Dáil Éireann debate -
Wednesday, 5 Dec 2001

Vol. 545 No. 5

Financial Resolution No. 4: Excise – Cider and Perry.

The Taoiseach

I move:

(1) THAT in this Resolution "% vol" means the number of volumes of pure alcohol contained at a temperature of 20ºC in 100 volumes of the product at that temperature.

(2) THAT the duty of excise on cider and perry imposed by paragraph 8(2) of the Imposition of Duties (No. 221) (Excise Duties) Order, 1975 (S.I. No. 307 of 1975), shall, in lieu of the several rates specified in the Fourth Schedule to the Finance Act, 1994 (No. 13 of 1994), be charged, levied and paid–

(a) as on and from 6 December 2001, at the several rates specified in Schedule 1 to this Resolution, and

(b) as on and from 1 January 2002, at the several rates specified in Schedule 2 to this Resolution.

(3) IT is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).

SCHEDULE 1

RATES OF EXCISE DUTY ON CIDER AND PERRY

Description of Cider andPerry	Rate of Duty
Still and Sparkling:
Of an alcoholic strength not exceeding 6% vol	£65.57 per hectolitre
Of an alcoholic strength exceeding 6% vol but not exceeding 8.5% vol	£151.59 per hectolitre
Still:
Of an alcoholic strength exceeding 8.5% vol but not exceeding 15% vol	£215.01 per hectolitre
Of an alcoholic strength exceeding 15% vol	£311.97 per hectolitre
Description of Cider andPerry	Rate of Duty
Sparkling:
Of an alcoholic strength exceeding 8.5% vol	£430.02 per hectolitre

SCHEDULE 2

RATES OF EXCISE DUTY ON CIDER AND PERRY

Description of Cider and Perry	Rate of Duty
Still and Sparkling:
Of an alcoholic strength not exceeding 6% vol	83.25 per hectolitre
Of an alcoholic strength exceeding 6% vol but not exceeding 8.5% vol	192.47 per hectolitre
Still:
Of an alcoholic strength exceeding 8.5% vol but not exceeding 15% vol	273.00 per hectolitre
Of an alcoholic strength exceeding 15% vol	396.12 per hectolitre
Sparkling:
Of an alcoholic strength exceeding 8.5% vol	546.01 per hectolitre

Resolution No. 4 provides, with effect from midnight tonight, for an increase of excise duty on cider and perry and when VAT is included, it amounts to about 21p, or 27 cent, per pint of ordinary strength cider per yield, bringing the excise duty on these products broadly into line with VAT levy on beers. In relation to its alcohol content, cider and perry have been significantly under taxed for many years compared to beer. The expected yield from the increase, which will take effect from midnight tonight, is approximately 33.6 million, or £26.4 million, in a full year. The measure will not have a significant effect on the CPI.

Mr. Dukes

From memory, I believe the Minister said this afternoon that the effect of these three rate increases will be to add 0.9% to the CPI. I will deal with them in the order in which they appear on our paper.

Resolution No. 2 concerns duty on mineral oils. In common with most other people on this side of the House this evening, I felt like laughing, if it were no so serious, when the measure, particularly the part dealing with diesel with a sulphur content above 50 parts per million, was presented as an environmental measure. It is the only measure in the budget which could be classified as environmental by a great stretch of the imagination. As Deputy McDowell said, if this is the extent of the Government's commitment to environmental action, God help us. We have no right to condemn President Bush for giving the back of his hand to the Kyoto accord.

I oppose the increase in excise duty on fuels. It will raise only a very small amount of money in the context of the total budget, which at any rate will fall apart very rapidly. It is built on shifting sands. Given how calamitously wrong the Minister and the Government got the budget for 2001, I do not have the slightest confidence that the parts of the budget strategy announced this afternoon will hang together in 2002. My firm expectation is that the first brief the incoming Minister for Finance will receive from the Department after the next election, which is only a matter of months, if not weeks, away, will be an account of how and why the budget strategy for 2002 went off the rails. One of the first tasks facing the incoming Government will be to look very closely at how to address this matter because this budget will fall apart as surely as the health strategy announced a few days ago falls apart. The budget's provisions on health torpedoed the health strategy.

It is not right to saddle motorists with a 5p per litre increase in the price of petrol, a 5p per litre increase in the price of diesel and a 10p per litre increase in the price of high sulphur diesel. If I had some degree of confidence that the budget would work or do something worthwhile, I might accept the need to pay a price for it, including an increase in excise duties on petrol. However, with the budget set to fall apart, no such case can be made.

As the budget will create widespread disappointment and disillusionment, the increases would not be justified. They will add to the daily burden, particularly of those who live in rural areas and have no option but to use private cars, because buses are not available across huge areas of the country thanks to the indolence of the Minister for Public Enterprise. The other day I received a report on the rural transport initiative. While I am aware a few things are moving in some areas, progress is only a shade faster than the Luas which has once got as far as a static carriage on a static track in Merrion Square. The project should have been up and running by now. Had the original plans been adhered to, it would be. Given all these factors, I see no convincing reason to vote for the increase in excise duty on petrol and diesel oil.

I turn to the measure on tobacco products. The politically correct stance would be to state that one cannot object to 10p on a packet of cigarettes. Many would argue for a greater increase. We all heard the stories making the rounds in recent days that the price of cigarettes would rise by 1. The more well informed pundits, as they like to think of themselves, told me last night that the 1 story was designed to scare the living daylights out of people and that the rise would be 0.5. It now transpires the increase is 10p. This, together with the fuel, is of a piece with the weird lack of conviction in this year's budget. It does not contain a good environmental tax on petrol or diesel or a really good, dissuasive tax on cigarettes.

The Taoiseach informs us the effect of the increase in the price of a packet of cigarettes will be to reduce consumption by 0.7% below what it would otherwise have been. Why bother? The 10p increase contrasts sharply with some of the other Government plans for cigarettes. The Public Health (Tobacco) Bill, 2001, will require retailers to keep cigarettes locked away from public gaze in a cabinet under the counter and make it an offence to have any promotional or advertising material on display in their shops. They will also be required to pay a registration fee. It provides that retailers who commit an offence of displaying such materials, allowing a customer to see a packet of cigarettes before purchase, or selling cigarettes to those who are under age, may lose their registration for three months up to, I believe, one year. They will have to say goodbye to typically about 20% of their total trade for this period. This is madness.

I will have a lot more to say when we debate the Bill. I will not be politically correct and have never been known to be particularly politically correct. I hate nonsense when I see it. For the Government to persistently state it is concerned about cigarette smoking, an activity I would not recommend to anybody, and introduce a half-hearted measure such as this is, in the seanfhocal words, neither fish, flesh nor good red herring. Is it worth the bother, especially when it will raise so little money in the context of a budget as unstable and ramshackle as this?

The resolution on cider and perry will clearly create many protests in County Tipperary. We will all be inundated with more lovely red and green presentations from the cider industry council complaining about it. I cannot find it in my heart to get particularly excited about the measure one way or the other. I have a feeling that the amount of perry consumed has substantially diminished in recent years. I may be wrong as I am not a perry drinker. There are some cider drinkers in the House, although, as the Taoiseach would know, they have very little in common with those who consume cider in public parks.

To introduce an increase of 5p a litre on fuel, particularly in the context of such a chancey budget, is an excessive imposition, especially on those with no access to public transport. Increasing the price of cigarettes by 10p will not satisfy anybody, including those seeking muscular action to deter or reduce smoking, and it will not make a hap'orth of difference to those, among whom I will probably number myself, who will complain about it.

Mr. Quinn

The Deputy would not be worried about rationing.

Mr. Dukes

If there was rationing, that might have a real effect on me. We will complain about it for a few days and then we will forget that we ever bought cigarettes for £3.82 a packet. I cannot believe the Government is really serious in coming forward with this.

It would have been different if, instead of raiding every cache of money in sight, the Government said we would have real measures on indirect taxation in order to raise money for worthwhile social spending. That would have been an argument that I would have liked to have but that is not what it is doing.

With these measures it is raising what is in the context of this budget, a piddling unimportant amount of money for a budget which will do very little in any real sense for people.

For example, if one analyses what is provided for health in this budget and compares the true position post-Budget 2002 with the true outturn position for 2001, which the Government has sedulously avoided presenting to us, one will find that the extra amount of expenditure for health in 2002 over 2001 is about £100 million. This is in the context of what is supposed to be a £10 billion health improvement programme over ten years. It is ludicrous. It is worse than just nominal. Therefore, these tax increases are of a nature where I am surprised that the Government has the neck even to bother the House with these resolutions.

Caoimhghín Ó Caoláin

I wish to register my opposition to Financial Resolution No. 2, where we see a proposal to increase excise duty on petrol and diesel by up to 5p per litre as from midnight tonight.

Mr. Dukes

It will take the shine out of smuggling anyway.

Caoimhghín Ó Caoláin

The hard pressed motorists in this jurisdiction are cornered in every respect. From the first demands in relation to licence fees to vehicle registration tax, motor tax and increasing excise duty on fuel. We have a situation in the vast swathes of this country, where people are totally dependent on private transport, the personal or family car. I come from a part of the country where there is to all intents and purposes no public transport system. Apart from the main expressway service from Letterkenny and Derry to Dublin, we have no internal public transport system within the constituency of Cavan-Monaghan. We have no rail network. There is total dependency on car transportation. In these circumstances which one finds throughout the length and breadth of this jurisdiction people are being further pressed once again by this measure.

For freight transport, we also see a dependency on the use of the road infrastructure. All transport of goods to these parts of the country that are not serviced by public transport by rail or other means of distribution of goods and services, are also facing this further hike. The result of that, in turn, is that these additional costs, in terms of service and goods distribution, will be added on to the already increased burden on the ordinary consumer and on the road dependent motorist. There is, in a further Resolution, the re-introduction of the 21% standard rate of value added tax. In reality, we will see – of course it is all very convenient with the advent of the euro – that there will be great confusion but it will be very noticeable in the purses of hard pressed families at the end of each week that they have lost out and have been penalised further.

It is also the case that while the Taoiseach has said we have one of the lowest rates of excise duty on petrol and diesel within the European Community, for many years the situation was very different. Petrol retailers in the Border counties were closed. Whole communities and towns in my constituency had no petrol or diesel retail outlets, and it is only in recent years with improved economic circumstances that some of these have re-opened and that we see a thriving local economy based in no small measure on the influx of people from north of the Border attracted by the very competitive pricing for petrol and diesel south of the Border. People in other retail outlets also benefit from this traffic and from this spending power visiting our respective towns and villages along the Border's length. It would be a very sad message that this budget brings to those people dependent on that business, looking forward to a thriving business market in the lead up to Christmas and continuing in the new year.

I urge the opposition of this House to the proposal before us. It is unnecessary, it is punitive and it lacks imagination. What the Minister needed to do was allow the opportunity for an equalisation after years of hardship, marginalisation and economic depression, particularly in the Border counties. We needed a period of time of stable opportunity to build, to root and to anchor. Instead we have further punitive excise duty charges being placed at the petrol pumps. This affects everybody. There is no service, there are no goods and there is no activity within these areas, totally dependent on our road infrastructure, that will escape. There is no alternative. I would ask the Taoiseach to take on board the very damaging effects of this measure, particularly in the areas I have described. I record my opposition and will vote against this measure in the House tonight.

Mr. Quinn

Can I just clarify, because I missed it when it was read out by the Taoiseach, what the yield is in relation to Resolution No. 2 and Resolution No. 3? I have a yield of 33 million for Resolution No. 4. Perhaps the Taoiseach might indicate what the yield is for the other two.

The Taoiseach

The increases expected on Resolution No. 2 will result in yields of £7.4 million or 9.4 million this year and £168.5 million or 214 million next year. On Resolution No. 3, the expected yield is £0.7 million or 0.9 million this year and £29.3 million or 37.1 million in a full year.

Mr. Quinn

In total, then, we are looking at approximately just more than 300 million in a full year. My party is opposed to these Resolutions. The increase on cigarettes is not sufficient to have the deterrent effect which one would like to see. I would like the Taoiseach in his response to indicate how he feels about the impact on inflation having regard to what happened last year and how the Government may be constrained by the inflationary impacts the increase on cigarettes may have and, therefore is only looking for an increase of 10p. That increase is derisory at one level, bearing in mind that the figure of 1 did not get into the media unassisted. Somebody had to put it in there in the first instance. If the Minister was serious about raising money from the cigarette and tobacco smokers, he would look for something more than the 10p proposed. Maybe the Taoiseach might outline the thinking of the Cabinet and the Minister for Health and Children, Deputy Martin. That Minister no doubt would have liked to have got more resources – he said so here in the House – and this was one obvious way. Even smokers would accept that 10p is not much of a deterrent for people who put their health at risk and become a direct burden on the health infrastructure, as is evident from many studies. It may be that, in the light of recent revelations, the Minister does not wish to enhance the prospects for cross-Border smuggling. Perhaps the Taoiseach could explain why he has bothered to add only ten pence. Why not opt for a much larger figure?

The fuel increase adds insult to injury for the many people who are forced to drive or, in many cases, forced not to drive when they are stalled in gridlock, as we saw with the "no-flow" situation in Dublin city two days ago. This will result in quite a substantial increase in the operating costs of many companies which depend on fuel. The Minister may reply by saying he has reduced some other costs for companies such as the inexplicable reduction in PRSI, which as Deputy McDowell said earlier was neither signalled nor sought. This is a bonanza for employers on top of the bonanza they are already getting.

I am trying to elucidate some philosophical underpinning or strategic economic thinking behind this. On the one hand there are reductions in revenue from employers' PRSI and, on the other, there is an effort to increase revenue. I cannot understand why there is a need to reduce employers' PRSI which is already the lowest, or close to being so, in the EU. We clearly have a competitive economy. Companies' profit levels are comparatively high and taxation is far and away the lowest in the EU. Why reduce revenue in one area where there is no manifest demand for it? I have not seen any demand from employers' organisations for a reduction in PRSI. I have, however, seen a demand for the resti tution of the state of affairs which existed prior to last year's budget, when unannounced changes were introduced without any consultation in total contrast to the spirit of social partnership whereby changes in the tax system were signalled or negotiated in order that people would, at least, not be surprised by their imposition.

Together with a reduction in substantial revenues, there is a gratuitous increase in fuel revenues. This cannot be seen as a carbon tax, as advocated by the Green Party and others, because of its relative impact. The increase is 5p per litre in metric terms or 25p per gallon. Given that petrol costs about £3 per gallon the impact will not be large. Patterns of behaviour will not be distorted and hence it is pointless as a carbon tax. The rationale behind this is not clear. Was the Minister so ashamed by how much he had stolen from the social insurance fund that he felt obliged to put some veneer of respectability on this robbers' budget by raising some taxes?

The people of south Tipperary have received a vindictive, two-fingered tax. They are being punished for humiliating Fianna Fáil not once, but twice, in by-elections. We are all intimately acquainted with the relatively small Irish company which sources and produces product in that part of south Tipperary. Every Deputy in this House knows it as we have driven past it on numerous occasions. The one thing it did wrong was not to vote for Fianna Fáil on two separate occasions and it is now being penalised for this in a childlike manner. To suggest that taxes are being harmonised to bring them up to the same level as the rate of tax on beer does not wash. Why is this being done? No doubt Deputy Healy will have his own interpretation of the reasons.

Deputy Dukes is correct. In previous years we received representations from the Cider Industry Council about the demonisation of cider. Its members felt that cider was being represented as a drink which is only consumed illegally by underage youngsters in parks and which causes anti-social behaviour. The Government is saying very clearly to a constituency which has humiliated Fianna Fáil—

Mr. Cowen

Not as much as Deputy Quinn.

Mr. Quinn

I am quite happy with the results.

Mr. Cowen

It was a joke.

The Taoiseach

It is 11% of the national market. The Deputy is talking about—

Mr. Healy

Five hundred jobs.

The Taoiseach

Cider is stronger than lager. The Deputy wants the strongest drink at the cheapest price. Is he serious?

Mr. Quinn

The company happens to generate local employment and is being targeted in a specific and vindictive way.

Mr. Cowen

If that is the Deputy's argument, why look for an increase on cigarettes?

Mr. Quinn

I thank the Deputies for their interventions. It is all part of the context. The Government is raising £300 million and has stolen twice that amount from the social insurance fund. It will have to bring in two Bills to force—

The Taoiseach

Deputy Bell will be aghast at the price of a packet of cigarettes.

Mr. Quinn

—the Central Bank to surrender moneys it does not want to surrender. This is the absolute dishonesty of the legislation. The Government should look at its own stability programme. If Mr. Haughey had introduced this budget 20 years ago, he could not have been attacked in the same way because the stability programme would not have revealed the black hole the following year.

Mr. Martin

The lads have not got a lot left.

Mr. Quinn

He would have been found out. The creative accountant that is the Minister for Finance has now been caught out. Due to the requirements under the stability programme within the eurozone, each country must provide its best analysis and projection of what is likely to happen next year. Deputy McDowell found the fault line. The Government could have chosen another course but instead it has announced these three measures. One of them is vindictive and another will not have a deterrent effect on the consumption of tobacco. The third is an imposition on the general population and on employers specifically because that is where they will be able to say there is a cost problem – they have already had a reduction in their PRSI. The Government has foregone income on the employers' PRSI without providing any explanation or rationale and now it intends to hit all the people who depend on their own transport, either in freeflow or no-flow, to pay for it. There is no logic behind what the Government is doing. I am opposed to all three measures.

Mr. D. Carey

This is a new departure.

Minister for Education and Science (Dr. Woods)

Deputy Dukes seemed to think that the budget was not really worthwhile and that it was not worthwhile raising funds anywhere else. I think that this is a very worthwhile budget and every old-age pensioner in the country will also think so.

Mr. D. Carey

The Government has debated this budget up and down the—

Dr. Woods

It is worthwhile for an old-age pensioner to get another increase of £10—

Mr. D. Carey

Some democracy.

Dr. Woods

—from January instead of the middle of the summer, which was the time that applied when the parties opposite were in power.

Mr. Quinn

I seem to recall Deputy Woods' own record in that regard.

Dr. Woods

My record was pretty good.

Mr. Sargent

What does this have to do with the resolution?

Dr. Woods

I do not think any other Minister has given three 25% increases in old age pension payments in three successive budgets.

Mr. Quinn

In terms of the times.

Dr. Woods

The Deputy will find that is my record. I understand why Deputy Donal Carey is upset.

Mr. D. Carey

I am not upset.

Dr. Woods

I understand why he is upset. The Minister for Finance—

(Interruptions.)

Mr. Cowen

Can we not speak here?

Mr. D. Carey

We should not be here at all.

Dr. Woods

The Minister for Finance is providing £850 million to those who depend on social welfare in very difficult times.

Mr. D. Carey

It is my business—

Dr. Woods

The Opposition did not think he could do it, but he has done it. An old-age pensioner—

Mr. D. Carey

This is very unfair, a Cheann Comhairle. The Minister is taking up the time of the Opposition.

Mr. Cowen

It is not the Opposition's time; it is time for every Member of the House. We have just as much time.

Mr. Sargent

On a point of order, I recall that the Ceann Comhairle has often corrected people for not referring to the matter before the House. I understand that we are dealing with resolutions. Is that correct, or has there been a change in Standing Orders?

Dr. Woods

It is about raising the funds to pay for the old age pension and other matters.

A Deputy

We want some democracy.

Dr. Woods

Deputy Dukes was right when he said that was what this resolution was about. The Deputy was not here at the time.

Mr. Sargent

I was listening carefully.

Dr. Woods

Well, not carefully enough because he did not hear what Deputy Dukes said.

Mr. Sargent

I heard everything.

Dr. Woods

An old age pension couple over the age of 66 will get £205 a week. That is a huge development and the money we are clawing back to meet those requirements is relatively small.

Deputies are saying this money is small but the three of these add up to about £200 million. They say it is small and ask why we bother collecting it. We collect it because we want to deliver for old age pensioners and widows. A widow over 66 will get a £12 increase bringing her allowance to £114 a week. That is real progress. These people make up the bulk of the numbers of people dependant on social welfare. They are the real numbers and it is not the theoretical numbers we hear so often from the other side of the House. The Minister for Finance is delivering real money to the real people who count and the real people who depend on us – our old age pensioners, our widows, those on disability and invalidity allowances and those on child benefit.

Child benefit will go up again by £25 for the first two children and by £30 for subsequent children. Nobody believed the Minister could deliver that kind of increase.

Mr. B. Hayes

Is this the Social Welfare Bill or Financial Resolutions?

Mr. D. Carey

It is a joke and an abuse of time.

An Ceann Comhairle

Order please. I would ask the Minister to concentrate on—

Dr. Woods

Now, to find the funds to meet—

Mr. D. Carey

This is a joke and the like of it did not happen before in my twenty years here.

An Ceann Comhairle

Order, please.

Dr. Woods

To find the funds to meet these—

Mr. D. Carey

It is an abuse of time.

Dr. Woods

It is the Opposition that is taking up time.

Mr. D. Carey

The Minister for Social, Community and Family Affairs, Deputy Ahern, is well able to tell us how much is being spent on social welfare. It is on the paper every day of the week.

An Ceann Comhairle

Order now, please. Deputy Carey please allow the Minister to speak. The Deputy is out of order. The Minister should focus his remarks on the Resolutions before the House.

Dr. Woods

That is what the Minister for Finance has done. He is raising—

Mr. D. Carey

The Minister's slogan—

An Ceann Comhairle

Order please, Deputy Carey.

Mr. D. Carey

The Minister's slogan, does he remember, when he was campaigning for the leadership of Fianna Fáil, was "the honest candidate in the race"?

An Ceann Comhairle

The Deputy should cease interruption. The Deputy will suffer the consequences if he continues to disrupt.

Mr. Cowen

It is not our fault Deputy John Bruton is not the Leader

Dr. Woods

The Opposition is questioning whether it is worthwhile having these Resolutions and whether it is worthwhile raising these moneys. Of course it is worthwhile. It is worthwhile to take more people out of the tax net which is what we are doing.

Mr. Quinn

The Government is giving money away.

Dr. Woods

What we are doing is taking people out of the tax net. The people at the lower end of the tax are being taken out.

Mr. Quinn

Why is it reducing employers' PRSI?

Dr. Woods

The employers' PRSI is 1.25%—

An Ceann Comhairle

I remind Deputy Quinn that his interruptions cannot be recorded in the official report because he has not been given the floor.

Mr. Dukes

On a point of order, does the Ceann Comhairle remember a precedent when a predecessor of his threatened to ask a Minister, myself, to leave the House if he did not stop giving provocative answers. Maybe the Chair could apply it to this Minister here.

An Ceann Comhairle

That is not a point of order.

Dr. Woods

I understand how provocative it is if I point to how the funds coming from these Resolutions are to be used. Deputy Ó Caoláin raised the question about petrol and Northern Ireland. I understand his concern here and I understand the cross Border benefit that exists at the moment. That is beneficial to people on our side of the Border. If my calculations are right, the difference is that the petrol price in Northern Ireland is some 38p higher than it is here. If we reduce the difference by 5p we end with a difference of 33p.

Mr. Dukes

We have a mathematical genius here.

Dr. Woods

The Deputy will find that because there is still a quite considerable difference it will not have that bad an effect. In relation to what Deputy Dukes said earlier, the money has to come from somewhere and these are some of the methods chosen to bring in the money and balance the books.

Mr. D'Arcy

I have to comment on the Minister's intervention at this stage. For a man who has discussed a budget for the past six weeks to take up the time in this way is an absolute disgrace. In my 22 years in this House I have not yet seen it happen except at Question Time.

Mr. D. Carey

The Taoiseach did not need any help until the arrival of Dr. Woods.

An Ceann Comhairle

The more Deputies interrupt the less time there will be for Deputies to speak.

Mr. D'Arcy

I will try to keep my contribution short. The price increase on cigarettes is the greatest joke I have ever heard. I say to the Minister for Health and Children that the 10p put on cigarettes will encourage people to smoke. It is the Minister's job when sitting around the Cabinet table to say "yea" or "nay" to what affects his Ministry. When there was mention of adding 1 to a pack of cigarettes, young people told me that they would stop smoking. The 10p added will only encourage them to smoke and it is a disgrace as far as smoking is concerned. It will do nothing to encourage people not to smoke.

Another question I want to raise is the increase of 5p per litre on oils. The Minister for Education and Science, Deputy Woods, spoke about taking people out of the tax net. Will he consider the numbers of people working at £6 per hour? Many live in country areas where they may have to drive up to 20 miles to work. The increase of 5p per litre and the 1% VAT amounts to 27p per gallon. For those people earning £250 or £300 a week that is just the limit. They will lose out because of that increase. The tax concession they get on a £250 salary is approximately £5 per week. So much for the Minister taking people out of the tax net. The truth is he is giving them a tax concession on their salary but he has taken it back in the cost of their petrol and diesel. These people have to drive to work and on the worst roads in Ireland in some cases.

Another point concerns the motorist. I said to the Taoiseach that the Government consistently went back to the motorist for finance. The Government has now charged the motorists 250 million extra in any full year as a result of imposing this 5p per litre. These people are paying duty when they purchase a car, then they are paying petrol tax and road tax. Time and again the Government has gone back to the motorist. It is all right for those who live near work or those who can use public transport. In my Wexford constituency the majority of people drive to work day after day and this imposition of 27p extra per gallon will use up whatever tax concession they got.

The amount of money being taken from the motorist is not being channelled back into the proper areas – the county roads. We have approximately 700 miles of the worst county roads in Ireland. Unfortunately the county manager says he cannot get the money from the Minister for the Environment and Local Government, Deputy Dempsey. Now the Government is coming back to the motorists for another 240 million a year and people are still left driving on bad roads. It is an imposition as far as they are concerned.

Mr. Healy

I strongly oppose Financial Resolution No. 4. I ask the Taoiseach and the Government to withdraw this Resolution because it puts 500 jobs in the cider and perry industry at serious risk. Most of those are based in Bulmer's in Clonmel. I was surprised and disappointed to hear Deputy Dukes say that he could not become excited about that. The majority of those in the cider industry will be excited by this savage increase of 21p per pint. They believe that their jobs are at risk and I agree. This is a home grown industry which has developed since it was started by Magners in Clonmel in the 1930s. We all seek the development of indigenous industry, yet this increase savages just such an industry. Cider had an image problem but is now a very up market quality drink. This increase will affect employment in an industry which has also developed the production of apples throughout the country as 90% of cider apples are grown here giving employment to small farmers, particularly in the south east. No account was taken of the fact that this is a labour intensive and costly industry compared to beer production. I remind the Minister that most beers are imported. The rate of yield of this increase in 2002 will be 36.6 million.

The next item is a reduction from 5% to 2% in betting duty, almost equivalent to the increase in duty on cider. Has the Minister's pet hobby taken over the Book of Estimates? If this goes ahead, it will have an adverse affect on employment in Tipperary South. The Book of Estimates makes no mention of the oft promised decentralisation which is a further blow to the county. I appeal to the Government to withdraw this resolution.

Mr. D. Carey

I tabled a parliamentary question last week about competitiveness as I read about what was expected in the budget. The reply from the Department of Finance was a mess. I asked for the basket of goods used to measure competitiveness across European countries. It was a lame duck reply which stated that only labour costs were examined in relation to competitiveness. I was told that the budget would answer my question, but it did not.

It is a matter of getting the people to have confidence in the budget, particularly when there is the prospect of an economic downturn. The Minister's three measures will probably increase wage demands. As was pointed out, the increase in the price of tobacco will even affect old age pensioners. The increase in the price of petrol will add to labour costs as people in industry are mobile. What has the Minister done for competitiveness in this budget? As Deputy Quinn stated, he only reduced employers' PRSI.

If we look across the whole spectrum of goods, there is no significant recognition of the dilemma facing industry, especially native industry which has been disadvantaged for years. The Minister has nothing to say about native industries except a few abysmal references to capital taxation. When the Taoiseach was Minister for Finance did he ever take a basket of goods to compare costs with other countries? How can we compete with our reduced productivity if we do not have petrol or other goods costing less than in competing countries? How can that happen now? Jobs will be lost because the Minister has not faced up to the competitive disadvantage creeping up on us.

Mr. Higgins

(Dublin West): In deference to other backbenchers waiting to speak, I will be brief. I strongly oppose Resolutions Nos. 2, 3 and 4 because they are not being introduced for health or environmental reasons, but simply to grab more from ordinary working people.

Mr. Power

The Deputy has political reasons for opposing them.

Mr. Higgins

(Dublin West): I support measures to stop people becoming addicted to cigarettes, and from the very first, I called for the banning of cigarette advertising which is now happening. That type of measure should be implemented instead of grabbing tax from people, who should be helped with their addiction, not penalised.

Environmental reasons are not the genuine ones for increasing the price of petrol or diesel as is shown by the lopsided amounts of money allocated to roads and public transport. If the Government was serious about the environment, it would invest massively in public transport.

I oppose these resolutions because they continue the drift of the Government's pro big business policies which take from ordinary working people and give to the super wealthy. Under the heading "corporation tax," 329 million is handed back while extra taxes are placed on ordinary people. Big businesses will be even more profitable in 2003.

This grab is further underlined by figures I received from the Minister in a reply to a parliamentary question which show that the aggregate amount of money sent abroad by multinational corporations in profit in 1999 and 2000 was £23.3 billion. That amount of money was sent abroad in corporation profits by these companies. They had only paid £3.1 billion in tax. There is adequate funds there to be taken by a small increase even, from these people who can afford it – these major corporations – rather than hitting the small people again.

Mr. Naughten

We are talking about an increase of one third of a euro per gallon in the proposal as it stands at the moment. On top of that there will be a further increase on diesel which will bring it to two thirds of a euro. I ask the Taoiseach if the second increase in diesel has been factored into the consumer price index and what is the availability of this sulphur diesel? The Minister this time last year stated that he would maintain the low rate which he introduced last year on diesel for sulphur-free diesel and not increase the diesel again and so put a further pressure and expense on industry. The payments for corporation tax are being brought forward seven months and this will combine to put huge financial pressure on many small businesses throughout the country. It is a tax on rural Ireland and on the west. The west coast will be forced to haul its manufactured products right across the country to the east coast in order to export them. It is discrimination and no consideration has been given for the second increase which will mean a two thirds of a euro increase on the cost of transport.

Mr. B. Smith

Fine Gael and Labour seem to be converted to the policy of keeping excise duty at the lowest possible rate for petrol and diesel. I remember the time well when excise duties were at an exorbitant rate during the 1980s when Deputy Dukes and Deputy Quinn were prominent Cabinet Ministers. That was the time when that Government devastated the economy of the southern Border counties. Deputy Dukes referred earlier in the proceedings—

(Interruptions.)

Mr. B. Smith

I have been elected to the House the same as Deputy Farrelly and I did not lose any election either. I was a civil servant. Is Deputy Farrelly trying to infer that there is something wrong with being a civil servant? The Deputy should qualify his remarks. I am proud of any job I have ever worked in.

An Ceann Comhairle

Deputy Smith without interruption.

Mr. B. Smith

Deputy Dukes referred earlier to traffic problems. When he was Minister for Finance there were not too many traffic problems. The only traffic jams in Ireland at that stage were caused by the exodus of people and traffic from the South to the North of Ireland to buy petrol and diesel. The people did all their shopping in the North. That was the time when Deputy Fitzgerald as party leader said there was nothing wrong with the economy of the southern Border counties being devastated. I am glad to note that Fine Gael and Labour appear to have converted to the policy of the best possible excise duty. Thankfully, with Fianna Fáil in Government in the late 1980s, policies were implemented that revived the Border economy and the economy of the southern Border counties.

The price of oil on the international markets has decreased by about 33% over the past six to eight months, but the reduction in price has not been passed on to the consumer. There is a huge variation in the price of fuel from the south of Ulster to the west of Ireland or to the south of Ireland. I would like to see the introduction of a maximum prices order on fuel costs because the price reduction has not been passed on to the consumer. This is particularly prevalent in the south of Ulster and the north midlands.

Mr. Farrelly

I must introduce the Deputy to the Minister.

Ms Clune

The tax on sulphur diesel has been flagged as a climate change policy and as our contribution under the national climate change strategy under the Kyoto Agreement. It is nothing of the sort. Sulphur is not a greenhouse gas. This measure will do nothing to contribute to our requirements under the Kyoto Agreement. We are told that in the year 2002 we will see the implementation of the strategy. We have been wagging our finger at President Bush for turning his back on the Kyoto Agreement. The Minister for the Environment and Local Government has just returned from Marrakesh where the agreement was further thrashed out. We have global commitments to a climate change strategy and we have done nothing in this budget to address it.

An Ceann Comhairle

The 60 minutes has now expired and I am required to put the following question in accordance with an order of the Dáil of this day.

(Interruptions.)

An Ceann Comhairle

When the question is being put it is not in order for any Member to interrupt.

Question put: "That Financial Resolution No. 2 be agreed to."

Tá

Ahern, Bertie.Ahern, Dermot.Ahern, Michael.Ahern, Noel.Andrews, David.Ardagh, Seán.Aylward, Liam.Blaney, Harry.Brady, Johnny.Brady, Martin.Brennan, Matt.Brennan, Séamus.Briscoe, Ben.Browne, John (Wexford).Byrne, Hugh.Callely, Ivor.Carey, Pat.Collins, Michael.Cooper-Flynn, Beverley.Coughlan, Mary.Cowen, Brian.Cullen, Martin.Daly, Brendan.Davern, Noel.de Valera, Síle.Dempsey, Noel.Dennehy, John.Doherty, Seán.Ellis, John.Fahey, Frank.Fleming, Seán.Flood, Chris.Foley, Denis.Fox, Mildred.Gildea, Thomas.Hanafin, Mary.Harney, Mary.Haughey, Seán.Healy-Rae, Jackie.Jacob, Joe.Keaveney, Cecilia.

Kelleher, Billy.Kenneally, Brendan.Killeen, Tony.Kirk, Séamus.Kitt, Michael P.Kitt, Tom.Lawlor, Liam.Lenihan, Brian.Lenihan, Conor.McDaid, James.McGennis, Marian.McGuinness, John J.Martin, Micheál.Moffatt, Thomas.Molloy, Robert.Moloney, John.Moynihan, Donal.Moynihan, Michael.Ó Cuív, Éamon.O'Dea, Willie.O'Donnell, Liz.O'Flynn, Noel.O'Hanlon, Rory.O'Keeffe, Batt.O'Keeffe, Ned.O'Kennedy, Michael.O'Rourke, Mary.Power, Seán.Reynolds, Albert.Roche, Dick.Ryan, Eoin.Smith, Brendan.Smith, Michael.Treacy, Noel.Wade, Eddie.Wallace, Dan.Wallace, Mary.Walsh, Joe.Woods, Michael.Wright, G.V.

Níl

Allen, Bernard.Barnes, Monica.Barrett, Seán.Bell, Michael.Belton, Louis J.Boylan, Andrew.Bradford, Paul.Broughan, Thomas P.Browne, John (Carlow-Kilkenny).Bruton, Richard.Burke, Liam.Burke, Ulick.Carey, Donal.Clune, Deirdre.Connaughton, Paul.Cosgrave, Michael.Coveney, Simon.Crawford, Seymour.Creed, Michael.Currie, Austin.D'Arcy, Michael.Deasy, Austin.Deenihan, Jimmy.

Dukes, Alan.Durkan, Bernard.Farrelly, John.Finucane, Michael.Fitzgerald, Frances.Flanagan, Charles.Gilmore, Éamon.Gormley, John.Gregory, Tony.Hayes, Brian.Hayes, Tom.Healy, Seamus.Higgins, Jim.Higgins, Joe.Higgins, Michael.Hogan, Philip.Howlin, Brendan.Kenny, Enda.McCormack, Pádraic.McGahon, Brendan.McGinley, Dinny.McGrath, Paul. McManus, Liz.

Níl–continued

Mitchell, Olivia.Moynihan-Cronin, Breeda.Naughten, Denis.Noonan, Michael.Ó Caoláin, Caoimhghín.O'Keeffe, Jim.O'Shea, Brian.O'Sullivan, Jan.Owen, Nora.Penrose, William.Perry, John.Quinn, Ruairí.Rabbitte, Pat.

Reynolds, Gerard.Ring, Michael.Ryan, Seán.Sargent, Trevor.Shatter, Alan.Sheehan, Patrick.Shortall, Róisín.Spring, Dick.Stagg, Emmet.Stanton, David.Timmins, Billy.Upton, Mary.Wall, Jack.Yates, Ivan.

Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Bradford and Stagg.

Question declared carried.

Question put: "That Financial Resolution No. 3 be agreed to."

Tá

Ahern, Dermot.Ahern, Michael.Ahern, Noel.Andrews, David.Ardagh, Seán.Aylward, Liam.Blaney, Harry.Brady, Johnny.Brady, Martin.Brennan, Matt.Brennan, Séamus.Briscoe, Ben.Browne, John (Wexford).Byrne, Hugh.Callely, Ivor.Carey, Pat.Collins, Michael.Cooper-Flynn, Beverley.Coughlan, Mary.Cowen, Brian.Cullen, Martin.Daly, Brendan.Davern, Noel.de Valera, Síle.Dempsey, Noel.Dennehy, John.Doherty, Seán.Ellis, John.Fahey, Frank.Fleming, Seán.Flood, Chris.Foley, Denis.Fox, Mildred.Gildea, Thomas.Hanafin, Mary.Harney, Mary.Haughey, Seán.Healy-Rae, Jackie.Jacob, Joe.Keaveney, Cecilia.

Kelleher, Billy.Kenneally, Brendan.Killeen, Tony.Kirk, Séamus.Kitt, Michael P.Kitt, Tom.Lawlor, Liam.Lenihan, Brian.Lenihan, Conor.McDaid, James.McGennis, Marian.McGuinness, John J.Martin, Micheál.Moffatt, Thomas.Molloy, Robert.Moloney, John.Moynihan, Donal.Moynihan, Michael.Ó Cuív, Éamon.O'Dea, Willie.O'Donnell, Liz.O'Flynn, Noel.O'Hanlon, Rory.O'Keeffe, Batt.O'Keeffe, Ned.O'Kennedy, Michael.O'Rourke, Mary.Power, Seán.Reynolds, Albert.Roche, Dick.Ryan, Eoin.Smith, Brendan.Smith, Michael.Treacy, Noel.Wade, Eddie.Wallace, Dan.Wallace, Mary.Walsh, Joe.Woods, Michael.Wright, G.V.

Níl

Allen, Bernard.Barnes, Monica.Bell, Michael.Belton, Louis J.Boylan, Andrew.Bradford, Paul.Broughan, Thomas P.Browne, John (Carlow-Kilkenny).Bruton, Richard.Burke, Liam.Burke, Ulick.Carey, Donal.Clune, Deirdre.Connaughton, Paul.Cosgrave, Michael.Coveney, Simon.Crawford, Seymour.Creed, Michael.Currie, Austin.D'Arcy, Michael.Deasy, Austin.Deenihan, Jimmy.Dukes, Alan.Durkan, Bernard.Farrelly, John.Finucane, Michael.Fitzgerald, Frances.Flanagan, Charles.Gilmore, Éamon.Gormley, John.Gregory, Tony.Hayes, Brian.Hayes, Tom.Healy, Seamus.Higgins, Jim.Higgins, Joe.Higgins, Michael.

Hogan, Philip.Howlin, Brendan.Kenny, Enda.McCormack, Pádraic.McDowell, Derek.McGahon, Brendan.McGinley, Dinny.McGrath, Paul.McManus, Liz.Mitchell, Gay.Mitchell, Olivia.Moynihan-Cronin, Breeda.Naughten, Denis.Noonan, Michael.Ó Caoláin, Caoimhghín.O'Keeffe, Jim.O'Shea, Brian.O'Sullivan, Jan.Owen, Nora.Penrose, William.Perry, John.Quinn, Ruairí.Rabbitte, Pat.Reynolds, Gerard.Ring, Michael.Ryan, Seán.Sargent, Trevor.Shatter, Alan.Sheehan, Patrick.Shortall, Róisín.Spring, Dick.Stagg, Emmet.Stanton, David.Timmins, Billy.Upton, Mary.Wall, Jack.Yates, Ivan.

Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Bradford and Stagg.

Question declared carried.

Question put: "That Financial Resolution No. 4 be agreed to."

Tá

Ahern, Dermot.Ahern, Michael.Ahern, Noel.Andrews, David.Ardagh, Seán.Aylward, Liam.Blaney, Harry.Brady, Johnny.Brady, Martin.Brennan, Matt.Brennan, Séamus.Briscoe, Ben.Browne, John (Wexford).Byrne, Hugh.Callely, Ivor.Carey, Pat.Collins, Michael.Cooper-Flynn, Beverley.Coughlan, Mary.Cowen, Brian.Cullen, Martin.Daly, Brendan.

Davern, Noel.de Valera, Síle.Dempsey, Noel.Dennehy, John.Doherty, Seán.Ellis, John.Fahey, Frank.Fleming, Seán.Flood, Chris.Foley, Denis.Fox, Mildred.Gildea, Thomas.Hanafin, Mary.Harney, Mary.Haughey, Seán.Healy-Rae, Jackie.Jacob, Joe.Keaveney, Cecilia.Kelleher, Billy.Kenneally, Brendan.Killeen, Tony. Kirk, Séamus.

Tá–continued

Kitt, Michael P.Kitt, Tom.Lawlor, Liam.Lenihan, Brian.Lenihan, Conor.McDaid, James.McGennis, Marian.McGuinness, John J.Martin, Micheál.Moffatt, Thomas.Molloy, Robert.Moloney, John.Moynihan, Donal.Moynihan, Michael.Ó Cuív, Éamon.O'Dea, Willie.O'Donnell, Liz.O'Flynn, Noel.

O'Hanlon, Rory.O'Keeffe, Batt.O'Keeffe, Ned.O'Kennedy, Michael.O'Rourke, Mary.Power, Seán.Reynolds, Albert.Roche, Dick.Ryan, Eoin.Smith, Brendan.Smith, Michael.Treacy, Noel.Wade, Eddie.Wallace, Dan.Wallace, Mary.Walsh, Joe.Woods, Michael.Wright, G. V.

Níl

Allen, Bernard.Barnes, Monica.Barrett, Seán.Bell, Michael.Belton, Louis J.Boylan, Andrew.Bradford, Paul.Broughan, Thomas P.Browne, John (Carlow-Kilkenny).Bruton, Richard.Burke, Liam.Burke, Ulick.Carey, Donal.Clune, Deirdre.Connaughton, Paul.Cosgrave, Michael.Coveney, Simon.Crawford, Seymour.Creed, Michael.Currie, Austin.D'Arcy, Michael.Deasy, Austin.Deenihan, Jimmy.Dukes, Alan.Durkan, Bernard.Farrelly, John.Finucane, Michael.Fitzgerald, Frances.Flanagan, Charles.Gilmore, Éamon.Gormley, John.Hayes, Brian.Hayes, Tom.Healy, Seamus.Higgins, Jim.Higgins, Joe.Higgins, Michael.

Hogan, Philip.Howlin, Brendan.Kenny, Enda.Lowry, Michael.McCormack, Pádraic.McDowell, Derek.McGahon, Brendan.McGinley, Dinny.McGrath, Paul.McManus, Liz.Mitchell, Gay.Mitchell, Olivia.Moynihan-Cronin, Breeda.Naughten, Denis.Noonan, Michael.Ó Caoláin, Caoimhghín.O'Keeffe, Jim.O'Shea, Brian.O'Sullivan, Jan.Owen, Nora.Penrose, William.Perry, John.Quinn, Ruairí.Rabbitte, Pat.Ring, Michael.Ryan, Seán.Shatter, Alan.Sheehan, Patrick.Shortall, Róisín.Spring, Dick.Stagg, Emmet.Stanton, David.Timmins, Billy.Upton, Mary.Wall, Jack.Yates, Ivan.

Tellers: Tá, Deputies S. Brennan and Power; Níl, Deputies Bradford and Stagg.

Question declared carried.

An Ceann Comhairle

We now move on to Financial Resolution No. 5, for which 30 minutes have been allocated.