When we adjourned the debate last night I was talking about the people's expectation of reasonable reform in the tax system. People are leaving because of our penal tax system. This morning I listened to one of our more popular sports people being interviewed. He criticised our tax system. He mentioned the amount of money it would cost him to stay here and said that some slight reform might have induced him to live here — and he has a case. It may be said that these sports people are exceptionally well paid. That may be so but the vast bulk of it is earned outside the country.
While I have great concern for people like that, I have even greater concern for people who are leaving the country to earn a living in England where there is substantial income to be earned in the building industry. I can relate the story of a married man who, having lost his job last September, went to London to work in the building industry rather than go on the dole. He was able to earn £480 sterling per week. When he came home at Christmas the Revenue Commissioners informed him that he must pay the difference between the tax paid in England and what would have been due here on the money he was good enough to earn so that he would have something reasonable in his home for the Christmas period. That is unjust and unfair.
A young person told me the other day that he had worked in this country for 26 weeks from April to September, and then went to England where he earned a considerable amount of money. When he came home the Revenue Commissioners were looking for the difference in the tax paid. This must be looked into. This situation is arising more often now when people find that, come autumn, jobs are closing down. They could go on the dole and if they do, the strange fact is that they could reclaim the tax they paid for the first half of the year, but because they have the initiative to go outside to seek work and bring home an income to their families they are penalised.
With regard to the description of the tax reforms as being modest, I would say that is being polite; they are meagre. The top rate of tax has dropped from 58 per cent to 56 per cent. Therefore the higher the income the better off people are. That is what happens when one deals in percentages, and until we get away from that the people at the higher end of the scale will always have greater benefit than the people at the lower end. The standard rate has improved by 3 per cent from 35 per cent to 32 per cent. Further down the scale there were allowances and other initiatives. However all of them are taken away immediately when we look at things like mortgage relief and relief on life insurance premiums because now one can claim relief on only 80 per cent of the premium whereas two years ago one could claim 100 per cent. There is no clawback for people who have mortgages and life assurance premiums — and those who have not are few and far between. Any young man starting up a home will have a mortgage and he should get recognition for his initiative rather than expecting the local authority to provide him with housing.
Then we had the Minister making vague references to the proposal to withdraw child benefit. Immediately there was an uproar and Government Ministers, one after another, poured cold water on this proposal saying that it was only floated, that it was not a definite proposal and that it would only affect those at the higher end of the scale; but no figure was mentioned in the budget of where the cut off point would be. The Taoiseach clarified this yesterday by saying that the cut off point would be above £30,000 a year income. This obviously was not the intention originally, but because it was seen to be such a hot potato and there was so much reaction from the housewife who spends most of her time looking after her children — and surely she was entitled to this little income without the Government trying to get their hands on it — it was seen to be a bad development and should never have been suggested.
Deputy Ellis made great play last night of the fact that we had free fuel and free electricity for our old aged pensioners and various other categories. I accept that but they are hard got. I do not know what Deputy Ellis' experience is, but my clinics are taken up with people whose social welfare payments have been cut, causing grave hardship. These unfortunate people with the minimum income, living in poor homes, look forward to free fuel to keep them warm over the winter months. Fortunately we had a mild winter. I believe if this were not so the consequences would have been tragic.
I have had widowers and old age pensioners coming to me and saying that because they had a bit of ground — not land but rocks and bushes — they were expected to provide a certain amount of fuel. Able bodied people would not be able to go out and get it, and it would not burn in the first place; but these people were assessed as having an amount of ground around the house which could supply a certain amount of fuel. Nothing could be more miserly. Nothing could be more disheartening for old people who have given their life to this country. I hope there will be a change of heart in our approach to social welfare and that those people who are not in a position to fight their case will not be put through the hardship they are going through at the moment.
I want to refer now to 1992. Being a Border Deputy I am particularly concerned. Some five or six months ago the Government were on a hobby horse with Ministers all over the place saying we must prepare for 1992. There were seminars everywhere. There was one in Monaghan which was exceptionally well attended. Minister Brennan came and gave an excellent outline of how we were to approach it. There were various spokespersons from key businesses all over the county and from senior development organisations all over the country. We were led to believe that this business was being taken seriously. However, there was not even a line in the budget with regard to 1992.
In fact, we have turned in the opposite direction. Instead of trying to achieve harmonisation in the taxation system, duty on petrol — the one important ingredient so far as the Border areas are concerned — was increased by 5p per gallon. If we had taken 5p off we would be heading in the direction of 1992, we would be helping to achieve a balance between prices North and South, but there is more to it than that. This whole business of cross-Border trade should be addressed now if we are looking forward to 1992 rather than waiting until the night before to do all that will have to be done when the barriers are lowered and people can come here freely and trade, and we will be expected to go abroad and do likewise. We will have to face a certain amount of competition but we will not be prepared.
People in the Border areas were living in the expectation that there was light at the end of the tunnel with the approach to 1992 and that their businesses could hold out until then. They hoped that between now and 1992, with a movement towards the equalisation of the tax system, they would receive benefits and that gradually their incomes would improve but this has not happened. Nothing has happened to give them any ray of hope and they no longer see any light at the end of the tunnel. With the announcement of an additional 5p on a gallon of petrol their hopes were dashed. That increase may seem small and people may say it will be absorbed with the forthcoming decrease of 5p a gallon by the oil companies but I do not accept that. If the reduction by the oil companies, which was to be announced on the eve of the budget, had been announced and if the Government had reduced the price of a gallon of petrol by 5p rather than increasing it, the difference between the price per gallon in the North and that in the South would be less than 60p.
The question of the Structural Funds also rises. The Government have apparently decided that they will not devote any more time to setting up regional committees. The people have responded to this. In the area which I represent — Cavan-Monaghan, Sligo-Leitrim and Donegal — a number of meetings have been held. At least ten meetings were held in Cavan and on each occasion people attended in their hundreds. Husbands and wives attended in the hope of getting some information. There is an amount of confusion in regard to this matter. People believed that 70 or 75 per cent grants would be made available for improving their homes or renovating old dwellings in tourist regions. They thought they would receive grants of 70 to 75 per cent for setting up mushroom units or for breeding turkeys, chickens or suckling herds. This was the drift of the message that was coming from these meetings but no such grant aid is available. We have been told that we will receive from the EC funds 70 to 75 per cent of the amount that we make available. There is no mention in the budget of how much money will be set aside to match the funds from Brussels.
It is interesting that the true facts regarding the increase of the EC Structural Funds are being presented by the Government in order to create a false feeling of well being. Members of local authorities, development organisations and the public generally are being misled and will be disappointed as a result of wild statements that large amounts of money will be received from the EC Structural Funds. It has been mentioned regularly that we will receive an extra £4 billion in the next five years.
Yesterday I spoke to the chairman of the regional committee in my area who told me that he has received at least 300 applications for funds from individuals and groups but he has no office and no back-up service to deal with these applications. That chairman is an exceptionally capable chairman of the regional committee. He has had great experience in Europe and was a former national figure in this country. He told me he is depending on the goodwill of the local co-operative, Killeshandra Co-op, to make available to him their staff and offices to help him to get into some semblance of order the applications that have been received. I would like to put it on record that he has received much help from the Cavan county development officer but the staff available to him is minimal and they are quite busy.
Likewise, the county manager who is a capable and dynamic man, whom we are proud to have in the county and who has brought about great changes in the short period he has been there is also making his staff available but that is not a well organised system for dealing with what is undoubtedly a very important development, the increased Structural Funds that are being made available to us. If we are serious about this matter surely we would set up an office in the region with clerical staff. I presume not more than three or four people would be willing and able to deal with the applications. We should ensure that the efforts of the people who made applications get fair recognition.
Many groups are concerned about the development of tourism, about developing their local areas and making amenities more accessible to tourists. Farmers come together to develop areas of land for plantation. I believe "drainage" is not a very popular word to include in an application for Structural Funds, that agricultural production is not favoured, but a number of farmers have waste land which, with some development, could be used for planting, pony trekking and hiking. Those applications have been detailed and costed. The people are doing the best they can, given that they have not the back-up service and the knowledge that is needed.
What I and many people cannot understand is if on the third day of February these applications are still lying in a room in Cavan and have not been opened due to lack of staff, how will they be considered in the drawing up of a county plan and a national plan? Will the efforts of these people be wasted? In fairness to the people, a clear and definite answer must be given so that they will not be totally disillusioned. They have shown a keen interest and awareness in this area. If there is any motivation at all the people will respond. That has been proven by the numbers of honest people who attended meetings to ensure that they would get a grasp of what is available to them.
An agreement has been reached that the total amount of money in the three funds will be doubled by 1993 but no guarantee has been given that Ireland's share will be doubled although there is a good prospect of that happening. This means funds will be increased by approximately 15 per cent annually and will amount to about £700 million in 1993. In the past the Regional Fund was allocated on a quota basis with Ireland's share at 3.2 per cent. Last year we did not receive that amount because we did not provide enough money to match that sum. We receive about the same amount from the Social Fund as from the Regional Fund. We received 10 per cent in 1987 and we can hardly expect this to be doubled. We received 10 per cent from the Agricultural Fund, one area in which we could have collected at least double the amount but we did not avail of all the opportunities. There are good prospects for a large increase in this area.
There is also misunderstanding as a result of statements about 75 per cent funding, as I have said earlier. Agreement has been reached only in relation to the Regional Fund but it is hoped that it may extend to the Agricultural and Social Fund in future years. It will not however apply to the cost of a project and that is the important message that we must get across. People should not be misled into thinking that if they put up 25 per cent of the cost of a project, 75 per cent will be received from the EC. It would be great if that was the case. These people are well entitled to that type of grant aid. I have no doubt that 100 per cent grant aid has been handed out to foreign industrialists to come to this country but they close down within a number of years for tax reasons. Having got all they can from the system they close their doors and leave the country. If grants are made available to small, family-run businesses these people will stay and make every effort to succeed.
In future years the grant aid will not apply to the cost of projects but to the amount of public finance involved. The Structural Funds have gathered much support; people are keenly interested but the Government have a lot of work to do and explanations to give so as to ensure that the applications sent in will get a fair hearing, that they will be judged on their merits and that the funds which these people are seeking will be available to them.
There is another important aspect of the Structural Funds and that relates to the county councils and, therefore, the roads. The Minister for Health, Deputy O'Hanlon, on the other side of the House is equally aware of the state of the roads in Cavan-Monaghan. They are no better than in any other county and are worse than most other counties. People might say I am making a meal out of the potholes in Cavan but I make no apology to anybody for that. We have a unique problem. We have no other means of transport. We do not have an airport as yet and I do not suppose we will. We had a rail service but it was taken away in the mid-sixties. Therefore we are solely dependent on our roads and they are in a deplorable state.
I think it was Deputy Ellis who paid tribute to the Minister for the extra moneys he has made available in this budget. I am sorry to say I do not see it. There may be extra money but it is not sufficient to make a reasonable impact on the serious situation that exists. There are unfortunate people who live in long laneways. Before leaving the house children going to school must first put on their wellingtons and carry their little shoes in their hands to the end of the main road to meet the bus. They must then take off their wellingtons and hide them behind a gatepost or a tree and put on their shoes. If they travelled in their shoes their legs and their stockings would be destroyed and they would be soaking for the day. That is the situation we are faced with apart altogether from the unsightly mess to be faced by tourists who we are trying to attract to the country.
Long ago, and I am sure it is still the case, there was always a general clean up before inviting guests, to make sure that every place was looking well. By way of all sorts of promotions — many of them hare-brained — we are bringing people here who, because of the state of our roads, will not return. Nothing sells better than a good product and a good product needs no advertising; the word will spread quickly. If you treat a customer well he will bring ten customers back. If you treat a customer badly he will prevent 100 from coming. Many of the people involved in tourism would also be involved in clubs of one kind or another and there are general comments when they return as to whether they enjoyed the holiday. If it was good then more people will come but if it was bad it will turn people away. That is an aspect with which I am concerned.
I am primarily concerned about the people who are using our roads every day and who are depending on them and have to put up with existing conditions. The rate support grant has been cut by half and that has been the sole reason for the serious deterioration of our roads. The problem started in 1977 and it is now with us 12 years and it is getting worse. Like a wild teenager our potholes are creating havoc all over the place. This problem must be tackled; it cannot be allowed to continue any longer.
Yesterday I was in Cavan at the launch of Local Awareness for the eradication of TB. It was a meeting that was exceptionally well presented. The local district veterinary officer, Seamus Griffith, gave an excellent outline of what they expect to do within the next three to four years. Eradication of bovine TB is a major problem. We have been working at it — if working is the correct description — for the past 35 years. We made rapid progress in the early years but for the last few years we seem to have become bogged down. It is a serious setback to any farmer, married or single, when the veterinary surgeon announces on the morning of the test that he has a reactor or a number of reactors in his herd. It is devastating. It was probably a lifetime of work building up a good herd of dairy cows and then they are gone by the way-side.
I do not think it has been appreciated by the powers that be, by the Government, by the Minister for Agriculture and Food or the Minister for Finance how these people are expected to live when their herds are taken from them and when their farm is totally destocked. Nobody has come up and said, here is an income as in the case of an industrial worker who has been made redundant. They are just left. Their cattle have been taken from them and they are told that in six months they may be allowed to get back into stock again but it could be a period of 12 months. Nobody has said how they are to live in the meantime. I know there is compensation for the cattle but I do not have to spell out here the enormous losses suffered by people as a result of putting small cattle into factories and good dairy cows in their full term of milking. Certainly they would not be in great condition and the moneys received would represent a loss, on average, of over £700 per cow.
I recognise that some improvement in the new scheme has taken place regarding an income of £45 per month being offered for depopulation grants. A good dairy cow producing four gallons of milk per day would bring in £124 per month to the farmer. Now he is getting only about a third of that amount. We are now talking about small pockets of areas afflicted with the disease. It is not good enough that farmers who are not affected, because of some good luck and the grace of God, should turn a blind eye to those who are hit with this serious problem. A fund should be set up and I believe the farmers would be the first to respond, and the Government should also put in a major capital investment in the fund. I would expect the meat factories and the co-ops to respond likewise.
In conclusion there is one important aspect that I would like to mention and that relates to a bypass for Cavan town — not a surgery bypass. I have no doubt the Minister for Health, Deputy O'Hanlon, would support me in that. We have a major problem and the bypass has been on the cards for the past ten years. It is a bottleneck for people, for businesses and for lorries travelling to Dublin or to the West who have to pass through Cavan town and who are seeking a bypass.
