Joan Burton (Dublin West, Labour)

When the Minister sat down at the conclusion of his Budget Statement six weeks ago, the Fianna Fáil, Green Party and Progressive Democrats Members rose to give a standing ovation to a budget that unravelled faster than knitting. Of all the disastrous aspects of the budget, aspects that have not just been unlucky for the Minister, the Government and his party, but also for traders and businesses across the country, the decision to raise the VAT rate by half a point has left unbelievable misfortune in its wake.

The Minister's argument, to which there is some point, is that the vast wedge between prices North and South is being driven by the failure of importers, British multiples and others to pass on the reductions in the value of sterling. Nonetheless, the psychological hammer blow was struck by his foolish decision to increase the VAT rate from an already high 21% to 21.5%.

Currently in the Chamber there are five Members, not including the Leas-Cheann Comhairle, four departmental officials and a number of other officials. I remember the benches opposite being full of people screaming about the budget's wonders. It followed the Minister's call for patriotism. Is there not a Chinese curse to the effect that one should be careful what one wishes for? For a long time, many of us have wanted an all-Ireland economy, following on the patriotic tones of Wolfe Tone and others. We now have that economy, but it is like West Germany after the fall of the wall, in that those in West Germany needed to pay for reintegration.

The Minister has driven shoppers in their tens of thousands north of the Border. Traditionally, people within 20 miles of the Border have shopped on whichever side of it the advantage lay. Perhaps the standing ovation was for this. The Green Party Members would possibly have disapproved on the grounds that driving trade north would lead to greater emissions, unless people were driving hybrid cars. However, the Fianna Fáil and Green Party backbenchers jumped up and applauded until the Minister's ears rang. It has been the single most disastrous policy in a disastrous budget that also included attacks on the elderly and schools.

A Spanish curse tells people to ask of God what they want, but to then pay. The Minister is paying. It is the 11th hour and only 15 minutes remain until the end of the debate on the Finance Bill. The Minister should withdraw it. While that would not produce a significant immediate change, it would signal that the Government is recovering some element of economic sense. While it would cost the State, it is replaceable by other revenue-raising amendments. The Minster applied a levy that could not be called income tax and he increased VAT so that he could say that he had not increased income tax.

It is a disaster. The Minister has an opportunity in the 11 minutes remaining for an 11th hour convention and to withdraw the measure. I strongly suggest that he do so in the interests of trying to restore some sense of financial rationale to the budget.

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