Seán Fleming (Laois-Offaly, Fianna Fail)

There is a vicious circle and the banks are starving companies of funding. I understand they are nervous and that they do not know where they are going. However, there are good and viable businesses which are vulnerable. They should not be but they are because the banks will not provide the normal source of credit to companies. Any business producing a product has the intellectual ability to do so; it has the marketing ability to sell that product; it has the raw materials to manufacture it and the financial resources to carry on the business while doing so. Access to credit is a basic material in any business. It is as fundamental as the raw materials that a given company needs. When a business is starved of one of the materials it needs to operate, there is a detrimental effect. I hope when NAMA is up and running and the banks receive a cash injection from bonds they can cash in with the European Central Bank, it will translate into cash flow. There must be absolute guarantees in this regard. If that does not take place, the entire exercise is pointless. I do not believe it is but when the implementation of the measures takes place, we must make that case very strongly.

In the past ten years there has been an increase in living standards for many. In recent weeks I have listened to elderly people such as those we all meet in the course of our daily business. They may be in their 70s or 80s. Some have addressed me as "Young lad", for which I am thankful, and stated they really know what tough times are and that current circumstances are not nearly as bad as before. They are taking it in their stride. People who have been around for a long time and, perhaps, are a generation older than the rest of us have been through tough times before and know what it means. Nevertheless, they have survived. I do not underestimate the difficulties we face. They are as bad as they have been for more than a generation. However, previous generations faced greater difficulties which they overcame and I believe the same will happen in this case.

One challenge facing the Government is the €21 billion or €22 billion to be spent on social welfare. A mechanism should be put in place whereby a portion of this sum will be allocated to employment or job supports. Many who were earning between €500 and €700 a week and have now lost their jobs and are in receipt of jobseeker's benefit or jobseeker's allowance would be happier to be in work. If social welfare payments could in some way be linked to their employers to keep them in employment, it would be far better for the people concerned and the economy. Ultimately, we must work our way out of the recession. We will not be able to tax or spend our way out of it.

I refer to specific sections of the Bill. I realise the income levies are unpopular but because we are in mid-year and because of the way the PAYE system works it is the most practical way of proceeding. Perhaps at the end of the year such levies could be integrated with the normal taxation system. However, what is important is that the levies catch a great many who might otherwise escape if the revenue was raised based on taxable income because of the various write-offs available.

Certain amendments to mortgage interest relief were introduced on 1 May. I do not believe Revenue handled this matter well. Some have difficulties in respect of whether they have been making repayments for more than seven years and so on. Revenue should have let the scheme roll until it sorted out the problems and if there was something to be recouped, it could have been done during the course of the year.

During January and February there were 30,000 job losses each month. However, that has not been the case since. We have not reached green pastures yet but the worst months are behind us. The situation has not fully bottomed out but in terms of job losses, the worst is behind us. I welcome the change in the corporation tax rate from 22% to 25% and the reduction in the amount of interest one must pay in respect of late payments of taxation as a result of reducing interest rates.

I commend the Bill to the House and trust it will move successfully through Committee, Report and Final Stages in the coming weeks.

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