Kathleen Lynch (Cork North Central, Labour)

I am glad the Minister has admitted this measure is nothing more than a grab for local government funding. He was clearly not successful in his budget negotiations. An Oireachtas committee, of which Deputy Hogan was a member, sat for two years investigating the high cost of car insurance. The tax on cars now costs more than insurance cost two years ago. It is outrageous and I do not understand how the Government believes people can afford it. If the Minister knew anything about how the motor trade operates, last December he would not have announced a change in VRT to be introduced in July. The repercussions of that decision were seen in Cork recently with the loss of many jobs in the industry.

Whoever is advising the Minister on motor tax must have written this paragraph in the Budget Statement. It states:

From 1 January 2009, the provision of bicycles and associated safety equipment by employers to employees who agree to use the bicycles to cycle to work will be treated as a tax exempt benefit-in-kind. The exemption may only apply once in any five year period in respect of any employee. There will be a limit on the value of such purchases of €1,000 for each employee. The scheme may also be implemented via salary sacrifice arrangements, [that is a new one] whereby an employee agrees to forego part of his or her salary to cover the costs associated with the purchase of the bicycle and associated safety equipment. Where such salary sacrifice arrangements are implemented, they must be completed over a maximum period of 12 months.

In my language, and that of anyone else I have asked, this means the Minister is offering to pay people with a bike. Forget people's salary, we will give them bikes. Not only will they get a bike, we will decide what colour it is because obviously different employers will have different colours. It will probably have a logo. As for the safety equipment, where would one be without a bell on one's bike? What about a lamp? What about a dynamo or bicycle safety clips?

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