Dáil Éireann debate -
Tuesday, 7 Mar 2006

Vol. 616 No. 1

Finance Bill 2006: Report Stage (Resumed) and Final Stage.

Debate resumed on amendment No. 4:

In page 9, between lines 15 and 16, to insert the following:

"1.—The Minister shall establish a new subhead in the Book of Estimates on expenditure to be incurred as a result of obligations under the Kyoto Protocol.".

—(Deputy Boyle).

Mr. Boyle

Perhaps at this stage the Minister and I can come to some arrangement as to how we want this Bill to proceed. I presume the other Opposition spokespersons will attend shortly.

I was disappointed with the response of the Minister for Finance before Private Members' Business that the Book of Estimates subhead for carbon credits meets what I was seeking in terms of the amendment before us. I am afraid it does not. My amendment is quite explicit and refers to the Kyoto Protocol. I found the Minister's argument somewhat circular. He was trying to say that the mention of carbon credits was sufficient with regard to meeting the amendment while going on in his later contribution to say the Government is doing more than providing carbon credits in meeting this country's obligations on greenhouse gases and the Kyoto Protocol. If that is the case, the subhead entry in the Book of Estimates should be much more wide-ranging.

The Minister has not responded to much that I said when moving the amendment, namely that the mechanisms he has chosen have been wrong and that he is seriously underestimating the likely cost to Ireland. He is working on the basis that Ireland can and will reduce greenhouse gas emission percentages though the most recent figures have shown that, sadly, those figures are again going upwards in areas where the Government has least control. The Government is bereft of mechanisms to show how that might be brought in a different direction.

When, in the course of his reply, the Minister brings in such items as his proposed excise duty reduction on biofuels and the grants in respect of renewable energy, he is arguing against himself. This area requires a strategy approach far more wide-ranging than the Government has adopted to date. Even the small and belated measures he has cited are fraught with difficulty in themselves. The Minister is aware that the original biofuel measure brought in by his predecessor took a full 18 months of negotiation with the European Commission even to have it introduced on a small scale, and it does not seem to have been taken up at all. The Minister's own proposal is only a minor pushing out of that particular boat and we might still find ourselves in difficulty because there does not seem to have been any work in advance on whether this proposal is acceptable to the European Commission.

The Green Party believes the Minister should go further. If we are genuinely talking of making biofuels competitive we need to remove the excise duty cap once and for all. The gap between the cost of energy produced by biofuels and conventional fossil fuel products is narrowing and a proper fiscal incentive might tip the balance in terms of consumer confidence. Even in terms of the types of vehicles the Minister is promoting, many of them are expensive. While they might have environmental benefits in terms of their fuel use, some of them are large-scale and might cause environmental damage in other respects.

The Government must take responsibility for the fact that the tax reliefs introduced across the board have had environmental consequences, particularly with regard to the construction industry. One third of all housing in this country has been built since 1995, most of it built without proper energy efficiency standards. The lack of such standards has contributed to a growth in our greenhouse gas levels, and by that I mean the levels emitted by the actual households. That does not even begin to count the costs of the construction of these units, which have been a major contributor.

This country has the greatest level of car usage in the world. We spend more time in our cars than people in any other country. If the Government is encouraging people, through tax reliefs, to live long distances from their work, thus needing to travel by private transport, and if the Government is encouraging through tax reliefs the building of housing which is not energy efficient and is using non-sustainable materials, it is ultimately unfair for the Government to put in place taxation measures which are spreading the burden across all groups in our society whether or not they as individuals have contributed to the problem. The Minister and Government need to do a lot better.

Amendment put.

The Dáil divided: Tá, 39; Níl, 64.

Tá

• Boyle, Dan.
• Breen, James.
• Broughan, Thomas P.
• Burton, Joan.
• Connaughton, Paul.
• Connolly, Paudge.
• Costello, Joe.
• Cowley, Jerry.
• English, Damien.
• Gilmore, Eamon.
• Gormley, John.
• Hayes, Tom.
• Healy, Séamus.
• Higgins, Joe.
• Hogan, Phil.
• Kehoe, Paul.
• Lynch, Kathleen.
• McCormack, Pádraic.
• McGinley, Dinny.
• McHugh, Paddy.
• McManus, Liz.
• Mitchell, Olivia.
• Morgan, Arthur.
• Moynihan-Cronin, Breeda.
• Murphy, Catherine.
• Neville, Dan.
• Ó Caoláin, Caoimhghín.
• O’Dowd, Fergus.
• O’Keeffe, Jim.
• O’Shea, Brian.
• Perry, John.
• Rabbitte, Pat.
• Ryan, Seán.
• Sherlock, Joe.
• Shortall, Róisín.
• Stanton, David.
• Timmins, Billy.
• Twomey, Liam.
• Upton, Mary.

Níl

• Ahern, Michael.
• Ahern, Noel.
• Ardagh, Seán.
• Brady, Johnny.
• Brady, Martin.
• Brennan, Séamus.
• Browne, John.
• Callanan, Joe.
• Carey, Pat.
• Carty, John.
• Collins, Michael.
• Coughlan, Mary.
• Cowen, Brian.
• Cregan, John.
• Curran, John.
• de Valera, Síle.
• Dempsey, Noel.
• Dempsey, Tony.
• Dennehy, John.
• Devins, Jimmy.
• Ellis, John.
• Finneran, Michael.
• Gallagher, Pat The Cope.
• Glennon, Jim.
• Haughey, Seán.
• Hoctor, Máire.
• Jacob, Joe.
• Keaveney, Cecilia.
• Kelleher, Billy.
• Kelly, Peter.
• Killeen, Tony.
• Kirk, Séamus.
• Kitt, Tom.
• Lenihan, Brian.
• Lenihan, Conor.
• McEllistrim, Thomas.
• McGuinness, John.
• Martin, Micheál.
• Moloney, John.
• Moynihan, Dónal.
• Moynihan, Michael.
• Mulcahy, Michael.
• Nolan, M.J.
• Ó Cuív, Éamon.
• Ó Fearghaíl, Seán.
• O’Connor, Charlie.
• O’Donnell, Liz.
• O’Donoghue, John.
• O’Donovan, Denis.
• O’Flynn, Noel.
• O’Keeffe, Batt.
• O’Malley, Fiona.
• O’Malley, Tim.
• Parlon, Tom.
• Power, Peter.
• Roche, Dick.
• Smith, Brendan.
• Smith, Michael.
• Treacy, Noel.
• Wallace, Mary.
• Walsh, Joe.
• Wilkinson, Ollie.
• Woods, Michael.
• Wright, G.V.

Tellers: Tá, Deputies Boyle and Catherine Murphy; Níl, Deputies Kitt and Kelleher.

Amendment declared lost.

An Leas-Cheann Comhairle

Amendments Nos. 5 to 7, inclusive, are out of order.

Amendments Nos. 5 to 7, inclusive, not moved.

Mr. Perry

I move amendment No. 8:

In page 9, between lines 15 and 16, to insert the following:

"1.—The Principal Act is amended in section 466A by the substitution of the following for subsection (2):

"(2) Where in any year of assessment an individual proves that he or she is a qualifying claimant he or she shall be entitled to a tax credit (to be known as the ‘home carer tax credit') of a sum equal to the higher of the amount specified in section 472 of this Act.".".

Deputy Bruton has put considerable thought into this amendment. It proposes that the home carer's allowance of €770, which has not increased since its introduction, be increased to the same level as the PAYE tax credit, currently €1,490. Such a step would partly compensate for the erosion in income brought about by individualisation, while recognising the role of spouses who choose to work in the home. In addition to providing a considerable financial benefit to families in which one spouse chooses to care for children, it would recognise the contribution of home carers. This is not a major demand given that the home carer's tax credit has not been increased since its introduction. The State must recognise the role of those who choose to stay at home to look after children by giving them parity with PAYE workers who receive a tax credit of €1,490. I ask the Minister to accept the amendment.

Ms Burton

The Minister should explain the reason certain types of contributions are valued more than others in the tax structure. For instance, highly paid individuals who make pension contributions of €100,000 receive tax relief of €42,000. In comparison, the position of carers is one of extreme disadvantage. The Minister should explain the reason he lavishes so much resources on high income earners in finance legislation while offering few advantages to those on low incomes. It would be interesting to learn how much tax relief for home carers costs, as compared with tax relief paid in respect of pension contributions for high earners.

Mr. Boyle

I support the amendment. The Government has failed to institute a plan which would bring the home carer's allowance at least some distance closer to the standard PAYE credit. The home carer's tax credit was introduced as a sop in response to the furore which greeted the introduction of tax individualisation. The fact that the value of the credit has remained static for several years indicates the Government is no longer interested in providing such a sop.

My family unit has helped the Government increase its tax base in that my wife chose to stop working outside the home and, as a result, lost the benefit of having a separate, individualised tax credit. I suspect many thousands of others are in the same position. Even with the new child care payments, the Government does not recognise that those who choose to work in the home have an equal economic or social value as others in the economy. If it is serious about valuing home carers, it should introduce significant, annual increases in the home carer's credit with a view to achieving parity with the PAYE tax credit. On these grounds, I support the amendment although the Minister, who has been silent on this issue to date, will not be inclined to accept it.

Caoimhghín Ó Caoláin

I, too, support Deputy Bruton's amendment. Any measure of relief or support which can be directed towards those who are providing caring support in the home is to be welcomed. The limited supports and poor opportunities for further relief currently available to those who provide service, commitment and care in the home impose a responsibility on us to reflect the interests and needs of home carers at every opportunity. I have no difficulty, therefore, in supporting the amendment.

Having had amendments Nos. 5 and 6 ruled out of order, I am unable to follow the reasoning behind the refusal to accept some amendments while rejecting others. The excuses trundled out for rejecting amendment No. 5, for example, which sought to introduce indexation to recognise the reality of the increase in the cost of living, was that it would impose a charge on the Exchequer or people. While I support amendment No. 8, does it, too, not entail imposing a charge? Where and how is the line drawn in deciding which amendments are valid and which are out of order? Deputies put in equal work in trying to present amendments which will make a critical difference to the Finance Bill. It is disappointing when they are rejected as frequently as they have been by the Ceann Comhairle.

Minister for Finance (Mr. Cowen)

The amendment relates to the home carer's tax credit of €770 which, under section 466A of the Taxes Consolidation Act 1997, is granted to married couples where one spouse works at home to care for children, the aged or incapacitated persons. The amendment proposes that the amount of the home carer's credit should be the same as the maximum of the employee tax credit, commonly known as the PAYE credit, which, by virtue of section 3 of the Bill, will amount to €1,490 this year. In other words, the amendment seeks to increase the value of the home carer's tax credit by €720 per annum.

It is estimated that to increase the home carer's tax credit as proposed would cost €63.5 million in a full year. As I indicated in my Budget Statement last December, the total cost of the income tax and revenue changes I made is €887 million in a full year, which is 30% greater than the previous year's total. The increases I made in the employee tax credit and personal tax credit, in addition to benefiting all workers, were intended to ensure all those on the minimum wage would be fully outside the tax net. The changes I have provided for in the Bill are generous by any standards and I am not in a position to accept the Deputy's amendment.

Mr. Bruton

I am disappointed by the Minister's response. The PAYE credit was increased on about four occasions but the home carer's credit was never increased since its introduction by his predecessor, which implies that people who work in the home are regarded as inferior. However, we all realise that the people who are willing to work in the home to rear children or help older or infirm relatives are an important element of any community. I cannot understand why the Minister took such a peculiar attitude given that, in any other forum, he would laud the people who are willing to commit themselves to caring in the home. A degree of consistency is needed between rhetoric and action and a balance should be found between the needs of the economy for more workers and of families for people to work in the home. The Minister and his predecessor seem to have closed their minds on this issue.

Mr. Perry

Given the critical role of carers in the home and that many are unpaid, €63 million represents a good investment. Although the Minister has refused to accept this amendment, he could at least indicate that he is prepared to increase the home carer's allowance in the future because it is disappointing that the allowance was not increased from €770 or index linked in any way. In light of the cost to the State of looking after people in long-term care, carers who rear children or look after the elderly within the home represent good value for money. These are critical roles, yet in some cases the people involved are refused home carer's allowance. Providing the PAYE equivalent in tax benefit would go some way towards recognising the work of the spouse in the home. This is a well-crafted amendment which demonstrates concern for people who contribute hugely to society and it is disappointing the Minister has given no credence to it.

Caoimhghín Ó Caoláin

I support Deputy Bruton's argument on behalf of home carers. The Minister did not respond to my question, although I accept that he may not be in a position to do so. If that is the case, clarification could be provided later. I do not wish to impinge on this commendable amendment but the Minister, in his response, indicated an estimated cost in excess of €60 million, yet many amendments were ruled out of order on Committee and Report Stages due to potential charges on the Exchequer. What is the difference in this case? In terms of the drafting of future amendments, I am curious as to what is acceptable for consideration and debate, as against the traditional letter from the Ceann Comhairle citing number after number. My experience in this regard is not unique, other Deputies have had the same experience. I ask for an explanation.

Acting Chairman

The decision as to why Deputy Ó Caoláin's amendment was out of order and Deputy Bruton's was acceptable is a matter properly for the Chair. I will ask the Ceann Comhairle or the Bill's office to explain the difference as I would like to learn it myself.

Mr. Cowen

I have nothing further to add. As I said with regard to the budget, we introduced a good package of tax reliefs for many PAYE workers, including those in single income families, and the argument that the commitment to these families should be equated with increases in home carer's credit is a flawed one. Significant improvements in take home pay have resulted from the budgetary provisions being incorporated into the Finance Act. The choices I made were aimed at taking minimum wage earners out of the tax net.

It is easy for the Opposition to enter the fray regardless of its record of increasing income tax and the costs of its proposals. It is a simple line of argument and, if I had more money available to me, I would provide for much more. We brought a record package in that respect and I contend that by reason of the reforms we have undertaken to the income tax code, we have shown more commitment to working families than any previous administration. However, I do not wish to open that debate tonight.

Amendment put and declared lost.

Mr. Bruton

I move amendment No. 9:

In page 9, between lines 15 and 16, to insert the following:

"1.—The Principal Act is amended by the insertion of the following new section 15A:

"15A.—(1) In any year of assessment where monies are paid to any state or other body in respect of which the individual making such payments would be entitled to a tax credit or an allowance for income tax the Minister for Finance may direct that such state or other body shall make a return of such payments made by such persons in such format and shall be determined by regulations as shall be made by the Minister for Finance to enable a tax credit or deduction to be made or allowed.

(2) In respect of any such information provided to the Offices of the Revenue Commissioners no liability shall attach to the Office of the Revenue Commissioners or otherwise for failing to provide such tax credit or allowance to the person who made the payment.".".

I do not intend to dwell long on this because we have discussed the substance of it with Deputy Burton's amendment No. 1. This amendment is designed to encourage the Minister to open up areas where a form of refund at source could be operated in respect of tax allowable expenditure. One such area concerns bin tax which, we are told, almost 1 million people are now paying, although the Minister's own figures indicate that only 164,000 are claiming tax relief. That suggests that 836,000 did not get tax relief in 2003. As many Deputies on this side of the House have indicated, that is not fair play and a more proactive approach is needed by the Government in identifying unclaimed tax relief and making refunds easier to obtain.

During the debate on Deputy Burton's amendment, I made suggestions to the Minister and was disappointed that other than a vague agreement that they would be useful, he made no commitment on making authoritative estimates of the level of underpayment, making easy claim systems available when allowances are sent to people or allowing medical relief for sensible measures such as preventive optical or dental care, which are currently deemed not allowable because of their routine nature. I will not labour the point because other amendments need to be discussed but a provision along these lines ought to be adopted by the Government.

Ms Burton

I support the amendment. Given the statistics provided by the Minister on the rate of pick up of tax breaks, it would seem that some 800,000 households are not claiming tax relief on refuse charges. This means the Minister is in pocket to the tune of that amount.

The Minister recalls, I am sure, correspondence and comments about Dublin Bus. If a person overpays a bus fare, Dublin Bus gives a voucher indicating the overpayment. Money accrued in this way which is not claimed is used, to some extent, for charitable and community purposes. The question arises of what the Minister does with the extra money he is holding on behalf of taxpayers. If the facility does not exist for taxpayers to collect this money, there is a good argument that it should perhaps be distributed over and beyond the income that may be distributed by the Government to charities. The Minister is essentially holding on to taxpayers' money which rightfully belongs to taxpayers. It seems inappropriate that the Minister can hold on to this money. If he will not refund it or provide schemes for refunding it, perhaps other ways should be found to distribute it to some charitable causes.

One must also bear in mind that these reliefs are somewhat of a scam, particularly where they concern people whose income is so low that they have no tax liability. We do not operate a system of refundable tax credits. If a family has a significant number of children but the parents work at or close to the minimum wage, the reality may be that they will not have much of a tax liability if the income is very low. Therefore, the family will not be in a position to benefit from tax refunds. Despite this, these are the types of families, especially those with small children and babies, who require a refuse collection on a weekly basis, especially in the summer.

There is much dishonesty evident in this issue. In some ways, this tax break was introduced as a way of getting over the argument that there was a double taxation element in bin charges as people had already paid them through the general payment of income tax. The way the system operates, local authorities in the Dublin area attempt to charge on the double and even on the triple for refuse services.

Fianna Fáil destroyed the rates base of local government in 1977 to win a famous general election. As a consequence, the party screwed up the economy for many years. The Minister may argue that the chief architect of this debacle left shortly afterwards to join the Progressive Democrats. He may state that the destruction arising in the economy from that particular event was in many ways the product of what subsequently became the Progressive Democrats wing of Fianna Fáil.

The Minister boasts that a certain percentage of taxpayers do not pay income tax because their income is so low. However, these people are in no position to receive a refund on service or bin charges. In Dublin, most local authorities are trying to work towards a flat charge and a pay-per-lift charge. The objective is to have this weighted. It is especially interesting in the case of the local authority in Dún Laoghaire-Rathdown, where the cost has now risen to quite significant levels.

All this indicates that this matter equates to Fianna Fáil's attempt to get back to rates by the back door, as a result of what it did in 1977. Local government in Ireland has never recovered from this event. Once the idea is sold to the people that a particular form of taxation is to be abolished, it becomes impossible to go back. The old rating system had many elements which were extremely unfair nonetheless. We are now in a logically absurd position with regard to a number of these matters.

The easiest action to take would be to give people at the point of payment a tax credit for bin charges. Perhaps the moneys could be refunded directly at the point of purchase of bin services by the local authority. The authority could then be reimbursed by the Department of Finance. This would ensure that a very high percentage of the tax credit would be refunded to people. It may also be cheaper to do this from an administrative perspective.

I support the amendment put forward by Deputy Bruton. If we are logical about the tax system, it is the responsibility of the State to find a way of refunding tax credits to people who are lawfully entitled to them. We have a system which pays lip-service to this. In theory there are many tax credits, but in practice the majority of people in the case of bin charges fail to make use of them. It is most likely that it is people with accountants who gain the benefit of the tax credit, even though they may require tax relief least of all. We are in a logically absurd position.

Mr. Boyle

We do not need to spend too much time on this amendment. As Deputy Bruton stated in moving the amendment, we have covered most of the ground already in amendment No. 1. The theme of the contributions appears to be that if the Minister is not prepared to have some kind of refund mechanism for the additional moneys he finds in the coffers due to the indifference or ignorance of taxpayers, he may consider more innovative ways of recycling the money.

Perhaps he should consider a dormant reliefs fund to match the dormant accounts fund for the unclaimed accounts in insurance companies and banks. Perhaps he would prefer the mechanism used in the national lottery for unclaimed winnings, where money is recycled in other causes. He may even increase the amount of money given to the National Pensions Reserve Fund. At least there would be a recycling element to this.

The point is that money is in the coffers that would not be there if people knew of and were able to claim their entitlements. The Minister sees a political benefit in this, and if I were in Government I would probably see the same. In terms of tax equity and fairness, it is an issue that must be tackled.

Caoimhghín Ó Caoláin

I support amendment No. 9. From the first part, it is clear that this is not intended to be only a one-way street. It may very well facilitate the collection of revenues due that might not otherwise present. It puts the onus on State and other bodies to make the necessary returns of all moneys received. It is likely that other bodies exist that do not currently make all the returns, and this amendment may produce a greater beneficial outcome in terms of the overall revenue performance. It may not merely aid and abet the objective of ensuring that all tax compliant PAYE workers receive their due credits. It is a laudable amendment which reflects on the spirit of the first amendment, which was discussed previously. I join in recording support for it.

Mr. Cowen

If I understand the Deputy's amendment correctly he proposes that I make regulations to provide that where payments made to the State or other bodies qualify for income tax relief that relief be given by way of deduction from the payment, rather than as part of the taxpayer's tax credits. In that case the Deputy is proposing an extension of the principle of tax relief at source, which currently exists for medical insurance premiums and mortgage interest payments. While that system works very successfully in both those areas it is not, as I said on Committee Stage, suitable for all reliefs. Ideally the system needs a small number of payment recipients relative to a large and regular number of payers. There are not many reliefs which meet such criteria and the system would not be cost-effective either for Revenue or the payee for once-off or irregular payments to a wide variety of payees. There is also an Exchequer cost and to work smoothly the tax relief at source system must apply to all payers, whether or not they are liable to tax. The benefits must be judged against the costs and that cannot be done on the catch-all basis proposed by the Deputy.

On Committee Stage, I indicated to the Deputy that I would consider whether there was any area, given the number of bodies or institutions on whom one was dependent for information and the number of taxpayers involved, to which an extension of tax relief at source could be applicable. If and when I identify any areas of tax relief that are suitable for applying the scheme I will bring them before the House. However, extending tax relief at source is not as simple as people might think. For that reason I cannot accept the amendment suggested.

Amendment put and declared lost.

Mr. Bruton

I move amendment No. 10:

In page 9, between lines 15 and 16, to insert the following:

"1.—A person, none of whose taxable income is chargeable at the higher rate, who makes a pension contribution within the limit set out in section 779 of the Principal Act, shall be entitled to receive a tax credit contributed to the pension scheme equivalent to relief at the higher rate.".

This amendment deals with the entitlement to pension relief. In our system, as the Minister knows, pensions are one of the few areas where we have not standardised tax credits. People are entitled to pension relief at their top rate and in many cases to relief on social insurance contributions. That is fine for people who are on the top rate of tax but, as we know, many people are on the standard rate or do not pay tax at all.

The benefit of the relief to those on a low income is, at best, less than half of that accruing to high-earners. It is an ad valorem relief whereby the more income a person has the more relief they receive. At the top of the scale a person can earn up to €247,000 and get relief for pension contributions at up to 40%, meaning the taxpayer contributes a subsidy to such a person’s pension fund of €41,500 each year. They are effectively in receipt of matching money each year. The Minister envisages that people can accumulate up to €5 million per individual fund, which would generate a pension of close to €500,000 per year. One half of that will have been funded by the taxpayer, which represents an extraordinary largesse compared to what somebody on the standard rate of tax receives. One half of the population has no pension cover whatsoever other than the social welfare pension and it does not take a genius to know that that half will predominantly comprise the low-paid. It can safely be assumed that three quarters of the low-paid have no pension cover.

We are presiding over an unjust shareout of taxpayers' money in this regard because, as I am sure the Minister's advisers will confirm, the total value of concessions under the pension relief provisions amounts to approximately €300 million. If there was an analysis by income distribution, which there is not at the moment, I safely assume it would reveal that two thirds of that money will go to the top 10% of earners. It is a very iniquitous spread in what is a generous area of tax relief.

I am in favour of encouraging people to provide private pensions but it must be done on a fair basis. In particular, we must encourage people at the low end and the purpose of my amendment is, at the very minimum, to give people relief at 42% regardless of where they are on the income scale. People will rightly argue that those on a standard rate do not have a huge amount of spare income to put into a pension but at least they would be given the opportunity to do so. The Minister will say that this issue is under consideration but it has been under consideration for a very long time. The only gesture made this year was a small one, though we cannot complain about any gesture. It allowed the small number of people in this category with SSIAs to be able, as a concession, to put an extra €2,500 into their pension using the tax relief.

When these data are available in some 12-18 months there will be a huge outcry at the way in which the money is being shared between those on modest and those on higher incomes. Some people privileged enough for an employer to put money into a fund for them can contribute an unlimited amount. We have seen that used as a way of paying senior executives non-taxable income. I am not sure there is any authentic public benefit in that system.

We should have reformed the system long ago. We did not reach this section on Committee Stage but on Report Stage the Minister responded that he would need a study before he would concede the suggestion. He thought the costs might be greater than the benefits, but I cannot understand his logic. We have conceded that there are huge benefits in relief for pension provision, which is a bulwark of our tax code, but it is preposterous for the Minister to say he needs an analysis to help him decide whether to give at least as much, in percentage terms, to the lowest paid as to the top paid. It is purely a debating point rather than a serious attempt to address the issue. More seriously, he says he wants time to review the pension board study but I have met with the Minister for Social and Family Affairs, Deputy Brennan, who has presumably studied the issue in great depth and he has said he supports the proposal. It is clear that among those most informed in Government it is regarded as a good path to take. We should not hesitate to do so and I hope the Minister will agree.

Ms Burton

The Minister must accept that probably the most unfair aspect of the entire Irish tax code is that dealing with pension relief. This fact is borne out by the study commissioned and written by the Minister's officials, as volume 3 of the study into tax breaks. It showed an extraordinary position. Of the six or seven case studies in the report, two deal with separate individuals who have accumulated pension funds of €100 million each, will receive a €25 million tax free payout and be given an opportunity to invest the remaining €75 million in approved retirement funds that appear to carry other significant tax advantages, such as transferring the funds tax free to spouses and, probably, children.

The study contains a number of other examples of people who I assume are, for the most part, proprietary directors. Their companies made contributions of €5 million, €6 million, €7 million or more to their pension funds, thereby attracting very large tax breaks. We must be clear that if a proprietary company wishes to provide a pension fund for its directors, that is its business, but I do not know how it would be the State's business to provide a large tax benefit of approximately 42% of the sum contributed by the company. These are tax arrangements of the purest kind that serve to mitigate income tax and put people in that situation in advantageous positions.

In an amendment I have retabled I will ask the Minister why the House cannot be given the information on the 6,000 or so special self-administered pension funds, such as the details of their capital amounts, tax breaks attaching to them and the cost of such to the State. Why can the House not be given similar information on approved retirement funds with amounts that are in excess of a certain minimum?

If a community group or community-based or private crèche receives a grant of a few thousand euro, the information is available somewhere in the reports of various public bodies and is essentially in the public domain. However, while some receive extraordinary pension benefits from the State and earn far more in tax breaks than most people earn in a lifetime, the information is not disclosed. This is wrong and the matter of privileged sections of people being exempt from tax for one reason or another has bedevilled the debate on tax. The ordinary PAYE taxpayer has no way of knowing how much these tax benefits are worth and to whom they are paid. A tax benefit and tax forgone are as valuable to high income people, if not more so, than a direct payment of a State grant.

The failure to cost tax expenditures, especially in the pension area, is wrong. The Minister publicised his scheme for low income earners with SSIAs and no pension provisions. For example, if a person saves €7,500 of his or her SSIA money in approved pension products and meets the conditions, he or she will get a bonus from the State of €2,500, a third of the amount. Multimillionaires with special arrangements get incredible deals, but they are all confidential. The deal is in excess of the amount a person with no pension provision should get.

It is sensible, proper and correct of the State to support people in saving for retirement and I have no quibble with it. However, the amounts given to some people are disproportionate and are, effectively, welfare for the rich. Deputies get hot under the collar because a lone parent gets a few bob but these types of tax breaks are the highest form of State welfare for the rich. The Government does not seem to care. The Minister will put a ceiling on reliefs in the Bill but people already with money in pension funds of the type described in the officials' report will get away with it.

How will we ensure fairness and equity in what is happening? I read the report of the National Pensions Reserve Fund and welcome that the fund is doing well. We must bear in mind that 48.1% of workers do not have pension cover. The National Pensions Reserve Fund will do nothing for them. The fund's proceeds are intended to meet the pensions of public servants and the like from 2025 on. We are left with a group of citizens without pension cover, many of whom are women who left the workforce to look after families.

Some type of fairness should be a consideration in the allocation of significant tax benefits in respect of pensions. I am uncertain of the annual cost of such benefits on the Exchequer. It must be at least €1 billion and it has been suggested the cost is €2 billion to €3 billion. The reports did not contain costings. All we know is that the benefits are very expensive and skewed towards people at the top end of the income scale. Members of the Oireachtas and the senior Department of Finance officials with the Minister are well paid by Irish public service standards but most of us could not avail of these pension products because we do not have enough money or annual income to invest the €100,000 needed to make gains and are not self-employed, meaning we do not qualify to take part in the most lucrative of the pension schemes.

When he speaks about the costs of various tax breaks, the Minister often refers to pensions as though the whole country and citizenry benefit equally from pension benefits. They do not. Until we are given the detailed breakdown of the figures and see how much the high income earners earn from pension tax breaks as opposed to people on modest and low incomes or public servants who are strictly limited in what they can claim, a situation will continue in which pensions are the critical area in transferring large amounts of money tax-free to be used at a later date by people who are already very well off. The Minister for Social and Family Affairs is suggesting introducing mandatory pensions. From what he says there is no difference between mandatory pensions and mandatory taxation. Small, self administered pension funds and approved retirement funds for the wealthy reveal the true nature of specialised tax relief. The Minister must provide us with more information on this. The report by the Minister's officials shows this matter is a scandal.

Tomorrow is international women's day and the majority of the 49% of workers not covered by pension relief are women. If the Minister wished to make a difference to women in this country he should bring forward imaginative schemes to allow women who have left the work force to contribute and receive pension relief. Currently, tax relief is tilted in one direction and the more one has, the more one receives.

Mr. Boyle

Tax relief on pensions is, to paraphrase Oscar Wilde, the tax relief that dare not speak its name. It is the most pernicious and iniquitous method of relief in the system. The Minister has missed a major opportunity to tackle one of the most unequal aspects of our tax code. This became apparent when tax forgone began to equal the amount paid annually in the State pension and it has now surpassed that amount. This gap will now be widened because of the lack of action. Why do we pay €2.7 billion in State pensions while forgoing €3 billion?

Raising the State pension above €200 before the end of the Government's term is a gimmick as this figure is among the lowest in Europe as a percentage of average income. Any fair pension policy would have this as its mainstay and would not rely on taxation and tax relief as a means to provide for our citizens in later years. The need for equity in the system, the principle advanced in Deputy Bruton's agreement, is one with which I readily agree although I do not agree with the mechanism he suggests.

Inequity exists between taxpayers at the standard rate and those at the higher rate. Inequity is also suffered by those in the workforce but not in the tax net and women neither in the work force nor in the tax net, to whom Deputy Burton referred. We need mechanisms to address pension needs and if tax relief is such a mechanism it should be a refundable tax credit in order to cater for these sectors and provide the same effective relief. Neither the Minister nor the Government has this degree of imagination.

Providing tax relief to those with a disposable income of €100,000 is a disgrace. Why does this exist in our tax code? A sum of €100,000 per year for an individual is the equivalent of eight years for those on the highest rate of the State pension. Females can expect to enjoy this for 15 years of their life while males can enjoy it for ten years of their life. If there was sanity in the pension system we would average these figures and provide the highest possible State pension. We would not provide the expectation that the rich can enjoy the same income entitlement and standard of living when they cease to be economically active. Currently, those earning six figure sums before retirement can earn six figure pensions. In a society where the majority of our elderly population does not live in that realm we cannot support such iniquitous policies.

Government legislation on PRSAs prevents people from accessing the fund for ten to 15 years. At the higher end of the scale, those who sold the funds are entitled to withdraw the equivalent of 1% of the value of the fund during the same period. Is there any justice or equity in the pension policy pursued by this Government? The Minister advocates one policy while his counterpart in the Department of Social and Family Affairs indicates another. Any move towards reform will have the rabid Rottweiler of Ranelagh up in arms, addressing the inequity of being rich and staying rich in the unwieldy society this Government has helped create.

If the Minister wishes to achieve something in his term of office he must ensure those at the lower end of the scale can live on their incomes and that these increase at a rate greater than inflation. The opposite approach is the current policy. Tax relief of significant proportions is provided to the richest in society and these are out of sync with cost of living increases. I wish to hear the Minister admit the system is not working and needs to be radically changed. The opportunities the Minister has had have been missed and we will pay the price in years to come in increasing inequality.

Caoimhghín Ó Caoláin

I concur with the arguments and sentiments of the last speaker and I support amendment No. 10 which seeks, in a modest way, to provide those on the lowest income scale with some credit for their efforts to provide for pension needs in later life. The review of tax reliefs has revealed how the wealthy have used pension reliefs to avoid tax on a massive scale. One notorious case concerns retirement funds of €100 million set up by two companies for two bosses. In each case €25 million was withdrawn by the individuals concerned as a tax free lump sum. This occurs at one end of the scale and this amendment seeks to address the other end.

Without addressing this we will see a perpetuation of the inequalities inherent in our society and Government policy as presented over the past two terms. The Government continues to deny it is the case but all evidence shows we are creating opportunities for those who have built up largesse to have a greater return from the Exchequer and public funds. Yet, those at the very lowest level who have striven and faced all the difficulties of providing for themselves and presumably in many cases for their families and dependants throughout their lifetime, have no measure of relief offered. It is a simple choice of taking the first steps to address the inequalities that exist and in this regard the amendment proposes a very paltry step in that direction. I hope the Minister will accede to it.

Mr. Cowen

There seems to be some amnesia on the opposite side about the fact that this Bill provides for the first time in the tax code for limits and fixed amounts beyond which the State will not provide relief for pension provision. This has not been done before by any Government. I did not hear much comment about that in the contributions. I remind Members that I commissioned the internal report on pensions and I acted on its findings.

Deputy Bruton's amendment is concerned with contributions to occupational pension schemes by those on lower incomes and seeks a tax credit to be contributed by the Exchequer to the individual's pension scheme equivalent to relief at the higher rate of tax of 42%. I presume the amendment proposes that this tax credit is to be in place of relief the individual may be getting at the standard rate, assuming they are in the tax net.

The proposal is similar to one of the recommendations made in the recently published national pensions review. The Bill provides for a once-off incentive for those lower paid with SSIAs who are in the savings habit to invest their SSIAs in pensions. Further work is ongoing in this respect.

The question of pension provision in the longer term is a separate matter. The national pensions review produced by the Pensions Board provides a basis for consideration which the Government is giving to the overall pensions situation. This consideration is a work in progress. The chief executive of the Pensions Board when referring to the report which issued before Christmas, stated: "Its detailed analysis and costing of the pension situation are at least as important as the recommendations and should continue to be used as a frame of reference going forward". There is work to be done on analysing and costing the situation.

The board understands that further decisions must be made in the context of employment interests, competitiveness and overall economic and social considerations. The Pensions Board considers that its analysis and recommendations must be considered by the Government in a wider context. The Government has taken no position on any of the recommendations in the report nor is it a question of addressing these in the Finance Bill at this stage. The wider policy issues raised by the Pensions Board will require further and ongoing examination by Government.

Deputies have been pressing me on the need for the analysis of tax decisions. I remind the House that decisions relating to pensions have far-reaching effects which are long term and go to the heart of our tax structure. I presume Deputies will want the Government and I as Minister to undertake the necessary analysis before proceeding.

The cost of increasing tax relief for pensions to 42% depends on the uptake but it is clear it could be very significant and this must be borne in mind in future policy analysis in this area. For that reason alone I cannot accept the amendment at this time.

The report of the Pensions Board, which listed the possible means of incentivising wider pension coverage, acknowledged that one effect of such a change might be simply to confer additional tax relief on those already saving for pensions. There are other considerations with respect to this proposal. The potential for those dead weight costs would need to be taken into account in assessing it.

Deputy Bruton stated the cap I instituted would give approximately €500,000 of an annual pension per year. Given increased longevity rates, a pension fund of €5 million less the lump sum will give a male retiring at age 60 an annual pension of approximately €110,000 for life. Where a person retires at 65, the annual pension will be approximately €135,000. The average life expectancy is based on Central Statistics Office data. A male aged 60 in 2001 has a life expectancy of 19 years and when retiring at 65 it is 15.4 years. There is a general consensus that life expectancy will continue to improve. The CSO assumes that by 2030, average life expectancy for a male aged 60 will be 25 years.

Deputy Burton raised the issue of publishing lists of schemes approved under Part 30, Chapter 1, of the Taxes Consolidation Act. This is similar to an amendment proposed on Committee Stage. It relates primarily to the small self-administered occupational pension schemes or SSASs, which are generally one-person schemes and also used to improve retirement funds. The proposal seems to be that Revenue would publish details of SSASs approved by them each year. During the earlier debate, I indicated on Committee Stage the fundamental difficulty with the proposal, which is the issue of taxpayer confidentiality. With regard to SSASs in particular there is a very real risk that in publishing the information sought, individual taxpayers could be identified. All taxpayers have a legitimate expectation of privacy in their dealings with Revenue and the release of a taxpayer's personal information in this manner would undermine those expectations. Those issues must be respected.

The pensions provisions in the Bill seek to close off excessive funding for pensions, to limit the amount that can be drawn from pension products by way of tax-free lump sums and to restrict the capacity of individuals to use ARFs as purely long term tax-exempt vehicles. I am confident these changes will have the intended impact and will create greater equity in the area of pensions tax relief.

With regard to State pension provision, the record of this Government is far better than any of its predecessors. Pensions have increased by more than 120% at a time when the consumer price index has increased by 35% or thereabouts.

Mr. Bruton

I am disappointed at the Minister's response. He is willing to give substantial relief to those with high incomes and states that more work must be done in order to give far less relief to those on low incomes. This strains credibility. I do not understand his argument that this could undermine competitiveness in some way. It would give people more security and would be a positive measure. He also argued that this might confer benefit on people who already had a pension but it would benefit people at the bottom of the pile, those on the standard rate of income tax and if they are single are earning under €32,000 a year. The conferring of benefit on people who are on incomes under that amount and who are making some contribution into a pension scheme could hardly be regarded as some extraordinary worry to the taxpayer.

Mr. Cowen

I was quoting from the report.

Mr. Bruton

The Minister was quoting it as if it would be persuasive in the House. The Minister is responsible for what is decided in this House. We are debating the matter and the Minister is quoting from the report to back up his position.

Mr. Cowen

I am quoting the chief executive.

Mr. Bruton

It is not credible and it does not bolster the argument against this amendment.

Mr. Cowen

That is the Deputy's view.

Mr. Bruton

If the commission was here the members would not be arguing along the lines the Minister is arguing. The Minister congratulated himself for being the first to put a cap on pensions. That is true but most of the huge explosion in the cost of pensions has occurred under his Government, with the huge increase in pension relief provided, allowing from what was 15% of income to rise to 30% of income and now at 40% of income in certain cases. Caps were never an issue. Caps have been introduced only late in the day on a scheme that has been largely created by the Government. The equity element for which the Minister seeks credit should have been part of what the Government allowed Mr. McCreevy introduce. The Government should have recognised that the change from 15% across the board to this generous relief required those sorts of caps. I do not pretend this amendment is the answer but the House must get to grips with this and have a more significant reforming element than we have seen. The sooner the Government comes forward with proposals we can debate the better. I am glad this has been supported. It has been worthwhile to debate this issue and hopefully when we return next year a more comprehensive package of reform will come from Government, which I will support if it is fair.

Ms Burton

If the Minister is to boast about his Government's achievements it is important to note that the abuse of pensions for tax purposes was consciously slipped into the Dáil by then Minister for Finance, Mr. McCreevy, around 2000. If the Minister examines his officials' report he will see that in 2000 Mr. McCreevy removed practically all limitations on pension investments for tax purposes. He significantly widened what could be invested in. The Minister's report shows that until then the numbers and amounts in small, self-administered pension schemes were relatively modest, as one might imagine, because only a relatively confined group of people, generally senior company executives or proprietary directors, could avail of them. Once Mr. McCreevy opened the floodgates in 2000, all the worst abuses that we have highlighted happened. The Minister's officials' report shows the amount of money in those funds rose very quickly to over €1 billion within a short time in approximately 2,200 special funds.

Acting Chairman (Dr. Cowley)

Deputy Burton's two minutes have expired.

Ms Burton

The Minister must acknowledge that he was put in office to remove his predecessor, some of whose actions were so extreme in favouring tax evasion and avoidance by the rich that the Taoiseach saw fit to replace him. The Minister should remember that.

Mr. Cowen

On the question of taking long-term decisions, let the record show the views of the Opposition parties when we decided on the National Pensions Reserve Fund, a policy decision by my predecessor. Let the record show what Opposition spokespersons said about raiding that fund when a downturn happened in 2001 and 2002. Let the record show what they all said on how that pension fund should be dealt with and whether we should put money aside for the future. The consistent position of this Government will stand the test of time in terms of taking decisions that will be of great benefit not to this Administration or in the next term but in 2025 and beyond when there will be the prospect of ensuring we have adequate provision for State pensions for ordinary workers. Let the record show the views of the so-called workers' representatives on that when the heat came on in the first few years of the fund.

Mr. Boyle

It is too early to tell.

Mr. Cowen

It is not too early to expose Deputy Boyle's inconsistency.

Mr. Boyle

We will see who is inconsistent in 2025.

Mr. Cowen

The Deputy should read previous debates. There is only so much sanctimonious hypocrisy I can take in one night.

Ms Burton

Let the record show what Mr. McCreevy did.

Mr. Cowen

Pension provisions——

Ms Burton

That is why Mr. McCreevy was removed.

Mr. Cowen

There is a conspiracy theorist over there.

Caoimhghín Ó Caoláin

The Minister seeks to apply a broad brush stroke across the Opposition benches. I can speak only on behalf of my party, which I am proud to represent. The position I have argued consistently on the national pension fund is not as the Minister describes "to raid" it, but on the contrary to use it as a resource in the interests of the wider economy.

Mr. Cowen

Many a pensioner was left short at the post office on a Saturday morning after some of Deputy Ó Caoláin's mates got to them. There is only so much nonsense I can listen to.

Caoimhghín Ó Caoláin

The arrangement for the provision of education is one example of how the Government squanders money on PPP arrangements.

Mr. Cowen

I have heard too much of that nonsense. There was not much for many a pensioner on a Saturday morning.

Ms Burton

We know who the Minister looked after.

Caoimhghín Ó Caoláin

We would pay less in guaranteed return to the national pension fund and save the hard-pressed taxpayers their tax euro.

Mr. Cowen

That is enough sanctimonious hypocrisy for one night.

Caoimhghín Ó Caoláin

The Minister is not prepared to accept that reality because the Government was beholden to private sector interests.

Mr. Bruton

I admire the Minister's selective quotation from history. He did not even quote, but assumed the record would back up anything he says. When the record is examined it will show a different picture. The late Jim Mitchell, who stood here for Fine Gael before me, was a strong supporter of that and advocated that the pension contribution be increased to 1.5%.

Mr. Cowen

In subsequent debates that was not the position.

Mr. Bruton

The National Pension Reserve Fund has set aside money to do what the Minister accuses the Opposition of advocating, namely putting money from the fund into bankable infrastructure projects. The Minister and his colleagues have not been able to propose any project that could draw down that money. This is a failure to implement a positive suggestion from the Opposition. It has yet to be implemented.

Mr. Cowen

There were conflicts of interest on that.

Mr. Bruton

Since it has occurred the Minister has made changes to remove the conflict of interest, which arose as a result of the——

Mr. Cowen

The issue is how one deals with conflicts when they arise.

Mr. Bruton

The Minister loves to talk people down but does not like to hear the truth.

Mr. Cowen

Not at all.

Mr. Bruton

The Minister's predecessor established the National Development Finance Agency to advise on and negotiate PPPs. It was to advise both sides, and the resulting conflict of interest was rightly highlighted. To the Minister's credit he removed the conflict by changing the way the NDFA operates. The conflict of interest signalled was of sufficient significance for the Minister to make changes. I will take no lectures on this because the Minister is coming under pressure and throws out abuse all over the place.

Mr. Cowen

I am not throwing out abuse but defending my position and pointing out the inconsistencies I have heard from various parties tonight, which I am entitled to do.

Mr. Bruton

The Minister is distorting the record and trying to deflect from a genuine debate on the equity of pension provision.

Mr. Cowen

I am not distorting the record.

Mr. Bruton

Any fair observer, even the Minister, must notice that there is great inequity in this. Much of that inequity was recreated by his predecessor and the Minister is, in effect, sticking his head in the sand if he does not recognise that. It was he who made the great leap forward that has created the vehicle that exists which is being used to the extent it is. One cheer is warranted for starting to introduce caps on something that should have been in place from when these enormous expansions in eligibility were made.

I do not wish to delay the business of the House because there are other issues that we would like to reach.

Amendment put and declared lost.

Acting Chairman

Amendments Nos. 11, 12 and 13 will be discussed together.

Mr. Bruton

I move amendment No. 11:

In page 10, line 6, column (1), to delete "€32,000" and substitute "€34,000".

The truth is that this Government said, on taking office for the second time, that the key target it had for tax was to reduce the proportion of people paying at the top rate to 20%. That is now 32% and is way ahead of what was proposed. The Minister has let down 246,000 taxpayers who would not be paying at the top rate of tax if the commitment had been honoured. One hits the top rate of tax now at €32,000 for a single person. That is no more than the average industrial wage. Indeed, it is way below the average industrial wage in the public service, in distribution or in most of the private sector.

This is an area where Government has failed by its own standard to deliver what it set out to do. It is not that it has been short of tax money. In the space of just 12 months, the increase in revenue collected by this Minister between his budget speech this year and the one he made in 2005, is €5.2 billion. That is an astonishing increase in tax revenue, but resources could not be managed in such a way as to deliver commitments that were made in the general election and subsequently in An Agreed Programme for Government. It is a reflection on the inability to manage resources effectively.

This is not the only commitment made that has been airbrushed away. There were commitments to end hospital waiting lists in two years, reduce class sizes for children under nine etc. These have been airbrushed away and the resources have not been well managed by any standard.

The Minister might say that this is an easy amendment to table and that is true. However, I tabled it precisely because it is the type of amendment the Government said it was going to deliver when it put together its programme for Government and which it has lamentably failed to do.

Ms Burton

Has the Minister any idea how long it took his predecessor, the former Deputy McCreevy, to swim from Inchydoney to the shores of Belgium when he was thrown overboard after the meeting with Fr. Seán Healy? As well as creating open season for pensions and all manner of extraordinary arrangements for the wealthiest, he gave them tax-free holidays and a scenario where people with income in excess of €1 million per annum paid no tax.

Allied to that was the extraordinary meanness of the former Deputy McCreevy. He established a scenario where although the Fianna Fáil and Progressive Democrats manifestos and the programme for Government contained solemn undertakings that only 20% of taxpayers would pay tax at the top rate, to this day the current figure for those paying at the top rate is more than 31%. By the time we get the figures at the end of the year, it will probably be more than 32%.

When historians come to look at the Minister's budget, on the issue of tax relief for middle income earners they will find he was very mean in relative terms because tax revenues have continued to soar ahead. He has continued to maintain a plethora of tax breaks for the very wealthy, working on the principle of St. Augustine: "Lord, let me introduce reform, but not just yet". The dates for most of the Minister's proposed reforms are anytime after the middle of next year to the middle of 2008.

Sceptics among us might argue that we have been here before. From time to time, the former Deputy McCreevy announced the closure of various tax breaks and then re-opened them in the course of several budgets. We know the Minister intends to limit some of them, but whether that will happen, I do not know.

I do not see why the Minister should get agitated when we, on this side of the House, say that the former Deputy McCreevy was taken out, thrown overboard and left to swim from Inchydoney to Brussels, much to his horror and discomfort. He has never been happy in dealing with the services directive in quite the way he was when he chirped away in the Department of Finance. That is how the Minister, Deputy Cowen, has come to be here. We are entitled to measure his achievement, if any, against the promises made by his party and in An Agreed Programme for Government. The most fundamental promise was that the majority of taxpayers would pay tax at the standard rate and the Minister has failed lamentably in two budgets to deliver one iota on that. Instead, he has tinkered with closing off some of the tax breaks for the very wealthy, but it is too early to say whether that will work because we do not know if he will simply extend the dates again in due course. That is what his predecessor did.

Everything is relative. The Minister will tell the House that in 1977, when the late Jack Lynch was Taoiseach and Fianna Fáil was in power at the beginning of its glorious revolution, marginal tax rates were extraordinarily high. Of course they were. They were so under Mr. Haughey and under various Fine Gael and Labour Party Administrations. However, they have been brought down consistently, with one exception. Single PAYE workers who earn slightly more than the average industrial wage and who do a little overtime or receive a bonus pay tax on this at 42%.

No amount of throwing shapes changes the fact that the biggest con job carried out by the Minister's predecessor, the former Deputy McCreevy, was to promise that only 20% of taxpayers would pay tax at the top rate. The Minister or his Government has never come near to honouring that commitment. On many occasions, his colleague, the Tánaiste, has said that this is primary value for the Progressive Democrats. His colleague, the Taoiseach, has said on many occasions that it is an outrage that some millionaires pay no tax. When it came to this year's budget, nonetheless, the Minister again continued to milk the ordinary PAYE taxpayer. Equity is a relative entity. People on modest incomes are justified in looking over the fence at the kind of people found in the tent at the Galway races and asking what it is that is so special about them that they should benefit from the extraordinary regime of tax benefits introduced by Fianna Fáil. What is so special about these people? I acknowledge and am pleased that they are entrepreneurs. I am delighted that their businesses are doing well and hope they continue to do prosper. However, what is wrong with them paying their fair share of tax? What is wrong with the Minister giving ordinary PAYE taxpayers a break?

Nothing the Minister says about the state of the economy nine or 20 years ago can detract from the fact that his budget gives away approximately €3.4 billion in pension reliefs, most of it to the higher paid. He is failing to fulfil the primary promise made year after year by this Government since it assumed power that only 20% of PAYE taxpayers would pay tax at 42%. The percentage of PAYE taxpayers who pay tax at this rate is almost 32% in draft form, so the Minister is very far away from his target.

When I heard the Minister speak on budget day, I wondered why he was so timid in respect of a promise which was freely given and repeated time after time by his Government. There is plenty of money with which to address this promise. It might mean taking a few bob off the people who frequent the tent at the Galway races and making them cough up a little bit more. Seeing as these individuals have made so much money, I do not see why they should not be happy to contribute slightly to the nation's welfare. They will die like the rest of us and, like the rest of us, their bequest to their children will be the type of society they helped create. I do not understand why the fundamental Fianna Fáil promise, which is also a fundamental Fianna Fáil problem, was abandoned by the Government. The Minister can revisit the records of every other party in this House but his Government has been in power for nine years. The Minister was assigned his post to right some of the wrongs of his predecessor and bring some notion of fairness to the tax code. Until some sense of fairness is introduced in respect of the 32% of PAYE taxpayers who pay tax at the top rate, the Government's primary election promise will remain a broken promise.

Mr. Boyle

The Minister might remember how I complimented him on budget day and after his speech on Second Stage of this Bill. I do not know if he interpreted it as a compliment but I meant it as such. I am convinced he believes in the need for change and we share a belief in the direction that change should take. However, I am frustrated because the amount of change he believes in is far too modest and the speed at which he believes change should take place is painfully slow. These are the two genuine areas of disagreement which exist between most of the parties in this House. The number of fundamental philosophical differences between the parties are few but fundamental differences emerge when it comes to how change is managed and when it can be achieved.

The Minister might think that some of us on this side of the House are sanctimonious for making these arguments but I would prefer to be labelled sanctimonious than be smug and arrogant, traits which are all too evident in the Government. If the Minister seeks real debate, he should have it on those terms rather than engage in name-calling.

With regard to the substantive amendments before us——

Mr. Cowen

Let the record show who is doing all the name calling in this debate.

Mr. Boyle

I am recording my own version of history, as the Minister has been doing all evening.

Mr. Cowen

This name calling took place on Second, Committee and Report Stages.

Mr. Boyle

There will be no more compliments for the Minister.

Mr. Cowen

I will live without them.

Mr. Boyle

Fair enough, but he might need them one day.

Mr. Cowen

I will be waiting for transfers from Deputy Boyle's colleagues.

Mr. Boyle

They will, of course, be very valuable in Laois-Offaly.

Mr. Cowen

The day that happens, I will be there.

Mr. Boyle

I will address the substantive amendments before us. As members of the Opposition, the limitations we face in making amendments of this type mean that these upward figures are the extent to which Deputy Bruton can suggest these changes. I agree with what has been proposed in these amendments and support them.

The real change which is needed and which would cut across all parties and potential Governments is the need to index these bands and credits. As members of the Opposition, we are not allowed to make such amendments because they would cut across the decision-making powers of future Ministers for Finance. While a considerable amount of phony debate has taken place about headline rates of income tax, there has been less debate about the effective rates of income tax. One can only tackle the underlying problems about iniquities relating to effective rates of income tax by introducing the concepts of index linking. The sooner we move and have real debate on these issues, the less need there will be for amendments of this type.

If I recall correctly, on Second Stage, the Minister spoke about statistics and the proportion of people, their income levels, what they pay in terms of overall income tax and the percentage of the income tax take. The figures were spurious because one needs to break down each of those income groups and find out what is the effective tax rate. One needs to discover what they are paying as a proportion of their own income. We would then know the degree of equity that exists within the income tax system. It is perceived that people on the highest incomes pay a proportionately less effective tax rate than people on the lowest incomes. Until we get statistics more honestly provided in this form, the Minister cannot argue against the type of amendments proposed this evening by Deputy Bruton.

Caoimhghín Ó Caoláin

I will facilitate the moving on of this debate as little more than 30 minutes remain on Report and Final Stages. I support the amendment.

Mr. Cowen

I propose to deal with amendments Nos. 11 to 13, inclusive.

These propose changes in respect of the standard rate bands. The costs of the increase in the income tax bands, as proposed by Deputy Bruton, would be €438 million in a full year. The proposal would increase the standard rate band for a married one-earner couple to €46,000, which is €5,000 more than was envisaged in the budget. The proposal would also reduce the non-transferable band available to the lesser earning spouse in a married two-income couple to €22,000, as compared to the figure of €23,000 envisaged in the budget.

I appreciate the Deputy's concern in respect of married one-income couples, however, the budget introduced several income tax changes which will benefit married one-income couples. For the second year in a row, married one-income couples have seen substantial increases in their tax credits and standard rate band. The standard rate band for such couples was increased by €2,600 to €41,000. The personal employee tax credits were increased by €50 to €1,630 and by €220 to €1,490, respectively. These changes ensure that a married one-income couple in the PAYE system who receive the home carer's tax credit may earn up to €27,600 without any liability for income tax arising. As a result of the budget, the income tax bill for a married one-income couple with an income in excess of €41,000 per annum is reduced in 2006 by an additional €892 per annum.

When the Government set itself the target that 80% of PAYE taxpayers would pay tax at the standard rate of income tax, the income tax landscape differed from the current landscape. People in the tax net at that time were afforded tax allowances at their marginal rate of tax. Thus, if the personal allowance was increased by €1,000 per annum, it was worth €480 to the higher rate taxpayer and €260 to the lower rate taxpayer. The effect of this was that increases in personal allowances removed higher rate earners from the higher rate as more of their income was exempt from tax at 48%, which was the higher rate at the time. In the 1999 budget, those tax allowances were standard rated and were worth a uniform €260 to all taxpayers, regardless of whether they paid tax at the higher or standard rate. This was seen as a fairer system and hailed as such at the time. The standard rate of allowances were later relabelled tax credits. One side effect, however, was that increases in the standard rate of tax allowances no longer acted to remove higher rate taxpayers from the higher rate band. The only way this could be achieved was by widening the standard rate band. Over time, without other reforms, the number and percentage of higher rate taxpayers would have risen inexorably.

Providing greater equity has made the 80% standard rate target more difficult to achieve. The solution reached was individualisation in 2000. Before 2000, a married taxpayer received double a single person's tax band and double their tax allowances. Individualisation of the standard rate band meant each person would be treated as an individual taxpayer with an appropriate standard rate tax band. At the time, the standard rate bands were €14,000 for a single person and €28,000 for a married single earner and €28,000 for married double earners. The individualisation proposal only affected the standard rate band. There was never a proposal to individualise personal allowances. Married earners still receive twice the allowance or tax credit of single people.

The other major reform has been to undertake to keep those on the minimum wage out of the tax net. This was part of the social partnership agreement in 2001 and 2002. The principal way to achieve this was by increasing tax credits. It absorbs resources that might otherwise have gone to widening the standard rate band. Given that tax credits are calculated at the standard rate band, increases in these credits does nothing to remove one from the higher rate.

This is the context in which we must deal with these issues. After budget 2006, the average tax rate for a person on the average industrial wage will be 12% lower than it was when the Government came into office. The average tax rate is 15% for those on the average industrial wage compared to 27% previously. This is a major advance in terms of equity for average workers, which cannot be denied. In 2006, a PAYE person on the average industrial wage will have seen his or her pay increase by more than €12,000 compared to 1997. Even allowing for the pay increase of €12,600, the tax bill is down by more than €400 per year compared to 1997. In real terms, when the cost of living as measured by the CPI is taken into account, a person on the average industrial wage will have seen his or her take home pay increase by 44%, of which approximately half is due to tax reductions. These are significant achievements in terms of reform of the income tax code. It is more favourable and equitable to people on average and lower incomes.

After budget 2006, the percentage of the income tax yield coming from those earning at or under the average industrial wage is 6% compared to more than 14% in 1997. The total yield from people in that wage bracket, and under, is less than half of what it was when the Government took up office. This is a reduction of 57%. The reality is that people on average incomes, or lower, are much better off now under the income tax changes introduced since the Government came into office than was possible or envisaged by those who have opposed us since then and prior to that. When one examines all the income tax reductions that have taken place, 31 of the 32 have been under Fianna Fáil-led Administrations over a long period.

While it has not been possible to reach the goal of 80% on the standard rate, our tax policies have ensured we have the lowest tax wage in the European Union, and one of the lowest in the OECD. Since 1997, the average tax rates for all categories of taxpayers has decreased significantly. Earners retain a greater proportion of income and take home pay. The average tax take from income tax, PRSI and the health levy is a proportion of gross income. While in the past it was approximately 27% for someone on the average industrial wage, it is 15% as a result of successive changes since the Government took office. This is a record the Government can defend and be proud of.

The structural change of moving to tax credits has made that target much more difficult to achieve. It must also be considered in the context of other priorities or needs. I could have left 25% of people on the minimum wage outside the tax net, as was the case previously. These people who are now on a higher minimum wage are outside the net tax, which is a greater priority than some of the issues raised by the Deputy. This is not to say that these people were neglected. Their take home pay is also better. One must make these decisions.

I stand over the Government's record in regard to the income tax code as it applies to average workers and the overall tax yield from workers. One of the reasons this has been achieved is that there is a greater number of people at work in the economy. This is creating wealth and tax revenue and enabling us to spread the benefits to a greater extent than would otherwise be the case if the jobs were not being created.

It is fine if people want to debate whether we are too pro-enterprise or not sufficiently pro-enterprise. We can have that philosophical debate on a party political basis. However, the point is that there are far more people at work, far more people with more disposable income and far more people in a better position than was the case previously as a result of the income tax changes that have been introduced. I will defend the structural changes we introduced and the further priorities we have identified.

Mr. Bruton

I will not delay because Members would like to debate other amendments. When the Minister made this commitment, he knew that the standard rating had been introduced. Tax credits were in place. It is not something that was unknown to the Minister and his Government colleagues when he made this commitment. Seeking a fool's pardon now because it was much more difficult to achieve that he thought is a bit like the former Taoiseach, Charlie Haughey, saying he did not realise what a big issue the health service was until the election happened. These were commitments the Government solemnly made, and people will take the Minister at his word.

I do not share the Minister's view that this has been a great boon for single income families or average working families. When the process of individualisation was reconsidered as a result of a backbench revolt, a home carer's credit was set at €770. It was virtually equal to the PAYE allowance at the time, amounting to a credit of €800. This has been allowed to be eroded. There has been no increase while PAYE workers have seen huge increases. Individualisation for single income families means they pay €5,000 more in tax on the same income than a double earner family. This has gone too far, coupled with the erosion of the home carer's credit. The Minister has tipped the balance too far.

To say average workers have done well is not true. They have worked hard and provided huge amounts of tax revenue for the Exchequer through not just their income tax but the purchase of houses, cars and so on. We should not forget that this is the only country in Europe where the tax rate on consumption is higher than the tax rate on income. There is an extremely high level of tax on consumption in this country. This is a big factor in the huge growth in tax revenue. It has not been a good deal for average workers who must spend most of their income on tax.

Amendment put and declared lost.

Amendments Nos. 12 to 14, inclusive, not moved.

Acting Chairman

Amendment No. 16 is related to amendment No. 15 and both may be discussed together.

Ms Burton

I move amendment No. 15:

In page 11, between lines 24 and 25, to insert the following:

"4.—No deduction, allowance or relief that would, but for this section, be allowed or available in computing profits or gains arising from rental income or in assessing liability to tax on that income shall be allowed or made available to a landlord of a tenancy, within the meaning of the Residential Tenancies Act 2004 and to which Part 7 of that Act applies, who has failed to comply with the requirements of that Part."

Nine years ago families who paid the 42% rate of tax usually could have aspired to owning their own homes. One of the consequences of the Celtic tiger is that for many families and for younger people, managing to buy a house is becoming more difficult. Yesterday I heard one of the Minister's cheerleaders, the chief economist from Bank of Ireland, say that the average cost of a house, or I should say a two bedroom apartment, in the Dublin area for first-time buyers is moving towards €400,000. Mortgage interest rates are inexorably rising and the European Central Bank has said they will rise on probably two occasions in the next year and a half, so the cost of mortgages is rising.

An extraordinary number of people are now renting. That is one of the statistics we do not hear from the Government. In the 1950s and until the mid-1960s, a reasonably moderate proportion of people lived in rented accommodation. The Minister may recall that in 1973, a Labour Party Minister, Jimmy Tully, from Meath brought in the right of council tenants to buy their own houses. Many of the landlord companies which operated in Dublin, Cork and other large cities also extended that right. For example, the Artisan Dwelling Company offered to sell a large number of its properties to its tenants.

However, after all the economic prosperity of the Government, more people are renting than at any time in the past 25 years. While some of the renters are migrant workers from other European countries and beyond, who may or may not stay here indefinitely, many of those renting are Irish. Traditionally, some of them might have got a local authority house to rent. As I said, in 1973 the Labour Party brought in the right of people to buy their council houses after a period of renting from a local authority. After approximately ten years, they could buy the house if they were in employment. Good solid social progress was made and I believe Fianna Fáil always supported the Labour Party in its position of giving renters the right to buy properties and have an aspiration to own their own houses. That is an aspiration probably shared by all the parties in this House.

Times, however, have changed under this Government. Many of our people are now renting and they will do so for a long time, if not forever. That brings us to the impact of renting on estates throughout the country. In my area of Dublin West, in some estates and developments, over one third of houses are rented. In some of the recent developments, some of these property millionaires queued up and brought 30 to 40 properties off the plans because, given that they have so much accumulated by way of rent allowances, they must buy more properties to maintain the benefit of their tax allowances.

The amendments propose that people who have these advantages fully comply with the Residential Tenancies Act 2004, that they are not granted tax allowances in respect of rent unless they are in compliance and that they furnish the Revenue Commissioners with sufficient information to show they have complied with all the requirements of the law in regard to registering as a landlord.

I do not believe I am the only Member of this House who has had dreadful problems with the new Residential Tenancies Board. As I said, in some estates in my constituency, up to one third of houses are owned by landlords. Sometimes, in the case of apartment developments, up to 50% are owned by landlords. Some of those landlords have absolutely no sense of responsibility to the tenants living in their houses or, more particularly, to other people in the complex, development or estate who have bought their own homes. The properties are in a disgracefully state. No advice or information is provided for tenants on issues such as late night parties and loud noise. When residents in an area try to get information about these landlords, they find they are not registered. We do not even know if they are registered for tax purposes.

In countries such as France, Italy and Spain, people often rent houses for generations, as happened here up to the 1960s. Being a landlord carried responsibilities. However, the Government has bred a new class of landlord who seems to know only profit and who churns tenants over at least once a year. As a result, a sustainable community is not being built up.

The Minister may say the proposals in these two amendments are very modest, which I acknowledge, but they are an attempt to use the tax laws to make these landlords in some way collectively socially responsible to other people who live in the estates in which they have invested. One must remember these landlords are investing for a profit. Many of them seem to have no sense of social responsibility. As I said, in other countries, there is a long tradition of letting properties and at times it is difficult to distinguish a rented premises from one which is owner-occupied. Anybody who goes canvassing can pick out the rented properties at a distance of 100 yd. because we have bred a landlord class who seem to have a diminished sense of responsibility to their community.

The Minister may say the provisions in the amendments are very modest but they are an attempt to use the provisions of tax law to put some smacht on these landlords so they have some social responsibility to the other people in the area in which they have bought their rented properties. If we could address this problem, we would have a much better regulated rental market. Perhaps down the road, we might return to what was, I thought, a fundamental value of Fianna Fáil that people might be encouraged to own their own properties and have a sense of pride.

Currently in Dublin West, the average rent is approximately €1,200 per month. With a property costing €400,000, one would not need to be a rocket scientist to work out that if one had the wherewithal to buy, one could buy as cheaply. However, people on the minimum wage cannot afford to get into that end of the property market. They cannot take the step up. My council in Fingal has been to the fore in producing affordable schemes but has nothing for this year. Those schemes have practically dried up. Part V was meant to provide a continuing throughput of social and affordable housing but the Minister's party welshed on that and allowed developers to pay cash instead. Cash is virtually useless because it is nowhere near the equivalent of the houses which should have been produced.

I commend this amendment. Landlords should not have things all their own way. If there is a technical way of improving the amendment I would accept that. Through the tax system we are developing a new landlord class. An ordinary family gets modest tax breaks on mortgage interest relief when buying a property. Given the structure of tax breaks which the Minister's party has introduced, the tax breaks for a landlord are typically worth five to seven times what they are worth to a family buying its own home to live in. That is another major inequity and unfairness in the way the Minister's predecessor in particular developed the tax system.

The Minister perhaps has an opportunity here for reform. It means turning his back on some of what the former Minister, Mr. McCreevy, did, but socially that is well worth doing.

Caoimhghín Ó Caoláin

Both amendments are reasonable and I hope the Minister will accept them in these closing minutes of the Report and Final Stages of this Bill. I will speak specifically to amendment No. 16. Some private landlords are in receipt of what can only be seen as a bounty through the supports from the rent allowance scheme. While they are enjoying these supports provided through public moneys, and getting redress with regard to whatever claims they can present through their inventive accountants, many are not registered as landlords with the Private Residential Tenancies Board. This shows a patent disregard for the law. The requirement is clearly there. It is important we ensure there is compliance through the introduction of the measures which amendment No. 16 seeks to achieve and that it becomes compulsory that landlords meet all the requirements, including registration, before benefitting in any way, at any level, either within the taxation code or through the supplementary welfare Acts.

I listened to what Deputy Burton said. Sadly, it is all a reality. She spoke of a new landlord class being bred, and that seems to be so. We have traditionally known of the poor standard of much of the accommodation being let, of appalling conditions, not only in rented accommodation in our cities but in many of our rural towns through the years. Much of that accommodation was deemed inappropriate and local authorities regularly threatened not to assess people coming from those properties for local authority housing, saying that because of the state of repair of those flats, or whatever one would call them, they were beyond safe, habitable use. From a number of surveys we know today that this abuse is now being visited on our new immigrant brothers and sisters, our new neighbours of colour in different parts of the island. This is a further reprehensible abuse by people who have traditionally shown no regard for their neighbours and the needs of their respective communities. Now they are showing even less regard for people coming to our country from other parts of the world.

Strong measures must be introduced to ensure compliance and to ensure the standards required are enforced. I commend amendment No. 16 to the Minister and hope he will give us some small return for the effort put in this evening.

Mr. Bruton

I support the amendment though I do not altogether share the belief that landlords and renting are bad. The real problem is that we have taken an extraordinary attitude to renting. For years we had no proper regulation. The Private Residential Tenancies Board was a good idea but is not working. It has teething problems and needs to get its act together. This amendment will help force the pace in terms of getting more landlords registered.

It is criminal that our approach to supporting people in the private rented sector is that they get a subvention from the State only if they are unemployed. Many low income people should be supported and we should be trying to develop a high quality rented sector catering to people of all incomes rather than, as we have done, create a situation where a lot of rented property is geared towards people at the lowest end of the scale. We have not put investment into standards. We have no income support for people, which would give better control over the regulation of the sector and its management.

Renting is here to stay. It is much more prevalent in the rest of Europe than in Ireland and does not have the deplorable reputation which renting has obtained in Ireland. We need to strengthen our regulatory approach and be broader-based in the way we give income support and tax relief to people who choose to rent. We might then develop a high quality rental sector. I support these amendments, and some of the Minister's amendments also go a little way along this road.

Mr. Boyle

I will speak briefly as I do not want to deprive the Minister of the opportunity to utter the final words on the Bill. I support the amendments. The principle being advanced, that no degree of relief for a subsidy or direct payment should be given to people who should be obliged to adhere to the law of the land, is sound and should be part of the Finance Bill just as much as it should be part of the necessary social welfare legislation. Not only are we giving relief with regard to many rental properties, but the State is the biggest tenant. Some 40% of all rents paid in this State are paid through the supplementary welfare allowance and that degree of double jeopardy means we should have provisions like this in both our finance and social welfare legislation.

Mr. Cowen

I propose to take amendments Nos. 15 and 16 together.

I understand the intentions of the Deputies with regard to the two amendments are to ensure that all landlords now legally obliged to register their tenancies with the Private Residential Tenancies Board will be required to demonstrate that they fulfil their obligations or will otherwise not be granted any deduction in determining the taxable amounts of their rental income.

The legislation currently included in section 11 of this Finance Bill addresses this issue as far as the key tax relief involved is concerned. This entire area was the subject of some discussion on Committee Stage of last year's Finance Bill, when I undertook to consider the issue further. It was also covered by speakers at the time of the passing of the Private Residential Tenancies Act 2004 when there was comment on the desirability of establishing a linkage between the legislation as proposed and the reliefs granted in tax legislation. Section 11 of the Finance Bill provides that unless a landlord meets his or her registration obligations under the Residential Tenancies Act in respect tenancy, then the interest deduction——

Acting Chairman

As it is now 11 o'clock, I am required to put the following question in accordance with an order of the Dáil of this day: "That the amendments set down by the Minister for Finance and not disposed of are hereby made to the Bill, Report Stage is hereby completed and the Bill is hereby passed."

Question put.

The Dáil divided: Tá, 66; Níl, 47.

Tá

• Ahern, Michael.
• Ahern, Noel.
• Andrews, Barry.
• Ardagh, Seán.
• Brady, Johnny.
• Brady, Martin.
• Brennan, Séamus.
• Browne, John.
• Callanan, Joe.
• Carey, Pat.
• Carty, John.
• Collins, Michael.
• Cooper-Flynn, Beverly.
• Coughlan, Mary.
• Cowen, Brian.
• Cregan, John.
• Curran, John.
• de Valera, Síle.
• Dempsey, Noel.
• Dempsey, Tony.
• Dennehy, John.
• Devins, Jimmy.
• Ellis, John.
• Finneran, Michael.
• Gallagher, Pat The Cope.
• Glennon, Jim.
• Haughey, Seán.
• Hoctor, Máire.
• Jacob, Joe.
• Keaveney, Cecilia.
• Kelleher, Billy.
• Kelly, Peter.
• Killeen, Tony.
• Kirk, Séamus.
• Kitt, Tom.
• Lenihan, Brian.
• Lenihan, Conor.
• McEllistrim, Thomas.
• McGuinness, John.
• McHugh, Paddy.
• Martin, Micheál.
• Moloney, John.
• Moynihan, Donal.
• Moynihan, Michael.
• Mulcahy, Michael.
• Nolan, M.J.
• Ó Fearghaíl, Seán.
• O’Connor, Charlie.
• O’Donnell, Liz.
• O’Donoghue, John.
• O’Donovan, Denis.
• O’Flynn, Noel.
• O’Keeffe, Batt.
• O’Malley, Fiona.
• O’Malley, Tim.
• Parlon, Tom.
• Power, Peter.
• Roche, Dick.
• Smith, Brendan.
• Smith, Michael.
• Treacy, Noel.
• Wallace, Mary.
• Walsh, Joe.
• Wilkinson, Ollie.
• Woods, Michael.
• Wright, G.V.

Níl

• Boyle, Dan.
• Breen, James.
• Broughan, Thomas P.
• Bruton, Richard.
• Burton, Joan.
• Connaughton, Paul.
• Connolly, Paudge.
• Costello, Joe.
• Cowley, Jerry.
• Crowe, Seán.
• Deenihan, Jimmy.
• Durkan, Bernard J.
• English, Damien.
• Enright, Olwen.
• Gilmore, Eamon.
• Gogarty, Paul.
• Gormley, John.
• Hayes, Tom.
• Healy, Séamus.
• Higgins, Joe.
• Hogan, Phil.
• Kehoe, Paul.
• Lynch, Kathleen.
• McCormack, Pádraic.
• McGinley, Dinny.
• McManus, Liz.
• Mitchell, Olivia.
• Morgan, Arthur.
• Moynihan-Cronin, Breeda.
• Murphy, Catherine.
• Neville, Dan.
• Ó Caoláin, Caoimhghín.
• O’Dowd, Fergus.
• O’Keeffe, Jim.
• O’Shea, Brian.
• O’Sullivan, Jan.
• Perry, John.
• Rabbitte, Pat.
• Ring, Michael.
• Ryan, Eamon.
• Ryan, Seán.
• Sherlock, Joe.
• Shortall, Róisín.
• Stanton, David.
• Timmins, Billy.
• Twomey, Liam.
• Upton, Mary.

Tellers: Tá, Deputies Kitt and Kelleher; Níl, Deputies Kehoe and Broughan.

Question declared carried.

An Leas-Cheann Comhairle

The Bill, which is certified a money Bill, will now be sent to the Seanad.