Fiona O'Malley (Dún Laoghaire, Progressive Democrats)

I am glad of this opportunity to speak on the Finance Bill which is passing quickly through the House. A budget such as the current one does not happen overnight. Prudent management of the economy and sound investment have led us to a position whereby we are able to deliver such a budget. We should cast our minds back to the 1980s to realise the transformation that has taken place in Ireland since then. Massive unemployment, economic stagnation and emigration created an air of seemingly permanent despair that was a feature of the country in those years. Tax reform, compliance with EU criteria, the Maastricht treaty, the Stability and Growth Pact in particular, and social partnership have all contributed to the economic and social transformation we now experience.

This is the eighth budget which bears the hallmarks of the Progressive Democrats's philosophy. Together with Fianna Fáil, we have put in place economic policies which have permitted us to generate wealth which can then be redistributed to the most vulnerable and marginalised in society. However, if one does not generate wealth, one cannot disperse it. This budget, more so than any other, is tackling in particular the needs of people on lower incomes. It takes those on the minimum wage out of the tax net. It removes those on the average industrial wage from the top rate of tax and brings the old age pension up to €193 weekly, well on the way to the target of €200. This represents an increase of 67% since 1997.

It is such details and statistics which are long forgotten because we now have days of plenty and we forget. Looking back, nobody would have thought that over the lifetimes of the current and previous Governments, we would be in a position to increase the old age pension by 67%.

The early child supplement to which Deputy Andrews referred is an example of an innovative response to a particularly trying challenge. I commend the Minister on his flair in dealing with the situation.

Another commendable measure relates to biofuels. This is an area in which Ireland can grow and develop. Recently we have all become more aware of energy issues and the energy crisis. Ireland can play a major role in developing biofuels and renewable alternative energy. There are opportunities for Ireland if someone is prepared to take a bold step. We have the expertise but we need the taxation and fiscal incentives. In time to come, we will reap the rewards. I commend the Minister on taking a stand on this matter and, as he is aware, he is very popular with the biofuels sector because he has taken a brave step by allowing the sector to grow and advance. It is an area of major growth in this country.

A Minister for Finance has a responsibility and an opportunity to be forward looking and to take bold steps for the future. Two commendable examples are the strategic initiative fund for higher education and the measures the Minister proposes with regard to SSIAs and pensions. Education is the bedrock on which our economic prosperity has been built. As with the advances in second level education in the 1960s, the new fund for higher education will turn out to be just as important a measure as we advance.

Given the demographics of the country, pension provision for the future is a challenge. Prudent management of the economy involves providing for the citizens' financial well-being in the decades to come. The National Pensions Reserve Fund was the result of one commendable measure in this area and the Minister's SSIA pension contribution plan is another. Lack of pension provision for the future, especially among women, is a real problem which the Government needs to keep an eye on. The Finance Bill measures are a start but with regard to public sector pensions and the benchmarking issue, we need to be fully aware of their true value.

I commend the Minister's vision in solving these problems of tomorrow with the prudent management of today. That is a virtue often overlooked and seldom rewarded. Aristotle said that economics is merely a means but what is important is the aims we wish to serve. This budget has demonstrated that once one has provided the money and the wherewithal to generate income, we can deliver for our citizens economic prosperity in which they can all share. That is what they deserve.

See this speech in context