Dr. Micheál Collins:

I shall start by confirming the figures for the Deputy. The figures are from the most recent CSO survey on income and living conditions, the most detailed survey and data we have on income in the country. It gives us the picture of where we are before taxes and social welfare occur. It is the case that the top 20% receive 25 times the share of those at the bottom. One of the other numbers was that the top 30% of all earners get 67% of all the income. This is the starting point of the State steps to redistribute. If we have such high inequity to start with, it is a big job to redistribute income and even out the situation. This brings us back to issues around how to begin to address in some way the issue of more adequate earnings and incomes. This is the reason we have an effective tax and social welfare system. We must have that. Otherwise we would have even more unequal income distribution, which would be even more problematic.

We must remember competitiveness is not just about wages. Wages are important, but there are issues in regard to public services, infrastructure and the education system. Competitiveness touches on all of these also. In terms of low paid workers and the general groups the committee is looking at, we must remember it is not all about pay and that there are issues around precariousness of employment or precarious work practices and uncertainty for employees, who do not know from one week to another what their work hours or income will be.

Putting people and families in a position such as that is not sustainable in terms of ensuring adequate and decent standards of living for society.

I agree with Mr. O'Brien that a jobless household is the real issue. There is no doubt about that. Given the scale of the economic crash we have had, we have many of these households. The great concern is that if we have significant numbers of lower skilled people unemployed, the potential jobs awaiting them are not a great improvement from their current position. We want to get these people back to work, but we want to get them back into decent jobs and work. We must think about this agenda.

On the broadening of the tax base, we have still got quite a bit of work to do. We have made significant progress over time, but broadening it further would probably include issues such as increasing employees' and employers' PRSI, which are quite low. Neither of these two groups are paying sufficient currently to support the social insurance system we have in place or the Social Insurance Fund, which continues to require subvention from the Exchequer. Given the structure of the economy and the population and given the likely costs that face us in the years to come, this brings us back to thinking realistically about how we will pay for these.

I and some of my colleagues at the Nevin Economic Research Institute have been pointing towards the fact that we must stop dealing with the day-to-day crises we have been dealing with, in positive and negative times, for approximately three decades and begin to embrace seriously where we are going as a society. We must think about that. This will require us to think about structural reform and about preparing for the long-term challenges. It is unrealistic to look at the tax take we collect currently and the likelihood of what is ahead for society without realising that we must either make significant public spending cuts in the years to come or collect more tax. We have not had that debate, but it would be useful to have it.