Michael Kennedy (Dublin North, Fianna Fail)

We have to deal with measures to bridge the gap between the State's current income and expected revenue. Some €3 billion is needed to run the country for the next year, and there is no point in denying it or rewriting history. No more than previous Fianna Fáil-led Administrations, Fine Gael-Labour Governments were equally bad in terms of increasing the national debt and creating problems. We need money now and the general public recognises the next two or three years will be difficult and is willing to make its contribution. However, matters are not helped when people on the other side say that extra taxation is not needed. I do not pretend that I am an economist, but I have been a businessman and so know something about it. Eminent economists argue that if the Fine Gael proposals were implemented, we should be borrowing an extra €4 billion on top of what the Government is planning. We should recognise that our GDP will decline by 1.5% next year and a further decline is on the cards for the following year. We know that €2 billion of this money will come from taxation measures and a further €1 billion will be garnered from savings on public spending. Everyone in the House expects savings across the public service. We have all had difficulties, whether with the HSE or other bodies. I welcome the fact the Government will tackle this problem.

Income from taxation will primarily come from the 1% income levy. That levy is fair and equitable. However, I welcome today's confirmation by the Taoiseach that those on lower incomes will be excluded from this. Higher earners, those earning over €250,000 per annum, should pay a higher figure than the 2%. I suggest 2.5% or 3%. I hope when the Minister brings forward the Finance Bill, he might incorporate that because higher earners have done well out of this country, they are not afraid to pay up and they are willing to make their contribution.

I mentioned old age pensioners earlier. The €7 increase, bringing the pension to €230 per week, is important. Most of the people I have met over the past number of years recognise that they have been well treated. They are quite happy with the increases they have been getting year on year. From my discussions with people, I believe they are happy they are getting an extra €7 in the coming year considering the state of the public finances. They recognise that as much as the rest of us do.

The levies will certainly pay for the 5% increase in the mortgage interest relief for first-time buyers. That is a very important facet. These people need help in these difficult times and it will allow them to claim up to €416 per month which is significant.

I am particularly pleased with the transportation issues. Deputy Broughan will agree with me in regard to metro north which will benefit his constituency, even though it does not run through it. The area north of the Liffey, including Meath and south Louth, needs a public transportation system comparable to the Luas on the southside. We need an efficient and cost-effective method of public transport. Every morning the M1 motorway coming into Dublin city is clogged up. We need to take those 20,000 cars off the road for future sustainability, to reduce CO2 emissions, etc. All the sceptics, including Deputy Broughan, were half hoping that metro north would not be in this year's programme. Deputy Broughan could have——

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