Frank Feighan (Roscommon-South Leitrim, Fine Gael)

I commend Deputy Coveney on introducing this motion, which deals with improving competitiveness, reducing inflation and helping to reduce poverty by cutting the lower rate of value added tax from 13.5% to 12.5%. When the country was banjaxed in the late 1980s, Fine Gael, under the leadership of Mr. Alan Dukes, introduced the Tallaght strategy. We developed ideas and were supportive of the Government at a difficult time. I am not an aggressive politician, but people from the other side of the House have been telling Fine Gael to develop ideas for years. However, Deputy Coveney's enterprising idea is being rejected out of hand by a tired Government lacking its own ideas. As the Government needs the Opposition's help, I appeal to the former to accept Deputy Coveney's solution.

The credit crunch is having a significant effect on business, particularly small businesses, a category in which I include myself. Many small and innovative businesses have spent years addressing various issues, but the cost of being in business will put them out of operation. The issue between the public and private sectors is significant. The latter has been neglected for too long, but it is too late to save it. Anything that would encourage businesses to be competitive and give them a breath of fresh air would be helpful. I commend the Deputy's solution in this regard.

House completions have bottomed out at 25,000, the building sector is banjaxed and the tourism industry is under severe pressure. The increase in oil prices is putting the transport industry under pressure. Bringing the matter to the human level, our shop sells €5 ESB meter cards as a service to normal people who are in receipt of social security payments and are under serious pressure. These people come to my door at 11 p.m. or midnight because their electricity has stopped and they have needed to take the €5 or €10 from elsewhere. Most of us are fortunate enough to live in well insulated houses with ESB storage heating, which is reasonably good. However, most of the people in the situation I have outlined live in local authority housing built in the 1970s and 1980s. Since those houses have no insulation, they cost twice as much to heat as ours. Deputy Coveney's solution will help to reduce the cost of electricity. Sometimes, the houses I visit are colder than it is outside. Anything I can do to help people get through their difficult times would be reasonable.

Regarding the windfall levy and the cut in the VAT rate, reducing the 21% rate would have a greater impact on inflation, but there would be fewer benefits for the poor. Deputy Coveney has introduced the motion to address this matter, given that the poor, as opposed to higher income households, spend most of their income in the 13.5% rate bracket. Last year, Spain introduced a windfall levy for this reason and the UK Treasury is considering a proposal by the energy regulator.

Introducing the environmental issue is nonsense. Fine Gael has developed a positive and innovative solution to a serious situation. I have highlighted how the vulnerable are being targeted and how our suggestion will help them to reduce their bills. I commend the motion to the House.

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