Mr. Tom McDonnell:

I shall address Deputy McDonald's questions by starting with the issue she made about Dublin 1. My organisation proposes a system that is based on market value rather than site value. The measure would address the basic issue but also our ability to pay the deferral system and income is a component of that. For example, if a person is unemployed then it is certain that he or she would defer a payment and, therefore, would not pay the tax.

With regard to whether one should expand the wealth tax from the property tax, there are a number things that can be done and that Ireland should be doing. Although this is not strictly a wealth tax, we should support financial transaction taxes which ensure the movement of finance.

Taxing financial assets in Ireland is quite difficult because of the open nature of the economy. We will look at this in greater detail in the future. One of the reason we do not have specific proposals on such taxes is that we do not have cost proposals on it. We do not have the numbers.

In terms of perfect equilibrium, it is not a perfect equilibrium and that is the reason it must be sustainable over the long term. When one has high levels of unemployment and incomes go down, the income component of a deferral system kicks in. In addition, house prices are falling. This tax will be less of a burden during times such as now. When good times return, if they ever do, then the level will increase. On the issue of the sustainability of the debt and whether we should be repaying it, the position taken by TASC, as we articulated last year, is that we should suspend the payment of the promissory note, pending a full renegotiation. We have made that clear. We believe Ireland should come up with its own technical paper in which all the options available to Ireland are examined.

I have been asked what can be done for children and for the working poor. One begins by issuing a guarantee that there will be no cuts to services for children, no increase in taxation vis-à-vis the low paid, credit spans and so on. A broader commitment is also made, including a commitment to a quality audit so that as part of the budget process one looks at how the proposal will affect children over the entire year. We need to know that by looking at the evidence and having the debates in January and February and not in the middle of November when we all criticise the decisions that are not based on evidence and are made on the night before the budget. We need to take a multi-annual approach. One of the areas that Dr. Seán Healy raises is the idea of refundable tax credits, which we fully support. It is a very good way of supplementing the incomes of the working poor.

The money in the National Pensions Reserve Fund, which is approximately €4.5 billion, is uncommitted and could be committed to the domestic economy, not necessarily as a stimulus only but in targeted ways. Let me give examples. A significant cohort of the people who were formerly in the construction sector will never be able to get jobs in construction again. We had a boom. When the economy returns to normal, the levels of construction will be below the boom levels, therefore we must consider now what skills will be necessary for the economy of the future so that we do not create structural unemployment over the next decade and onwards. We need to focus specifically on the long-term unemployed and ensure they will get the education, retraining and upskilling necessary. We need to pour money into developing people. It is about human capital to a large extent.