Such people, who are found throughout the country, spend a great deal of time caring for older people in their communities. The Government accepts that it has to care for them financially and to put in place provisions to that end in the budget. I may speak again about older people, who have a special place in my heart at this time of the year and at all times of the year, if time permits.
The phrase "dancing on the head of a pin" is not used enough. It describes the approach to life that prevents a person from seeing the big picture. The phrase comes to mind when one listens to the ridiculous statements coming from the other side of the House. The annual report of the Combat Poverty Agency states that the best of the two ways out of poverty is employment. The other way out of poverty is increased social welfare payments.
The Social Welfare Bill proves that the Government is delivering social welfare payments. The social welfare measures in the budget for 2004 will accrue mostly to those at the lower end of the income distribution scale. Such people would experience a significant deterioration in their income without such measures. The most significant net income gains will be enjoyed by those on the lowest incomes. Much smaller gains will accrue to those in middle to high income brackets. The budget announced last week is highly progressive. Those who depend on social welfare will receive the greatest gains from it. It ensures that the lowest income groups will gain progressively from welfare payments to a greater extent than higher income groups, which will contribute progressively more to the cost of public service provision. The overall distributional effect is similar to that in budget 2003, but there will be a greater impact this year as a consequence of the increased payments across the different sectors.
The Conference of Religious of Ireland is not well-known for supporting the decisions of this or previous Governments. In its critique of last week's budget, however, CORI said:
We acknowledge the social welfare increases were well ahead of what pundits had forecast. We also acknowledge the Minister's statement that he will implement the social welfare commitments contained in Sustaining Progress.
According to a recent ESRI report, consistent poverty has been reduced significantly from 14.5% in 1994 to 4.9% in 2001, the most recent year for which figures are available. Long-term unemployment, which is one of the greatest causes of poverty, has decreased from over 5% in 1997 to approximately 1.5% today. One cannot deny that progress has been made in alleviating poverty.
It is clear that we have delivered on our promise to increase social welfare payments. Despite the fact that it is the best way out of poverty, it is not well recognised that employment creation is the other way out of poverty. Fianna Fáil has undeniably delivered in this regard since it returned to Government in 1997. One should not forget that the national debt has almost been halved since 1997. Ireland has the second lowest debt in the European Union. Its debt repayments are at their lowest level since the early 1980s. When debt servicing costs, which are a factor in public expenditure across the EU, are excluded, Irish public expenditure is 43.7%, which is close to the EU average of 44.3%. Ireland's level of public expenditure is remarkably high, especially when one considers our low levels of national debt and unemployment.
Certain Deputies on the Opposition side would love to see increases in corporation tax and PAYE. As revenue is required to fund social spending, should we not set tax rates to maximise revenue, which is what the Government has done since 1997? Reductions in income tax between 1997 and 2002 have resulted in an increase in receipts of 41%. Reductions in corporation tax in the same period have resulted in an increase in receipts of 93%. We reduced corporation tax to promote enterprise. The level of unemployment is half what it was in 1997. If we allow for recent increases in the unemployment rate, it is a resilient performance for a small, open economy during an international downturn.
We must be competitive in a real way if we are to create and keep employment in Ireland. Low corporation tax provides a competitive edge on other countries which are looking for foreign direct investment. We need to make the best use of our advantages. An increase in corporation tax would jeopardise our success in creating jobs. It would risk a return to the dark days of the 1980s when many of my generation were forced to emigrate. Our unemployment rate is half the eurozone average. The fact that we do not have to spend as much of our resources on supporting those without jobs as we did ten years ago is a consequence of our success.
Social welfare expenditure has increased despite the decrease in unemployment. Although the unemployment rate has halved from over 10% in 1997 to under 5% today, we have increased social welfare expenditure by over €4 billion since 1997, to over €11.4 billion today. The Government has acted positively to help those on lower pay. It introduced the minimum wage, which will increase by 10% next year. An extra 41,000 people will be taken out of the tax net in 2004, meaning that 35% of those on the tax record will not pay tax.
The Opposition's withering comments about the Government's neglect of the poor in Ireland are simply untrue. This is demonstrated by an examination of the increases in social welfare payments. In our efforts to tackle poverty, old age pensions have increased by well over two thirds. Child benefit is up more than 300%. I must keep saying that, and I hope that other members of the Government parties will keep saying it, since it does not seem to be getting through to the other side of the House. The revenues to fund those increases have been generated by a low-tax, competitive and enterprising economy. Increasing taxes would jeopardise jobs and the revenues necessary for the social provision that we all want for all sectors of the community unable to care for themselves.
I will return to the issue of the elderly. This is the time of year when we see advertisements for Christmas gifts for children. They started at the end of August. We were talking about advertising in the House last night, wasting a great deal of time on a Bill which there was no need to introduce. Those three hours of Opposition time could have been used for more productive gain than what we had to endure last night, especially with the BCI already introducing the code, moving it forward and, shortly, publishing it.
There has been a strong media campaign by advertisers for some time. We are all made aware of those coming festivities at an earlier date every year. The lead-in period seems to extend every year. Thoughts of the Christmas season and anticipation of the joy and happiness it brings to us all are with us at this time of year, and it would be nice if we used the extended run-in time to give more intense focus to our thoughts on a sector of society that needs our increased care and support at this time.
I refer, of course, to the elderly who live alone and may not have any living relatives. I think of the elderly who may have lost contact with their sons or daughters through family circumstances. I think of them alone with their thoughts on Christmas Day. Memories of the past in remembrance of loved ones long gone will come to their minds. The joy and the happiness they see around them will remind them of olden days and better times. Christmas to them can be a very sad time. We have been and are supporting the elderly by giving them increases, but it is not enough. We must give more to the elderly. We must all give more time to them and spend longer looking after them. That is why I praised the voluntary sector for the work that it is doing.
We should stay in touch with the elderly in our locality and in the extended community, not only at Christmas but throughout the 12 months of the year. I believe that we owe a debt to those people who worked so hard to build up this country over the last few decades. It will not be long for us. If we all live for another decade or 15 years, some of us will be in that category ourselves. We will be seeking support and comfort from people of a different generation. While we are getting on with our busy lives up here, my message for those who care for the elderly, and those who forget to do so, is that they should please give them the gift of their time this Christmas, even if that means only calling in to see them, spending some time with them and seeing that they have enough food on the table and if there is anything they can do to support them. I am almost 100% sure in saying that a lonely older person would prefer someone's time to the significant increases we will give them from 1 January.