Leaders’ Questions.

Yesterday, the Government announced cutbacks of €440 million in public services. At the press conference, neither the Taoiseach nor the Minister for Finance would give any breakdown of these cutbacks. We now know why. They were ashamed to set them out. The figures produced by the Government show that one third of the cutbacks — that is €1 in every €3 because of the Government's economic mismanagement — will come from the health budget. Specifically, they will come from moneys set aside to assist thousands of families in catering for elderly family members in nursing homes. What the Government has done is sacrilegious.

The promises made to help families with the high cost of nursing home care have been abandoned. The Taoiseach and the Minister for Health and Children will claim this matter concerns legislation and legal difficulties. The elderly and their families who need this assistance cannot afford to put legislation on hold because of legal difficulties in the same way as the Taoiseach and the Minister for Health and Children can. They cannot afford to put their lives on hold because they need immediate attention. Families must make decisions to sell family homes to meet the costs of nursing home care. The sop of the €12 million allocated for nursing home subventions is only to salve the Taoiseach's conscience.

Thousands on the streets may not understand all the details of the consequences of Fianna Fáil's economic mismanagement. However, they know for sure the Government is taking money away from the health budget, particularly the €110 million earmarked for the care and assistance of elderly people in nursing homes. Before this blows up in the Taoiseach's face, will he not see the value of increasing nursing home subventions, as Deputy Reilly has pointed out on so many occasions? Will he not leave the moneys for the purpose for which they were allocated under a policy decision?

The €110 million earmarked for elderly people and their nursing home care is abandoned. A sop has been given out of it with the rest going back into the maw of a heartless Exchequer. Will the Taoiseach show some sense of humanity in this matter? Will he put the moneys into nursing home subventions for those who require them? What he has done is heartless, sacrilegious and he must reverse the decision.

Deputies

Hear, hear.

The fair deal scheme can only come into place when there is a proper legal footing for it. Dealing with people who have diminished mental capacity is a legally challenging area. The Attorney General is drafting legislation which will be sufficiently rigorous to address the matter.

This is a deferral of the introduction of the scheme. It can only come into place when legislation is in place. In the meantime, the Minister for Health and Children is providing for an enhanced provision of €12 million to deal with the nursing home subvention issue. It is unlikely the nursing home Bill will be published until the next session. Its enactment will be around the end of the financial year.

Over €500 million of extra resources have been allocated for care for the elderly. It is not an area we have been remiss upon. The fair deal scheme is an effort to bring about a uniform level of care and a proper legal basis for the provision of nursing home care. Due to the challenging nature of the legislation, we have not been able to enact it thus far. On the basis that the funds will not be used this year, we are in a position to defer it until the enactment of the legislation. In the meantime, the enhanced level of nursing home subvention will assist the situation.

Let the old suffer.

This goes back to the old slogan of "Health Cuts Hurt the Old, the Sick and the Handicapped." The people understand the Taoiseach is cutting back moneys allocated under a policy decision to help elderly people with nursing home charges. This morning many are concerned for elderly family members who might fall and break a limb, thus requiring nursing home care. These people may have to sell the family home to pay for that care. It does not matter to them that the Government has not been able to draft legislation.

Before Christmas, the Minister for Health and Children told the House she wanted nursing home legislation put through in three days. Since then there have been umpteen questions in the House on the state of the legislation with the same answer that it will be produced the following week. It will be 18 months before the Minister can introduce the legislation. Meanwhile, those people who need nursing home care now cannot put their lives on hold.

Out of the €110 million allocated, €85 million will go back into the maw of the Exchequer with only €12 million as a sop for increased subventions. Then there is the irony of an announcement of an extra 200 contract beds yesterday. The Minister's press release stated: "Sanction has now been received from the Department of Finance for the spending of €13 million from the fair deal provision of €110 million on 200 extra contract beds." That was announced last January. It is just a reheated announcement.

They were not delivered.

This Fianna Fáil-led Government, for all its bluster, has been unable to introduce legislation to deal with the fair deal provision. It is allowing thousands of elderly people to suffer in indignity.

It is putting pressure on families to sell their homes when for all his failures the Taoiseach could have used the €110 million for the purpose for which it was designed — either by increased subventions or as an allocation towards care for the elderly. He has failed miserably in this area of the €440 million cutbacks. What he has done is politically sacrilegious and he is condemned for that.

I ask the Taoiseach to reverse this decision before it gets out of hand. Bring back that €110 million. He has taken one in three of the €440 million in cutbacks from the health area, which he proclaimed had not been subject to any cuts and in fact, was exempt, by comparison with other Departments. The evidence is here, nonetheless, and he should be ashamed and have some conscience as regards what is going on, and reverse this decision. Deputy Cowen, as Taoiseach, is supposed to be in charge of the Government. He should leave this money intact in line with the decision that was taken and put it into care for the elderly because they are watching this and listening in their thousands. They now know that Fianna Fáil has directed that €85 million of the €100 million should be withdrawn. Elderly people will suffer as a consequence of this political decision. I ask the Taoiseach to reverse it.

Deputies

Hear, hear.

I point out to Deputy Kenny that 80% of day to day expenditure is in the areas of health, education and social welfare. However, economies have to be made and moneys must be reallocated, while keeping the overall spending limit for this year at what we intended. Because of the deteriorating economic situation, where we have increased allocations to provide in areas over and above what was projected, money must be reallocated from within the overall Government spend.

The critique from Fine Gael was that we were not doing sufficient in this area. The bottom line is that this must be dealt with in a way that will seek to minimise the impact on frontline services. That is what we will seek to do. The whole purpose of these proposals is to minimise the impact. As regards this specific allocation, the money was ringfenced for this purpose. This specific purpose cannot come into operation for practically the whole of this financial year. Therefore that allocation is not required in present circumstances.

It is required for care for the elderly.

It is overdue.

One minute it is legal and the next minute it is fiscal.

(Interruptions.)

Let the Taoiseach finish, please.

They are still there.

If I may be allowed——

There is only so much listening, we can do.

The problem is that the Deputy never listens.

I am prepared to listen to reason, but not rubbish.

The Deputy is not the leader of his party yet. The situation is——

He has hit the disabled. He has hit those with mental illness, who cannot speak up, and that is why we are here today talking to the Taoiseach. That is not an answer.

The Ceann Comhairle will have to do something.

Deputy Reilly should be aware that this is Leaders' Questions. Surely I do not have to remind him of that. Nobody is allowed to intervene, other than the leaders.

I thank the Ceann Comhairle. As regards the whole question of contract beds, some 2,000 have been put into the system within the last three years, in addition to increased home services. More money will be spent on services for the elderly this year than in previous years. However, as regards this specific initiative, which will not come into play this year because of the enactment required in order to make it operable, that money will not now be used — so, it is a deferral. In the meantime, other initiatives for the elderly, which have totalled €500,000 in the last three years, will continue to be provided as part of the base, to enhance the service. We acknowledge it would be better if this could be brought in sooner. That was our hope, but the legal difficulties must be overcome in the first instance.

The subvention system was introduced in 1993, at a time when the whole house could have been taken under original regulations. We are trying to regularise all that now and have a proportionate response which meets the requirements of the situation. It is not possible to talk about economies on the scale of €440 million and suggest that health, education and social welfare can be exempt from the process, given that €4 out of every €5 of day to day expenditure——

That is what he said yesterday — that they were exempt.

No, he did not.

No, I did not. The Deputy is good at claiming that he is paraphrasing me, while misquoting me. I made it very clear in my statement that we are seeking to minimise the impact on frontline services.

He said they were exempt.

I did not say that. I said, in relation to the 3% payroll——

I am not going to take any more lectures from the Taoiseach.

If the Deputy is not prepared to read and understand what is going on, that is his problem.

I am well able to read, and the Taoiseach can try to shout everybody down, if he wants——

(Interruptions.)

The 3% payroll bill relates across all Departments and State agencies, with the exception of health and education whose parameters——

The Taoiseach said they were exempt.

Let the Taoiseach finish.

Let me say what was said, because this is what I did say. The parameters will be decided on the basis of discussion with the Department of Finance. That is what I said and what the record will show. No amount of effort by the Deputy to misrepresent me will disprove that point.

(Interruptions.)

The Taoiseach's fair deal has turned out to be a raw deal.

I call on Deputy Gilmore, without interruption.

It is becoming increasingly clear that the so-called package which was announced with great fanfare by the Government yesterday, is only a very small picture of what it has in store for the people in the coming months. It would appear that yesterday's announcement was packaged for public relations purposes. It contained a number of high profile items such as ministerial pay and a reduction in public relations' budgets. I believe this was the tenth occasion on which the Government announced it would cut the cost of tribunals.

Yesterday, when I asked the Taoiseach how much the 3% cut in payroll would come to, he said it amounted to €250 million between now and the end of 2009. That leaves €1.25 billion to be made up as regards the cuts the Government is planning. The detail of the announcements made yesterday is a long way from that €1.25 billion. Already we see a drip-drip effect starting to take place. Deputy Kenny referred to the fair deal package for people in nursing homes, which has now been put on hold. This means that people in nursing homes and their families are being asked to bear the burden as regards the state of the public finances. We are told that more cuts will be announced next week by the HSE. There has been a cut in €45 million in real terms in overseas development aid, and there is speculation today that some 5,000 jobs are to go in the public service.

Instead of having this type of drip-drip feed of sneaky cuts and stealth taxes emerging during the summer months, will the Taoiseach give the House the full picture as regards what the Government intends, before the Dáil goes into recess? I want to ask him again, because he did not answer yesterday, what is in the package to address the needs of people suffering most from the downturn in the economy. These are the people who are losing their jobs. Some 54,000 people have lost their jobs in the last year. Since 2 May, when Deputy Cowen became Taoiseach, more than 25,000 people have lost their jobs. That is nearly 600 for every working day he has been Taoiseach. Those people are entitled to know what the Government is going to do to get them back to work and secure their future — as well as the future of the many other people who are worried they will lose their jobs in the months ahead.

As I said yesterday, the Government, on the basis of the mid-year Exchequer returns, decided to bring forward a package totalling €440 million for the remainder of this year, which would have a full year impact of more than €1 billion, not €1.25 billion..

It is €1 billion, plus €440 million, minus €200 million.

No, that is not the position. Let us be clear. There is no need for any confusion.

All right, so tell us.

The €440 million package is the outcome of decisions made yesterday for the remainder of this year, which will have a full year, 2009, impact estimated by the Department of Finance of over €1 billion.

That is €1.44 billion.

No, it is not.

Between now and the end of the year——

(Interruptions.)

The Taoiseach should be allowed to finish. The question has been asked and should be answered.

We are talking about this financial year and next. The €440 million relates to this financial year. Next year it will have a full year effect of over €1 billion. That is the situation.

What about next year?

So €1 billion plus €440 million is not €1.44 billion.

(Interruptions.)

Deputy Burton cannot intervene at all.

Allow me to finish.

Get a blackboard and write it out.

The Deputy is completely out of order.

If that is going to be the level of debate here, we can forget about it. In the context of our mid-year Exchequer returns, we have made these decisions. This is our initial reaction to the situation. We are saying that in the context of the Estimates for 2009 further decisions may be required to make sure that we have a sustainable public finance position going forward. That would be determined by information as it emerges during the course of the year. It is necessary for the Government to do whatever is required to make sure we work within the Stability and Growth Pact principles that have been set out, which is the basis of our membership of the euro currency. We have seen a deterioration of €3 billion in our tax revenues this year. That means we must work within the spending limits we have set ourselves to underline confidence in ourselves going forward and to devise a strategy next year that will be sufficient to be sustainable going forward. That is the position.

I made it clear yesterday that this is a process by which the Government is tailoring its response in an effort to meet the requirements of the situation as it emerges. That is no suggestion of anything else to the contrary. It involves some efficiencies, administrative savings, the reallocation of existing allocations from some Departments to others, which now require more money because of the increased unemployment that was mentioned, and working within the overall spending limits we have set ourselves. That is what we are trying to do.

We are also examining the position for 2009. We are putting out the information as we have it on what we are trying to do. We are not suggesting that this process is nowfinito, that this is the end and that all Members can sit back until next February. We have to manage this serious situation, and we intend to do that. We intend to discharge our duties in government and bring to the attention of the House, as I have done, through the course of the debate on this issue today and tomorrow, whatever information Ministers are required to bring forward; that will be brought forward and detailed to the House. That is the way I want this to be, that is the way it should be and that is the way it will be. There is no question of anything to the contrary. We are bringing forward to the House the decisions that were made and finalised by Government at 2 p.m. yesterday, which were then announced and on which we will have a debate for two days. That is a fairer reflection of the Government’s intentions than what has been suggested from the benches opposite.

I am simply trying to get clarity on what exactly the Government has decided. I understand what the Taoiseach has said. Cuts of €440 million will be made between now and the end of 2008 and cuts of €1 billion, or €1.44 billion to be exact, will be made in 2009. From that figure will be taken €250 million for the payroll reduction which will leave cuts of €1.2 billion, the details of which we have not got. That is the first problem. We have some of the details, the decision on ministerial pay increases, a review of tribunal costs and various bits and pieces of information. Information has begun to be leaked about the postponement of the Fair Deal scheme and all of that, but we do not have the detail of where the €1.2 billion cuts will bite between now and the end of 2009. That is problem one and we need an answer to that.

Second, the Taoiseach has said that this process will be revisited a second time in 2009. Therefore, it is clear this morning that the round of €1.4 billion cuts is the opening shot and round two is to come in 2009 or perhaps in the context of the Estimates and budget. Where will the Taoiseach secure cuts of €1.2 billion, outside of the payroll reductions, between now and the end of 2009? They can only come from cutting jobs, services or increasing taxes or charges or whatever.

The Taoiseach also needs to tell us exactly what is in his mind for round two. Are the cuts of €1.4 billion announced yesterday simply the opening shot of a two or three phase round of cuts in services and expenditure that the Government has in mind over the course of the next 15 months?

It is clear that in regard to the remainder of this year we are involved in efficiency savings of €240 million, securing other savings in PR and consultancy expenditure of approximately €20 million and payroll savings of €10 million beginning this year. The remaining savings of €360 million will come from efficiency savings and deferred capital programmes. That accounts for the €440 million savings.

The cuts will be in capital costs — I knew it.

Yes, of course, capital will play a part. If the suggestion is that I should take the savings all from current spending, the Deputies are effectively suggesting that day to day savings should be even deeper.

What projects will be affected?

Will the Taoiseach tell us what projects will be affected?

These will be brought forward——

What schools will be affected?

It is not a question of schools being affected.

What is it a question of?

Allow me to speak and I will explain the position.

The Taoiseach will not tell us anything. He is as good as his predecessor in that respect.

Allow the Taoiseach to finish.

In regard to the OPW, we are talking about a figure of €75 million.

Various projects.

We want them listed on a sheet of paper.

A debate on this issue will take place in the House over two days during which everything will be laid out.

We want a list of the projects concerned.

If the Deputies want to have that debate in two minutes rather than during the nine hours they demanded, that is a bit unreasonable.

Give us a list of the projects.

Allow the Taoiseach to finish.

We will outline to the House in full all the issues making up the figure of €440 million. We have no problem doing that. That is the purpose of the debate from the Government's point of view. Any suggestion to the contrary by the Opposition is ridiculous. We will set out our position during the course of this debate. I have explained to the Deputies that the figure of €440 million includes €140 million in deferred capital expenditure, there is also €300 million on the current side, €240 million of which relates to efficiency savings, and there is another €60 million from other savings, administrative and otherwise.

The Taoiseach has now given us three different figures.

No, that is the €440 million, they are not different figures.

Deputy Gilmore has been trying to suggest that they are different figures, it is the same figure, €440 million, divided as I have outlined, and the Ministers will set this out in detail during the course of the debate.