Tommy Broughan (Dublin North East, Labour) | Oireachtas source

All budgets are about choices. I strongly opposed the Labour Party entering government since I feared that serving under a Fine Gael-led Government would do fundamental damage to the people who sent my Labour Party colleagues and me to this Chamber. I always wanted a Labour-led Government only. After four austerity budgets having been implemented or planned by the Government, the core aspirations and interests of our people have been harshly subjected to the aspirations and interests of the wealthy and powerful, represented in this Chamber by Fine Gael, Fianna Fáil and some of the conservative Independents. The Labour Party support base is decimated as a result.

Last week, Deputies Catherine Murphy, John Halligan, Thomas Pringle, Patrick Nulty and I showed how there could be another way. Our key proposal was for a wealth tax modelled on the French solidarity tax and yielding up to €450 million. Deputy Ross tells us in the media such a tax would kill entrepreneurship, but it has not killed it in France, Norway, Switzerland or the Netherlands. The IMF itself said the wealthier countries should be seeking to have the top 1% or 2% of wealthy people contribute much more. I have over 25 years’ experience in supporting small business and business start-ups in community business centres in my constituency and do not believe a modest additional tax on millionaires would have any impact on the development of entrepreneurship in Ireland. Deputy Ross is protecting the very class that he sometimes berates in his columns.

Last week, we supported a higher rate of tax on very high incomes and the introduction of a tiny financial transaction tax. Even one or two items in the menu of measures presented by the Independent left Members would have removed the need for the most shameful new cuts in budget 2014. However, Fine Gael would not have permitted such changes. No real Labour person should be associated with the resulting austerity measures. We learned this evening from RTE that the levy on the domestic banks is effectively cost neutral. It will not cost anything.

I welcome the introduction of free GP care for the under-fives, which is possibly the first step on the way to a universal health care system. Powerful medical vested interests, including the Minister for Health and Children, Deputy James Reilly, in his earlier career, have prevented the development of an NHS-type system for the State throughout its history. I welcome the critically needed additional €20 million for community mental health services.

The stimulants for the building trades and construction industry from the new tax credit for home renovations, the tax exemption for long-term unemployed starting a business and the further development of the strategic investment fund are all very welcome. I opposed the sale of the national lottery licence but I acknowledge that the €400 million is being put to very useful and many purposes. It is to be hoped that the retention of the 9% VAT rate will produce additional jobs, especially for people on the Irish live register although there is no such linkage in this massive tax expenditure. I welcome the fact that Garda recruitment is resuming and that key public service vacancies will be filled in 2014.

It is particularly important in my constituency that €10 million is being set aside at long last to refurbish Priory Hall in my constituency after the appalling four-year struggle for justice for the owner-occupiers and residents of that apartment complex. I commend the Taoiseach on this.

I welcome the announcement by the Minister for Finance, Deputy Noonan, that provision will be made in the Finance Bill to close off the loophole so that Irish-registered companies cannot be stateless in terms of their place of tax residency. It is very notable how the international community, especially the United States, has welcomed this so strongly.

There is profound relief that the education cuts did not go above €44 million, although there seems to be €84 million missing in the 2014 budget. The 1,250 new teachers will ease the pressure on many schools but our burgeoning child population means that class sizes are rising. The Minister for Education and Skills has scored a number of spectacular own goals in the Department of Education and Skills. In another political system, as Pat Leahy said recently of the Minister for Health and the Minister for Justice and Equality, the Minister for Education might be off the pitch or long gone out of the Department.

Despite the small gains referred to and the halting of some cuts, the overall impression of budget 2014 is that the juggernaut of austerity rolls on across the Irish population and landscape. The fateful and appalling banking decision of September 2008 continues to crush the most vulnerable sectors of society. Sadly, Fianna Fáil and Sinn Féin have no credibility on this issue because they supported the decision. Neither does Fine Gael whose members were clearly well briefed on the blanket bailout. They supported it, as we can now see from reports. Unfortunately, thanks to the current Rabbitte-Gilmore leadership, Labour’s credibility on this issue is also in tatters.

The results of these decisions for budget 2014 are the despicable cuts to young unemployed citizens’ jobseeker's allowance, cuts to maternity benefit, the household benefits package and supplementary welfare payments, and the carry-over cut to child benefit. Among the most egregious cuts are the ending of the bereavement grant and the mortgage interest supplement for new applicants. Sadly, the credibility of the Minister for Social Protection has almost evaporated in budgets 2013 and 2014. I still urge her to cross the Chamber and join us on this side of the House.

The cop-out on taxation by the Tánaiste, Deputy Gilmore, produced a range of obnoxious changes which will deeply affect lower- and middle-income families. It will be deeply damaging to what Deputy Donnelly calls middle Ireland. Younger people have taken a big hit in this budget and €8 million will be taken from the small budget of the Minister for Children and Youth Affairs, Deputy Fitzgerald. Her vital programmes assist the most marginalised young people. Along with the cuts to the jobseeker's allowance rates, the aforementioned cuts represent an unjust attack on younger citizens.

I have always believed in an NHS-type health system for Ireland but given the extreme pressure on health services, the restrictions on tax relief for medical insurance premiums will have a significant negative impact on families' incomes. This is why I voted against the measure last night. This proposal seems a typically careless idea from unelected and totally out-of-touch “West Wing”-type advisers in the Department of Finance and the Tánaiste's Department. They seem to be the kinds of people former Deputy Charlie McCreevy would not send to the village shop for a bottle of milk and a pan. They do not seem to have any idea how families have already been downgrading, year after year, to cheaper health plans so that they could keep their medical insurance.

The cuts in the one-parent family tax credit are equally reprehensible. The increase in the pension levy in 2014 is also inexcusable and a soft option by the people to whom I referred.

The increase to a tax of 41% or higher on nest eggs is another totally wrong-headed approach by a Government which is now starting its run-in to political oblivion. I received a number of angry and poignant e-mails last night from citizens with small savings who asked why the Government is punishing them by grabbing nearly half of the interest on their savings, given that they paid income and other taxes on the funds concerned. It was for that very reason that my colleagues on the independent left and myself did not consider such a tax hike in our menu of suggested tax changes published last week.

The increase in prescription charges to €2.50 an item will hit many of my senior constituents and the cut in income limits for over 70s medical cards is also deplorable. Senior community leaders have asked, for example, why the €500 income limit is not simply doubled to €1,000 for a married couple. Yesterday, the Minister for Health, Deputy Reilly apparently had no answers for journalists on from where the €113 million so-called probity savings will come on the medical cards. The immediate removal of a secondary benefit like a medical card for people returning to work is also harsh. We will all easily remember six, six, six, the €666 million of health cuts in budget 2014 and there is a fear, as 2014 unfolds, that not just the Minister for Health but the whole health system may go into meltdown.

One of the persistent failures of this Government as the Acting Chair, Deputy Catherine Byrne knows well, coming as she does from the south side of Dublin, has been the failure to address the housing crisis. The increases of €5 per week in contributions from recipients of rent supplement and mortgage interest supplement will further squeeze those struggling to remain in their homes. The closure of the mortgage interest supplement scheme to new applicants is equally deplorable. Of course, it is welcome that the Government is investing in the building of new social housing units. However, 500 units is wildly short of what is required to address the incredibly long housing waiting lists. Focus Ireland says that at least 9,000 new social housing units need to be built annually in the next few years. I acknowledge that the Minister of State at the Department of the Environment, Community and Local Government has said that around 4,500 housing units will be provided for social housing in 2014 through leasing and existing capital programmes. These will be through transfers from NAMA and the increased uptake of the Rental Accommodation Scheme, RAS. While 4,500 additional units are welcome, the policy of relying on the private market to fill the gap in social housing provision has utterly failed. It has been a disaster for the past 20 years or more. There are 5,000 people on the housing waiting list in my area of Dublin Bay North, or housing area B and 20,000 people on the list in the whole city but the number of vacant units coming on stream is minuscule. It is unbelievable that, for example, Dublin City Council has not yet received any NAMA units. I have asked the new Dublin City Council Manager to start giving leadership to the city, particularly in terms of the provision of new housing.

In two months' time Ireland will be exiting the bailout era but the huge debt burden resulting from the blanket bank guarantee and interest repayments will continue to weigh heavily on our nation. It is clear that a totally new approach and hopeful determined leadership is essential. Regrettably, the Tánaiste, Deputy Gilmore, is not the person to give that leadership.

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