Dáil Éireann díospóireacht -
Wednesday, 26 Oct 1988

Vol. 383 No. 4

Private Members' Business. - Estimates for Public Services 1989 and Summary Public Capital Programme 1989: Motion (Resumed).

The following motion was moved by the Minister for Finance on Tuesday, 25 October 1988:

That Dáil Éireann takes note of the 1989 Estimates for the Public Services (Abridged Version) and of the 1989 Summary Public Capital Programme."

Debate resumed on amendment No. 4:

After "Programme" to add to the Motion:

"published by the Government on 18th October, 1988. In noting the publication of the 1989 Estimates Dáil Éireann draws attention to the fact that they present only one part of the budgetary and financial picture for 1989, and resolves to have a full debate on each estimate as amended, as soon as possible after the 1989 Budget."

—(Deputy Noonan,Limerick East.)

Mr. Deenihan

I see the 1989 Estimates more as a holding operation than a serious effort to make progress with regard to the economy. Judging from the media coverage and public interest generally in the Estimates debates, I think the Estimates could be described as a non-event. There are no real policy changes reflected in them.

Most aspects of the Estimates have been discussed at this stage but I would like to make a few observations which I consider very important. Despite numerous promises from various Government spokespersons to emigrant groups, the amount of money provided in this year's Estimates for emigrant services is the same as last year and indeed the previous year. The figures released today by the Central Statistics Office show that emigration increased by over 5,000 for the year ending April 1988. This reflects a major increase since 1986. At the same time, however, the amount of funding for the various services abroad has remained the same. We must also consider that the value of £250,000 is not the same as it was two years ago when we take account of inflation in England which is about 14 per cent. Therefore, this sum will not have the same effectiveness in providing the necessary services.

Again, I wish to reiterate the various viewpoints of the people involved in the emigrant centres. At present they are allowed only to give advice but I think their brief should be extended to providing accommodation as well. Without the voluntary efforts of associations in England, New York and other centres to where large numbers of our people emigrate, the emigrants would be left to their own. If they were to depend on the Government or even on the previous Government to look after their interests, they would be left out on the streets of New York and other centres.

DION are an agency who give grants to emigrant agencies in England. I suggest that their remit be extended to include New York and other American cities. It is rather ironic that the city of New York had to provide the Irish Emigration Reform Movement with a grant to man their centre and provide the hotline to it. It is a sad day for this country when we have to depend on Government agencies abroad to look after our people.

I make a special plea to the Government and to the Minister for Labour that a special allocation in the region of £500,000 be made from the national lottery funds so that we can make some effort towards discharging our responsibility to our young people who have been forced to leave Ireland.

There is nothing in the Estimates that would indicate there are job creation possibilities that would help to keep our people at home. The Irish Episcopal Council came out strongly on this aspect and pointed out that jobs are not being created to the extent that they should be in order to make an impact on emigration. I know their figures were disputed but subsequently they were shown to be accurate. People such as Padraig White, are doing their best to cloud the problem of emigration.

We are making no effort whatsoever to provide any form of education for our young people before they travel abroad, whether it is forced or voluntary emigration. Information is provided by the Department of Labour and other agencies but it is not getting through to the young people who are leaving, otherwise we would not see reports that young people are being picked up and exploited in various ways on the streets of New York. It is about time we impressed on those involved in education that they have a responsibility to impart as much knowledge as possible in order to prepare our young people for emigration. Nobody likes to recognise that people have to emigrate but the reality is that people are emigrating and will continue to do so. Indeed, a recent report by the ESRI suggests that over 130,000 people will emigrate in the next four years. There is no reason to think this figure will change.

The allocation of £250,000 is paltry and a total insult to the voluntary groups in England who are making great efforts to provide advice and information to emigrants. This figure will have to be buttressed in some way by money from the national lottery. I feel that we in this House would all agree to a substantial sum of money being given to emigrant services. This would also get the approval of the entire population who are concerned about the emigration issue.

I would like to refer to the decrease in funding for school transport. It can no longer be said that there is free transport to school because young people have to pay a sizeable sum for this service. It is no longer the luxury service it was in the past. Many parents find they are not getting value for money. When these charges were introduced some years ago, those who are now in Government opposed them vehemently. Now they have no option but to increase the charges to make up the sum of £6 million. I am very concerned also about the number of young people who have no school transport service. I am aware of four cases of young handicapped people who cannot go for special education because transport will not be provided. I appeal to the Government to ensure that the most vulnerable people in our society should not be affected by the cuts. It is a crying shame that four handicapped people cannot get transport to schools which are not too far away from them. In one instance it would only be a case of rerouting the transport to the extent of five miles but the Department of Education will not consent to this. When this creeps into the system it only turns people off. The disadvantaged have very few people to speak out for them. Every effort should be made to ensure that the handicapped are provided with adequate transport facilities to enable them to attend special schools. I appeal to the Minister for Education to have this matter reviewed. I will bring it up with her at a later stage.

Recently there was a well received announcement from the Department of Industry and Commerce that the brief of SFADCo would be extended to include north Kerry. That is something that I have campaigned for since I came into politics. Many politicians have campaigned for this over the last 20 years. Despite the fact that the SFADCo brief has been extended into north Kerry the Government have decreased the amount of funding for administrative costs from £2 million to £1.5 million. I do not know if this decision was made before the Government decided to extend the brief of north Kerry to SFADCo. When one considers that SFADCo's resources will have to stretch further than before, we cannot expect the same effectiveness from SFADCo if they have to cover north Kerry as well as their original brief on a smaller budget. Will the Minister ensure that SFADCo is adequately funded as otherwise their effectiveness will be reduced? The reason north Kerry wanted to be included in the SFADCo region is because they are not happy with the support from the IDA. We always felt that we were the poor relations vis-à-vis Cork. Now expectations have been raised and we want better treatment under SFADCo. If the money is not there we will not get better treatment.

I will refer now to the cutbacks in local authorities in lieu of rate support grants. I know that the Government have taken over responsibility from county councils for certain loan repayments. I hope that the cutback in the grants to local authorities will not affect the overall funding of county councils as county councils are hard pressed to provide funding for the repair of county roads, for instance. Almost all rural TDs who spoke on the Estimates referred to county roads. In County Kerry there are over 2,400 miles of county roads and we are a major tourist county. Local people know which roads to avoid but tourists will be totally turned off Kerry because of the condition of the roads. Many of the bad roads are in our most scenic areas where there is the greatest concentration of tourists. I appeal to the Minister to take account of the wishes of county councils and ensure that adequate funding is available to maintain county roads. The reduction in support grants will mean a deterioration in county roads as county roads are always the last item on the agenda of most county councils to be allocated money. If there is a reduction of 8 per cent in local authority funding I fear that next year there will be a further deterioration in county roads. Will the Minister ensure that our county roads system does not deteriorate further?

In relation to the Estimate for the Department of Labour I am very concerned about the decrease in funding for the social employment schemes. For the remainder of this year sufficient social employment schemes have been sanctioned in Kerry so as to provide 300 jobs. Unfortunately these jobs cannot be activated because Kerry has used up its quota of funds. They have used up their quota because they are in the same region as Cork which has been allocated a greater amount of money for social employment schemes. One scheme I know of would employ 20 men. The men were recruited and their expectations were raised. They wanted to get off the dole queue at little expense to the taxpayer. However, last week they were told that the scheme could not go ahead due to lack of funds. That is ridiculous, especially when people are willing to work in the sort of weather we have been having lately. It is an indictment of our system that money cannot be provided for worthwhile schemes. Apart from that scheme a number of school principals find that due to the cutbacks, they cannot take on caretakers or secretaries in the schools under the social employment scheme. In the interests of creating worthwhile employment I would appeal to the Government to review the funding for social employment schemes. I know that the decrease here is only 1 per cent but we should increase this allowance substantially.

In relation to the funding for DION, the committee in charge of emigration, it is vitally important that the sum already provided is supplemented by a grant from the national lottery. I appeal especially to the Minister for Labour and to his Government colleagues to ensure that this occurs.

Minister for the Environment (Mr. Flynn)

In ionad bheith ag caint faoi fhoilsiú na Meastachán go luath, faoi mar a dheireadh an Comhrialtas linn, d'fhoilsigh an Rialtas, don dara bhliain as a chéile, Meastacháin na bliana seo chugainn ag tabhairt a dhóthain ama do na Ranna Stáit agus do na gníomhaireachtaí Stáit pleanáil a dhéanamh don todhchaí de réir an airgid a bheidh ar fáil dóibh.

The early publication of the Estimates, for the second year in succession, is indicative of the Government's achievement in really getting to grips with the financial problems it inherited and confirms the Government's control over the management of the nation's finances.

The economy is on the path of recovery, which is based on the widespread consensus on the need to bring public borrowing under control and the restoration of investor confidence. We are now seen internationally as an investment opportunity economy with a stable currency.

Our success has been acknowledged by most commentators and financial institutions at home and abroad. Indeed the confidence restored to the economy is clear from all the economic indicators — low inflation, lower interest rates, surplus balance of payments, lower foreign borrowings, increased investment and so on. The one remaining problem area is the level of unemployment but that is now beginning to respond to Government initiatives.

It is recognised that there is always a considerable time lag between a resumption of growth in the economy and an increase in employment. This is because unused capacity and under-employment have first to be aborted.

Our utilisation of industrial machinery has increased significantly in the past 18 months. We should now see a speeding up of job creation and as a result, the levels of unemployment continuing to fall.

The recent publication of the CSO's 1988 labour force estimates show a rise in the numbers at work. This is indeed a very encouraging sign. It is backed up by the end of September live register figure of unemployment which reached its lowest level since October, 1986 and confirms the downward trend which began in mid-1987.

However, the level of unemployment is still too high and the Government will continue the strategy set out in the Programme for National Recovery of increasing employment through investment and economic activity.

The indicators for the medium term are encouraging with an improvement in the business environment. Output in manufacturing industry is rising and there is increased investment. There is also evidence of progress being made on new job creation this year in the major economic sectors of the economy. This is a very positive sign for the future. The Government are well on their way to reaching the target set out in the Programme for National Recovery of creating 20,000 new jobs per year in the manufacturing industry. Now is the time to consolidate these gains and to build further on the progress made.

However, we must still have regard to the underlying causes of our financial problems — the mountain of debt and the annual cost of servicing it which the Government inherited from the Coalition Government. Nevertheless we have made enormous progress on our Programme for National Recovery, in particular the reduction in the Exchequer borrowing requirement.

Mr. Carey

Did the Minister ever hear of 1977? What about Professor O'Donoghue?

An Ceann Comhairle

Please, Deputy Carey, desist from interrupting.

Mr. Flynn

If Deputies opposite want a lesson in the history of foreign debt and deficit budgeting, I can tell them who started it.

Mr. Carey

I wish the Minister would oblige the House and tell the truth.

An Ceann Comhairle

Deputy Carey, please restrain yourself. The Deputy may not impute to any Minister or any Member of this House that he is telling an untruth. That is not in order.

Mr. Carey

I did not.

An Ceann Comhairle

I hope not.

Mr. Carey

He told me he would give me a list of the debt and how it arose. I should like the Minister to do that.

An Ceann Comhairle

There is a time limit to this debate and it is particularly wrong that there should be such interruptions.

Mr. Carey

I should like to hear——

An Ceann Comhairle

If the Deputy persists I shall have to ask him to leave the House. The Minister to continue without interruption.

Mr. Flynn

It is essential that the process of reducing the Exchequer borrowing requirement continues so that the confidence of investors in the Irish economy is sustained. The process has not been deflationary and has led to a recovery in economic growth.

The Estimates before the House are part only of the Government's strategy and must not be considered in isolation. We must now look to the future with renewed confidence in the country's ability to recover lost ground. We must become more efficient and cost competitive if we are to succeed in the new Europe.

To enable the country to grasp the opportunities which will become available in the lead-up to the single European market, the Government must continue to plan and manage the public finances so as to stabilise the debt GNP ratio. Success in this matter is vital if we are to create the conditions necessary to encourage development and initiative, which will in turn generate the impetus for increased economic activity.

As far as my Department are concerned, the 1989 Environment Estimate shows a reduction of some £66 million or 11 per cent. At first sight this is a large amount but it includes savings resulting from schemes and grants that were terminated in earlier years where expenditure is falling rapidly — for instance, expenditure on housing grants is down some £25 million on the 1988 provision.

The success of the Government's efforts on the broader economic front provides the impetus for recovery in the construction industry. The general economic outlook is now brighter than it has been for many years, giving confidence to investors, to industry and to the man in the street. Low inflation, low interest rates and a surplus in our balance of payments all mean a better climate for increased private investment and increased employment.

Although the public capital programme expenditure affecting the industry is forecast to decline in 1989, the impact on the industry will be more than compensated for by the increase in private investment made possible by the success of the Government's economic policies. Indeed, taking account of both public and private investment in the industry we are, for the first time in many years, looking realistically to an increase in construction output in 1989.

In the past two years, we have seen a number of positive developments to encourage and stimulate growth in the construction industry including the substantial fall in the cost of borrowing, including mortgage interest rates; the extent of investment involved in the redevelopment of the Custom House Docks site, including the National Sports Centre — £285 million over a five-year period; output in the industrial, commercial and retail sector will record a substantial increase in volume in 1988; this year's budget measures, including the reintroduction of section 23 incentives, a reduction from 6 per cent to 5 per cent in stamp duty for houses in the £50,000 to £60,000 band and the extension of time limits for availing of the urban renewal incentives; the extension last year of the scheme of financial incentives for urban renewal to an additional nine centres thus generating construction activity in strategic locations throughout the country; the establishment of a special revolving fund to enable the NBA to undertake urban redevelopment works in conjunction with private interests. Initial projects include one at Westgate/Selskar in Wexford involving residential units, a shop and restaurant and a new private housing development at St. John's Mews, Douglas Street, Cork. In addition, the agency recently commenced work on an office development on Ormond Quay in Dublin. This development should encourage other developers to commence work on large derelict quayside areas of our capital city.

The single most important development which will affect the Irish construction industry over the next few years is the completion of the single European market by 1992. This will open up the vast European Community construction market to the Irish construction industry, presenting a great opportunity for our manufacturers, contractors and professionals, and a great challenge too. The industry must be prepared to grasp these opportunities and meet the challenge.

As part of the awareness and preparation campaign for the completion of the single European market, my Department recently hosted a seminar in Dublin entitled "The Construction Industry — 1992". We will be holding further seminars in Cork on 14 November and in Galway on 21 November.

I recently received the first annual report of the Construction Industry Development Board which I established in July 1987. The report sets out the recommendations made to date by the board and I will give full consideration to them in formulating future policy for the construction industry.

The Government's economic policy has resulted in the lowest mortgage interest rates for 20 years. Healthy competition between the building societies and the banks means there is a plentiful supply of mortgage finance at reasonable interest rates. I would like to refute the suggestion that the enormous success of the Government's initiative under the tax amnesty could result in a shortage of mortgage finance. Talk of "mortgage famine" flies in the face of the facts. Overall, the success of the amnesty has had little impact on the net funding position of the building societies.

During this session I intend to bring before the House a major Bill on building societies. This Bill represents the most comprehensive overhaul ever of the legislation governing the societies. The societies will be given new powers to engage in a wide range of activities under the supervision of the Central Bank. This legislation will enable the societies to adapt and expand their role in the rapidly changing financial services sector while continuing to make a valuable contribution to the economy as a whole. I look forward to the commitment and cooperation of all parties on the other side of the House in dealing with this important legislation.

The success of public housing policy in recent years and demographic and social changes have affected both the level of demand for local authority housing and the nature of that demand. The overall numbers on local authority waiting lists have fallen and the needs of specific categories like the elderly and homeless persons have assumed much greater significance. Greater emphasis has also been given to improving the living conditions of local authority tenants, particularly those in larger run-down estates in urban areas.

The 1989 Estimate provision for local authority housing is £39 million, including provision for remedial works to existing local authority houses and serviced caravan parks for travellers.

Building new local authority houses is not the only way to meet social housing needs. 1989 will be the first full year in which local authorities will have available to them the new powers of the 1988 Housing Act to provide accommodation for homeless persons, otherwise than in their own rented housing stock. Social housing needs are now being satisfied in a variety of other ways also, including the level of completions and vacancies occurring in the local authority rented stock and the continued expansion of the voluntary housing sector.

The allocation next year for the task force on special housing aid for the elderly is increased from £1.5 million to £2 million. This worthwhile scheme makes essential improvements in the housing conditions of the elderly and enables many of them to remain in their homes, rather than seek rehousing by the local authority, or institutional care from the health board. Next year this cost-effective and well targeted scheme will improve the housing conditions of up to 2,000 elderly persons living alone.

The road network is of major importance to the economic and social well being of the country. This role is set to assume even greater significance with our renewed economic growth, the completion of the Single European Market by 1992 and the implementation of the economic and social cohesion provisions of the Single European Act. These developments will have a major impact on future road development policy. I have already carried out a comprehensive review of the road development programme and having consulted the recently established National Roads Authority, I am now putting the finishing touches to the Blueprint for Road Development. The blueprint will set out a medium to long-term strategy for the development of the entire road network from national to county roads. It will also address the question of the financing of the programme, through a partnership of the State, the local authorities, the EC and the private sector.

The Estimates include £150 million for road improvement and maintenance grants next year. I am providing within this overall amount £20 million for county road strengthening grants, which is an increase of £5 million or one-third on the amount available this year.

Mr. Carey

One would need the £5 million for Clare alone, not to mention any other county.

Mrs. O'Rourke

That is a lot more than the Deputy's Government managed to give.

Mr. Flynn

It is just a little more than was given to county roads when I took up office in the Department of the Environment. That year it was £6 million. In my first year in the Department I increased it to £15 million. This year I repeated that £15 million and next year I am providing £20 million. In just a couple of short years I have given £50 million.

Mr. M. Brennan

Now, Deputy Carey.

Mr. Flynn

That is more than 20 years allocation before that.

Mr. Carey

I am surprised, then, that there are so many potholes in Clare.

An Ceann Comhairle

Please, Deputy Carey. The Deputy will have his opportunity. In the meantime he should contain himself in quietude.

Mr. Flynn

Deputy Carey may very well be right that there is something wrong but at least I want him to know that the increase next year over this year's allocation, which was a huge increase over the two previous years' allocation, is £5 million extra, £20 million in toto. This will enable local authorities to accelerate their work programmes to bring the most important county roads up to an acceptable standard.

Additional expenditure on major road improvement works is one area which is being considered at present in the discussions concerning the increased funds that will be available from the EC Structural Funds.

In this context I will be urging the highest possible recoupment rates from the EC Structural Fund for State expenditure on roadworks, especially 75 per cent for major improvements to national roads. We have also obtained widespread Community support for aiding projects such as roads and bridges from the Structural Funds which are funded by or with the assistance of private funds. This is a major breakthrough which will ensure that we will be able to draw down all the funds that will become available in the next few years. I will, of course, be taking the necessary steps to ensure that schemes carried out with private sector funding meet the criteria laid down by the EC.

The Estimates include a number of areas dealing with environmental matters. As time is limited, I will confine my remarks to air pollution and unleaded petrol. Dublin's Millennium Year has seen an intensification of measures to tackle its smoke problem. The results of monitoring for the winter of 1987-88 show a slight improvement in the overall situation. However, I want to make sure that that underlying problem is tackled.

The Government allocated £250,000 in 1988 to develop a scheme of financial assistance towards the cost of smoke control measures in Dublin. The allocation will be used to fund a scheme to allow householders to change their existing heating arrangements to smokeless appliances and fuels. An outline of the scheme was announced on 26 June this year.

Before the scheme can take effect, however, I must decide on the special control area order made in April by Dublin Corporation for Ballyfermot, one of the worst affected areas in the city. Following an oral hearing of all objections to the order, which took place between 28 June and 4 July, I am now considering the written report of the hearing before deciding whether or not to confirm the order, or to confirm it with modifications. The Estimates include one million pounds for the scheme of financial assistance in 1989. It is my intention to announce my decision in the matter inside the next few weeks.

Yesterday I launched a new campaign designed to increase the use of unleaded petrol in this country. There must be a complete changeover to unleaded petrol and we have to create a climate of opinion that favours such a changeover. This is necessary for environmental and health reasons and also to encourage motorists from Europe where unleaded petrol is much in use. The Government gave the lead in the budget when it reduced the excise duty on unleaded petrol so that it retails at the same price as leaded petrol. The establishment of a reasonable network of unleaded outlets around the country is well under way and further outlets will be available before the end of this year. I have sought the assistance of the motor trade in the campaign and I intend to make regulations as soon as possible requiring that all new petrol engined vehicles placed on the market must be designed and constructed to run on unleaded petrol.

Before concluding, I would like to say a few words about local authority finances. This area has been subject to various comments from Deputies and others. In 1988, the total current expenditure of local authorities is expected to be approximately £959 million, but the rate support grant will only meet one-fifth of that expenditure. Income from rates on commercial property, amounting to almost £193 million, is as important as the rate support grant. I want to make this comparison to lay at rest the notion that a cut of over 6 per cent in 1989 in the rate support grant, as compared with 1988, will cause a comparable reduction in the authorities current expenditure. This is patent nonsense and totally misleading of the factual position. To put the matter into perspective, the reduction of £13 million represents less than 1.4 per cent of local authorities' 1988 current expenditure.

At a time when all areas of public expenditure are under review to reduce public expenditure in the national interest, the reduction in the rate support grant is not excessive, especially when the following factors are taken into account: the Government's early decision on the Estimates will allow local authorities to hold their estimates meetings before the end of the year. As a result, authorities can arrange their expenditure and revenue collection programmes before the year starts, to match the funds available. It also provides management with sufficient time to review working practices so that maximum efficiency is achieved; I am making an extra £5 million available next year for county road strengthening grants; staff costs in 1989 will be substantially reduced as a result of the voluntary redundancy scheme and other controls on staffing levels; and local authorities have benefited substantially from the reduced interest rates brought about by the Government's good management of the economy.

In 1987, local authorities generally halted their slippage into increased deficit and in many cases improved their position in this respect to some degree. I am looking forward to a further improvement in 1988. This Government have restored realism to all aspects of public finance and local authorities have responded to the Government's courageous lead in this matter.

Is leír ó luath-fhoilsiú na Meastachán seo go bhfuil an Rialtas ag taobhú go láidir leis an gcuspóir atá acu chun smacht airgeadais a bhaint amach. Tugann sé le fios go soiléir don lucht airgeadais go bhfuil an Rialtas dáiríre ina n-aidhmeanna agus cabhróidh sé seo i gcoinneáil muiníne san margaí airgeadais.

Mr. Taylor

These Estimates represent a betrayal by Fianna Fáil of the thousands of people who had put their trust in them. They have managed to convey an impression in many sections of the media that they are in some sense mild, or at least milder than expected — but nothing could in fact be further from the truth.

The first thing that has to be remembered about the spending cuts we are discussing this week is that they are part of a series of cuts more savage than anything in the economic history of this country. Essential services which have already been pared to the bone are going to be cut further next year. We cannot afford to be under any illusions about this. There is no breathing space here.

Our health services, which have already suffered far too much, will suffer again next year. More beds will be forced to close, more staff will be forced to leave, more patients will be forced to wait. The development of a two-tier health service will continue apace — with wards now covered in lino being carpeted in order to fleece the VHI, and deepen the financial crisis which is about to engulf that organisation. We have already reached the point in our health services where people must be in grave risk of their lives before they can be guaranteed any level of access. How many have to die before we see a change of policy by this Government?

There are a great many lies told about health spending in this country. How often have we heard people who should know better talking about the imperative need for us to tighten our belt, and telling us that we can only provide whatever level of health service we can afford? Who is to say what that is? If we are waiting for the parties of the Right to specify what we can afford, people will die.

The simple fact is that according to the best international comparisons available, nobody can accuse this State of spending too much on health. The OECD figures in this area are particularly instructive. According to them, in the most recent year for which figures are available, we spent $514per capita on health. The United Kingdom Government — Mrs. Thatcher's Government — spent $585 per capita, and the average for the OECD as a whole was $722. Given those simple statistics, how can we do anything other than hang our heads in shame at what we have allowed to happen to our health services since 1984, the year in which those figures were gathered?

What makes the picture even worse is the fact that our health services are inevitably going to require more resources than those of other countries. The reason for this is simple — if a population has a very high number of dependent people, either very young or very old, the provision that must be made is greater than otherwise. Our population has a very high dependency ratio — considerably higher than the OECD average — and we have to face up to that reality. The reality we must face is the one on which Fianna Fáil campaigned fairly successfully in the last election campaign when they said: "Health cuts hurt the old, the sick, and the handicapped". It was true then but Fianna Fáil have been living a lie ever since. They have systematically cut health spending from the 7 per cent of GNP at which it was maintained during all the years that Deputy Desmond was Minister for Health. By the end of the next year, it will, according to their own estimates, represent 6.2 per cent of GNP. By any objective standards, that is a savage cut and a substantial part of that cut is going to be brought about as a direct result of the Book of Estimates published last week, despite all the hype about extra money for health.

Health is only one area that has suffered grievously under this Administration. Who can forget the torrent of protest that was generated by Fianna Fáil's infamous attempts to reintroduce the educational standards of the thirties through the notorious Circular 20/87? And who can forget the cynical compromises that the Minister for Education arranged, to present thousands of parents with a fait accompli when this school year started? Above all, who can forget the crocodile tears shed by the Ministers for Social Welfare and Education when they were presented with the sight of parents who were literally unable to send their children to school in September because of the ever-increasing cost of books, uniforms, and other requirements? They shed crocodile tears on television but in the secrecy of the Cabinet room they agree to further impositions on parents with their increases in school transport costs and their massive hikes in third level fees. These Ministers, let us not forget, are members of the Fianna Fáil Party, the party who stake a claim to history because of the introduction of free post-primary education. For the last two years they have been systematically dismantling the education system they inherited, instead of equipping it to meet the challenges that lie ahead of this country. Donogh O'Malley must be turning in his grave.

Before leaving the subjects of health and education, there is one point in particular that I must make. For many years now the people I represent in Tallaght have been told that their claims for a hospital and for a regional technical college are receiving priority attention. There is no argument about the justice of these claims. It has long been recognised as a scandal that the fastest-growing area of population in the country and indeed in western Europe — now some 80,000 people — has no hospital and no third-level education centre. It has unemployment, of course, and it has suffered from Establishment neglect for years. The commitment to providing these basic facilities generated a sense of hope and purpose in Tallaght that was tangible. The betrayal of that commitment by this Government has led to a feeling of outrage which Fianna Fáil will have reason to remember whenever they face the people of Tallaght again. The massive cuts in the Public Capital Programme for next year will ensure that Tallaght, in common with other disadvantaged areas of the country, will have to wait for one more year at least to see some progress on these essential requirements.

The cutting of the Public Capital Programme will, of course, have economic as well as social consequences all over the country. The Minister for Finance, in his speech yesterday, said that he had cut £106 million from the Public Capital Programme. In net terms, he is in fact cutting a great deal more. The reason I say this is simple: there is a huge provision in the Public Capital Programme for Aer Lingus fleet replacement, which accounts for an increase in the allocation for transport of more than £55 million. Now, I am not arguing that that allocation is unnecessary, but I am saying that every penny of that money will be invested abroad. It will go to create and protect jobs in Seattle, rather than contribute to the thousands of jobs we need here at home. If that money were not in the Public Capital Programme, the real cut in that programme would be £163 million. By any measurement, it is impossible to cut that amount of money from the Public Capital Programme without generating increased unemployment. We estimate that the job losses arising from this set of cuts alone will run to more than 12,000.

Many reputable independent commentators including, for instance, the ESRI have argued that one of the major policy instruments available to the Government to generate growth in our economy was the Public Capital Programme. In their medium-term review, when they predicted that the economy could return to high rates of growth next year, they did so on the assumption that Fianna Fáil would not implement further cuts at the end of 1988 — and particularly that the Public Capital Programme would not be cut again. They reckoned without the mandarins of the Department of Finance, and the slavish hold they have over this Government. They reckoned without the obsessive urge of the Minister for Finance to project a macho image as he grooms himself for Europe. Above all, they reckoned without the political calculation of the Taoiseach, who knows that the way to protect the largest majority in Europe in this House is to keep Fine Gael and the Progressive Democrats off balance.

In fairness to the Taoiseach, I would have to say that he has succeeded very well. Fine Gael do not seem to know whether they are coming or going. Their spokesperson on finance is quite capable of saying in the same sentence, that the Government have not gone far enough and that the cuts in these Estimates will cause major hardship. The Progressive Democrats will no doubt do what they have always done — speak in favour of the cuts and vote against the specifics.

What none of these parties will do is to pause long enough to consider the human impact of the decisions they are making. It seems that to the parties of the Right this is all a game. If they have any familiarity with the trauma of unemployment, the misery of queues for health services when you are in pain or the indignity of charges for basic health care when you have to live on a small pension, it does not show. What does show is a callous indifference to the real price that people have to pay so that the ideologues of the Right can play their games of fiscal rectitude.

Nowhere is this price more evident than in the series of mean and petty cuts that the Government have implemented in the social welfare area. In this area, they have not just received the tacit approval of the Opposition Right-wing parties — support from the Right has been whole-hearted to the point of being blood-curdling and acquiesced in the cuts, but they have also conspired together to ensure that there is little, if any, public debate on this sustained attack on the rights of working people. The cuts in social welfare have, as a result, gone almost unnoticed, except of course by those people who have had to bear the brunt of them.

Let us examine, for a moment, Fianna Fáil's record in this area. The cuts I record are those arising from Fianna Fáil's budgetary decisions in 1987 and 1988. (1) If a family is in receipt of child benefit they will have received no increase in 1987 and will receive none in 1988. This is an effective cut of £12.75 million, affecting all families with children. The child benefit scheme was introduced by the Labour Party in 1986 — and it is recognised by anybody who cares, as a prime instrument of policy available to any government who want to alleviate poverty. (2) If you have to claim long term disability benefit you now need 260 stamps, five years' constant employment, as against 156 in January 1987. This is a cut of £9.25 million affecting many thousands of claimants. The Labour Party maintained and improved these basic entitlements all during the seventies and eighties. (3) If you have to claim unemployment benefit, maternity benefit or disability benefit your number of paid or credited contributions has been increased from 26 to 39. This, in effect, is a cut of £6.75 million, affecting thousands of people. (4) If you are a widow, deserted wife, single parent, or prisoner's wife, you will no longer be entitled to claim the half-rate payment of disability benefit, maternity allowance or unemployment supplement from January 1988. It was the Labour Party who introduced these major benefits for women in the seventies. (5) If you need dental or optical treatment you must have 207 paid or credited contributions, as against 156 in January 1987 and 39 contributions in the claim year as against 26 in January 1987. (6) If you avail of the social employment scheme the allowance payable to a single person has been reduced from £70 to £60 per week. The allowance under the teamwork scheme has been reduced also by Fianna Fáil, from £70 per week to £60 per week. Both these schemes were introduced by the Labour Party, and further cuts are inevitable next year in these areas as a consequence of the miserly allocation in the Minister for Labour's Estimate. (7) The 11 per cent increase for the long term unemployed in July 1988 works out at a bare 7 per cent for a married couple with three children. The Labour Party first introduced special increases for the long term unemployed in 1983. Many families will now see their increases clawed back in increased local authority rents, particularly following this year's cut in the rates support grant. (8) If you are entitled to claim pay-related benefit with unemployment, disability, or maternity benefit, your entitlement has been cut in half. The rates of 25 per cent and 20 per cent have been reduced to 12 per cent, and the "floor" for PRB has been raised to £68 per week, which means that the maximum PRB has been reduced again. The Labour Party were largely responsible for the introduction of PRB in the seventies. This is a cut of £20 million.

This is the record since Fianna Fáil took office. The provision made this year means that the record will almost certainly get worse. There are hidden social welfare cuts in the Book of Estimates — make no mistake about it. We need not take seriously the Minister for Social Welfare's assurance that all rights are protected in his Estimate. He always gives that assurance. He never publicises the cuts he is actually making. Instead he sends out circulars to the social welfare offices and community welfare officers and hopes that nobody will notice. Almost none of the cuts I have outlined above would have come to public attention were it not for the efforts of the Labour Party in highlighting them.

In the time available to me, it is not possible to go into all the aspects of the Estimates that need to be covered. There is, however, one area that cannot be allowed to pass without comment.

The cut in the rates support grant that has now been imposed by the Minister for the Environment is intolerable. Alone, it will lead to nearly 2,000 job losses and major cuts in services that are essential to the quality of life. I know that there are now local authority managers who are at their wits end to know how they can possibly cope with a cut of this dimension.

All the information available suggests that a disproportionate amount of that cut is being inflicted in Dublin. This Minister is, on the one hand, telling his Fianna Fáil councillors in Dublin that they should not impose charges for services and on the other, he is telling them that they are to be punished for not imposing charges in the past. This is the same Minister who wined and dined his European counterparts — at our expense — in the most expensive hotel in his constituency not too long ago and then told us all that in future he was going to arrange things so that local authorities would be engines for growth and development. This is also the Minister who has intoned solemnly time and again that he is committed to adequate financing for the provision of local authority services. He has done a kind of Lanigan's Ball with his junior Ministers about the reintroduction of rates, stepping out the proposition to test the wind and then stepping in again when he discovers how cold the wind is blowing.

The local authority service over which he presides is dying on its feet and he seems to be content to be the undertaker. The result will be serious damage to the quality of life of our people — of old people who depend on street lighting and on the public library, of children who depend on the recreational facilities provided by local authorities, facilities which are overgrown, not developed and many in a dangerous condition. Everyone who depends on sanitary services will suffer.

Perhaps those who will suffer most are those who look to our local authorities for shelter. A few days ago I predicted, before the Estimates were published, that unless the Government changed policy immediately a major housing crisis is inevitable, I have to say now that the cuts outlined in the housing area in the Book of Estimates brings that crisis considerably closer.

To give one example: there are more than 6,000 families on the housing waiting lists in Dublin and Cork cities now. That is a 50 per cent increase in the last 12 months. How many houses were started by those two local authorities to deal with this massively growing problem? The unbelievable answer is two — not 2,000, or even 200, but two. To add to that, the local authorities concerned have lost several hundred houses from their housing stock altogether as a result of the tenant purchase scheme. Altogether, over the whole country, enough money has been allocated for approximately 160 houses. At the same time, according to returns furnished by the local authorities, there are 17,000 families in urgent need of accommodation — families who have been approved for rehousing, but must stay in their present conditions because Fianna Fáil will not provide any money.

This is exacerbated by two additional features. First, the present housing stock is being allowed to run down to an appalling condition through lack of finance for maintenance. Secondly, there is a growing problem of "ghettoisation" in parts of the country, particularly in Dublin, as a result of families with jobs leaving areas, and those areas being used to house new families with a range of social problems. As a result, communities are beginning to come under great strain. In overall terms the neglect of housing by Fianna Fáil is sowing the seeds of enormous damage. They, and they alone, must carry responsibility for the very damaging consequences that will inevitably follow.

In conclusion, these Estimates, taken together with everything that this Government have done since assuming office, are a terrible reflection on a civilised society. They reflect a headlong rush into Thatcherite greed and selfishness. When the Irish people are invited to pass judgment on them I believe they will reject these policies roundly and the political parties that espouse them.

Minister for Education (Mrs. O'Rourke)

It is just a little over one and a half years since we assumed office. We did so at a time when the country faced very serious economic and financial difficulties, when the entire country was in the grips of a malaise of despondency, when foreign debts were spiralling upwards and the current budget deficit, as a percentage of GNP, was dangerously high. The servicing of the national debt was absorbing, and still does, money which could otherwise be put to good use in areas which would stimulate economic growth and development. In the present year the servicing of that debt will cost some £2,000 million.

It has now become apparent to everyone that the measures devised and implemented by this Government since March 1987 are the only ones that will redress our financial problems, give rise to economic growth and an environment conducive to job creation. At the same time there is much extra work we must tackle. However, our economic climate has improved dramatically since March 1987. The target reductions in the 1988 budget for Exchequer borrowing and for the current budget deficit will be exceeded this year.

Reduced Exchequer borrowing and improved confidence in the Irish economy have resulted in reductions in interest rates. This, coupled with a low inflation rate, has increased our competitiveness in international markets. Indeed our exports are at an all-time high and our inflation rate, running at 2 per cent per annum, is much lower than virtually all of our trading partners.

Our financial and social objectives can be realised only by maintaining a strict budgetary discipline and continuing with our financial reform strategies. Correcting the current budget deficit — stabilising it at between 5 per cent and 7 per cent — must remain our first priority. Never again can we revert to the time when the Exchequer borrowing requirement was 13.2 per cent of GNP.

Despite the success of this Government's economic and fiscal policies to date the outlay by the Exchequer on non-capital supply services in 1988 of £5,683 million, and a projected outlay in 1989 of £5,565 million, are still much in excess of current revenue. As a result Government must continue to borrow a significant amount each year to meet current services which otherwise could be used for infrastructural development projects and productive investment. The 1989 Estimates for all Government Departments have been framed on the basis that further measures are necessary to reduce public expenditure in real terms, thereby reducing our dependency on borrowing and freeing money for essential services.

The 1989 Estimates for non-capital services, of £5,565 million and for the Public Capital Programme, of £1,319 million, result in a total reduction of £311 million in the expenditure which would have been incurred in 1989 had this Government not taken certain corrective measures. Of course, in order to achieve savings of this order, it was necessary to analyse carefully and review critically proposed public expenditure.

The net provision for the four Education Votes in the Abridged Estimates Volume for Public Services for 1989 is approximately £1,169 million, the gross provision being in excess of £1,256 million. The allocation for pay and pensions in the gross provision is £1,026 million approximately corresponding to 82 per cent of gross expenditure. It includes the cost of the second phase of the 1987 Public Service Pay Agreement, the payment of special increases due in 1989 and the remaining phase of the ex-gratia award to teachers. Over £6 million more is required in 1989 than in 1988 to meet the cost of third level student support.

The total provision of £1,256 million is a substantial level of expenditure on education. It constitutes a clear indication of Government commitment to maintaining and developing the quality of our education system. For example, in 1989, 18.8 per cent of Exchequer expenditure will be spent on education services. Of course that means that £18.80 out of every £100 Exchequer expenditure in 1989 will be spent on education. The expenditure on education amounts to almost 6.2 per cent of GNP, which is much higher than for virtually all other member states in the European Community. We should like to spend more but our present financial difficulties do not make that possible. Indeed we must continue to strive to achieve a greater effectiveness and efficiency, obtaining greater benefits and results from our already high investment in education.

I have already mentioned the need to strive for greater efficiency in the education process. The potential of information technologies and computerisation will be apparent to everybody. I have arranged for additional funds to be made available in 1989 to accelerate the computerisation of the examination process in Athlone. My Department have issued a detailed request for proposals for the provision of suitable hardware, software and application development services to the market. The latest date for receipt of replies is Friday next, when it is hoped that the relevant contract will be signed and the work commenced. The benefits which will accrue from this first phase will include the production, by computer, of provisional statements of results for each candidate, certificates for candidates, computer readable results data and examination statistics. We shall also be updating office system facilities.

In our budget there is provision for an allocation in 1989 of £291,000 for the expenses of the National Council for Curriculum and Assessment — the NCCA. This will allow for increased activities in relation to the review of primary and post-primary curricula. We have already done a lot of work in this area. From September 1989 all students commencing the junior post-primary cycle will follow programmes of study leading to the new junior certificate which will replace the existing intermediate and day vocational group certificates. The new certificate programmes constitute a positive response to the changing needs of society and will enable our young people to prepare better for entry into society and working life. I might put on record this evening my appreciation of the huge input and commitment of Deputy Hussey, my predecessor, to curricula reform particularly at post-primary level. However, much work still requires to be done to update post-primary programmes, in particular to revise modern language syllabi, to develop a technology programme suited to the needs of all junior cycle pupils, to review assessment procedures and senior cycle programmes.

The Primary School Curriculum Review Body, under the chairmanship of Moya Quinlan, which operates under the aegis of the National Council for Curriculum and Assessment, are continuing their work. I expect to receive their report next year.

With regard to the national school building programme I am happy to say that the 1989 allocation will be adequate to meet priority needs. It will enable my Department to provide grants to meet contractual commitments in respect of approximately 70 building projects authorised in 1988. In the coming months it will be possible also to authorise approximately 40 additional primary school building projects. A substantial sum is being provided to meet the ongoing work of improving existing schools. I should say that school managements are cooperating fully with the approach of my Department in giving priority grants for essential classrooms in schools experiencing acute problems of accommodation. In that way a considerable impact will be made on the waiting list of grants for classrooms.

The Government's policy of not providing capital for new accommodation in areas where there is already sufficient suitable accommodation available in existing schools will be continued in 1989, a policy which will have particular reference to urban areas where scarce capital resources will not be expended on duplication.

In accordance with the Programme for National Recovery, and in order to ensure that pupils from disadvantaged groups are given assistance to meet necessary expenditure on school textbooks, the aid towards the cost of school books for necessitous pupils is being increased at primary and post-primary levels. At primary level the book grant for necessitous pupils in 1989 will increase from £6 to £7 while the total grant to secondary schools will increase by £195,000 to £1,150,000. A similar level of increases will be made in the grants to VECs and to community and comprehensive schools.

The cost of running the State examinations at post-primary level in 1988 will amount to some £8 million. Very often people do not realise that State examinations cost that much. There has continued to be a significant increase in the number of candidates sitting the leaving, intermediate and group certificate examinations. For example, in 1980, some 41,000 candidates sat the leaving certificate examination and 70,500 sat the intermediate and group certificate examinations. The corresponding figures for 1988 were 57,500 and 78,500 respectively. On average 11 papers per candidate are processed resulting in almost 1.5 million scripts being assessed annually. Some measures aimed at increasing the efficiency of the examination process were implemented this year. They will be accelerated in 1989 and are expected to yield savings of some £500,000.

Furthermore, in order to lower the net cost of the examinations to the Exchequer, the Government have decided for 1988-89 to increase the examination fees which were last increased in 1986-87. The fee for the group certificate examination will increase from £19 to £20. The fees for the intermediate and leaving certificate examinations will increase from £30 and £33 respectively to £32 and £35.

I have again made provision in 1989 for adult literacy and community education which is provided free of charge or at nominal cost by vocational education committees. The financial allocation made in the 1989 Estimates for this activity is £400,000 — the same amount as for 1988. A study on the effectiveness of this scheme is currently being undertaken by my Department in association with the Irish Vocational Education Association and future initiatives will be based on the outcome of this study. Provision is also made in the 1989 Estimates to continue with the pilot education opportunities scheme which caters for the long term unemployed over 23 years of age to come back into formal schooling and to take State examinations.

Earlier this month the Minister for Labour and I launched the Youth Reach scheme. This scheme is the first major initiative undertaken for the 10 per cent of school leavers who drop out of school early without gaining any formal qualification. The scheme will operate in centres in 11 VEC areas around the country and is designed for young people who have dropped out of school for at least six months. Such people will be offered up to two years education and training and will receive a training allowance based on various criteria of £20 to £25 per week.

General studies, vocational studies and work experience will be three distinct elements in the scheme. It is anticipated that there will be 1,000 places available for young people on 1 January 1989 and 2,000 in the following year. The cost of the programme in 1989 will be £11.2 million but the Exchequer will not be required to provide additional finance as the cost will be met by a reallocation of existing resources, targeting on those truly in need.

The 1989 allocation of £18.625 million for the post-primary capital programme will enable existing contractual commitments to be met and fully covers the cost of the construction work in respect of a programme of nine major school building projects which was authorised this year.

It is also my intention that this public investment will be augmented by funding from private sources. With this in mind, I am initiating a scheme which will be attractive to private investors. The Minister for Finance has already given his approval for the introduction on a trial basis of a privatisation scheme under which developers will be invited to design, finance and build three second level school buildings. The schools selected which are located at Cashel, Castlerea and Newcastlewest are participating in a rationalisation process. At a time, therefore, when funds under the State's capital programme are limited, this scheme enables me and the Department to maintain the momentum of that rationalisation. Funding, as I said, will take place outside the State sector and no payment by the State will arise until the buildings are completed and handed over.

My Department will be inviting applications shortly by public advertisement from developers. I know, from inquiries, that there will be a ready response to that advertisement and that the pilot scheme will prove a successful vehicle both for investment and for the creation of additional employment in the construction industry.

The gross allocation provided in the 1989 Estimates for third level and further education is £242.716 million. At present some 59,000 students participate in third level education and it is projected that enrolments will increase by 10 per cent by the start of the next century — after which enrolments are likely to fall if participation rates remain reasonably constant. In such circumstances careful planning is required to ensure that optimum return is got from investment in this area and that no expensive permanent physical facilities be provided which would be surplus to requirements in a relatively short period.

An interdepartmental committee are reviewing the sector generally with a view to making recommendations on the rationalisation of Departments and institutions, on their funding arrangements and on the provision of third-level places. I look forward to their report in the near future. A committee are also examining the duration, type and throughput of courses, including courses in VEC colleges, leading to NCEA awards and considering their relevance and effectiveness in meeting the needs of the marketplace.

In the past third level institutions have made great contributions to society, they have readily introduced innovations and were quick to respond to the changing needs. They can be justly proud of their achievement records. I have no doubt that the financial allocations to third level institutions will cause some difficulties, but I have also no doubt, given the goodwill of the management authorities of these institutions, that these difficulties will be overcome.

At present, when financial constraints are great, the institutions must respond to new challenges and new opportunities. They will have to appraise and evaluate all their operational activities and examine every area of spending critically with a view to making the best use of existing resources. They must innovate and find ways to make our higher education more productive and cost effective. They must also avoid wasteful duplication.

A number of interesting developments have already taken place in the field of co-operative endeavour. For example, the Government as part of their science and technology policy have designated UCD, TCD, UCG, NIHE Dublin and NIHE Limerick as research centres under the national biotechnology research programme and the work of these centres focuses on different aspects of biotechnology and complement each other. Other third level colleges, notably the RTC's have also received substantial funds to update specialist facilities in the applied science and technology areas which have job creation potential.

Efforts in these and other areas not only enhance teaching programmes at the institutions but also make a major contribution to technological and economic development. Co-operative arrangements will be fostered and encouraged by my own Department, by the Department of Industry and Commerce and by EOLAS.

The allocation in the 1989 Estimates for third level capital projects is £11.44 million. It is sufficient to meet all existing contractual commitments. In recent years there have been considerable building developments such as new buildings and major extensions in the universities and other third level institutions.

Since 1987 my Department have operated a special scheme of grants for mature women who have completed at least one year of a higher level course and who are either unemployed or in poor financial circumstances. To date £10,000 per annum has been allocated for this scheme. The scheme will be continued in 1989 and as it has been so successful in helping mature women in need of financial support to acquire third level qualifications I have arranged to provide £15,000 for the scheme.

In the education sector measures have been taken to achieve savings as part of the Government's strategy to reduce the Exchequer borrowing requirement. None of the measures, however, will reduce essential education services. At the same time, in accordance with the Government's commitment, extra resources are being allocated to the disadvantaged.

In the Estimates, as I have stated earlier, the Government have provided a gross allocation of over £1,256 million to Education despite difficult financial circumstances. With this amount and with the co-operation of the many committed persons in the education sector it will be possible to maintain and improve the quality of the education services provided by our schools, colleges and third level institutions.

I commend these Estimates to the House.

Mr. Carey

I generally make a contribution to the debate on the Estimates when they come before the House. I commend the Government for introducing them in the period before Christmas. However, the House should be able to make a critical analysis of the Estimates and, in a democratic way, to change some of the figures which the Departments and the Government have compiled if they consider it necessary.

The debate so far has been just another boring sequence of long scripts being read by various speakers, not just on the Government side of the House. We are failing to put on record the challenges that face the public in general because of the decisions which have been arrived at in the Estimates.

Other speakers, particularly Deputy Taylor, illustrated that there is a substantial consensus in the House that our financial affairs must be in order. I have listened to the contributions of the various Ministers and each has given his or her reason as to why they should be considered Santa Claus or a miracle worker who has brought in a proper Estimate because the previous Government did not have the courage to do what was asked of them.

The Minister for Education has a commendable script, probably the best presented. Its contents are intemised from one to 18. It was delivered well by the Minister. She started off with the economic commentary that:

It is just a little over one and a half years since this Government came to power. We assumed office at a time when this country faced very serious economic problems and financial difficulties due to previous Governments failing to implement sound policies.

The previous Government lost power because at the election they put before the people a set of Estimates which were rejected totally by Fianna Fáil who, in so doing, gave the impression to the electorate that the manna would come from Heaven when they got into power, it was to be more of this and more of that, they were going to shovel out the goodies. In fairness, I think the Government recognised their numerical position in this House as a minority Government. The people decided how this Government would work and they saw the only way in which this nation would tackle the financial difficulties would be to implement the budget and the Estimates that had been presented by the then Minister for Finance, Deputy John Bruton. I am not making the case for Deputy Bruton's budget, but I am saying that its implementation was the reason the financial institutions responded.

My party had identified the real problems facing this country and set an agenda. We are talking about the Estimates as they come up here from time to time. The Minister said there had been a lack of resolve and insufficient commitment. I do not know what she meant by that because I do not believe it can stand up. The Fianna Fáil Government will not go to the country on a budget or Estimates calculated as Deputy Bruton's Estimates were calculated when we fought the 1987 election. It is clear from the documents presented in this House that the Fianna Fáil Government are now trying to ameliorate things, to say they are not in Government to cut in the way they were supposed to. I see the Minister of State, Deputy Fahey, across the way. He is trying to take out the harder and coarser end of things for his Government. He is going around giving out little grants from the lottery——

Mr. F. Fahey

Some big grants.

Mr. Carey

I have no objection to him being nice and handing out money from the lottery, but I object to Ministers on the other side of the House intimating that the financial crisis is all over and that this country is now on the way back. This country has a long way to go and in fairness I think the Government realise that but do they accuse my party of lack of courage — or of insufficient commitment, as the Minister said — to take the decisions and measures necessary to solve the economic crisis? I recall when Deputy Bruton produced his measures the cry that came from the then Opposition about the awesome impact they were going to have. We were considered "Thatcherites." I am glad to see that the Fianna Fáil Party realise that that was the way back from the financial crisis we were in then. The recognition of that and of the courage of this party should be mirrored when we face the electorate again because as I see it in these Estimates the resolve of the Government is slipping.

When Deputy Noonan, our financial spokesman, was in here the other day he told the Minister for Finance that he was not accepting the Estimates because as he saw it they were only one side of a chapter. He said that you have to wait until the budget and see the revenue side and what decisions are being taken. I think he believes, although the Government side are not saying so, that there is some buoyancy of revenue there, but this buoyancy of revenue must be put to the proper use. After all, the single objective of 83 per cent of this Parliament is to see that the financial status of this country is preserved, that for the long haul for the future we will have a sound economy, that we will be able to hold our heads high and will not have to stand back watching the young emigrate by the boatload every day. Mind you, I heard Deputy Fahey when he was on this side of the House, saying that Fianna Fáil would cure the emigration problem when returned to power. It was a hobbyhorse of the Minister of State when he was over here and he made several emotional contributions about the terrible emigration and the haemorrhage in the west and his concern for them. The same haemorrhage is taking place today. The same numbers are going.

Mr. F. Fahey

No, they are not.

Mr. Carey

The same hurling teams are being decimated. The same thing is happening in my constituency.

Mr. F. Fahey

There is a major reduction.

Mr. Carey

They ran in 1987, you could not keep them here, and in 1988. There may be a little slowdown on it but there is still a substantial haemorrhage.

Mr. F. Fahey

At least we never denied they were going as the Deputy's Government did.

Mr. Carey

They are going and politicians, trade unions and all sides in this country have to admit at long last that there is a financial crisis. Fianna Fáil have to admit it. They still have not come to terms with the fact that there is one, that it is still there. Deputy Mervyn Taylor gave a commentary on behalf of the Labour Party and spoke about the Rightwing parties in this House, Fianna Fáil, Fine Gael and the PDs. The consensus in this country also includes, so far as I know, the trade unions. The ICTU who represent the vast majority of workers in this country took part in the Programme for National Recovery. That is even more than the 83 per cent representation here in the Dáil which is just leaving the Labour Party and the parties of the Left to their minority position.

Even since the change of Government and the 1987 election has there not been a major change in the attitude of the ICTU? Are they shouting now about firms closing down? Are they calling on the Government to bail them out? Are Fianna Fáil Deputies rushing to the Minister's office to save the redundant workers? The figure for redundancy last year and this year is very high. It is ignored by Ministers and does not seem to be a major issue. Already 15,000 people have been made redundant in the first nine months of this year. That is a major problem and a major source of worry, certainly to young people looking on. It is probably one of the prime reasons for their deciding to emigrate.

One only has to look at what the Minister announced the other day. The Minister taxed the employer by bringing his contribution up substantially for the coming year. I see no sense in taxing employment further. We talk about making the best use of resources. The Minister for Education spoke about making the best use of resources and went down through each category. We want employers to employ more people, and the Minister for the Environment was in here telling us about the upsurge in employment. Yet, he is part of a Government who are putting a further tax on employment. That is a cynical exercise.

This Government should think again before the budget and at least recognise the cost of employing one person. Foreign companies coming in here and taking on a workforce are not told by the promoting agencies about sustantial welfare costs, pension schemes, VHI subsidies, labour agreements and so on. That is all forgotten and when these companies come in they get a surprise. I believe that is the reason they stop at 100 employees when it was projected that they would provide jobs for 200. The cost of employment is a major factor. In the future the Estimates should be geared towards keeping costs down with a view to 1992.

The Minister for the Environment spoke about his road programme. His lack of a road programme is one of the major reasons companies here will go to the wall after 1992. There are some areas of the national primary routes that are now deteriorating. If the secondary routes continue to deteriorate too there will be substantial job losses in the long run. The condition of transport facilities here will be the making or the breaking of companies, and we have a long way to go.

The Minister was very eloquent in his praise of himself. One would think he was Santa Claus when he spoke about the additional £20 million and how he had improved what he called the road strengthening programme. He said it was better than the Coalition. The previous Government did not do so well either. I am not here to praise the previous Government's record in environment either, but at least they fully maintained the national primary routes and the national secondary routes. Indeed, in my county we had substantial road strengthening programmes. We had the benefit of EC allocations which helped substantially but the current position in my constituency is that roads are collapsing. Farmers themselves have to dump the aggregate on what are described as farmer roads. If they did not do that at night some of them would not have access to their houses. Other Deputies tell me that in what is described as the jewel constituency, North Tipperary, the lanes have not had any aggregate at all this year, so maybe we are doing a little bit better in County Clare. The Minister should be under no illusion. He is well able to give funds to County Mayo. When it came to the national lottery he gave £450,000 to his own county. What did he give to Counties Clare and Louth?

Mr. N. Treacy

Deputy Daly gave it to Clare.

Mr. Carey

Deputy Daly is a reasonable Minister and I am not going to quibble with him. We worked reasonably well in County Clare and we have not a bad team for the county on the political side. As far as the contribution made by the Minister for the Environment is concerned, it was a farce for him to say that there has been an improvement in the roads or will be an improvement in the county roads here during 1988 when what will happen is the direct opposite. That is the truth of the matter.

An Leas-Cheann Comhairle

The Deputy's time is up but we will give him another minute.

Mr. Carey

What I would ask for is that the farce and the games that are going on in this House with regard to these Estimates should not be allowed to go any further and that there be some realism about the plight of the people, the plight of the economy, and an acknowledgement of the severe financial crisis we are still facing on the part of the Government, the Left-wing parties and all the people in this House. Let us try to save Ireland.

Mr. Abbott

I wish to support the Estimates and the overall strategy of the Government which underlies the Estimates for the year 1989. The other speakers today have generally approved the strategy and dealt with it. As part of the evidence of that strategy I find in my own constituency that even in 1987, which was a year of adjustment, manufacturing jobs in the Mullingar area in County Westmeath grew by 75 which was the greatest growth for many years and signified a reversal of the fall in the number of manufacturing jobs in the previous year. I took that as a good sign that the Government's strategy was working last year and I look forward to an even greater increase in manufacturing jobs in that area and in the surrounding areas for 1988. I think that increase in employment in manufacturing, on which our young people depend so much for their future, will continue into next year and be sustained in future years if we hold to this strategy.

Looking first at the Estimate for the Department of the Environment, I congratulate the Minister on recognising the valuable work which has been done by the housing for the elderly task force and increasing their budget by 33 per cent. In my experience as a county councillor I have found that the housing needs of the elderly could be catered for by that scheme if the scheme were to be extended. In many cases the housing needs of elderly people who were requested to move into OPDs could easily have been catered for if certain modest repairs and modifications had been carried out to their existing accommodation. Old people do not like to leave their native surroundings or move into a new estate or even a group of very pleasing OPDs. Many of those who are on the waiting list in my constituency and the waiting lists in other constituencies will take heart from the fact that the few little jobs which they wish to have done, perhaps the installation of a water supply or a bathroom, can be carried out with much more certainly in 1989 than they possibly could have expected if funding had remained the same.

Many Deputies have already dealt with the position in regard to our roads. There is certainly a glaring need to do something about the cul-de-sacs, the farmers' roads, lanes or whatever they might be called from county to county. I take great heart from the fact that the Minister for the Environment has increased the road strengthening grant from £15 million to £20 million for 1989. I request the Minister to encourage his officials to loosen the strings somewhat in respect of the strengthening grant so as to allow some of this money to be used in improving selected and high priority cul-de-sac roads. We must remember that along many of these cul-de-sac roads we have some of the highest producing farms and highest populations in rural Ireland. I am very fearful that we will continue to go along as we have done for the last ten years in local government circles by disregarding the interests of the people who live along these cul-de-sac roads and perhaps in the process consign them to the hidden Ireland to their detriment and to the detriment of the country. I hope that in the future we can reverse this trend. There seems to be a consensus among rural Deputies on the need for this work and I am confident that local government officials throughout the country will respect the need to keep using road strengthening moneys in the very efficient way they have been used up to now. There is not one county councillor who is not amazed at the value we have got from these grants over the past few years. It may well have been necessary to isolate this money from other programmes in local government so as to ensure that the main county and regional roads were brought up to an adequate standard. There may have been inefficiencies in local government in the past but certainly the targeting of money for the strengthening of roads has got rid of a certain amount of these inefficiencies.

It is very heartening to note that the western package is being extended, for practical purposes, to cover the western side of County Westmeath. It was previously extended to cover a large part of County Longford and will be extended to cover all of County Longford in 1989. This will prove very important as funding will be made available for group water schemes from increased EC funds.

I would like to think that priority sewerage schemes, such as the Kinnegad, Moate and Castlepollard schemes will benefit from the funding which will be made available under the Department of the Environment Vote. I would also like to think that they might benefit from some EC funding under the revised Regional Fund arrangements in 1989.

Let me highlight a concern of mine in regard to the increase in Regional Fund moneys for Ireland, a disadvantaged area within the EC. We have been privileged to have been put among the category one countries along with Greece, Portugal and Spain, meriting particular attention from EC Regional Fund moneys. From my information it appears that EC funding for roads in Ireland will exceed our expectations. It would appear from this Estimate that we should fight harder to take advantage of this increased funding. It appears that the funding which will be available to category one countries will not be taken up by the other countries and that Ireland is in a highly favourable position to take up these funds because of its preparedness relative to the other countries, Spain, Greece and Portugal. I would like to think that there will be the necessary flexibility in order to allow us to take up this money not only for the national primary and secondary routes and the major urban routes but also for county and regional roads which, notwithstanding the good work which has been done through the use of the road strengthening moneys, still need the expenditure of substantial funding to bring them up to the standards required in the 20th century and to leave them in a better state as we approach the 21st century.

We face difficulties in relation to our ability to take up this EC funding for roads if we in this House continue to flog dead horses as many Deputies have done in respect of matters in dispute which by reason of the financial constraints on the various Ministers concerned are matters of academic debate. We should be looking at areas where we possibly can get movement and where money is available from the EC. We should do that while the fund is available to us. On looking at the arrangements made by the EC for a doubling of the Regional Fund moneys available to Ireland over a five year period, it strikes me that this and the other countries concerned might let the opportunity pass because of overall budgetary strategy, dictated by a mounting national debt which has only just been brought under control through very courageous Government action, and that we would let that fund run without taking up funds over the five year period and find when it came up for renewal that our power of negotiation had been considerably diminished.

It is up to the Deputies in the Opposition to encourage the Government to get up and go after this money and not to leave the Brussels bureaucrats with their arms dangling wondering where we are. Spain and Portugal and the other countries may well not be as active as we are in pursuing this money. We may move out of category one at the end of five years. We may because of the growth we probably will experience as a result of prudent Government management during the next five years move out of category one and find ourselves in an inferior position vis-á-vis EC Regional Fund grants for road construction and so on.

On the Estimate for the Department of Education, I congratulate the Government for maintaining the basic essential educational services. It was an area of some controversy some time ago but on seeing how the services are delivered in my constituency and in others, I am satisfied the changes are being brought about with the minimum of disruption. In certain areas in my constituency I detect a visible improvement. The number of courses being offered is being expanded. One finds that the German option is being taken up increasingly in the linguistic field. One also finds that, through economies in the capital budget, more modest extensions can be planned for national schools, and more modest extensions consistent with the actual needs of the pupils can be planned for vocational schools like Killucan, Castlepollard, Moate, Mullingar and Athlone. That is the approach which is being applied throughout the country where scarce resources are being distributed and planned better so that service can be provided in a shorter time.

In the area of adult education, despite screams from interest groups and Opposition politicians, one finds that one can satisfy local needs. Only recently I came across a man of 50 years of age — an electrician — who had been unemployed for the past ten years. He was finding it more difficult to get a job as he got into middle age. Last year, through the good efforts of FÁS and their incentive schemes he set up his own business and happily he is going from strength to strength servicing industrial concerns in north-west Meath and Longford. I was thrilled when that man came to me the other day and pointed out a hi-tech adult education course for electricians being run by the City of Dublin VEC. He said he would like to go on that course. I told him I would help him as much as I could, but I asked him if he would try to organise local electricians in the Westmeath area so that a similar course could be run by the Westmeath VEC. This would save them the expense of travelling to and from Dublin. It is very satisfying to see that this man, despite his misfortunes, has organised a number of his colleagues in the electrical trade to take up that course. They will be learning about the hi-tech micro-chip technology that all practical electricians must learn.

This is indicative of the vibrant attitude adopted by people in the workplace. They see in adult education the possibility to respond to the better economic times ahead, to respond to the challenge of more economic activity through a sounder Government economic strategy and through opening further opportunities in the EC in 1992.

As a Deputy representing a hospital town, it would be remiss of me not to mention health. Health has been an issue of national controversy over the last couple of years. It is an issue on which the Government have been attacked many times, but in the Midland Health Board area, every effort has been made by the doctors, nurses and administrative staff to ensure the optimum level of service for the people of Westmeath and Longford. The health board in that area have gone from strength to strength in efficiency and in delivering better services as a result of the changes brought about by the budget.

One looks forward to the equipping and staffing of phase I of Mullingar General Hospital, and to the construction of phases 2A and 2B of Mullingar General Hospital, as well as the continued planning of the upgrading of the admission unit of St. Loman's mental hospital.

In the agricultural field, I would welcome the extension of the western package grants to Westmeath and the installation of the Finney basin rural integration development pilot scheme. I see great prospects in this area if one can get the co-operation of the various State and private bodies involved.

The Estimates presented by the Government will provide the opportunity for dynamism in the economy and provide the opportunity for debate and discussion on how best to face the future. I welcome all debates which will help us ensure that the best resources of this House are pooled to provide a better future for all.

Mr. McCoy

In spite of the fact that most economic indicators are moving in the right direction, the spectre and problem of unemployment remains stubbornly high. No matter what statistics are used to create the illusion that 20,000 new jobs are created this year, the position on the ground does not substantiate these claims. Figures published today indicate that by the end of the year, actual recorded redundancies will have outpaced the job target creation set by the Government. There is a mass exodus of our young people to Britain and the USA because many of them are being denied a paltry few pounds dole on the basis of means testing their parents who are often in poor circumstances. This despicable procedure has taken many of these young people out of the unemployment statistics.

The agricultural Estimate shows an overall increase of 2 per cent. This is immediately explained and accounted for under the heading "General Administration". This shows an increase in real terms greater than the overall increase in the whole Estimate. The conclusion can therefore be drawn that the overall Estimate net of administration overheads is down from last year's figure. Of the total of £156 million, £70 million is for administration and £86 million is the Exchequer's contribution to agriculture. This figure of £86 million must be considered against increased levies on produce and the progressive reduction of VAT refunds in the last two years from 2.4 per cent to 1.4 per cent. This reduction of VAT refunds has cumulatively brought £50 million into the Exchequer from the agricultural side. This shows that, over the last two years, the net amount in real terms accruing to farmers from the Exchequer will be of the order of about £36 million.

Let us look at the VAT refunds. These legitimate refunds — the refund of VAT on inputs to agricultural production — were agreed many years ago by the farming organisations and the Government of the day. The justification given for decreasing the refunds was to collect the outstanding moneys in terms of health and other charges from the farming community notwithstanding the fact that in many cases those people had already settled their own bills. Now that those arrears have been collected there is no justification for maintaining this reduction in VAT refunds on the basis that it is to collect outstanding health and youth employment levies. I note there is no provision in the Estimate to extend the scope of the disadvantaged areas scheme.

Debate adjourned.