastern side and right up to Moville and Bunaphobal in County Donegal. There must be a question of diminishing returns. The people who are responsible for assessing how far you can go without having diminishing returns must have fallen asleep. Their calculators must be working wrongly. There must be something wrong or they would try to remedy that.
I regret to say that people drawing their salaries from the Exchequer in Dublin are going to buy stuff down below. Where are they getting their salaries from? Are they getting them from London or the old Stormont? They definitely are not and that is one place where we could have an example of practical patriotism. It is hard to blame people on the dole and people who are struggling to bring up large families out I am darned if I can find it in my heart to forgive people who are drawing salaries from the Exchequer and who are going down putting the money into an exchequer — no fault to them, they are taking whatever they can get — from which we do not draw salaries, agricultural grants, housing grants, unemployment benefit, unemployment assistance, disability benefit and a whole range of services.
While petrol and drink are the major sales there are sales right across the board. Our people in commerce are being deprived. While we have an advantage in clothing and so on, no one advertises it on the radio and no one talks about it in the newspapers. It seems the shallower the commentators on our national radio and television the more heed and influence they receive. I do not see anybody trying to push the fact that our clothing and shoes are better value here and that there might be a spin-off purchasing campaign if people came down to make those purchases. Last night I spoke to a woman who sells bicycles in Clones. Normally she would have sold 21 bicycles by this time but she has not sold one bicycle this year. That gives this House an idea of what is going on in this area.
The Minister for Agriculture spoke about the milk situation. I do not like to see more power being given to the Commission to decide when something can be put into intervention. It is going down a dangerous road and removes the responsibility of elected representatives. If a large number of people take part in the cessation scheme there will be a severe impact on the beef processing industry and on the veal processing industry. In my own county we provide between 30,000 gallons and 40,000 gallons of Baileys Cream which is a marvellously successful product on international markets. If there is a cessation flood tide, that is another industry which is in danger in an area which is already deprived.
There is no use in talking about compensation. Compensation be damned. I would not have it and the Government should have a policy with regard to it. I would not like to do the Minister, Deputy Deasy, wrong but he seemed to be indicating that they had a damn good bargain if they got out of milk. For God's sake, will someone in the Department of Agriculture look at its implications all over the economy? The Germans have complained about the cost of intervention but everyone should have a good look at what they have got out of the EC, which is a market of 320 million. The Germans are heavily industrialised and they are able to take advantage of it.
It is not all one-sided and they took advantage last year of the severely disadvantaged areas scheme by extending it in West Germany. We cannot get it extended here. The Taoiseach in a public relations exercise, without there being any substance in what he said, told my constituents in Cavan-Monaghan that the severely disadvantaged area scheme was going to be extended to cover those two areas.
You could not keep up with the decay in this economy. I examined statistics with regard to the construction industry a very short time ago. Today, in the post I received information which indicated that it is even worse than I thought it was. The statistic I had was that it was 47 per cent of what it was in 1980. From the statistic I received today I find it has gone down to 46.9 per cent provisional for the month of November 1986, which is a drop of 13.5 per cent from what it was this time last year. Would someone ask the people responsible in Government to wake up for God's sake before major industries like this collapse?
I said earlier that the Government have the advantage of very sharp reductions in the price of oil. An examination of the section in A Strategy for Development, published recently, would be worthwhile. Oil cost this country £840 million in 1985. In other words, that is what was taken out of this country and given to Iran, Iraq and so on. There is an analysis of the benefit to our economy of these reduced oil prices. OPEC have as their objective a price of $20 per barrel. At present it is $14 or $15 a barrel.
In 1981 when we left office the cost of a barrel of oil was $39.25. At present it is little more than one-third of that price. What are the Government doing with the advantage they have? The money that would normally be in Iran, Iraq, Norway and Britain is now in this country, but the Government do not have a clue about what to do with it, no more than they have a clue about the development of agriculture. It is because of that that £1.5 billion has gone out of the country inside the last 12 months. There is no confidence in the economy. Some of the £1.5 billion was taken out because of DIRT. The Minister answered that by saying they got what they wanted out of that. The man must be a nincompoop or he would know that if the money that was taken out of the country was still here he would have got double the amount of return from DIRT.
"Nincompoop" is hardly a parliamentary term.
I do not want to waste too much time.
I know that "buffoon" is not acceptable.
The Spanish word "buffoon" means the clown King Philip used to have in his court. I did not say "buffoon". I said "nincompoop", which is a milder term.
I know Deputy Wilson would like to keep up standards.
That is correct. "Nincompoop" is nicer. It has three syllables. It is not too offensive.
The Chair does not think so.
If the Chair does not think that Deputy Bruton is a nincompoop then I agree with the Chair.
If it is used as a description, that is different.
I attach particular importance to our financial structures because of the emphasis which was laid on them in 1982. It was financial stunting. With clever footwork it changed as soon as the Government were in office. All we have had with regard to the national debt, the current budget deficit, social welfare and a string of important Government activities was a twist. As soon as the pressure was put on from the Labour Party, or people who defected from Fine Gael, the "Let's Twist Again" tune was played. We have had let's twist again as we had all summer.
The Constitution is brought in to clobber the will of the people. The Ceann Comhairle had to exercise his constitutional right — I know he was becoming increasingly embarrassed — one way although I suggest to him a few times that he might have gone the other way. The Government are being saved by the Constitution which they have chosen to attack time and time again since they took office in 1982.
The Chair does not go in for each way bets.
I can see that, although I always meet the Chair at Leopardstown on St. Stephen's Day and he sometimes takes my advice on those occasions. I hope he will take it on this as well.
What the Government say is that those are their principles. If they find the people do not like them they will change them. Those are their principles but if they find a group of dissident Deputies who do not like them and if they are in danger of being thrown out of office and into the Elysian fields of ease they will change them. They changed them on the national debt, on the current budget deficit, on social welfare and on education. They shifted Ministers in order to achieve that just as they subscribe to a revisionist theory of history. Situational ethics are the order of the day.
There are many people on the Government side who are people of principle. Many of them are exceptionally worried. They are loyal to their party, and that is not necessarily a bad thing, but they have consistently to come in behind a Government in which they have no belief whatever. One of them, it is what I would expect from him, Deputy Coveney, admitted that the type of campaign which is starting in one area, what I called political merd, does not carry any sanction from him. He does not approve of it. He rejects it and regrets it.
What we have had is a very successful public relations exercise. The Government employed a high-powered team to sell it to the public. They had that high-powered team when they were selling the 1982 programme upon which they have fallen down dismally and abysmally. The handlers words are "put clothes on the emperor". The people are looking at the emperor and they see him in all his nakedness. The emperor in this case is the Government. The Government are naked and unashamed. They are marching the country down to ruin in all the important areas of the economy. The people are not amused when they see how naked the Government are nor are they amused with their antics in regard to Dublin Gas. They are not amused with the antics we saw on social welfare. They are not amused with the pig's dinner they made of the Single European Act. They are not amused with what happened here as we put the Extradition Bill through the House. They are not amused when they see the national debt increasing drastically every day. The are not amused when they reflect that they believed that the current budget deficit would be eliminated (a) immediately; (b) in two years; (c) in four years and (d) in five years. They are not amused when each time the crunch came the band played ‘Let's Twist Again". All I have to say is: "Go Garret, son of Gerald. Go in peace, but go."
I call Deputy Molony. He has 15 minutes.
I gather with some disappointment that I have only 15 minutes, but I understand the difficulties of the day. Like Deputy Wilson, there were many things I should have liked to have said but I had a difficult decision to make. I had hoped to speak a little about the institution of the Dáil and I am not sure if I shall get that chance. Many of the problems graphically described by Deputy Wilson, which most politicians in this House recognise need to be solved, are ones that can be changed only by a change of attitudes. The type of attitude change which is needed will only be inspired by real leadership from this House. I am not talking about the Leader of the Government or the Leader of the Opposition, but about this House playing a leading role. I am talking about an improvement in the perception of politicians and of our political institutions.
One of the sad things about our country is that from time to time we have examples where the public feel that politicians or the political institutions are there merely to serve the purpose of a few. Just as political institutions are seen in that way, sometimes Government agencies are so seen. It is incumbent on us to ensure that every institution will be seen as existing for the common good. It is essential that we get rid of the sectional groups in the society that have grown so much in the past decade or two.
I want to highlight one example of total public disgust at something which happened recently. It is fair to say that most people were shocked to read the recent decision of the Supreme Court in the matter of an application by a company called JS Developments Limited where that court said that this company were entitled to an award of £2 million compensation because the company were unable to develop land they purchased on Roche's Hill near Dún Laoghaire in County Dublin. It appears that that company purchased this land, amounting to 25 acres, knowing that the land was zoned to be retained as an open space. Nevertheless they bought it, presumably, for that reason, at very good value.
The company then applied to Dún Laoghaire Corporation for planning permission to build a housing development on the 25 acres and, not surprisingly, Dún Laoghaire Corporation refused the application for planning permission on the grounds that the development would "seriously interfere with the visual and recreational amenities of the area". That ground was given to identify the refusal with the zoning and with a reason that would not entitle the company to compensation because the land could not be developed. Again that was entirely reasonable, given the fact that zoning of the land had been for retention of the area as an open space.
I just want to clarify the position. I am sure Deputy Molony is not thinking of sitting as an appellant at the Supreme Court.
Heavens, no, not at all. I am reciting the background to this matter to give an example. Of course, the Supreme Court is not in question at all. In any event, the company JS Developments Limited, surprisingly in all the circumstances — or so it must have appeared at the time — decided to appeal the decision to An Bord Pleanála. An oral hearing was held at which many local interest groups, including politicians, voiced their objections to the scheme. In short, the appeal was rejected. There was a slight difference, however, on this occasion. The reason given for the refusal was not the same as had been given by Dún Laoghaire Corporation. The reason given now was that the development "would be seriously injurious to the overall character of the area". The odd thing about this is that this reason was one which entitled JS Developments Limited to compensation.
Let me quote from the comments of Mr. Justice Brian Walsh on the wording used and the reason given by An Bord Pleanála for this refusal. He described the decision as "having a degree of imprecision of remarkable proportions." Mr. Justice Walsh asked why the board did not use the word "amenity" instead of "overall character", when they knew that the effect of not using the word "amenity" would be to give the applicant a clear possibility of compensation. Mr. Justice Walsh went on to say that the decision could not be construed since the reasons for it were so unclear, making it difficult for the court to arrive at a judgment one way or the other — I am giving a précis now of his judgement. He said that An Bord Pleanála should not give a ruling which could be regarded as duplicious. He went on to say that surely the board must have had in mind the consequences the terms of their refusal would have.
It is widely speculated that the An Bord Pleanála inspector who sat at the oral hearing on the appeal in Dún Laoghaire recommended to the board that planning permission not be granted and also recommended to the board that the reason given be an "amenity" reason rather than the reason ultimately given. The fact is that there are widespread questions being asked as to what happened. The cost to the State if this goes through, as I presume it will have to, will be over £2 million. From all we know, either an incredible mistake or, to use the words of Mr. Justice Walsh, "imprecision of remarkable proportions" occurred. I wonder if that is the case.
There are certain matters which have not been highlighted in this case and which should be highlighted so that the matter can be properly investigated. The fact is that the person in An Bord Pleanála who signed this refusal is no longer with the board but was a person appointed by the Minister for the Environment, Deputy Ray Burke, on his last day in office after the 1982 November elections. This person who was appointed had no planning experience, good, bad or indifferent. He was a person who was a political adviser and organiser in Deputy Burke's own constituency. All the evidence that we have before us is that what happened is simply inexplicable. Frankly, I do not believe that it was something merely by way of a mistake or misunderstanding. I honestly believe that there is a whiff of criminal activity about this. I think that we——
You are now getting into very serious territory. This man can be readily identified. He has no opportunity of defending himself against these serious charges and I do not think it is in order.
I respect fully the convention of the House that no one outside should be named and for this reason I am not naming the man in question but his name is known to me.
I think that he can be easily identified from the vivid——
I have made my point. I shall stop making it, except to say that never before in a judgement of the Supreme Court have I seen such a clear signal warning the public of something. I do not know if the Office of the Director of Public Prosecutions or the Garda can be directed to go in and examine the matter, but I think it is something that must be examined. I would urge that it be examined.
One of the great problems facing this country at present is the apparent inability of our institutions to tackle some of the problems we are facing. I refer to political institutions like the Dáil, trade unions and special interest groups, all of whom seem hellbent on serving their own need and ignoring the common good. This sort of thing to which I have referred, if we are to begin to tackle our problems, must be seen by the public as something that is properly investigated. If charges are to be brought, let them be brought, let an explanation be given as to what did happen. That is all I seek and I shall say no more about it.
There are quite a few million quid that could be examined in various places.
I want to refer, if I may, to some of the comments made by Deputy Wilson. I think that he is correct; we have a major problem in dealing with our public finances now. I have to accept what Deputy Wilson said when he spoke about this party specifically in 1982 promising that they would eliminate the current budget deficit over four years but failing to do so. However, they tried very hard to tackle the financial problems but they failed, perhaps because they did not go far enough although it is questionable whether they could or should have gone further. At least the Government never stopped trying to tackle the problem. I will not try to identify the root of the major financial problem but there must be a consensus in the House that there is a major problem which must be tackled. Public finances and unemployment should transcend party political differences.
I was appalled last night listening to a debate on "Today Tonight" between the Minister for Finance and Deputy Ray Burke. The Minister detailed the Government's problems going into next year's budget and asked Deputy Burke if he would accept that cuts in the order of £300 million were necessary. Deputy Burke refused to answer the question on the grounds that he did not have to and said that Fianna Fáil's approach to the budget is to say nothing and that their approach to an election will be to ask the people for a blank cheque as they have developmental policies to offer them. He tried to rerun elections in the past when it was possible for political parties to make promises designed purely for electoral purposes as was the case in 1977.
Rot, look at the statistics.
At that time political parties were not asked to account for the cost of their promises.
We are tried of that old cant.
If Deputy Wilson will be as assertive in campaigning as he was in attacking the Government on the grounds he gave today, he should say what Fianna Fáil propose to do by way of cuts——
We will.
——in the 1987 budget, he should tell the people where Fianna Fáil will get the £600 million they have already offered——
"Yoplait" statistics.
Deputy Wilson chooses to ignore the problem.
Sour yogurt.
The longer Deputy Wilson chooses to ignore the problem, the longer people will be deprived of an opportunity to discuss the real issues in the next election. This party, in common with every other party, have been guilty in the past of making promises without having them properly costed. I do not exclude the Progressive Democrats from this because, in a document published recently, they set out a series of cutbacks they would make which have been shown since to be wrongly costed. They have been invited to submit their proposals to the Department of Finance so that they could be properly costed and indeed the same offer has been made by the Minister for Finance to Fianna Fáil. The Progressive Democrats not only declined the offer but indicated that they could not trust the Department to do an analysis of their proposals because they know very well that the answer will not suit them. At the next election the people deserve to have the real issues set before them and not silly wild attempts by politicians to bluff and blow their way through a campaign, as Deputy Burke tried to do on television last night.
He has Deputy Burke on the brain.
The restriction on the time makes it impossible for me to say any more but I hope Deputy Wilson heard me when I acknowledged that the problems I described are common to all political parties. I urge that a change should be brought about because of the extent of our problems. If there is an interest in tackling the problems there must be a consensus at some level and that is not a bad level at which to start.
This Adjournment Debate takes place against a background in which we have seen the Government over the past few days bringing a number of important Bills before the House and having them rushed through with the agreement of the main Opposition party without, in some cases, any debate as in the case of the Exchange Control (Continuance) Bill, 1986, yesterday and others rushed through in 60 minutes. This happened in relation to the Courts (No. 3) Bill, 1986, last night and today in regard to the Income Tax (Amendment) Bill, 1986. This is sad because over the last four years Government parties have brought measures before this Houses, some of which were forced upon them, by decisions made in Europe or in our courts. Much of the social legislation on the Statute Book today has come, not as a result of the response by politicians in this House, but because it was forced upon us by decisions made in the Four Courts.
The Government have made great strides towards bringing in social legislation and I admire their efforts, particularly earlier this year in relation to the divorce referendum. I was very disappointed at the manner in which that debate was conducted and one hopes that whenever the measure again comes up for discussion we will be more mature in our analysis of the issue and more responsive to the needs of so many people. Despite what has happened, the tragedy of marital breakdown remains very much with us and the sad thing for me and others is that we cannot, as legislators, do anything to help the victims of marital breakdown.
This debate is taking place against the background of 31,000 people having left the country last year and the real tragedy is that some of our best, brightest and highly educated people have gone. I am told by those who researched the facts that up to 40 per cent of science and engineering graduates left last year. Given that higher education is now costing almost £100 million per annum, you do not need me to point out the economic cost of sending abroad so many of our best people, people we need to revive the nation. It is also a tragedy that so many people leaving are not just those who have no jobs. Many of them have jobs but they do not think there is any point staying in this country because effort is not rewarded. It is not worthwhile to work and those who try hardest are constantly knocked by Government policies that seek to take away from individuals what is rightly theirs. Is it not a tragedy that 65 per cent of every pound of taxable income of single people earning over £7,500 and married people earning in excess of £15,000 is taken by the Government? It is a disgrace and it is no wonder that so many people give up very good jobs to go abroad.
Irish people have achieved success everywhere and many are very successful in the United States. Britain and many other countries in Europe. It is sad that they have not the opportunity to achieve here what they achieved in so many other parts of the world.
Deputy Wilson and others referred to the extent of the national debt. In the past seven years we have added £16 billion to its size and in the same period unemployment has risen by 150,000. It is a farce — but unfortunately many Government Ministers do not believe it — that as we add more to public expenditure, which seems to be the policy of The Workers' Party and the Labour Party, we add further numbers to the unemployment queues. In the early part of this year Government expenditure increased by 9 per cent at a time when inflation stood at 3 per cent. Unemployment increased and we are constantly being told by many politicians in this House that in order to solve the unemployment crisis and the very serious economic situation we must get public expenditure under control. Yes, we have to do that, but this Government have failed miserably in each of the last four years to do anything realistically about the level of public expenditure. That is why the noises being made, in particular by the Minister for Finance, are not believed by many people. They do not believe that this Minister who presides over the worst current budget deficit in the history of the State is going to do anything to realistically tackle the serious economic problems that confront us.
The position this country finds itself in today was not forced on us by any external factors although, as a small open economy, we suffer more from external factors than many of our neighbours. The position we find ourselves in today has been foisted upon the people of this country because Irish Governments failed to tackle the real economic issues — Irish Governments who pretend they can solve all problems, give in to every group and say no to nobody. The tragedy is that despite the serious economic situation in which we find ourselves today, the main Opposition party, Fianna Fáil, have failed to respond to the national crisis. We all know what Fianna Fáil are against —high taxation; they want everybody to have a job, they are against crime, they stand for all the generalities that everybody in his right mind stands for, but we do not know what Fianna Fáil would do if they were back in Government tomorrow.
A few weeks ago the "Today Tonight" programme were discussing the current budget deficit and invited Fianna Fáil to send a speaker to debate this serious subject. They failed to do so. A couple of weeks ago The Irish Times decided to publish a series of articles and they gave each party an opportunity to put forward their plans and proposals which the people could see and examine and compare one set of proposals against another. Again the Fianna Fáil Party declined the invitation. Their excuse was that they were finalising their policy. After four years in Opposition they are still finalising their policies.
The tragedy is that in this once great party there is nobody prepared to stand up and give real leadership; there is nobody prepared to put forward an alternative point of view; there is nobody prepared to put forward any realistic proposal that the people might be expected to examine and perhaps support. For that reason I make no apology for saying that I do not want to see that party under its present leadership returned to office. The bizarre events of four years ago have not been forgotten by me. The low standards, the politics of wheeling and dealing which were so much part and parcel of that Administration have not been forgotten by many people, and I do not think they will be easily forgotten.
Earlier Deputy Wilson said that the Government talked about their principles but changed them if they did not suit. A few weeks ago the Fianna Fáil spokesperson for Education, Deputy O'Rourke, sent a letter saying that the Fianna Fáil Front Bench had decided to oppose the Single European Act. Within a matter of days following the publication of an opinion poll which indicated majority support for that Act, the Fianna Fáil Party changed their position.
Fianna Fáil have displayed nothing but disregard for the SDLP. They have shown scant regard for the very strenuous efforts being made by that party to uphold constitutional nationalism in that part of this country. They have been treated very badly by Fianna Fáil. It was very sad to see the Deputy Leader of the SDLP having to call on politicians in this House to stop playing politics with the tragedy of Northern Ireland. He should not have had to do that, but the tragedy is he had to do it because for so long so many people in this House — and unfortunately so many people in the leadership of Fianna Fáil today — like to play politics with the tragedy that is Northern Ireland.
There are some who will say that the comments I am making can be described as character assassination. They are not in that league. I am not going to be intimidated from exposing the myth that is the main Opposition Party in this House.
Last night Deputy Woods huffed and puffed about the Courts Bill being rushed through yet his party agreed to do it. This may be the last sitting day of this Dáil and if it is, it is as well that the people know what the possibilities for the future are and where each party stand in the run-up to the next general election. It is an important election for this country because what we need most of all is good government. Good government is not necessarily government of one party, just as bad government need not be government of two parties. What determines if a government are good or bad is not the number of parties which compose that government but rather the policies they pursue. What we have seen in recent days, particularly from Fianna Fáil, is a promise to spend more. We are back on that merry-go-round again. Recently the leader of the Opposition went to Cork and nothing was impossible——
Specify, do not generalise.
Everything that was required could be done.
Specify.
Listen and I will specify. I listened this morning to Deputy Haughey and thought he might tell us what Fianna Fáil would do in Government. The following is what he had to say. He said there is an alternative, that we need a new beginning, we need to restore morale and we need to restore confidence.
That is right.
Of course we need to do all these things. Can the Deputy tell me anybody in this House who believes otherwise?
Deputy Harney was not much help to him. She tried to bring him down.
Deputy Gallagher, please.
That is what she is doing now. All she wants to do is bring down Charles Haughey.
Deputy Gallagher, there was no trouble here until you came in.
They tried to stop me when I was over there but they did not succeed, and they are not going to stop me now. The Deputy can listen to what I have to say. We were told Fianna Fáil were going to develop our natural resources and our marine resources and would give a new impetus to the Department of Agriculture by setting up a new ministry for food processing and many other things.
What is wrong with that?
I want to know how Fianna Fáil will finance these measures.
There is no money involved.
If Deputy Gallagher cannot restrain himself he should leave the House.
Be a gentleman and let the lady speak.
I sometimes think there is no room for ladies or gentlemen in this House.
We do not like spite or hate.
I know Deputy Gallagher does not like what I am saying. Deputy Wilson referred to the revisionist theory of history. Some weeks ago the Fianna Fáil Party started to revise Fianna Fáil Party history but failed to even acknowledge the fact that for 13 years that party were led by one of their greatest leaders, Deputy Lynch.
We have it all now.
They failed to recognise him because they wanted to write——
There was no failure to recognise. That is newspaper talk.
Deputy Harney should be allowed to speak without interruption. She has only a few moments left.
The Deputy has one policy for the election anyway.
Fianna Fáil have one policy for every group that come to see them.
It did not work from the inside, so now she is trying it from the outside.
(Interruptions.)
Fianna Fáil's policy is to pander to every group, say yes to everybody, no to nobody, nothing is impossible. Nothing is impossible as far as Fianna Fáil are concerned because the be-all and end-all is getting power. They want to get it by default, not by putting forward constructive policies that the people could examine and decide if they wanted them——
We did it before and we will do it again without you and Dessie.
It is the policy of sitting back and taking power by default because power at all costs is the be-all and end-all of the main Opposition Party. What this country needs is good government and new political leaders. It needs people who will restore the respectability which attached to politics. The tragedy is that while once a person could boast about being a politician, now one is almost ashamed to admit it.
Nonsense.
That is the case because we are seen to treat ourselves differently from the way we treat other sections of the community. Earlier this year the Progressive Democrats put forward a Bill to remove ministerial pensions from serving Members of the Oireachtas.
Have they given up theirs?
(Interruptions.)
I am not going to allow continuous interruptions. I have shown a certain amount of patience and I am not going to allow Deputy Gallagher to do what he likes.
We want to roll back the influence of the State and the size of Government. That is why we support a reduction in the number of TDs in this House from 166 to about 130. That is why we support the abolition of the Seanad. We are too small a country to have two tiers of Parliament. That is why we think at least eight Ministers of State could go. They were created some years ago for all kinds of odd reasons. We have far too many people with responsibility and too few people doing anything about their responsibilities. These measures will help restore what Deputy Molony rightly regarded as the need to get a better perception of politics in this country.
We need to change our economic policies to ensure the incentive is returned to individuals. The greatest poverty fighter of all is employment, the right to a decent job and the right to have a decent standard of living for oneself and one's family. That can only be done as a result of people being able to keep more of what they earn instead of the State constantly consuming more and more of people's incomes. That is why the Progressive Democrats, of all the parties in this House, put forward — perhaps Deputy Gallagher and Deputy Wilson might read it — a realistic policy for reviving the economic affairs of this nation. We are happy to say the only way we can revive the economy is by restoring to individuals the incentive to work, to work harder, to invest and to employ. You will only do that by decreasing the levels of personal taxation. Instead of public expenditure dictating the extent of taxation in this country, which is the way we approach our budgetary policy, an acceptable level of taxation should on the contrary dictate the level of public expenditure.
It is unacceptable that tax on income should be any higher than 25 per cent as a standard rate on incomes up to £15,000 for single people and £30,000 for married couples and a further 15 per cent for those groups of individuals on incomes in excess of that. That is the only way we can return incentive to this country; there is no other way. Yet it has been described as daft. Unless you match that kind of tax policy with public expenditure cuts, which again we will be happy to do, and spell out clearly where those cuts will be made, nobody will be able to achieve that level of taxation.
I make no apology for saying that although we are a party that favours very radical and extensive cuts in public expenditure we are not going to do that at the expense of the weakest and most vulnerable members of our society. That is why we did not vote with the Government when they reduced the Christmas bonus by £3 million. There is no point in the Government making a big stand of principle on amounts of money like that against the most vulnerable and weakest section of society. Those in need should be looked after and should get State benefits. Those who get State benefits and do not need them should not get them. That money should go to those who are in genuine need of greater assistance from this State.
Many people spoke about the need for the Government to create more jobs. The Government cannot create jobs; they can create an environment under which employment can thrive. You do not do that by throwing money at problems or by increasing levels of public expenditure. The Danes did it by decreasing their budget deficit from 9 per cent four years ago to 3 per cent last year and at the same time they increased the level of employment in the country. The Irish can do it too if they have new and strong political leaders who outline their policies and stick by them no matter what the pressures may be and no matter what the political consequenses might be. The country needs tough leadership and it needs new leadership. I have no doubt whethere this Dáil comes back or not: its days are numbered. Whenever the next election comes the young people in particular will vote for a new choice. They will vote for a party that has spelled out in the last 12 months — we did not need four years to do it — where it stands on the fundamental issues that now confront this nation. I hope the people will respond and if that is the case the next Dáil will be a better Dáil because it will be able, once and for all, to deal realistically with the serious economic and social problems which now confront this nation.
This debate marks the completion of the fourth year of this Government's term of office. Ever since the Government was formed the Leader of the Opposition has been forecasting its imminent downfall. One commentator has calculated that there have been 14 such forecasts. How consistently wrong he has been throughout these years may be seen from the fact that this Government's life will have exceeded that of any of the last five Fianna Fáil Governments in the last 25 years, only one of which lasted as long as four years. Moreover, no one can allege that this Government have survived by shying away from contentious issues.
In our fourth year we tackled such issues as the referendum on divorce and, since last October, we legislated for the contested reorganisation of CIE, the reform of building society law and the establishment of the new Metropolitan Streets Commission. The last two proposals have been opposed by Fianna Fáil for their own reasons. We put through legislation on extradition which is necessary to enable us to ratify the European Convention on the Suppression of Terrorism and we put it through in the teeth of opposition from all three parties across the House as well as from Independent Deputies. We piloted the Single European Act through the two Houses despite forecasts by the Opposition and by some other observers that we would fail in this enterprise. In none of these difficult areas have we been deterred from doing our job by opposition from across the House or by reports of problems within our own ranks, reports which were so consistently led the credulous Leader of the Opposition convincing himself for the umpteenth time that the Government were going to fall.
Let me recall for the House not just our legislative performance in the last couple of months but some of the things we have achieved in the past four years. Since this Government took office, more than 130 Bills have been passed by the House and there are approximately 30 more on the Order Paper. It would be impossible, in the relatively short time available to me, to discuss in detail the full range of this legislative business. I will, however, touch briefly a score or so of the more important ones.
In the justice area there have been many significant changes and improvements. The Criminal Justice (Community Service) Act, 1983, enabled the courts to take a broader perspective when imposing penalties. They were empowered to require an offender to perform unpaid work for the benefit of the community. It is recognised that in many instances community service would be a far more fitting penalty than a custodial sentence, and a much less costly one for the State and the taxpayer. The Criminal Justice Act, 1984, addressed a wide range of issues relating to Garda powers. Increased powers were given to the Garda to detain suspects in certain circumstances. Provision was made to deal with the problem of offences committed while on bail and to provide for alterations to the existing trial procedures. One of the main purposes of the Bill was to deal with the problems facing the Garda in regard to the withholding of information and to provide for stricter sentencing. Balancing this, there were new arrangements for the investigation and adjudication of complaints against the conduct of members of the Garda Síochána in the Garda Síochána (Complaints) Act, 1986.
In the social area, considerable progress has been made during our period in office. The Age of Majority Act, 1985, resulted in the long awaited reduction of the age of majority from 21 to 18. This considerably eases difficulties facing young persons, particularly those getting married who wished to enter into mortgage or other commitments. The Domicile and Recognition of Foreign Divorces Act, 1986, abolished the common law rule according to which it is generally stated the domicile of a married woman was in all cases the same as that of her husband. It provided that her domicile would in future be determined in the same way as that of any other adult person. This effectively meant that a divorce should be recognised if it were granted in the country where either spouse was domiciled. The Irish Nationality and Citizenship Act, 1986, allowed foreign husbands of Irish citizens the right to accept Irish citizenship as post-nuptial citizenship had been reserved previously for foreign wives of Irish citizens. In these, as in other areas, we set about to remove the discrimination against women which remained in our legislation and which Fianna Fáil had so notably failed to tackle.
Talking of things which Fianna Fáil notably failed to tackle, the Health (Family Planning) (Amendment) Act, 1985, was a significant development in the provision of a comprehensive and accessible family planning service appropriate to the social realities of a mature society. It removed the previous restrictions on the scale of contraceptives to married couples, allowed for their sale to persons over the age of 18 years and eliminated the need for a medical certificate, a curious provision introduced by the present Leader of the Opposition.
In the fight against poverty the Combat Poverty Agency Act, 1986, introduced major forms. A new agency was established or, to be more precise, an earlier agency abolished by Fianna Fáil was put on a firm statutory basis, safe from their depredation should they ever return to office, to advise the Minister on all aspects of economic and social planning relating to poverty in the State, to initiate measures aimed at overcoming poverty, to examine the nature, cause and extent of poverty and to promote a greater understanding of those causes. Up to now no institutional mechanisms existed which were charged with these functions. The Combat Poverty Agency fills this gap.
In another area, the National Lottery Act, 1986 provides for the holding of a national lottery the proceeds of which will be allocated to sport, to culture and the arts, including the Irish language, and health and to such other purposes as might be decided on. The lottery is due to commence next year and it is expected that it will have a major impact on funding in those areas, starting in 1987. Another major Government initiative in this area was the National Archives Act, 1986 under the terms of which national archives have been established drawing together the existing State Papers Office and the Public Record Office providing, for the first time since the foundation of the State, for the release on a structured basis of Government and departmental records which are more than 30 years old. Arrangements for the making of regulations under this Act are at an advanced stage and I expect this new institution to be established in the coming year with the appointment of a director and a council.
In the housing area, one of the earliest measures enacted by the Government was the Housing Finance (Amendment) Agency Act, 1982 which removed doubts as to the power of the Housing Finance Agency established by us under the 1981 Act which indexed-linked bonds and ministerial guarantee. The Local Government (Planning and Development) Act, 1983 provided for the very necessary reconstitution of An Bord Pleanála and for amendments to planning appeals legislation. Under the terms of the Act a new statutory mechanism was introduced for the appointment of the chairman of the board and board members to end the practice of political appointment, political appointments in an area of high sensitivity and for the most dubious of motives. This Act has proved of crucial importance. From the recent Killiney decision we can see just how important a reform of this has been. That decision related to a decision by the earlier politically appointed Planning Board.
The passing of the Dublin Metropolitan Streets Commission Act, 1986 has been a major initiative towards upgrading central Dublin. The commission have a £10 million budget in a three year term of office and will have as its sole objective the revitalisation of the heart of the city, making the best use of and enhancing its existing assets. The Building Societies (Amendment) Bill, 1986 which has just passed, provides inter alia for abolishing redemption fees, getting rid of restrictive practices in relation to solicitors and prohibiting the charging of tiered rates of interest on loans. It also gives power to the Minister for the Environment to make regulations prescribing rules in relation to certain building society practices, overdue reforms that for some curious reason seem to have been unwelcome to the Opposition.
The Electoral (Amendment) (No. 2) Act, 1986 provides for the registration as special voters physically ill or physically disabled persons under conditions that will ensure against abuse. We have seen what happens when provision is not made against abuse in certain parts of the country, where particular political parties are active and strong, unfortunately. It also provides for the registration as postal voters certain persons resident abroad.
In the communications area, we enacted the Postal and Telecommunications Services Act, 1983, which provided for the establishment of two State-sponsored bodies, An Post and Bord Telecom Éireann, to take over the operation of the national postal and telecommunications services from the Department of Posts and Telegraphs. This year we enacted the Free Ports Act which enables the establishment of free ports in any part of the State with the immediate purpose of permitting the establishment of a free port at Ringaskiddy.
It has not happened yet.
Another measure enacted this year was the Dublin Transport Authority Act which provides for the establishment of a new statutory body, the Dublin Transport Authority, to improve radically the planning and operation of road and rail transport and the management of road traffic in the Dublin area. The authority are now in operation. More recently we enacted the Transportation (Re-organisation of Córas Iompair Éireann) Act, 1986 which provides for the retention of CIE as the parent of three new operating subsidiary companies registered under the Companies Acts. The new companies will have full responsibility for the operation of the railways, the Dublin city bus services and provincial bus services. This new structure for CIE will enable that board at last to operate as a transport board and not simply as a railway board running as subsidiary operations bus or freight services in different parts of the country.
In the industrial development area we have seen the enactment of the National Development Corporation Act which provides for the establishment of the corporation as a state venture capital investment company. The corporation, which was established last June, operates on a commercial basis and through the provision of equity style investment in productive and employment creating economic activity. Investments by the corporation may be made only in enterprises that are profitable and efficient, or are capable of becoming profitable and efficient and which have reasonable prospects for profitability; development expansion, growth or providing viable employment investments may be undertaken directly by the corporation in joint ventures with the private sector or in cooperation with a State-sponsored enterprise.
At the moment before the Dáil and the Seanad are such Bills as the Bankruptcy Bill, now in its final Report Stage, the National Employment and Training Authority Bill that brings together in one organisation the different bodies whose functions in this area may be felt to overlap and which need to be co-ordinated. The Status of Children Bill, initiated as a result of the work of Young Fine Gael, when we were in Opposition, to deal with the problem of illegitimacy is also before the Houses. They are only a few — in fact I have mentioned only one-seventh — of the legislative measures we have introduced.
In this period we also dealt with a number of emergencies such as the PMPA collapse, the ICI disaster, which we settled without any cost to the taxpayer despite repeated allegations to the contrary, and the seizure of the IRA funds. They were carried through decisively and effectively to deal with situations that arose out of the blue.
May we have a copy of the Taoiseach's script?
If the Deputy can see he will know I am working from notes. That is if his vision extends this far.
What the Deputy has is called "extracts".
I have not reached the extracts but I will come to them in due course. In addition to the measures I have just outlined, there are many important Bills in the course of preparation or just recently published. Legislation is being prepared to bring about further changes in the family law area, for instance, the giving of spouses equal ownership rights to the family home and contents, to provide for the working of protection orders separate from home barring orders in the cases of domestic violence, to extend the grounds for judicial separation, to raise the age of marriage and to require three months notice of marriage, and to empower the courts to make financial and property orders for separation proceedings. A Bill will be brought forward in the next session to abolish the death penalty, and of course, the Intoxicating Liquor Bill, 1986, which has just been circulated will introduce a number of much needed reforms in the liquor licensing laws to be followed by others in a second Bill dealing with matters such as under age drinking.
In relation to local government and the environment, legislation is being prepared to reorganise the system of local government. There will be a further measure early in the next session, a Bill to increase and strengthen the power of local authorities in relation to derelict sites. A Bill will be introduced shortly to reintroduce grants under the Shipping Investment Grants Act, 1969 with a view to creating the conditions in which shipping services may be re-established and developed in this State. A major Bill which is now being finalised is a companies Bill to tackle the problem of abuse and malpractice in the management and direction of limited companies. Legislation to implement the White Paper proposals for the reform of the public service is also being finalised and will be circulated shortly. In my own Department preparations are well in hand for legislation to eliminate all forms of discrimination on the grounds of sex and marital status and access to goods, facilities, services, sports and other forms of recreation. Another Bill to reorganise the National Museum by putting in place an administrative structure more appropriate to a modern cultural institution is being prepared.
I submit that this record is in total contrast to those of the last two Fianna Fáil Governments, the first of which, under two different Fianna Fáil Taoisigh one of whom despite his majority of 20, shied away from every tough issue that faced him and pursued an uremitting policy of soft options; the second of which was the most ignominious, disastrous failure among all the Governments of this country during the last 65 years.
Moreover, as they enter their fifth year, this Government will not flinch from taking the necessary further decisions to control Government spending even though a combination of unforeseeable circumstances has made necessary tougher decisions in this area than any Government have had to take since the war years. We will not run away from these problems. We will not take refuge in a flight to the country in advance of the presentation of our budgetary proposals. No, we shall present to the Members of this House and to the people a true picture of what needs to be done to correct the imbalances in our finances which, in recent months, have helped to force up interest rates well above their natural level. By facing this issue we shall bring down interest rates from their present unnatural level, thus stimulating enterprise and growth in 1987.
I believe that that is what our people want us to do. We owe it to our people to do just that. I believe, too, that this House will endorse our proposals although I recognise that many think otherwise. The reason I believe this may be simply stated. There is one course only that can properly be taken in present circumstances, namely, to reduce our current deficit to a level no higher than was planned for the current year — 7.4 per cent of GNP — and to reduce borrowing below this year's planned level. To do less than this would be to precipitate a financial crisis of confidence involving a level of interest rates throughout 1987 that would be disastrous for our people. I do not believe that a majority of Deputies will want to make themselves responsible for such a débacle by defeating a budget along these lines. The consequences of doing so, of precipitating an election, by rejecting these constraints — thus proposing to the people higher level of borrowing which would force interest rates through the roof — would be gravely damaging for those who precipitated such an event. Those who did that would be stigmatising themselves as cowards, who would not deserve and would not receive from the people a mandate to govern this country.
There is in this House an unexpressed acceptance of these realities. Deputies on all sides are aware of how critical is our situation. They do not hide this from each other in the lobbies and corridors. I believe there is also a growing acceptance within this House — as there certainly is outside it — that things are much too serious for political game-playing on this issue. Of course, the temptation remains, and some may succumb to it but not, I feel, a majority of this House. I want to put this issue on the table in plain language. I want to invite the Opposition parties, several of which are not present, to make their position clear on it.——
We heard it all before, four years ago.
Order, please.
Do any of these parties believe that we can, without grave danger to the State and society, seek to borrow more than 11.8 per cent of our GNP next year?
(Interruptions.)
It is hard to listen to it.
I know they do not like this issue being posed to them. I know they do not want to answer it. I know they will try to dodge answering it but I am going to put it to them: do any of these parties believe that we can, without grave danger to the State and society, seek to borrow more than 11.8 per cent of our GNP next year? Does Deputy Haughey believe this, or Deputy O'Malley or Deputy Mac Giolla, wherever they are, believe this?
We know what the Taoiseach and his Government borrowed this year.
They may refuse to keep silent here at this moment on this point——
How much is Deputy Haughey going to borrow to give out £500 million?
(Interruptions.)
Will Deputies allow the Taoiseach to continue with his contribution?
(Interruptions.)
Order.
The Taoiseach asked a question ——
There is no need for Deputy Haughey to get excited. I was addressing the Minister for Justice.
Deputies
Will Deputy Haughey answer?
Now is Deputy Haughey's time, he should answer it, he has the floor.
Will Deputy Haughey answer it?
(Interruptions.)
Will Deputy Haughey answer my question? Will he reduce borrowing below 8 per cent?
I asked the Taoiseach, did he or did he not——
I asked Deputy Haughey a question——
A Cheann Comhairle, I am in possession.
(Interruptions.)
Order, please, Deputies.
What will the current budget deficit be this year? Will it be 9 per cent of gross national product?
No.
Deputy Haughey should resume his seat. The Taoiseach is entitled to continue with his contribution until 4 o'clock. Unless all Members of the House stop interrupting the Taoiseach, or addressing each other across the House, it will be impossible for the Chair to get order. The Taoiseach and everybody else should address the Chair.
I was addressing the Chair. I was asking you, Sir, whether Deputy Haughey, Deputy O'Malley or Deputy Mac Giolla believe this? I do not know whether you can answer the question.
May I make it clear that I do not believe a word the Taoiseach is saying, not a word?
All Deputy Haughey has to do is answer.
Twenty four per cent of the people do believe it.
We do not want to get into that line of country. Deputy Haughey——
A Cheann Comhairle, I apologise for interrupting although I have to say I kept absolutely quiet and listened to the Taoiseach with respect until he asked me a question.
As far as I know, Deputy Haughey got a good hearing this morning, without any interruptions. That position should continue.
I certainly did.
That was more than I got from Deputy Haughey.
Deputy Haughey and the others may choose to keep silent on the question I have asked, but if they do, let me tell them that this is a question I shall continue to pose, as will the media, until it is answered, whether by a straignt reply, which I gravely doubt, or by damning, persistent silence which will leave no room for public misinterpretation of the intentions of the party and parties opposite with regard to the level of borrowing in the year ahead. It is not a question that is answered by saying, as Deputy Haughey has said twice already, that it is for the Government to bring in their budget. Of course it is a matter for this Government to bring forward their budget, to say how and by what specific measures they propose to keep borrowing and the current deficit within those limits, but that is not the key question. It is not the question that those from whom we borrow are concerned with. What they want to know — and on the answer to this will depend the level of interest rates in the period immediately ahead — is whether the different parties accept the discipline of these two figures or whether they propose a higher level of deficit and a higher level of borrowing. Of course, I do not expect to receive any kind of blank cheque from any Opposition party with respect to the details of the budget. On those details there may well be differing views although, in practice, the room for difference is very small indeed as we, who are preparing the budget at this time, know.
The achievement of the current budget target cannot be sought through significant tax increases. I do not believe any Deputy in this House suggests it should be, because taxation, both indirect and direct, is already too high and has been acknowledged as such by all parties.
Tax increases in the forthcoming budget can involve minor adjustments only, yielding quite small sums. This year taxation will yield just under 37 per cent of GNP. That figure cannot be significantly increased in 1987. Non-tax revenue is under 4 per cent of GNP, giving a figure for total revenue of no more than 41 per cent. Simple addition shows that the level of current spending must, therefore, be kept down to around 48.5 per cent of GNP, that is the sum of 41 per cent and the target deficit of just under 7.5 per cent. Deputy Haughey will have no difficulty in understanding and appreciating those figures.
I want to know do the leaders of the Opposition parties accept this or do they not. Do they accept that that is the limit on spending, never mind the question of how it is to be held down to that figure? We can talk about that, debate it, discuss it, disagree on it later, if necessary. My point is simply that however we may disagree on the composition of these figures for spending, for taxation, for the deficit and for borrowing, can we, in the national interest, agree that these targets must be met? If we can, then I believe that strong, immediate downward pressure will be exerted on interest rates by such an agreement on essentials by the parties in this House.
Bank overdraft and mortgage interest rates could come down quite quickly, could come down quite far. With lower interest rates, business and the construction industry could revive from the very start of next year. All of this is in the hands of the Opposition parties in the House today — there are now two of them here — if they are prepared to say where they stand on this issue.
All they have to do is make up their minds.
(Interruptions.)
We know where we stand. Our cards are on the table and keeping theirs up their sleeves will not do them much good in an election or otherwise.
(Interruptions.)
If, however, the Opposition parties are unwilling to make this commitment in the national interest, if they want to keep interest rates artifically high or to keep soft options open, intending to make election promises involving higher levels of spending, deficits and borrowing, then the immediate prospect is for a rise in the already ridiculously high level of interest rates. These interest rates are at their present absurd level in significant measure because of the fear in financial markets that this Government may fall and be replaced by a Fianna Fáil Government who once again, as they did so spectacularly when they were previously in office, will increase spending and borrowing above the limits we propose. I want to make it clear, however temporarily entertaining the Leader of the Opposition may find it, that if in the weeks ahead the Opposition parties refuse to accept this challenge and refuse to take seriously their responsibilities in the national interest by accepting these limits in spending and borrowing, we shall unsparingly hold them responsible before the people for the level of interest rates which they have in their power today to bring sharply down but which equally by refusing to accept their responsibility they can be responsible for keeping up or even raising.
(Interruptions.)
I am putting this challenge to all three Opposition leaders, not just to Deputy Haughey although his party's influence for good or ill is greater than that of the smaller Opposition parties.
The Minister for Finance is showing a great deal of interest in what the Minister is saying.
(Interruptions.)
The shadow Minister for Finance.
This sort of thing reflects no credit on the House or its Deputies.
Let us get back to business, so that the public may be able to judge the alternative proposals for cuts in spending or the changes in taxation from the present overall figures, I want to make it clear to all three Opposition parties that the services in the Department of Finance will, after Christmas, be at their disposal to cost any proposals they may have.
What about the Book of Estimates?
If the Opposition parties are serious about the government of this country——
(Interruptions.)
Let the people decide.
They are gutting everyone.
The 1987 budget will be introduced on 28 January next. As a proportion of GNP taxes have risen from over 24 per cent in 1975 to over 36 per cent now.
(Interruptions.)
Is this a parliamentary assembly?
I know it does not sound like one but I am trying to get it to sound like one and I am appealing to all.
Percentages can dull the reality of this rise of 24 per cent of GNP to 36 per cent. Put it another way: taxes in 1975 represented three months effort from each of us. This year they represent four months effort. The adverse impact of high taxation on the economy is self-evident. It acts as a disincentive to hard work, initiative and investment. It encourages people to spend in the black economy, distorts trade and encourages smuggling. However, it would be unrealistic to expect that tax reductions are possible in the short term. They can be achieved only through further borrowing and that is not a reasonable option because borrowing is no more than deferred taxation. Today we are paying the tax that was deferred last year and for the past ten years. The higher taxes we pay today are not available to support spending programmes. Instead an increasing burden of interest on past debts is pre-empting much of our revenue. Our PAYE receipts are now only just about sufficient to meet overall debt service costs.
In the longer term with the substantial growth in the economy, more people at work and a healthier budget position there would be room to bring taxation down to more acceptable levels, but this presupposes that first we curtail public spending, that we maintain it at a level that our economy can reasonably support. Only through reduction in the overhang of debt and of the future tax levels it implies can economic activity be stimulated. In the shorter term the emphasis on tax policy must instead be on spreading the existing burden in a more equitable and economically sufficient way.
In their recent report, welcomed this morning by Deputy Haughey, I was glad to see, the NESC said that the stabilisation of the debt-GNP ratio must now be a minimum objective of fiscal policy. They emphasised that any adverse consequences of stabilising the debt burden must be set against some of the more positive effects. The report went on to say that it was neither feasible nor desirable to effect the required degree of adjustment through the medium of higher taxation. I agree with this view.
The Council also recognise that corrections of the chronic imbalance in the public finances will require a considerable degree of sacrifice in society and they pointed to the positive effects of adjustment, saying that these would derive primarily from an easing of interest rate thresholds, a matter which brought such mirth from the Opposition a few minutes ago and whose Leader endorsed this report this morning.
There are lessons in all of this. The policy of following a path of high expenditure part paid for by high taxation but also based on heavy borrowing has failed. Heavy borrowing with the associated high interest rates and high taxation have impeded growth. The consequences have also evoked, understandably, adverse public reaction. We must change our approach because a continuation of that policy can only lead to further and greater difficulties.
If we are to create the growth needed to expand employment and sustain a reasonable level of public services we must first create the conditions for that growth. There are those who assert that tackling the problems of the public finances and cutting unemployment cannot be done simultaneously. Cutting the budget deficit, they argue, is adding to the dole queues. I reject this argument, first because we no longer have the luxury of choice in the matter of effecting a remedy. The public finances situation is not static. It will deteriorate rapidly, even explosively, unless it is tackled soon. Second, other countries which face problems like ours have dealt with them successfully without raising unemployment; indeed the converse is true. In recent years several countries have achieved simultaneous success in reducing budget deficits and unemployment and this pattern is quickly becoming the norm in the EC. For example, in Denmark the position of central government has improved from a deficit of 9.3 per cent of GDP in 1982, worse even than ours, to a surplus of 2.8 per cent this year, according to Commission estimates, while unemployment has declined from 10.1 per cent to 7.7 per cent. In Germany the Federal deficit has been scaled down successfully to just under 1 per cent this year while unemployment has also declined to 8.1 per cent and employment is currently growing there at a annual rate of 1 per cent.
Reducing the budget deficit is a primary requirement to build confidence which is the basis on which alone growth and employment can be built up. That is why the debate in the next general election must be on how we can cut spending in order to reduce borrowing. As happened in Denmark, once it is clear — if we can get it clear — that the politicians on all sides intend to tackle the problem, as they do on all sides there, and have taken the initial decisions, there will be an immense surge in investment confidence and job creation. We must get that surge, taking the appropriate decisions to reduce spending and borrowing. This is what the preparations for the 1987 budget are all about. A budget which involved substantial extra borrowing and did nothing about the underlying problems of over-expenditure would kill jobs by adding to uncertainty and interest rates. The important thing in the next general election is that all parties put all their cards on the table having verified them with the Department of Finance, as we do.
Now, Michael, will you tell me how you are going to reduce public expenditure?
The Minister for Justice should stop provoking interruptions.
Ireland has suffered from the Opposition parties offering half solutions to real problems. The tendency for Opposition parties, including our own party in their time, is to put forward very explicitly the very good points in their programme while giving a much less full explanation of the cost involved, arguing that they did not, save in February 1982, have access to the resources of the Department of Finance to cost their programmes. As I have said, this facility is available to the Opposition parties for the forthcoming budget exercise. We must face up to the reality of where continued high spending and consequent heavy borrowing will take us. We can get some idea of this by looking back.
Over the period 1977 to 1981 public service numbers rose by about 29,000. On the basis of necessarily somewhat crude assumptions but of a reasonably accurate order of magnitude, this increased the cumulative Exchequer pay bill from 1977-86 by about £2.5 billion. But these extra public sector employees contributed to tax revenue by around £1 billion. A measure of the net cost of this staff expansion under Fianna Fáil, which we have been cutting back ever since and trying to get under control, is £1.5 billion added to debt over that period. That sum one way or another represents extra borrowing. Since these numbers were increased interest has been accumulating on this additional amount, itself accumulating £1.5 billion. As an average of just over 14 per cent interest, which is the average for the period, this £1.5 billion net extra outlay on public service employment by Fianna Fáil over four years has already attracted £0.75 billion of interest cost to date, added on to the burden of debt. In short, our total debt today would have been over £2 billion less than it is now had this unnecessary expansion under Fianna Fáil in the staff of the public service not occurred and our annual interest bill today would be some £200 million lower. That £200 million would have been available now but Fianna Fáil's past actions mean that it is not.
(Interruptions.)
This is part of the price we are now paying for the promises made in the 1977 election campaign.
(Interruptions.)
Deputy Fitzgerald.
They cannot do what we cannot do——
Deputy McLoughlin.
(Interruptions.)
Let me give another example of the consequence of 1977. Rates on domestic dwellings were also abolished in 1977.
(Interruptions.)
Do you want to hear how much the deficit is up because of your policies?
(Interruptions.)
Order, order. This is what happens when Deputies will not control themselves and cease interruptions and inviting interruptions.
(Interruptions.)
Order.
On a similar basis, the debt today would be of the order of a further £2 billion if rates had not been abolished. As assuredly as any increase in expenditure, the abolition of rates without offsetting savings or alternative taxation has led to extra borrowing and to high interest rates and high unemployment today. Those two decisions of Fianna Fáil alone have added £4 million to the debt and £4 million more to our current cost of remunerating that debt. That is the consequence of just two decisions which Fianna Fáil took in 1977 and in 1981. I will not bore the House with the rest of them. Prior to the change of Government in 1977 the public finances were being brought rapidly under control. In 1977 foreign borrowing fell by one million dollars.
(Interruptions.)
Borrowing had decreased substantially and the economy was performing well. It is worth while recalling some of the facts but the consequences of their irrational policies are with us still. Piece by piece and step by step we have been trying steadfastly to reclaim those lost opportunities.
A Deputy
It is back you are going.
(Interruptions.)
The ultimate upturn for 1987 and for subsequent years will depend on how well we face the realities in 1987. By "we" I mean all of us, on both sides of the House.
You got yourselves into it.
The need for a measure of consensus in our politics, and in our society, is not limited to this issue. If we are to overcome the difficulties that are dragging us down there will be a need for a concerted stand by at least the four largest parties against the demands of interest groups. Our problems today are due in very large measure to the manner in which these interest groups — whether they be businessmen or financiers, farmers, industrial or public service workers, teachers, various groups of taxpayers with special interests, or lobbies for more spending in any of several hundred different areas — have, over the years, played each of us, the parties in this House, off against each other. If we unite for the public good against all these forces that are tearing our poor country apart, if all of us refuse to entertain any longer their exorbitant demands which have jointly pushed spending to intolerable levels and have promoted distortions in the tax code, we can save our people as a whole from great hardships. This does not mean that we need to agree on political or economic policies. Far from it. We need to keep our distinct approaches to such issues, so that the people may be offered real choices of different ways of managing our affairs.
But on this issue of resistance to pressure groups we need to create and to preserve a united front. If one party, through its leader or through a front bench representative, gives a particular group reason to believe that their claim for special benefits at the cost of the taxpayer will be met if only the group put their organised strength behind the party in question, then not alone is the public interest put in grave jeopardy, but our democracy is itself devalued.
We all know this, and most of us here agree privately amongst ourselves that such a stand is vital. We all know that it is wrong, desperately wrong, to succumb to the kind of pressures that I have referred to.
(Interruptions.)
Order, order, please.
We all know that we should together, in a concerted way, resist these pressures, and concentrate debate on the issues of economic and social policy that legitimately divide us. But are we willing, are we able, to do in public what in private together we agree is vitally necessary for the survival of our society? I hope that we can come to answer this question positively. As Leader of Fine Gael, I pledge my party to hold fast on these issues.
(Interruptions.)
I know that our political system is more vulnerable than most to pressures of this kind.
I want to know about the poison pen Fine Gael.
(Interruptions.)
In a small Parliament like ours——
(Interruptions.)
Would you get that little man to sit down?
Would Deputy Fitzgerald please sit down or leave the House?
In a small Parliament like ours, elected proportionately, where majorities are normally counted in low single figures, or at times like the present may not even exist, there is more room for pressure groups to exercise muscle than there is in larger parliaments, where majorities are normally bigger.
I do not conclude from this that we should enlarge our Parliament, which already has a high ratio of members to electors. At the same time, I have to admit to doubts, also as to the wisdom of making it significantly smaller, despite pressure from some sources to do so for the reasons mentioned. Nor do I propose that we should seek to distort the proportionality of representation in our Parliament, to which our people are rightly attached, with the objective of producing unrepresentative artificial majorities. But in retaining these characteristics, we must face the fact that their retention demands from us more restraint and a more concerted approach to those who seek to pressure us into spending more money or into maintaining or introducing into the tax system distortions that would favour particular sections of the community.
There is another aspect of our electoral system that we might, however, with advantage, re-examine. I refer to the multi-seat constituency system. We know that even before this system was introduced by those who then controlled our fortunes, politicians from another island who have notably refrained from any reform at home of their antiquated electoral system along these, or any other, lines, even then our politics was bedevilled by a measure of clientalism.
But we know also that over the years since the multi-seat system was introduced here and shortly afterwards we became an independent State, clientalism has become an ever-growing feature of our system, forcing our TDs to exhaust themselves in competition with their own fellow party members in each constituency, as well as with their opponents. In recent years these pressures have become intolerable and have greatly and dangerously weakened respect for politics and politicians in this State. Our people have found themselves, through this system, induced at one and the same time to use their TDs as messenger boys or girls, and then to hold them in contempt for so acting.
(Interruptions.)
Order, order.
Two attempts were made in the past to change this system. I opposed both of them, and would so if they were ever proposed again. I did so, and would do so again, for the simple reason that the political geography of this country, as of most other democratic countries outside of Britain and some federal states that developed out of British colonies, is quite unsuited to the British system of marking an X opposite the name of one person in a single-seat constituency. In this State, as nearly everywhere else, such a system would lead to enormous and unsupportable distortions of representation.
But because two unsuccessful attempts were made to change our system in the wrong way, we should not be discouraged from even considering how it might be modified in a manner that would remove the pressures of multi-seat constituencies while preserving both the alternative vote and also close proportionality of seats to votes. Such a reform is possible. I believe that for the sake of the health of our political system the time has come to look at some such reform. Deputies would not disagree with that in principle.
There is another area, too, where we need to consider change. I believe that many of our people have been very unhappy about some recent decisions of our courts on constitutional matters. Some, like Deputy Haughey this morning, blame our judges for these decisions, apparently believing that the judges should ignore the provisions of our constitution for the sake of our convenience.
(Interruptions.)
I believe we should look rather at the underlying cause of these decisions, which lies in certain weaknesses of our Constitution, which have forced on our judges the kind of decisions which, for example, Mr. Justice McCarthy deplored as undesirable in the recent case about planning compensation in Killiney. It is true that the immediate occasion for this particular decision was the incompetent wording — and that is the most charitable interpretation one can put on it — of a decision by an unqualified political appointee to the old. unreformed, Planning Board. But this incompetent or worse administrative act would not, I believe, have had such costly and damaging consequences for our community if the constitutional provisions that governed the judicial decision in this case — as in so many other cases — were not drafted in such a manner as to force decisions against the public interest and in favour of private interests.
The time has come to look at our Constitution again, as it approaches its Golden Jubilee: to re-examine its provisions in the light of our experience of how they have operated against what most of us now regard as the public interest. Legal reform, as suggested by the Leader of the Opposition this morning, is not sufficient. The root of the problem lies in the Constitution itself, as he well knows.
The truth is that our society needs renewal at every level: constitutional, political, economic and social. We have to tackle at their roots abuses of the tax system and of the social welfare system. We have to eradicate obstacles to growth and unemployment ——
(Interuptions.)
We cannot go on bickering and point scoring here while the world passes us by. I for one-am not prepared by failing to meet this challenge to betray the trust the people have placed in us. I believe that in all parties there are people of like mind on these fundamental matters. Let us, then, by continuing to offer our people alternative economic and social policies, get together for this purpose and show our people and the world outside that democracy can work in the public interest in Ireland. May I wish Deputies a happy Christmas and a busy and prosperous New Year before we come to the general election.
(Interruptions.)
Order, please, if Deputies did not show respect to the Taoiseach they must show it to the Chair.
(Interruptions.)
Deputy McLoughlin, I will ask you to leave the House.
(Interruptions.)
Question put: "That amendment No. 1 be made".
The Dáil divided: Tá, 81; Níl, 82.
Tá
- Ahern, Bertie.
- Ahern, Michael.
- Andrews, David.
- Andrews, Niall.
- Aylward, Liam.
- Barrett, Michael.
- Barrett, Sylvester.
- Blaney, Neil Terence.
- Brady, Gerard.
- Brady, Vincent.
- Brennan, Mattie.
- Brennan, Paudge.
- Brennan, Séamus.
- Briscoe, Ben.
- Browne, John.
- Burke, Raphael P.
- Byrne, Hugh.
- Byrne, Seán.
- Calleary, Seán.
- Collins, Gerard.
- Hilliard, Colm.
- Hyland, Liam.
- Keating, Michael.
- Kirk, Séamus.
- Kitt, Michael.
- Lemass, Eileen.
- Lenihan, Brian.
- Leonard, Jimmy.
- Leonard, Tom.
- Leyden, Terry.
- Lyons, Denis.
- McCarthy, Seán.
- McCreevy, Charlie.
- McEllistrim, Tom.
- Mac Giolla, Tomás.
- MacSharry, Ray.
- Molloy, Robert.
- Morley, P.J.
- Moynihan, Donal.
- Nolan, M.J.
- Noonan, Michael J. (Limerick West).
- Conaghan, Hugh.
- Connolly, Ger.
- Cowen, Brian.
- Daly, Brendan.
- De Rossa, Proinsias.
- Doherty, Seán.
- Fahey, Francis.
- Fahey, Jackie.
- Faulkner, Pádraig.
- Fitzgerald, Gene.
- Fitzgerald, Liam Joseph.
- Fitzsimons, Jim.
- Flynn, Pádraig.
- Foley, Denis.
- Gallagher, Denis.
- Gallagher, Pat Cope.
- Geoghegan-Quinn, Máire.
- Gregory-Independent, Tony.
- Harney, Mary.
- Haughey, Charles J.
- O'Connell, John.
- O'Dea, William.
- O'Hanlon, Rory.
- O'Keeffe, Edmond.
- O'Kennedy, Michael.
- O'Leary, John.
- O'Malley, Desmond J.
- Ormonde, Donal.
- O'Rourke, Mary.
- Power, Paddy.
- Reynolds, Albert.
- Treacy, Noel.
- Treacy, Seán.
- Tunney, Jim.
- Wallace, Dan.
- Walsh, Joe.
- Walsh, Seán.
- Wilson, John P.
- Woods, Michael.
- Wyse, Pearse.
Níl
- Allen, Bernard.
- Barnes, Monica.
- Barrett, Seán.
- Barry, Myra.
- Barry, Peter.
- Begley, Michael.
- Bell, Michael.
- Bermingham, Joe.
- Birmingham, George Martin.
- Boland, John.
- Bruton, John.
- Bruton, Richard.
- Burke, Liam.
- Carey, Donal.
- Cluskey, Frank.
- Collins, Edward.
- Conlon, John F.
- Connaughton, Paul.
- Coogan, Fintan.
- Cooney, Patrick Mark.
- Cosgrave, Liam T.
- Cosgrave, Michael Joe.
- Coveney, Hugh.
- Creed, Donal.
- Crotty, Kieran.
- Crowley, Frank.
- D'Arcy, Michael.
- Deasy, Martin Austin.
- Desmond, Barry.
- Desmond, Eileen.
- Donnellan, John.
- Dowling, Dick.
- Doyle, Avril.
- Doyle, Joe.
- Dukes, Alan.
- Durkan, Bernard J.
- Enright, Thomas W.
- Farrelly, John V.
- Fennell, Nuala.
- FitzGerald, Garret.
- Flaherty, Mary.
- Flanagan, Oliver J.
- Griffin, Brendan.
- Harte, Patrick D.
- Hegarty, Paddy.
- Hussey, Gemma.
- Kavanagh, Liam.
- Kelly, John.
- Kenny, Enda.
- L'Estrange, Gerry.
- McCartin, Joe.
- McGahon, Brendan.
- McGinley, Dinny.
- McLoughlin, Frank.
- Manning, Maurice.
- Mitchell, Gay.
- Mitchell, Jim.
- Molony, David.
- Moynihan, Michael.
- Naughten, Liam.
- Nealon, Ted.
- Noonan, Michael. (Limerick East)
- O'Brien, Fergus.
- O'Brien, Willie.
- O'Donnell, Tom.
- O'Keeffe, Jim.
- O'Leary, Michael.
- O'Sullivan, Toddy.
- O'Toole, Paddy.
- Owen, Nora.
- Pattison, Séamus.
- Prendergast, Frank.
- Quinn, Ruairí.
- Ryan, John.
- Shatter, Alan.
- Sheehan, Patrick Joseph.
- Skelly, Liam.
- Spring, Dick.
- Taylor, Mervyn.
- Taylor-Quinn, Madeline.
- Timmins, Godfrey.
- Yates, Ivan.
Tellers: Tá, Deputies V. Brady and Browne; Níl, Deputies F. O'Brien and Taylor.
Amendment declared lost.
Motion declared carried.