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Seanad Éireann debate -
Thursday, 19 Mar 1992

Vol. 131 No. 18

Appropriation Act, 1991: Motion (Resumed).

Debate resumed on the following motion:
That Seanad Éireann notes the supply services and purposes to which sums have been appropriated in the Appropriation Act, 1991.
—(Senator Hussey).

Last week before the debate was adjourned I was dealing with the issue of unemployment and job creation. Since then unemployment has continued to escalate, with the announcement this morning of 600 further job losses in the United Meat Packers Company and possibly another 600 part time job losses. That is particularly devastating at this time of year as the killing season starts, especially in the lamb trade. Yesterday the announcement was made of the loss of 135 jobs from Express Couriers Limited and a decision was made by Dublin Port and Docks Board to liquidate their subsidiary company Dublin Cargo Handling, with the expected loss of 220 jobs. The board will go to the High Court tomorrow to seek liquidation of the company. Allied Irish Banks suspended a further 100 staff yesterday, bringing to 884 the total number suspended in the two weeks since the industrial action began, with 26 AIB branches closed. Therefore, the situation is deteriorating very quickly.

At the same time, the Taoiseach announced the setting up of a job forum at the Ard Fheis, but that proposal seems to be grinding to a halt also. I have no doubt that the number unemployed has risen from 278,000 to 280,000 this week alone. I am certainly looking forward with trepidation to the next announcement of the live register of unemployed which, I have no doubt, will show that the number unemployed is heading towards 300,000. The tragedy of all this is that we have a booming economy. GNP growth rate averages 5 per cent, with an exceptionally high export market and a trade surplus in excess of £2 billion. The country is booming in economic and financial terms but in human terms it is losing, it is deteriorating and people are becoming demoralised. That is the terrible tragedy, the terrible anomaly and the terrible contradiction.

To briefly recap on comments I made previously, we now have 20.8 per cent of the workforce unemployed, double the unemployment average of the rest of the European Community. We now have more long term unemployed than the total number on the live register in 1980. Those statistics, 8.8 per cent long term unemployed compared to 8.1 per cent total unemployment in 1980, make very sad reading because it is almost impossible for the long term unemployed to get meaningful permanent employment. We are virtually writing those people off from a decent livelihood for the rest of their lives.

While the climate is right for job creation and capital investment and while we have a tremendously skilled and educated workforce, good growth, high exports and high profits, nevertheless, we have a depressed labour market. Nowhere is the labour market more depressed than in the nation's capital, Dublin, where, with one-third of the population, we have only about one quarter of the workforce and where the labour market has been deteriorating over the years. Whether that is due to Government policy, to the IDA locating advance factories to try to attract multinational investment outside the capital or whether there are other reasons I am not sure, but the capital city is certainly the black spot of the nation. In inner city areas unemployment levels are extremely high, with 41.73 per cent unemployed in the six unemployment exchanges. This crisis has not been addressed in any policy advanced by the Government. In fact, the Government's only job retention policy seems to be a laissez faire one. In other words, to call in the Examiner then bring in the Receiver and make promises that jobs will be retained. Jobs are not retained because once the Receiver is appointed the assets are sold off, the company is broken up and sold off to the highest bidder, and no priority is given to jobs. It is in that regard that I strongly criticise the Government. It is ironic that at a time when there is a call for a jobs forum on the creation of jobs the only approach on the retention of jobs is a laissez faire one.

In regard to the Secret Service allocation, to coin a phrase, it is hard to know what the Secret Service does in Ireland. As was once asked, is it a contradiction in terms to have an Irish Secret Service and British Intelligence? It is difficult to imagine either of them in operation to any great degree. What does the Irish Secret Service do with the £170,000 it receives? It would be interesting to know whether that is a secret, too. I should like the Minister to give us some indication as to how the money is spent and as to what are the matters of enormous national importance that require a Secret Service fund. What secrets of this nation are being protected?

On the salaries and expenses at the Office of the Attorney General, what has the Attorney General done in regard to the Nicky Kelly case which he has been considering for the past five months? He seems to be very slow in making up his mind on certain matters and very hasty on other issues. It is equally important to exonerate as quickly as possible the good name of somebody who was convicted, served a prison sentence and went on hunger strike as it is to take out an injunction against a 14-year-old girl. Does the Attorney General need five months to deliberate and put together a report on the pardon of Nicky Kelly for the Government? When does he intend to do something about that?

Under the heading of salaries and expenses at the Office of the Ombudsman, a substantial amount, £876,000, is included for "supply grants". The Office of the Ombudsman is very important and I am delighted it was established, in 1980. One area specifically exempted from the overview of the Ombudsman was the prison service. No prisoner can lodge a complaint with the Ombudsman in relation to any circumstances of his or her detention. When an ombudsman was being appointed as a watchdog for the public in Scandinavian countries, where the idea originated, a major function of that office was to ensure that those in custody had a voice in the outside world to lodge complaints about their detention. To my knowledge, Ireland's is the only country ombudsman that specifically exempts the Department of Justice from its provisions. The terms of the legislation should be extended to include what would be quite normal in any other jurisdiction in the western world.

Under the Estimate for the prison service in excess of £82 million is scheduled to be spent. To my mind, that money is very badly spent. Yesterday morning we read that a young man had died in prison custody on St. Patrick's night. That young man had not been convicted of any offence. Very poor value for money is obtained in the prison service and it is provided at a very high cost. The prison service is not very cost-effective. It does very little in positive terms for those who pass through the system but it seems to do a good deal in negative terms, in damaging somebody. The money is being spent and the taxpayer is being asked for more and more money for the prison service, year in and year out, yet none of the reports commissioned to rationalise and streamline the system are being put in operation. We have been seeking the implementation of the recommendations in the Whitaker report and I have before the House a Bill which provides that sentences of imprisonment shall be imposed only in certain circumstances. It suggests, alternatives to imprisonment, the establishment of a criminal law reform commission to make provision for the rights and living conditions of prisoners; the setting up of a sentence review committee; the fixing of the standard remission at one third and so on. Those measures would improve the efficiency of the prison service. They are included in the report of the Government-established commission of inquiry set up in 1984 and who reported in 1985. That report has been gathering dust on the shelves ever since.

The money is spent, but it is being inefficiently used. Why can we not implement the recommendations that would reduce the cost of the service and improve efficiency? Why has the report on prison suicides, commissioned by the Government as a result of pressure and issued in August last not been implemented? There has been another prison suicide. Seventy per cent of those who have died in prison since 1975 were under the age of 25 — the young man in the most recent case was 19 years old — 74 per cent died by hanging from prison bars in antiquated prison cells. Although it is recommended that specially designed windows be used so that there should be no access to window bars — that recommendation has not been implemented. Sixty-one per cent of those who died, died between the hours of 8 p.m. and 8 a.m. and 35 per cent were on remand. All who died fell into the category of young unconvicted prisoners incarcerated in antiquated prisons where no steps had been taken to implement the recommendations of the report of the advisory group on prisons. The Government are negligent. Lives are being lost, a prison sentence becomes a death sentence.

Let me give you an idea of a day in the life of a prisoner. The prisoner rises between 8 a.m. and 9 a.m., the cell is tidied and the prisoner slops out. There are two prisoners to each cell and 28 cells on each corridor of Mountjoy. Approximately 56 people on each corridor have to slop out into the toilet at the end of the corridor, one after another. They must clean the chamber pot in the wash-hand basin in which they also wash their face and brush their teeth. They then go back to their cells. That takes until 9 a.m. They have breakfast in their cells from 9 a.m. to 10 a.m. as no meals are eaten outside the cells. From 10 a.m. to 12 midday, they are realeased for work, if there is work; generally there is no work.

From noon to 2 p.m. is lunch time. They pick up their lunch one after the other and whoever is last gets a cold lunch. They go back to their cells until 2 p.m. From 2 p.m. until 4 p.m. they are again released for work, however there is generally no work. From 4 p.m. to 5.30 p.m. they have tea. They collect it and eat it in their cells. From 5.30 p.m. to 7 p.m. is recreation time. At 7.30 p.m. they are locked up and lights out at 10 p.m. That is a day in the life of a prisoner. It is a meaningless, routine, regime that is mindboggling. Prisoners spend 16 hours a day in a cell, there is nothing positive about that. I want to point out the inefficiency of the system and the waste of so much money. We need to look at the totality of our courts, our prisons and our Judiciary. Over £400 million of taxpayers money is being spent administering justice under the Appropriations Act.

I will now deal with education. There have been a very large cutbacks in education nevertheless the Department will spend more than £1 billion. Despite that large sum of money the percentage spent on education in Europe is much greater. We have the largest class sizes and the lowest per capita spending on education of any EC country. We are the only EC country that does not have a professional training or a national in-service training system in place. The cutbacks in the Programme for Economic and Social Progress have resulted in a reduced level of remedial education. We have reduced the career guidance and counselling services in our schools. We had intended to make progress in that area but due to cutbacks, are left without a counselling or remedial service. The high pupil-teacher ratio has not altered and as I said, it is the highest in Europe. A very large number of our schools are dilapidated and some schools are unhealthy to work in. The Minister knows that a tremendous amount of work needs to be done and a lot of money needs to be spent on primary and second level schools. Because of the drop in numbers attending primary schools, which will result in a drop in demand for second level places, virtually no new schools are being built. I cannot see why that money cannot be diverted to refurbishing dilapidated and unsuitable school accommodation.

It is incredible that there are virtually no clerical or caretaker staff employed in our schools. There is no State funding to employ either a secretary or caretaker in the voluntary secondary sector. Can you imagine any private sector operation, dealing with 300 to 1,000 children and 20 to 100 teachers, that could operate without basic infrastructural administrative services? Most schools do not have clerical support staff, secretaries or caretakers and the proposals in the Programme for Economic and Social Progress to remedy some element of that this year have now been dropped. That is a scandal. I read in today's newspapers that the vocational education committee sector will campaign very strongly against the lack of support systems in education.

The sum of £1.5 million is being provided this year for professional development or in-service training. The OECD was commissioned two years ago by the Minister for Education to examine in-service training in this country. They castigated the lack of any national, in-service training structure, and highlighted the ad hoc type of in-service training arrangements at primary and second level which were out of line with educational development elsewhere in Europe. That is one of the scandals of our system. As a result the CHL report carefully examined the needs of the teaching profession. It demonstrated clearly that we have an aging teaching profession. A teacher spends roughly 40 years in school yet there is no provision to take a single break. Children are becoming more demanding but the teachers are getting older. That is very unsatisfactory on educational, not to mention humanitarian grounds. The levels of stress are increasing. Curricular changes take place all of the time, the children are more demanding as they face the pressure of the points system, yet there is no professional development for teachers.

The Green Paper has not appeared so far. It was agreed in the Programme for Economic and Social Progress that it would appear in spring 1991, the White Paper would follow in the autumn and the legislation would come before the Dáil and Seanad by December 1991. We have no idea when the Green Paper will appear. My view is that the Government have decided not to go ahead with this. They seem to have reneged on this commitment. We are more than a year behind schedule. Are they afraid to come out with a discussion document on Irish education? The Green Paper is long overdue, it was covered in the Programme for Economic and Social Progress, but promises were broken in other areas. Is this commitment also going to be broken by the Government? The Dublin Institute of Technology Bill and the Regional Technical Colleges Bill have fallen by the wayside. There is not a word about them or when they will be introduced again.

Education is being put on the back boiler, yet the proposals to reform education are long overdue — as I said before in this House, I am sick and tired of seeing legislation from the Department of Justice but I never see legislation from the Department of Education. One-third of our population, almost one million people, is involved in education as students, not to mention the 40,000 teachers and yet we have not seen either a discussion paper nor legislation on education before the House. We need to make provision for pre-school education, nursery schools, for those in the two to four years age group. We have a constitutional requirement to provide education. We provide primary education but not pre-primary education and, as we all know, that is a very important period in the life of a child. That matter will have to be addressed by the Government and the Department of Education.

The previous Minister for Education made one substantial announcement, that he was proceeding with — and it is about the only thing the Department of Education has proceeded with — means testing for ESF grants. He has put in place the taxing of European money by the Department of Education so that all students going to third level, who would usually receive grants from the European Social Fund, will now be means tested. A promise has been made to review this decision somewhere down the line but the cart had been put before the horse. An inadequately funded or grant-aided system should not be changed until such time as it has been reviewed. I urge the Minister to carry out a review before he stops the funding.

It is unconstitutional of the Government to tax people or take money that has come through for training young people. I do not think they have any choice in this matter. If the City of Dublin vocational education committee or some other vocational education committee college do not take up the case some person who will be affected by the Governments decision may take up the matter because they seem to be in breach of European regulations. We need a general review of third level funding.

The final matter I wish to refer to, which concerns the Department of the Environment, is the scandal of the lack of housing that has grown to crisis proportions.

At present Dublin Corporation are constructing less than 100 houses per annum while we have approximately 1,000 homeless people, 7,000 on the transfer list and 3,000 awaiting allocation. Many people are disadvantaged because of lack of accommodation. The local authority are obliged to provide for those on low incomes or no means, or who are homeless, and they are not in a position to do so. Until 1988, the entire capital funding was provided by the Exchequer but that has stopped. Now 60 per cent must come from the local authority arising out of sales receipts from the selling off of their houses. Their best houses are being sold off with the result that no rents are coming in. The number of people on the housing list is increasing.

The squeeze will be much greater. We will have far more people seeking houses while the local authority have no facilities to help them. Due to a lack of funds maintenance and refurbishment is almost at a standstill. Government grants to local authorities have almost disappeared. Dublin Corporation receive 60,000 complaints per annum in regard to maintenance and most of them cannot be addressed. I was in flats in Mary Aikenhead House, which is 58 years old and I noticed that windows have not been replaced since the flats were built. These windows were rotten. The local authority cannot repair or replace them because they do not have the money. The response of central Government has been simply to cut off funding, to renege on their responsibilities, allow the old housing stock to be sold off and not replace it.

In years to come there will be a housing crisis and we will be back to the street demonstrations of the sixties.

The following statistics give an indication of how bad the situation has become. In 1981 the capital allocation from the Exchequer was £52.5 million which enabled 1,449 houses to be built. In 1982 the capital allocation increased to £76 million and 1,351 houses were built. In 1983 the capital allocation was £70 million and 1,665 houses and 88 flats were built. In 1984 the capital allocation was £60.5 million and 1,431 houses and 286 flats were built. In 1985 the capital allocation was £57.2 million and 1,111 houses and 247 flats were built. In 1986 the capital allocation was £41.6 million and 892 houses and 122 flats were built. In 1987 the reduced allocation of £18.7 million allowed for the building of 332 houses and 122 flats. In 1988 the capital allocation was reduced still further from £18.7 million to £2.75 million when 107 houses and 41 flats were built. In 1989 — incredible though it might seem — the capital allocation was reduced to £1.13 million for the City of Dublin, with a population of one million people. In that year neither a house nor a flat was completed. In 1990 the capital allocation of £2.81 million was made up of internal receipts from the sale of the corporation's houses and produced 25 houses. Last year the number of houses built was 90, this year the number will again be less than 100.

With that type of funding the problem is not just serious, it is critical. The allocation to the Department of the Environment is considerable, over £604 million, and priority is not given to the areas of greatest need. Local authorities, not just the Dublin authorities are starved of Exchequer funding and that should be addressed as a priority.

As Eamon Dunphy might say, "it was not a great year". I would like to see greater focusing on priorities. Projects should be more cost effective. Our prison service, and our education system should be put on a par with our European competitors. We should ensure that consideration is shown for those who do not have a roof over their heads.

Time permitting, I will endeavour to respond to as many points as possible raised in this debate.

Is the Minister of State concluding?

The Minister is not concluding. He has the right to speak at any stage, if he wishes and has now indicated his wish to speak.

On a point of order, I assume that this will not be a type of conclusive comment on the part of the Minister of State in the sense of our being able to raise further points. I have four or five technical points on which I would welcome a reply by the Minister of State. I presume he will reply again at a later stage.

Acting Chairman

My understanding is that the Minister is not now concluding but has indicated that he wishes to speak at this juncture and will continue at a later date.

At the outset, may I say that I feel honoured to have the opportunity to address this House today. I am delighted to be deputising for my Government colleague, the Minister for Finance, Deputy B. Ahern, who would have wished to be here.

As has come to be expected from the Seanad, the debate on the annual Appropriation Act, both before Christmas and as recently resumed, once again has proved to be a constructive, enlightening one, allowing for a wide ranging discussion on Government policy. Once again Senators have availed of the opportunity to weigh-up Government performance over the past 12 months and comment in a mainly constructive way thereon.

In the time available to me, I would like to recapitulate on the past year to comment on developments since the pre-Christmas part of this debate and reply to some of the many important points raised during the debate. Of course, since Christmas the end-year Exchequer figures for 1991 have been published. They showed that the Exchequer borrowing requirement was £501 million, or 2.1 per cent of GNP. Although slightly in excess of the 1991 budget target, this was a very good performance. When the proceeds of the Irish Life flotation is taken into account the actual EBR fell to just 1 per cent of GNP.

The main factor behind the 1991 budgetary overrun, was a sharp change in migration patterns. Although domestic employment held up well, the additional numbers on the live register led to unanticipated increases in social welfare costs. There was also upward pressure on health spending. However, after a slow start, overall tax revenue reached the budget estimate. The mid-July package of corrective measures, together with savings on debt service costs, limited the effect of the spending slippage.

Looking at the economy as a whole, all available economic indicators support the view that the Irish economy performed very well last year, given the difficult international background. Indeed, our economy has shown a remarkable degree of resilience in the face of the slowdown in the world economy. Most economists are now saying that Ireland's growth rate was well ahead of the average for the European Community and for the industrialised economies generally. Unlike the United Kingdom, the US and Germany — and despite the dependence of much of our industrial sector on markets in those countries — we did not slip into recession last year. Nevertheless, one gets the feeling that last year's economic performance has not received the attention it deserves.

For example, national output looks to have risen by over 2 per cent in 1991. Granted, this represents a sharp slowdown from the rates achieved in 1989 and 1990, but let us keep things in perspective. In both the EC and the OECD, the growth rate was barely over 1 per cent. The competitive gains built up in previous years allowed us to increase market share and ensured that we avoided the worst effects of the recession which hit our main trading partners very hard indeed. In the United Kingdom and the United States output actually fell.

Even Germany went into recession last year and is currently experiencing levels of inflation, interest rates and wage pressures which are causing very serious concern. In this context, the growth of almost 6 per cent in the volume of exports of goods and services which we achieved in 1991 was exceptionally good. The strong industrial export performance contributed to last year's excellent trade surplus of about 9 per cent of GNP.

There were a number of other very positive features about last year's outturn. Inflation remained low and, at 3.2 per cent, it was comfortably in line with the requirements of the EMS narrow band participation. Non-farm employment was up by 7,000 in the year to mid-April according to the results of the labour force survey. There are indications of a reasonable performance over the remainder of the year. Certainly, in the crucial area of manufacturing industry — where we have hard information for the first nine months of the year — employment has been holding up very well.

At this point, Senators could reasonably ask why, if things are as good as I say, has the strength of last year's performance not been more widely recognised? There are a number of reasons.

One obvious point is the evident weakness in domestic demand. Last year's growth came about largely through our ability to sell Irish goods abroad, not through the more immediately visible route of increased spending at home. Confidence has clearly suffered from the combined effects of the uncertainties in the international economy and the continuing burden of high real interest rates. The most recent indicators suggest that there is a continuing weakness in car sales, offsetting much of the growth in other caterogies of retail sales. However, there appears to be no doubt that the potential is there, in terms of available purchasing power, for an appreciable upturn in consumer spending. The implicit rise in personal savings during 1991 suggests that both consumer demand and private investment have been postponed rather than foregone. These factors lead us to believe that improved external conditions and an easing in interest rate pressure when they occur, could lead to a significant turnaround in domestic activity.

Another slightly disturbing feature of the present position is the apparent increase in domestic inflationary pressure in recent months. While inflation at 3.2 per cent in 1991 was below the EC average, the underlying rate for much of the year was somewhat higher.

The evidence is not decisive but it does appear that domestically generated cost pressures — which include both profit margins and labour costs — were fuelling inflation. If this is indeed the case, it would be extremely disquieting. It is absolutely essential that wage increases awarded under the terms of the Programme for Economic and Social Progress and developments in non-wage incomes are fully in accord with the employment needs of our economy.

This brings me to the issue of greatest current concern to the Government — the continuing rise in unemployment. It is true that the increase of 70,000 in nonagricultural private sector employment in the three years to 1990 and the steady employment performance since then, is evidence of the success of policies pursued by this Government and their predecessors. It is also true, that the sharp rise in unemployment, particularly in the first half of last year, mirrors the abrupt shift in migration patterns which followed the down-turn in our main trading partners, but this cannot disguise the fact that our impressive growth performance in recent years has not brought about the number of new jobs needed to match the increase in the labour force and to reduce unemployment.

There is no magic solution to this problem, but it is clear that the appropriate policy response must be one which is based on the establishment of the right macroeconomic conditions for growth — a task on which we have made great strides — and on the creation of domestic economic conditions which are more flexible and more adaptable.

The 1992 budget was framed with precisely that in mind. In the conclusion to his budget Speech, my Government colleague, the Minister for Finance, Deputy B. Ahern, described his budget as one of realism, ambition, determination and social concern. Senators will agree with that description. At its heart is the need to stay within responsible financial constraints and protect and enhance growth and employment prospects both now and over the medium term. By holding the Exchequer borrowing requirement to 2.4 per cent of GNP — broadly the same underlying level as the 1991 outturn — it helps to maintain downward pressure on our debt-GNP ratio. Indeed, the ratio should fall from 107 per cent at end-1991, to around 104 per cent by the end of 1992.

Preserving and maintaining general confidence in the Government's willingness and ability to manage the economy and the public finances well is a powerful tool in fostering growth and investment.

On the tax front, a policy of widening the tax base and of increasing other revenues allowed the Minister for Finance to continue the process of income tax reform. The budget addressed in a fundamental manner many of the unsatisfactory aspects of our tax regime and made significant progress toward putting in place an indirect tax system for the period beyond 1992. We now have an income tax system that is both pro work and pro jobs.

Conscious of the need to protect the less well-off, the budget fully compensated those on social welfare for increased living costs, and provided for real improvements in a number of specific areas.

On employment, the overall budget package is designed to give a considerable stimulus to job creation. In consultation with the social partners, the Government have undertaken a series of initiatives designed to confront the problem of rising unemployment and to accelerate the provision of new employment. Specifically, they have introduced the new employment and training schemes; the former assisting the creation of up to 15,000 additional stable jobs for persons who have been on the unemployment register for at least two months, the latter providing training on employers' premises for up to 10,000 people who have been on the unemployment register for at least two months.

One of the most satisfying developments since Christmas has been the progress made on the problems of public service pay. The then impending conflict, between the Government and the public service unions, was raised by Senator Manning in the early part of the debate and he voiced his concern, which was shared by all of us at the time, at the disruption that might ensue if agreement was not reached.

Senator Manning and, indeed, all Members of the House are no doubt relieved at the developments since then. The Government made a determined effort, in a revised package of measures on public service pay put to the public services committee of ICTU on 17 January 1992, to address the concerns, which had been voiced by the ICTU and the public service unions, about the earlier Government package, and to do so in as flexible a manner as possible, with due regard to the budgetary constraints which the Government faced.

The revised package involved significant improvements in the December 1991 position and was put forward so as to restore normal relations between the Government and the public service unions, to enable the day of action, scheduled for 28 January to be called off and, above all, to ensure continuity under the Programme for Economic and Social Progress of the process of consensus and co-operation between the social partners and the Government, which has served the country so well since 1987.

The public services committee of ICTU, having considered the package of measures put to them by the Minister for Finance, indicated on 27 February last that the package constituted a basis for suspending their campaign of action on the implementation of the pay terms of the Programme for Economic and Social Progress in the public service. As a result of this, normal relations have been formally restored between the Government and the public service unions. Arrangements are, accordingly, being made to implement, as soon as possible, the general round increase of 3 per cent, subject to a minimum increase of £4.25 per week and a maximum of £5 per week, due with effect from 1 January 1992 for most public servants.

Turning now to prospects for the year ahead, it is clear, unfortunately, that the external environment facing us at the start of this year remains less than buoyant. Growth continues to be sluggish and considerable uncertainty still surrounds the timing and strength of recovery. There could, in fact, be some further lag before the forces leading to a pick-up in activity are fully felt.

At home, the outlook is for a GDP growth rate of about 2.25 per cent and for an increase in jobs outside agriculture of about 9,000. However, further strong labour force growth is in prospect following last year's net inward migration and, in consequence, there is likely to be a substantial increase in the average number on the live register. The likely increase in disposable incomes in the wake of the budget, should lead to an increase in private consumer spending of 2 per cent and we can expect a modest resumption of investment growth and continuing export strength, as overseas agricultural markets re-open, and the modest international improvement gets under way. Inflation should average around 3.75 per cent, with the rate slowing down in the second half of the year.

In the remaining time available to me, I would like to pick up on some of the many points raised by Senators during the debate. Senator Upton referred to the social welfare measures adopted by the Government since Christmas in the context of the abridged Estimates as a direct attack on the weakest element of our society. This, of course, is not the case. What is involved here is simply a reappraisal of certain social insurance based schemes with a view to some reallocation of the limited resources available for social welfare services, the objective being to target resources to those most in need. The policy measures to give effect to the reallocation were reflected in the abridged Estimates volume. These measures reflect the Government's ongoing search for a more cost-effective approach to public spending in general.

The Senator's allegations fall down completely when it is realised that the overall level of social welfare spending is set to rise by nearly 8 per cent this year when account is taken of the additional £85 million for social welfare which was provided for in the budget. This is not the action of a Government who are out to attack the least advantaged in society. As Senators are well aware, all long term social welfare rates are now in excess of the priority rate as recommended by the Commission on Social Welfare. In addition, the Government made significant progress in moving the short term rates towards the priority rate in the January budget. These significant improvements have been made despite the pressures on the public finances.

Senator Manning referred to the figures for uncollected taxes quoted in the Comptroller and Auditor General's most recent report. I must emphasise that the figure of £2,718 million for outstanding taxes at 31 May 1991 quoted by the Comptroller and Auditor General must be considered in its proper context. As the Comptroller and Auditor General points out, the Revenue Commissioners estimate that only £426 million of the £2,718 million is likely to be collected. The reason for the difference is that the figure of £2,718 million consists largely of estimates which were made by tax inspectors in the absence of returns for taxpayers. I would emphasise that there is no disagreement between the Comptroller and Auditor General and the Revenue Commissioners about these figures.

The problem of tax arrears was one of the major problems in the taxation area inherited by the Government who took office in 1987. Since that year, radical action has been taken by the Government to deal with these problems, for example, the 1988 tax amnesty and the phased development of the self-asessment system. The Minister for Finance in his Budget Statement announced further measures to improve collection and enforcement and among these are the extension of tax clearance to licences, permits, etc., the extension of withholding tax to the commercial State sector, the extension of the construction industry tax deduction scheme to other sectors and the strengthening of the legislation governing the Revenue Commissioner's powers to attach the assests of non-compliant taxpayers. Furthermore, this year's Finance Bill will contain a number of significant measures which will strengthen the powers of the Revenue Commissioners to counter tax evasion and avoidance.

A number of Senators, including Senator Costello today, spoke about education. Senator Upton raised, among other things, the various non-pay aspects of the Programme for Economic and Social Progress in the education sector. The Senator will have been glad to note in the interval since he made that contribution that in the agreement reached between the Government and the social partners in relation to these matters we have managed to preserve the core of the non-pay aspects while at the same time scaling down or deferring some elements in recognition of the overriding need to preserve the stability of the public finances.

Senator Costello, in his reference to education, made a number of points which I would briefly like to reply to. The Minister for Finance in the budget made £4 million available to improve the pupil-teacher ratios to both first and second level with effect from September this year, to provide additional funding for caretaking and secretarial services and extra vice principal and guidance teacher posts at second level and to provide for other measures including disadvantaged schools and in-service training at first and second level.

The question of health expenditure was raised by several speakers. Government expenditure on health has shown a significant rise over the two years since 1990 increasing by £211 million, an increase of 16 per cent.

Senator Upton referred to the care for the mentally handicapped in psychiatric units. In 1981, there were 2,200 such persons; by 1989, this number had been reduced to 1,800, 300 of whom were accommodated in special separate units for the mentally handicapped. The Programme for Economic and Social Progress emphasises the continuing development of community care which will lead to further reductions in the numbers in institutional care. The process of implementing this programme was begun last year and was continued in the recent budget when an additional £3 million was provided for persons with a mental handicap. These funds, when taken with the extra funds in the original 1992 health allocation, will enable the provision of a wide range of additional services, particularly additional residential places in homes for the mentally handicapped, and extra respite care facilities. This will meet the immediate priority needs of the mentally handicapped arising in 1992.

Senator Upton and Senator Costello raised the question of social housing and the homeless. The Senators are aware that the Government published a major new policy document on social housing in February 1991 entitled A Plan for Social Housing. The plan contains a wide range of new initiatives designed to provide a more diverse approach to meeting social housing needs and improving access to housing for those on the lowest incomes and for those on the margins of home ownership. The fundamental principles underlining the plan are to improve access to housing, to widen housing options, to encourage self-help, to conserve and utilise the existing housing stock and to enhance tenants rights, whether in the private or local authority sector. The measures introduced in the plan have been implemented on an interim basis pending the enactment of a new housing Bill which is due to be published shortly.

On the question of the homeless, local authorities were given extensive additional powers in the Housing Act, 1988, to secure accommodation for homeless persons. A review of the operation of the homeless provisions of the Housing Act, 1988, was carried out by the Department of the Environment early in 1991. Following this review, new guidelines were issued to housing authorities in May 1991. These new guidelines have encouraged a greater response to the needs of the homeless by local authorities. A provision of £750,000 has been made in 1992 in the Vote for the Department of the Environment in respect of recoupment by local authorities of expenditure in relation to accommodation for homeless persons. This compares to expenditure in 1991 of about £377,000.

Senator O'Reilly referred to the tourism industry. The Government are keenly aware of the potential of the tourism industry for job creation. As agreed with the social partners in the context of the Programme for Economic and Social Progress, a special tourism task force have been established. Their terms of reference include reviewing the future prospects for the tourism industry with particular emphasis on the creation of additional new employment. They are also to propose creative and innovative approaches for developing the tourism market with a greater role for the commercial sector and to make such other proposals as are thought necessary for the further commercial development of the industry. The task force meet weekly and are expected to report in a matter of months.

I will now deal with an area for which I have taken on responsibility, that is, culture. The value of Ireland's culture and heritage as a magnet for tourists is well recognised by the agencies charged with tourism development and the Irish tourism industry. Bord Fáilte have been promoting Ireland's culture and heritage as an important reason for visiting this country. They have also developed a wide range of promotional material and activities aimed at niche holiday makers. Among the aspects of our culture and heritage now on offer as holiday products are Irish gardens, Christian Ireland, Irish music, Irish flora and fauna, great houses, stately houses, literary Ireland, offshore islands and Irish arts and architecture. Bord Fáilte recently organised a major conference on heritage, culture and tourism, which examined how this important aspect of Irish tourism can be further developed and expanded.

I will refer to one or two other matters that were raised. Senator McDonnell referred to prisons and glue sniffing. As regards the points he made about young people in prison, I can only say that young offenders enter prison with a range of problems. I appreciate the contribution made by Senator Costello this morning. There is accommodation in a range of prison and places of detention, both closed and open. Various educational programmes are available, consisting of main school subjects, basic skills and creative activities, such as art, drama and music. Because of the rapid turnover in prisons — this is particularly true in places catering for young offenders whose sentences may be relatively short — the emphasis is on literacy programmes. In addition, there are work training programmes with activities aimed at filling the needs and interests of young people and giving them the opportunity to acquire youthful work skills. To give one example of developments in this area, instructors are being recruited to operate courses at Wheatfield on a par with those available at FÁS, including apprentice training accredited by FÁS.

I concur with the Senator's comments on the dangers and the tragedy of glue sniffing. The first line of defence for children at risk from this activity is obviously the immediate family, but society as a whole needs to be alert to the dangers and to the tragic, sometimes fatal, damage that can be caused by solvent abuse. In this regard, it is good to note that there is a section in the new Child Care Act which makes glue sniffing illegal and also gives power to the Garda to confiscate glue and its allied products if they deem any young person may misuse them. I am confident that these measures will make a major contribution in controlling the evils of glue sniffing.

Finally, I thank Members for their excellent contributions. I look forward to the year ahead and hope it will be one of political peace and further economic progress.

Debate adjourned.
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