Noel Treacy (Galway East, Fianna Fail)

I am pleased to contribute to this very important debate. This is the ninth consecutive budget presented to the people of Ireland by this Fianna Fáil-Progressive Democrats Government and is, as I was glad to hear Deputy Kenny admit today, a budget that the Irish people deserve. Over these nine budgets, a clear and focused strategy has been followed, which has positioned this modern republic of ours as a country that is looked up to all over the world. This has all the more significance, as Deputies will be aware, because it is not that long ago that the opposite was the case.

Now we can hold our heads up proudly, as this nation and its people have a better place to live than ever before, due in no small measure to a Government which has taken the right decisions and created an economic and social climate of promise and opportunity. For the brave men and women who won our independence 85 years ago, such progress would have been hoped for but, in reality, scarcely thought possible. We have come to where we are not by chance but because policies have been implemented which have allowed the Irish people to achieve extraordinary things.

This is undoubtedly the longest era of sustained prosperity in our history. We were criticised for it but careful fiscal management has created an economic environment that has attracted investment, practically eliminated unemployment and for the first time in a generation given our people a choice to remain in their own country.

In my position as Minister of State with responsibility for European affairs, I am continually struck by the extraordinary journey which our country has travelled over the past few years. Less than two decades ago, we were one of the Cinderellas of the EU. Today we are at the top of the 25 and even as traditionally powerful states, such as France and Germany, experience sluggish economic growth, Ireland continues to power forward. For the new member states and for those close to EU accession, we are a perfect role model and a template which they all seek to emulate.

This budget is a generous, responsible and focused set of provisions which will sustain economic progress while improving the quality of life of all our people. Underlying all that this Government does is a genuine desire to spread our continuing prosperity as evenly as possible and to ensure that policies of fairness and equality, are always pursued.

By protecting and growing the economy through investment in infrastructure, low corporation tax and increased levels of funding for education and training, we have generated the means to target resources where they are most needed. There is no doubt that this is one of the fairest and most socially progressive budgets ever produced by an Irish Government. We have generated the means through prudent economic management and now we are setting about using them.

We have ticked all the relevant boxes because that is what good and accountable Government is elected to do. We are investing far more in our future, through enhanced capital spending in education at all levels, including a new package to promote innovation in our universities.

Budget 2006 introduced a truly innovative package of measures for child care and a big increase in the old age pension, fuel allowance and carer's allowance. It increased social welfare rates well ahead of inflation. It will keep those on the minimum wage out of the tax net — a record 740,000 people. It will keep those on the average industrial wage out of the higher tax rate. It will reform tax reliefs so tax payments more fairly reflect ability to pay. It will freeze indirect taxes and reduce other taxes. It will introduce special reliefs designed to improve our environment and it will relieve the tax and administrative burden on business and on small business in particular.

Budgets are now generally a challenge for the Opposition. Holes must be found and weaknesses probed. Sometimes these are found and exploited but no amount of verbal ingenuity can mask the frustration of this Opposition, which has been undoubtedly stumped. The best it can come up with in muted response is that it is an election budget. Speaking of elections, it is once again worth reminding the House what things were like when the main Opposition parties, Fine Gael and the Labour Party, were last elected to Government. This was a time when the economy was on its knees, a real basket case or the poorest of Europe's rich, as we were famously described in 1987. Thankfully, my party, Fianna Fáil, returned to Government that year and set about pulling the country out of the doldrums of the previous five years. Due to utter mismanagement and incompetence, Fine Gael and the Labour Party had presided over a situation where taxes had gone through the roof and inflation was rampant. People were being taxed at 65%. This week Deputy Rabbitte said the highest tax rate was too high——

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