Olivia Mitchell (Dublin South, Fine Gael)

In an attempt to have us forget about Government inaction over the past several years, the Taoiseach said this morning that he had to deal with the situation that confronts him now. The reality is that it did not arrive out of nowhere to confront him over the past few days because he helped to create it. I acknowledge that a crisis has arisen internationally to which we are not immune but it is undeniable and unforgivable that its impact on us is already greater than elsewhere and will probably be more long lasting. My colleagues have already referred to the rapidness of the collapse in our growth and employment rates. We are the worst on any scale. Our inflation rate over the past ten years has been twice the EU average. It is no wonder that we are the most expensive country in Europe. Regardless of the picture which the Taoiseach and his Cabinet colleagues try to paint, these factors did not arise by accident. They are specific to Ireland and were under our control but the Government did nothing about them.

That we have to face them now is entirely due to a feckless Government which spent with abandon over many years. During the Taoiseach's tenure as Minister for Finance, he increased spending at twice the rate of economic growth. Even a child knows that if pocket money increases by €1 per week, he or she cannot spend €2. Spending was based on unsustainable property taxes, despite the warnings of every expert. Indeed, any child could have told the Government about this.

While all this heady spending continued, long-term thinking was forgotten. Preparation for a rainy day was put off and there was no search for value for money, reform of public services or regulations and no drive for competitiveness. There was no sense of urgency about broadband services, energy or transport. God knows what our very well resourced training body, which was supposed to give us a cutting edge labour force, was doing. After ten years of continuous growth, we should have been in a better position than other countries to face a global recession but, with more expensive goods and services than any other country, we are in the worst possible position. At the same time, our coffers are bare and we have no reserves.

Our Government has made no response to these issues. It was in complete denial and ignored all the warning signs. It held parties for the incoming and outgoing taoisigh but did nothing about the gathering storm clouds for which the rest of the world was preparing. In July, it briefly acknowledged that a problem existed but then allowed it to drift throughout the summer, emerging only briefly to announce it would do something in October. Weeks of unease about the security of our banking system were completely ignored. People were withdrawing money and putting it under their mattresses. Joe Duffy was blamed for this, even though he was merely reflecting what the people in the streets had been discussing for months.

The Government's first response to these problems was to announce that it was giving us all a pay rise. There is something surreal about concluding a pay deal in the very month in which we announced the highest ever increase in unemployment. At the same time, there was almost a run on the banks. This is nonsense. At a time of such uncertainty, I do not know how we, as part of the public sector, can promise to pay ourselves more. Private sector workers are being asked to work harder and longer to produce more and pay more taxes at a time when they do not know whether they will have jobs, much less pensions. What else did the Government do? When the directors of Aer Lingus were trying to put together a business plan to save the airline the Minister for Enterprise, Trade and Employment, Deputy Coughlan, told them she was not happy with it. To the best of my knowledge the reason the Government privatised Aer Lingus was to give it freedom of operation. I recall a specific promise from the Government that, despite holding a considerable shareholding of the company, it would not interfere in the running of the airline as this would impact negatively on the share price. However, that is exactly what the Minister did, at a time when there were as many airlines as banks going to the wall.

The final straw was an increase of 8% yesterday in taxi fares. This shows how out of touch the Government is with the realities of the market at present. Taxis are largely a discretionary spend for people, so this increase will result in a reduction in taxi usage. It is completely bizarre and damaging not just to the economy, but also to the tourism industry. The Government must realise that the days of easy money are over. It cannot spend its way out of every problem now. There is a new world order and the Government will have to start making its own luck. It will have to husband resources, target investment priorities, reform public services and upskill the workforce. There is no sign that the Government has any idea of the challenge it is facing, how it will deal with it or, indeed, that it even realises there is a challenge.

See this speech in context