Martin Mansergh (Tipperary South, Fianna Fail)

The backdrop to the budget is the serious financial situation at home and the turmoil on the global markets. Even after the budget measures are implemented the projected general Government debt is €12 billion or 6.5% of GDP. If nothing had been done the deficit would have been 8%. That has necessitated serious expenditure reductions but also €2 billion in tax increases. It will take us until 2011 to get back on track in terms of getting the deficit down below the 3% threshold. Growth should resume when the contraction in the housing sector is out of the system.

The prosperity of the past 20 years was based on the decision in 1987 and 1988 to put the public finances on a healthy footing. The credit for that goes to the then Taoiseach, Charles Haughey, and the then Minister for Finance, Ray MacSharry, with the support of Alan Dukes and the Tallaght strategy from the Opposition benches, given that there was a minority Government. The public finances went remarkably quickly on to a solid foundation. That has been one of the principal bases for the spectacular employment growth, the substitution of a low tax system for a high tax system and the vastly increased expenditure and improvement in public services. I make that point to underline the fact that we have to pull back the rapid deterioration and not allow it to become a runaway horse, otherwise we will spend years trying to correct the situation, as happened through most of the 1980s.

At the same time, the Government does not want to put the economy into a deeper depression. The budget has involved difficult and painful decisions. It is undoubtedly an observable fact that different sections of the community and different interests of all types always feel they are a special case and that the burden should fall on somebody else. The favourite scapegoats seem to be either the rich or, increasingly, the public service. The reality is it falls on everyone to make a contribution. I understand the Opposition parties feel no particular obligation to come up with a coherent alternative concept and Governments are there to take responsibility. However, I certainly find the Fine Gael position as incredible as the Taoiseach did yesterday.

See this speech in context