Amendment No. 47 is related to amendment No. 1 and they will be discussed together.
Financial Emergency Measures in the Public Interest Bill 2009: Committee Stage.
NEW SECTION.
I move amendment No. 1:
In page 4, before section 1, to insert the following new section:
"1.—(1) This Act shall expire on the day that is 2 years from the date of its passing unless renewed by resolution of both Houses of the Oireachtas.
(2) Any such renewal shall be expressed to be for a period not exceeding 2 years.".
This amendment provides for a sunset clause for the levy which would be for two years' duration. If the Government of the day wished to renew it, it would have to be brought before both Houses of the Oireachtas.
As the Labour Party pointed out on Second Stage, the Bill is full of anomalies which the Minister for Finance, in his concluding speech last night, did not address. The Bill will apply to all Civil Service incomes, no matter how much or how little a civil servant earns. Civil servants on low incomes or who work part-time will be subject to the full rigour of the levy in the same way as the mandarins at the top, some of whom earn well in excess of €200,000 a year. Low-paid civil servants being subject to the levy is a critical issue of fairness.
Civil and public servants are realists. They understand the Government has landed the country into an appalling economic mess in which much of the prosperity for which we all worked hard to produce has been squandered. It has been frittered away by the Government in its handling of the banking crisis and, particularly, the Minister for Finance through his failure to address the corporate failures, scandals and abuses that occurred in Anglo Irish Bank.
At the end of September 2008, the Minister for Finance and the Taoiseach decided the taxpayer should rescue the bank when, in fact, they were aware of the goings-on in it from the day they took up their respective offices. I have no doubt that the former Taoiseach, Deputy Bertie Ahern, was more than fully aware of the goings-on in the bank, seeing that he was particularly wont to hang around with golden and privileged circles——
Will the Deputy repeat these allegations outside the House?
The Deputy is making serious allegations.
The Minister may wish to look at the newspaper records and listen to the recorded conversation when the then Taoiseach, Deputy Bertie Ahern, described the former chairman of the bank as his friend Seanie when they were on the same platform. It would inform the Minister of all he needs to know about the closeness of those circles.
Civil and public servants are realistic. They want to see the unfair pensions levy attaching to low-paid public servants addressed. They also want to see proportionality. They will be paying the levy, in part, to bail out the banks. They want to see action taken to deal with the wrongdoing in Anglo Irish Bank.
The Minister's invitation to say this outside the House is accepted. I have said it inside and outside the House on many occasions and will continue to do so until such time as the wrongs Anglo Irish Bank has inflicted on the Exchequer are addressed and the moneys recovered and restored to the taxpayer and public services. The Minister has a cheek to threaten me in that manner.
I did not threaten the Deputy.
I am not an easy person to threaten. If the Minister wants to threaten me to repeat what I said outside the House, I will do so any time he likes.
The Deputy made serious allegations about people who are not in the House.
I am not afraid. I took on the Minister's colleague, the late Liam Lawlor, for many years in Dublin West. I know all about Fianna Fáil and its threats. I am not intimidated by the Minister or the Minister of State, Deputy Peter Power.
The Deputy made serious allegations.
I have more experience of being threatened by Fianna Fáil than the Minister of State thinks. The Minister has some knowledge of the way the system operated in Dublin West; therefore, the Minister of State should not threaten me.
I ask Deputy Burton to confine her remarks to the two amendments. I ask her to desist from making other disparaging remarks about other Members. I also ask the other two Members to do the same.
I thank the Acting Chairman for his protection.
Public servants realise the country is in a hole and what caused the massive deterioration in the public finances. Despite the Minister's earlier promises to address the anomalies in the Bill, his amendments are purely technical in nature. The first anomaly is that low-paid public servants will have to pay the levy. The second serious anomaly is that the levy will be applied to all reckonable income, including income which is not reckonable for pension purposes. Public servants will pay the levy on all income, even though much of it may not be reckonable for pension purposes. In that sense, it is not really a pension levy but an income levy, an additional tax. The third anomaly which the Minister promised to review but did not address in his concluding speech on Second Stage is that a public servant earning €30,000 will actually pay more after tax than someone earning €50,000. The Minister brushed this aside by claiming it was a function of the way the tax bands operated and a matter addressed by taxation. That is not good enough.
There are serious issues concerning equity and how the levy is structured. One mechanism for addressing this would be through a sunset clause, whereby the Bill would be withdrawn after two years or, if the Government wished to reinstate it, it would be subject to a resolution of both Houses. As a parliamentary device, that would make sense because this is rushed legislation. As all Members are aware, rushed legislation is oftentimes bad legislation. I presume that some of the anomalies contained in the Bill inevitably will be subject to challenge, possibly in the courts.
It is important that there should be a mechanism for reviewing the legislation on a regular basis. Government Ministers, particularly those who represent Fianna Fáil, have referred in recent days to everyone working together. They even suggested — probably more so to Fine Gael rather than the Labour Party — the concept of a national Government. However, there continues to be an arrogance in the context of the intellectual response. There is a suggestion that the Opposition should not suggest any amendments because those in power are not listening. If we are serious with regard to everyone in the country working together, it must be remembered that those in opposition seek to be every bit as conscientious in respect of their patriotic duty as are those on the Government benches. However, it is very difficult to be patriotic when one is presented with Bills such as that before the House which contain profoundly unfair anomalies.
The fourth matter that arises in the context of the Bill relates to when, if ever, the pension levy will be removed. In an extraordinary interview on RTE radio this morning, the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Coughlan, spoke at great length about how, in her belief, our economic difficulties have largely been solved. That is what I heard the woman say. If that is so, why not include a sunset clause in the Bill? Last weekend's Sunday Independent contained another extraordinary and long interview with the Tánaiste. It is obvious that she is considering what the Government has done. In the interview to which I refer, the Tánaiste, when commenting on Government policy relating to the budget, stated: “The six-point differential was mad, the big psychology of it was that everybody went across the border to shop, which was a total disaster.” She further stated: “...for my own area, on the border, the VAT has been a nightmare.” Therefore, the second most senior officeholder in Government is basically saying that a key element of the Government’s budget strategy “was mad”.
It was mad.
Yes. When the budget was debated, we highlighted to the Minister for Finance that his proposal was crazy. The Minister rushed to increase the VAT rate by 0.5% and did not take any advice from those Members who informed him that it was not the wisest action to take. Among the Members to whom I refer was Deputy Morgan, who told the Minister at the time that shoppers — I do not know whether they were male or female — were fighting over trolleys in the car park of Sainsbury's in Newry. Anybody who has visited that store will know that one would not fight to get into or out of its car park.
It sounds as if the Deputy has some experience.
The Minister would not take advice from us on the matter at that time. We are now advising him that a sunset clause relating to the pension levy should be included in the Bill. I would be fairly confident in predicting that he will not be Minister for Finance in two years' time. He might, therefore, be glad to be in a position — probably from the Opposition benches — to revisit the levy. If the Minister is asking everyone in this country to put their shoulders to the wheel and work together, he must start from the principle of fairness.
Another reason to review the levy relates to the strategy — or what passes for one — which the Taoiseach put before the House and in which he has chosen to frontload support for the banks. That support includes the €7 billion that will be used to recapitalise Allied Irish Banks and Bank of Ireland and the untold amounts that will be required to pay for the nationalisation of Anglo Irish Bank. He has also chosen to impose the levy to which the Bill relates on public servants and to reduce the early childhood supplement. However, the Taoiseach has not chosen at any point to bring forward, as a priority, legislative measures which would close down the tax loopholes that are a continuing source of scandal to almost everyone in the PAYE sector.
Some of the best tax avoidance experts in the country, particularly those from PricewaterhouseCoopers, PwC — I must declare an interest here because I trained and worked with that firm — are members of the Commission on Taxation. I could write these people's recommendations on taxation now on the back of my copy of the Order Paper because I know that they will be. They will suggest that there should be more tax incentives, propose that there be headline closures of a few loopholes and put forward massive increases in all taxes relating to those on lower and middle incomes. The commission's report has already been written.
The Minister for Finance has offered no indication of the type of social solidarity he expects from the rich. Last week, the chairperson of the Revenue Commissioners disclosed to the Committee of Public Accounts that there are just over 5,000 people who classify themselves as tax exiles. These individuals are resident in the State but for tax purposes they are non-resident. Of those 5,000, some 440 are identified by the Revenue Commissioners as being high net worth individuals. These people have extremely large incomes and wealth and they reside in this country. However, they are not resident here for tax purposes.
The Bill before us is a financial measure and there is, therefore, plenty of scope to address the issues of social solidarity and the contribution extremely rich people will make in the difficult times that lie ahead. The Minister for Finance and the Taoiseach have consciously chosen to ignore these issues. If a sunset clause were included in the Bill, in two years' time we might know a little more about and be able to discuss what Fianna Fáil proposes to do to close down the tax shelters and loopholes which it has specialised in establishing since 2000 in particular. Until 2000, the Government was relatively moderate in its approach to tax shelters. After that date, it lost the run of itself with regard to such shelters. The consequence of this has been the introduction of massive imbalances in the context of those who pay tax in this country.
On each occasion on which this matter is raised, the Minister for Finance states: "Ah, but high income tax payers pay the most tax." As he is well aware, however, the high income earners to which the statistics he quotes refer are composed mainly of senior public servants who are married to other senior public service workers. Those people are in the PAYE system and all of their income is fully recorded. On the whole, there is no evidence that they make any significant use of tax shelters.
What is the position with regard to establishing a social solidarity pact under which those who are extremely well off pay tax? Poorly paid public servants will be expected to pay, on average, a pension levy contribution of 5% after tax, while their better paid counterparts will pay approximately 7%. However, there has been nothing but silence from Fianna Fáil as to the contribution the rich will be expected to make. I refer here to the kind of people who have served as directors of Anglo Irish Bank and other financial institutions. The directors of our major banks have, on average, earned well in excess of €1 million per year in the recent past.
The current issue of Business and Finance contains an article which the Minister for Finance and his officials ought to read. It discusses the fact that many senior banking executives became players in property development and investment. Not only did they receive high salaries but they used them to trigger borrowing from their own banks and counter-party banks in the Irish system. Apparently, these banking executives became participants in a number of property development deals and availed of the tax advantages from which a number of them were structured to benefit. This is a very serious issue because it means that by the time the banks were rescued, the individuals in question had a vested interest both in their respective banks and the property deals in which many of the banks’ customers were engaged. They had moved from being bankers to players in the development system. Only time will tell us how much this practice contributed to the damage and destruction experienced in the banking system, particularly Anglo Irish Bank. The Minister is silent on the abuses which have led the country to its current position.
In his amendments the Minister seems most unwilling to address the anomalies all speakers have raised. The proposed sunset clause would enable us to address some of the anomalies in two years and ascertain whether the pension levy will be permanent. If that is the case, the levy will not be funded in that the moneys raised will not be allocated to a fund earmarked or hypothecated to finance future public service pensions. Instead, they will be allocated to the Exchequer on a current basis, with the result that when we return to prosperity in a few years public servants will have no identifiable claims arising from their contributions to the levy to have their future pensions paid.
The Bill and the manner in which the Minister has approached its structure are appalling. My party leader, Deputy Gilmore, indicated we were entering an uncertain period of industrial strife and strikes. Part of the reason for this is the refusal of the Government to address the fundamental issues of fairness and equity. While I do not know if it intends to return to consultation with the social partners, it must address equity issues if it proposes to do so. The Taoiseach, having invested considerable time in negotiating with the social partners, placed the pension levy on the table at the 11th hour. The levy is so complicated that it must have been worked on for weeks beforehand in the Department of Finance and other Departments. I note that last night the Minister profusely thanked a range of public bodies for the work they had clearly been doing on the issue for some time. Why was he not prepared to discuss with the social partners the anomalies in the levy which their members find pressing?
It remains unclear when the levy will commence and whether the public service will be in a position to implement it, given the anomalies in the structure. How will the amount of pay on which it is based be calculated? How will local authorities, vocational education committees and so forth administer it? County council workers, for example, pay full PRSI and a complex formula is used to calculate their pension contribution as they only receive a small additional pension. Furthermore, many adult education teachers employed by the VECs work on non-pensionable contracts but pay PRSI. This means they do not have pension entitlements because they work on a contract basis in special teaching services. Will these employees be subject to the levy and, if so, will all their income be affected? Will all allowances and overtime payments be included? The levy is fraught with anomalies. If the Minister is considering talks with public service unions and seeks to avoid strikes, it would be clever if he were to provide a mechanism for negotiation in order that the anomalies can be addressed.
Other Members are offering to speak. While I am aware that Deputies may speak for as long as they wish on Committee Stage, I am conscious that proceedings will be suspended at 1.30 p.m.
As amendment No. 47 in my name is in the same vein as amendment No. 1, the amendments have been grouped together for the purposes of debate. For this reason, I beg the Acting Chairman's indulgence to allow me to address my amendment which I will not have an opportunity to discuss later in the debate.
It would be appropriate to include a sunset clause in the Bill because the proposals effectively amount to a tax masquerading as a pension levy. No one would pretend that this is a pension levy in any true meaning of the word. The funds raised will not be placed in a pension fund to provide for future pensions and will not be related to the pension benefit which different public servants derive from the public service pension. The Minister provided some detail showing the substantial pension benefits some people enjoy. The actuarial value of the pension of an assistant secretary or Secretary General, for example, is probably between 40% and 50%, whereas the actuarial value of the pension of a public servant earning a relatively low income is comparatively small in percentage terms. If, under the proposed levy, a contribution was sought which was genuinely related to the benefit the employee stood to receive in later life, it would be structured in an entirely different manner. In addition, people would be able to understand the system and would expect it to be funded and we would move towards a different approach to the treatment of pensions in the public service. That is not the case, however, because this levy is simply a tax.
It is important to realise, as Members on both sides have stated, that the structure of the proposed levy is unfair. It is worth examining the different structure adopted for the levy compared to other elements of the tax code. Those earning less than €18,300 per annum are exempted from paying the income levy — the "Lenihan levy" — whereas this same group will pay 3% under the proposed pension levy. Under the Lenihan levy, the 2% deduction of income does not apply until earnings exceed €100,000 and the 3% deduction is not levied until income exceeds €250,000.
The Minister, when he had time to contemplate what was equitable in imposing the levy, took a view that the income levy should be steeply progressive, with those on high incomes paying three times the rate of those on low incomes. Those on very low incomes were not required to pay anything under the levy. After some mature reflection on his initial proposal, the Minister changed the structure.
The manner in which the burden is spread in the proposed pension levy is an indication of the Government's thinking on fairness. The pension levy has an entirely different structure from that of the income levy, with those earning the minimum wage and less facing a net charge of 3%, while those earning €300,000 per annum face a 5% net charge, rather than three, four or five times the rate facing the lowest income earners. No one would argue that this tax structure is proportionate to the benefit people will derive from their pension, their ability to pay or the family burdens they may have to bear. Like me, the Minister and the Acting Chairman will have encountered harrowing cases of people experiencing major pressures arising from mortgages and family obligations. They are struggling hard to make ends meet, and this is tipping them over the edge.
The proposal has not been structured in a way that considers ability to pay, responsibilities carried, or benefits derived, and it does not contribute to the long-term health of pensions. We know this is an attempt to reduce the cost of the public service. We should be honest with ourselves in this regard. I do not believe it is a fair way of reducing the cost of the public service. If the Government wanted to reduce the public service pay bill it would not structure it in this way — it would not be looking to penalise those at the very bottom.
The argument I am making is that it is not a fair, balanced, proportionate and long-term measure. The Government should recognise that it is a temporary measure. Many people on this side of the House and outside the House do not feel it is fairly structured. The Government seems determined to push ahead nevertheless and is not likely to entertain any amendments in the course of the debate. Thus, at the very minimum the Minister needs to accept this amendment so that we can revisit this issue at a time when the economy, it is to be hoped, is in a stronger position, and we can recognise that all the anomalies and unfair aspects of the proposal should be changed. I am not happy about the fact that the Government has turned its face against attempts to tweak the proposal to make it fairer. I do not expect some of the amendments I have tabled for later in the Bill to be entertained, but this is one that should be entertained and I hope the Minister will support it.
These two amendments from Deputies Burton and Bruton are probably the most important on this Stage. The Bill is entitled the Financial Emergency Measures in the Public Interest Bill. Anybody reading that Title would be led to believe there should be a sunset clause. There are in-built contradictions in the Title, but it gives the impression that what is intended is a measure introduced on an emergency basis, which would be terminated after a short period.
The Taoiseach said today in the House he believed the social partnership should be the basis for moving forward, and he indicated that once he got this Bill out of the way everything would be on the table in terms of opening up talks once again with the social partners. We know the previous discussions had gone to the eleventh hour when all of a sudden the Taoiseach and the Minister pulled this rabbit out of a hat and put it on the table without any opportunity for response.
There has been no proper consultation on this proposal and no opportunity to examine the anomalies, including those which have been raised and detailed in this House. It is an unfair Bill in the category of worker that it targets and in the crudeness of its divisions — 3%, 6% and 10% — and their application. People on and below the minimum wage and those on family support will be targeted by this legislation as much as people who are earning vast sums of money.
There is also a provocative element in this legislation in that it pits worker against worker, because the public sector alone is targeted. That is seen as another unfair aspect of the legislation, and it clearly needs to be addressed in the context of social partnership. Unless there is a sunset clause, the social partnership process cannot examine it. The Minister is making it impossible for it to be put on the table for discussion in a meaningful fashion.
In that context, what will happen next year when there is a target of €4 billion? Will it be this levy, which amounts to €2 billion for 2009, plus the €4 billion targeted for 2010? Will it be cumulative if we do not withdraw this legislation or put a sunset clause into it? Does it mean the public sector will have to bear the levy along with another levy that will cut across the board, applying to other workers also? I ask the Minister to clarify whether there is a cumulative aspect to the proposal.
Another issue that has been brought to the Minister's attention a number of times in the House and which was raised again by Deputy Burton earlier is that of tax exiles. How can the Minister impose a levy of this nature on public sector workers, who have in no way been responsible for the mess we are in, and not propose any measure to tax those people who do not pay a penny of tax — who get off scot free? I am talking about the Bonos, the J. P. McManuses, and all the other fine philanthropists, either domestic or global, who jet into this country, do not pay a penny of tax here, and wrap the flag around themselves in presenting themselves as good Irishmen. Yet all they do is to provide, on a sort of charity basis, a contribution here and there. They do not do their civic duty. It is time to target them. The 120,000 people who marched last week want to see those people targeted. They want to see the tax loopholes dealt with and the tax exiles pay their share. Ensuring that happens is the Minister's job and his responsibility, not just his entitlement.
The intent of this Bill is to ensure the Exchequer gets adequate funds to keep the country moving, although it is not being done in a fair or equitable fashion. However, if the Minister does not put pressure on the existing financial institutions to lend out the necessary funds to maintain cashflow for small and medium-sized enterprises, what will happen? What is the purpose of going through this exercise if the banks are not providing for the lifeblood of the economy? We have nationalised Anglo Irish Bank and the Government is putting €7 billion into the other two banks, yet they are still refusing to give out loans.
The latest survey on small and medium-sized businesses showed that around 48% of businesses, down slightly from 54%, were in desperate need of regular cashflow. What is the Minister doing to ensure this is obtained? It is one thing to take cash from the public sector and put it into the Exchequer, but persuading the financial institutions, which are being funded to an enormous degree by the taxpayer, to provide the funding to keep the small and medium-sized sector — the lifeblood of the economy — going and prevent unemployment should be his priority. This is relevant in the context of the legislation.
There is one sector, the Judiciary, that we cannot touch because of a constitutional impediment. Its members cannot be obliged to pay this so-called pension levy even though they have public sector pensions. Has the Minister had any talks with them with a view to inviting them to join on a voluntary basis? They are some of the most highly paid people in the country.
If he has not yet invited them, perhaps he might consider doing so.
I strongly support the amendment tabled by the Labour Party. It is essential that we provide for a sunset clause in this Bill. I do not believe for one moment this is a pension levy. If it were a pension levy it would be paid into a pension fund, but the money is going into a black hole. I fully understand, therefore, why public anger is such that 120,000 people took to the streets of this city last Saturday afternoon. I believe public servants will march in ever greater numbers and we will face industrial strife and strikes. It is most unfortunate that the Government has brought us to this situation by forcing the social partners to go their separate ways.
I cannot see any fairness in this levy. It is grossly unfair that a worker who earns €22,000 per annum will be made to pay a levy for which he or she will get no benefit whatsoever. A worker who earns €35,000 per annum will pay a levy of 6% whereas his or her boss pays a levy of only 5% despite earning €350,000. Will the Minister address that anomaly? Public servants such as the chief executive officers of several State agencies earn in excess of €350,000. People earning €35,000, which is barely the average industrial wage, will pay more in tax than the CEO of the ESB, who earns more than €500,000 per annum, or the head of Coillte, who earns more than €414,000. The fundamentally unjust nature of this measure is a reasonable explanation for the numbers who marched on the streets of this city last Saturday.
I too heard the "Morning Ireland" interview with the Tánaiste to which Deputy Burton referred. The Tánaiste was satisfied that the public finances are under control but if that is the case, why do we need this pension levy and why are we debating this Bill? We have a range of means at our disposal for dealing with what we all recognise is an economic crisis created by the Government, bankers and speculators. Why is the Government not choosing reasonable options rather than attacking those on lower incomes? Standardising tax relief, for example, would provide €1 billion. That would almost reach our target in one hero's leap. The budget made some progress on the PRSI ceiling but it did not go far enough.
Certain Government Members are speaking about the need for consensus but what they really mean is that the Opposition should stay quiet. The Minister is shaking his head, but many of his colleagues have accused us of destabilising the market and scaring off international investors by calling it as it is.
You are a long way from Government yet.
His colleagues demanded that we stay quiet. Efforts are being made to hush Members on this side of the House rather than allow us to address the issues. Unfortunately, that is what obtained for far too long in respect of banking institutions and that is why we are in this predicament. Members on this side of the House are willing to engage constructively with the Government in the national interest. The talk about the green jersey does not impress me, however, because it brings to mind the analogy of the Taoiseach and Minister for Finance togging out for Ireland in the coming rugby match against England. Their efforts on the field in Croke Park would probably match their futile attempts to run the economy.
I hope the Minister accepts this amendment because doing so would represent a gesture not only to public service workers but also to the trade union leadership that the Government is beginning to open the door to negotiations and agreement in order to quell the industrial unrest which will undoubtedly cause havoc otherwise.
If the Minister were to agree to a sunset clause, he would go a long way in assuaging the feeling that currently exists among public servants that they have been unfairly singled out by a punitive measure. A sunset clause would at least allow people to understand that normality will return after this period of financial crisis.
The Government probably underestimates the damage that has been done by the campaign waged against the conditions of public servants. I am sure the Minister, along with every other Deputy in this House, has received a storm of e-mails from public servants in reaction to this measure. Many of these correspondents took the time to explain their personal circumstances and outline their disposable incomes. An almost invariable theme running through these e-mails is that the levy is not fair, followed by which reference is made to people who are getting off scot free. As last Saturday's march demonstrated in an extraordinary fashion, these attitudes are now deeply held by public servants and their families.
If the Minister were to announce an intention to terminate this measure when this period of financial emergency ends, that would go some way towards repairing the damage that has been done. The campaign has been quite vitriolic in some areas but that is not true of the great preponderance of civil and public servants who are low paid. Contrary to the public propaganda, these people are contributing 6.5% of their salaries to their pensions and they feel very aggrieved about the way they are being denigrated in the public arena. The real divide in this society ought not lie between public and private workers but between high and low earners.
It would be welcome if the Minister felt able to take on board these two amendments, or whichever he considers the more appropriate. The amendment in the name of Deputy Burton on behalf of the Labour Party provides an opportunity for the legislation to be reviewed at the end of two years, which is sensible and reasonable.
Deputy Costello drew attention to the name of the Bill which explains this is a crisis measure. If this is a crisis measure, surely the Government is not positing the case that we will be in crisis forever. If it believes we will come through this crisis, then there is a finite period involved. If that is the case, why then can we not provide that at the end of this finite period this measure will fall?
I was struck yesterday to hear the Minister of State, Deputy Mansergh, state that this income levy is about clawing back benchmarking. If that is the purpose of this measure, the situation is entirely different. If it were a pension levy that was being paid into a type of national pension fund and so on, one could argue about it. Clearly, the pensions issue is an issue that is coming down the tracks at us and is one we need to address. However, nobody, including the Minister, has claimed this is about pensions. It is about savings in public expenditure. It is an income levy and a cut in pay. It is a pay cut and not a levy towards one's pension. Given that is the situation and this is a financial emergency measure, why can we not agree to its termination after a fixed period? This would give hope to people who are currently demoralised and fearful of the future. We are in a serious, although it is hoped, temporary, crisis following which normality will return.
Personally, I would have preferred to go down the road of a progressive increase in taxation. I believe this would not have stirred anything like the antipathy stirred in the heart of the public service that is leading, as Deputy Gilmore said, to a wave of industrial unrest with which the Government will have to cope. I tend to agree with the Taoiseach that industrial unrest will not, in current circumstances, contribute to a resolution of the situation in which we find ourselves. What public servants had to say in the storm of e-mails sent to Members is that they will pay their share provided other interests in society pay their share. That is not the current perception of the situation. It appears the Minister has set his face against a revamp of the budget given the figures now available to him.
I am not quite sure what the Taoiseach meant when he said some tweaking could be anticipated. Glancing through the amendments, it is not readily apparent to me what tweaking is taking place. It is agreed on all sides of the House that there are internal inconsistencies in the measure as it stands, not least for reasons of the tax claw-back and so on. I am not sure that I can see what tweaking the Taoiseach is facilitating or what he meant by that statement at the time.
There is a further reason the Minister should rethink his position on this amendment. We are making the presumption that the Minister will oppose this amendment while not knowing if that is the case. There is an extraordinary settled acrimony on the other side of the House which seems to be the resolution of a man who has made up his mind.
There is an additional reason this amendment should be accepted. A number of amendments tabled by my colleague, Deputy Burton, have been ruled out of order. Resort has been had to the ancient rule in this House that an amendment which imposes a cost on the Exchequer may not be discussed, which is intriguing in this case because the cost will not be imposed until the Bill has been enacted. I am not sure how it can be argued that Deputy Burton is diminishing revenues to the Exchequer. It is a pity the Labour Party amendments have been ruled out of order because some of them would address the manifest inequalities in the measure as it stands. I believe this is punitive on people with modest incomes. An amendment in the names of Deputies Burton and Bruton — it would be better for all if one of the Deputies had a different surname — which provides that an €18,000 threshold ought to apply would provide minimal relief. I regret the amendments submitted on behalf of the Labour Party in this area have been ruled out of order.
I am glad the Minister of State, Deputy Peter Power, is in the House to provide backup for the Minister. It is remarkable how little backup he is getting from his backbenchers. I am fortunate to have a colleague in my constituency whose response to the e-mails in regard to the pension levy is to tell people he agrees with them. The implication is that when Hardy comes to Hardy he will man the bhearna bhaoil and vote with those of us who believe it is unfair. However, I would not hold my breath. That is what the Deputy concerned is saying in reply to the e-mails, which are a curse if one pushes the wrong button as they are sent around the House generally rather than to the person designed to receive them.
That may not be an accident.
Members must be receiving thousands of e-mails from me.
Given that so many of the amendments, which are designed to make this measure fairer, have been ruled out of order, I ask that the Minister rethink his position on this one. I cannot anticipate an argument for saying this is a permanent measure unless the Government has rethought the merits of the approach of the former Taoiseach, Deputy Bertie Ahern, when he designed a benchmarking process, the basis of the calculations for which none of us can obtain from the archives as the material was destroyed contemporaneously with the publication of the results. If this measure is not a claw-back of benchmarking as suggested by the Minister of State, Deputy Mansergh, then what is it? Is it that the Minister believes the international audience will be impressed, admittedly at a time when we badly need to impress them, by the toughness of the decisions taken by the Irish Government or is it an economic measure designed to drive down wages in the economy generally? In fairness to public servants, neither of those arguments has been advanced as justification for this measure. I believe there are a great many public servants already in financial distress and paying the 1% levy who will expect from today's debate some alleviation of the position as it relates to people on modest incomes.
Progress reported; Committee to sit again.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.