This is an interesting debate and I am pleased to contribute to it. The economic record of the Government is by any objective standards an impressive and progressive one. On each occasion on which the House discusses the question of the economy, one is treated to an extraordinary display of histrionics and downright mendacious economic revisionism, especially from the leading Opposition parties. We were not disappointed as Deputy Rabbitte rose to his usual low standards, and the mere presence of a Member who would accost him with his record was enough to have him scurrying out of the Chamber. That is exactly what we expect of that gentleman.
On the previous occasion I spoke on the economy, which was the Finance Bill, we were treated to a characteristically rip-roaring, fantasmagorical and, even by Opposition standards, bizarre performance by that economic guru from the far west, Deputy Ring. I remind Deputy Michael Ahern that not all the comedians come from Limerick, although there are one or two clowns from there, but there are certainly one or two others in other parts of the country who rise to very high standards of economic clowning. One of the interesting aspects of Deputy Ring's contribution was that he suggested that the 1970s was where the economy of today began. In a sense, perhaps he is right. A great deal has been spoken about the period from 1977 to 1981 and it is always taken that economics began in that period.
Ireland's economic progress dates back much further than that. The current economic position in which we find ourselves in this country, one of the youngest in Europe, had its foundations laid by a Fianna Fáil Minister, which is appropriate because great economic progress has always been achieved under Fianna Fáil Ministers. That Minister was Seán Lemass who had foresight and vision at a time when Ireland was lacking people with those qualities and imagination. He had the foresight, vision and political courage to launch the country in a particular direction.
The modern economy goes back to the early 1960s. We hit a bad patch in the 1970s and there is no point in gainsaying that. We crossed an important Rubicon during the period of the Government which ran from 1973 to 1977, which Members opposite often wish to overlook. We started borrowing on a significant enough scale for the first time to meet current expenditure. Keynesian or neo-Keynesian policies were followed with vigour in 1977 and 1981 and, with the benefit of hindsight, we would perhaps say those policies should have been truncated earlier than they were. It is interesting to examine the period from 1977 to 1981. We started from a very low economic threshold and the objective was to reboot and re-launch the economy. Economic circumstances changed dramatically in the late 1970s with the wars in the Middle East and the activities of OPEC with a quadrupling of oil prices as well as near civil war on our northern Border. We tend to forget that when we revisit that time.
By 1981 there was virtually universal acceptance in economic circles – Deputy Richard Bruton will bear me out on this – that the kind of expenditure we were engaged in was no longer sustainable and that we needed to cut back. In particular there was an acceptance that we could not continue to borrow simply to fund current expenditure. The reality is that the Government which was in office from 1982 and 1983 up to 1987 doubled the national debt, as Deputy Ahern has pointed out. The analysis, that accepted the Keynesian policies of trying to fund economic growth had failed, already existed in 1981, and was well accepted in the political community in 1982 and yet, when the parties now in Opposition controlled the economy in the period 1983 to 1987, they doubled the debt. That is a record of which they cannot be proud.
It took another Fianna Fáil Minister to take the reigns in the Department of Finance and call a halt to the madness that existed. It was interesting to listen to Deputy Rabbitte's subjective analysis of the period. There was an extraordinary lack of generosity which we have grown to expect from Deputy Rabbitte because he does not recognise that if we had not taken control of our economy in 1987, the World Bank would have. The point has been made that we enjoyed a rate of borrowing that was on a par with impoverished Third World countries. The Irish economy was re-launched by courage from 1987 onwards. I well remember the period 1987 to 1989 when a minority Government that was trying to put the economy back on track was beaten time and time again, usually on Private Members' motions. The Opposition could if it wished have overturned the economic policies of that Government. It did not because of the foresight of one man who does not get enough recognition, the then leader of Fine Gael, and I am prepared to pay generous tribute to the Tallaght strategy.
The Tallaght strategy would only have been a success if there was a Government with the courage in office to turn the economy around. That is why the announcements yesterday by the Fine Gael finance spokesperson, Deputy Jim Mitchell, and his comments in the newspapers bring a smile to my face.
The political record in the more recent past is what we should judge politicians on. We should not judge them purely on rhetoric because everybody in this House intends to do their best but if one examines the record in relation to health, which will be a big issue until May, during the last Fine Gael-Labour Party coalition one will see it was a disaster, particularly when one recalls that Deputy Noonan was in charge. It brings a smile to my face and a chill to my heart to think that a person who had such a disastrous record on health could be in charge of the economy as a whole. Health spending increased by just £400 million to £2.5 billion in the period up to 1997, less than half its current level, and let us not forget that waiting lists increased during that period by 27%. Incredibly, the Fine Gael-Labour Party coalition cut funding for the hospitals waiting list initiative in 1997 by 20%.
Let us examine the record on social welfare because Deputy Rabbitte comes to this House and parades his ersatz socialism as he does on his Prime Time slots on RTE. While his party leader was Minister for Finance and his party president was in charge of social welfare, old age contributory pensions increased by only 9.9%. Child benefit increases of £1 and £5 were given in Deputy Quinn's budgets. Those increases compare miserably with increases of £25 and £30 in the last two Fianna Fáil budgets but the most derisory and insulting thing they did while in office was in 1995 when it gave old age pensioners a miserly £1.60 per week. That was the meanest act since the time many years ago when Fine Gael cut the old age pension. It is astonishing to sit here and see Deputy Rabbitte ascend the Everest of his own indignance and pomposity and discuss the economic record of this Government. The man voted to give pensioners £1.60. He should be thoroughly ashamed of himself, his party leader and his party president.
The non-contributory pension has increased by almost 60%, from £67 to €134, under Deputy McCreevy's budgets. The widows' and orphans' pensions have increased to €144.80. Much has been achieved and much more needs to be done. We have entered into commitments which will be honoured by the next Fianna Fáil-led Administration.
Another issue the Labour Party likes to address is housing. It was dealt with by the last two speakers but let us reiterate the record. Since 1997, a staggering 215,700 new homes have been completed. Last year over 5,000 local authority houses were either built or acquired, the largest number in 15 years. In Wicklow, we are undergoing the biggest programme for 30 years. Over 1,200 houses were completed by voluntary agencies. Under the last Fine Gael-Labour Party Administration, local authority housing output actually fell by 11% to a low of 2,632 houses. That Government's record was miserable and the misery of that record can only be appreciated when one looks at the final year. In 1997, the Government spent less that one third of the amount being spent by this Government on local authority housing in 2001.
The health record also bears examination. The health budget has doubled to £8.2 billion during the term of office of this Administration. People will say it is not enough and others will say one can never have enough money for health. We need not just more funding but better management. Public transport is another issue which is being celebrated on the billboards but when one examines the track record of this Government, it makes that of the previous Administration pale into insignificance.
The record of this Government is that it has achieved a level of employment never seen before. It has reformed the taxation system. Other parties have talked about it – Fine Gael had a strong commitment in this area but were not allowed to deliver by their partners in Government. This Government has delivered: it has reformed the taxation system, in particular personal taxation. It has improved public services and infrastructure, created the conditions for over 300,000 additional jobs to be created, shared the fruits of economic growth fairly throughout the economy, committed substantial amounts of money to social welfare, built the national pension reserve fund and created, through radical taxation measures, a sense of security into the future for pensioners. The Government has also significantly reduced the national debt. Our economy has grown, in GDP terms, by an annual average of almost 10%. Living standards, inper capita consumption terms, have risen by almost one third. Involuntary emigration is now virtually unknown. We are the envy of Europe because of economic policies masterminded by the Minister for Finance, Deputy McCreevy, and delivered by this Government. Involuntary immigration is now virtually unknown. We are currently the envy of Europe because of the economic policies masterminded by the Minister for Finance, Deputy McCreevy, and delivered by this Government.