Dr. Tom McDonnell:

Deprivation has doubled. The deprivation rate stood at approximately 10% before the crash and now stands at approximately 25%, having peaked at over 30% in 2013. It remains very high, however, and indicates that many households are suffering, particularly those at the bottom of the income distribution scale. The unemployment crisis was the main driver of this. One of the things that will help a great deal will be employment growth. Employment is considerably lower than it was at the height of the boom.

Deputy Chambers is correct that we have not been investing in infrastructure in recent years and investment was disproportionately hit.

It means that as employment grows, public transport infrastructure is creaking. Coming on a train from Maynooth into Dublin one finds it difficult to breathe. It is arguably unsafe. Because of house prices in Dublin, people are having to move out to Meath, Louth and Wicklow, which means longer commutes and spending more time away from their families, which is psychologically devastating and corrosive in the long run. These problems can be dealt with but it is the focus on things like infrastructure that will be very important.

I was asked about the great debate on increasing the standard rate versus reducing the USC. Of course, it depends on what reforms one makes to USC. There is only about €333 million. I made the point that increasing the standard rate cut-off point by €1,000 would mean a full-year cost of marginally over €200 million according to the Department of Finance's tax strategy group. One could reduce the 2.5% rate to 1.5% at €164 million, which would be approximately half the fiscal space. With a break-down of 2:1 tax and spend, one is talking about net space of a little over €100 million for taxes with, obviously, more arising from tax increases on excise that are likely to happen. What one can do for households is really about shaving at the edges. In our opinion, it is better to focus on things like child care. From a progressivity point of view, reducing the universal social charge probably would be preferable. As was pointed out, a lot of households will not benefit at all from an increase in the standard rate. Again, in terms of the tax burden vis-à-visother countries, low-income workers in Ireland pay very low effective rates, but middle earners also pay very low effective rates compared with other high-income EU member states. It is kind of a rotten choice as I look at it.

I do not really have any solution in terms of the sugar tax. The soft drinks companies have already changed the sugar content. One cannot even buy some of the drinks that used to exist in 2016. If it is in fact true that aspartame is not as damaging as sugar, the tax is already doing what it is supposed to do. Excise is not technically supposed to bring in revenue, it is technically supposed to reduce bad behaviour and poor choices. If the yield ultimately goes to zero, it will supposedly have done its job. It is the same with alcohol and cigarettes.