Denis Naughten (Roscommon-South Leitrim, Fine Gael)

Two years ago, there was an Exchequer surplus of €4 billion, even after the Government had squandered as much money as possible on projects such as PPARS and electronic voting. The list goes on. The only commitment given by the Government at that time, in the wake of these instances of wastage, was that it would get it right the following year by ensuring it spent all the money available to the Exchequer. Now, 24 months later, we are going into debt at a rate of €40,000 per minute. The Government has spent recent months playing jigs and reels with the social partners in its efforts to secure savings of €4,000 per minute. What about the additional €36,000 per minute we are obliged to borrow? The Government is engaged in abacus economics.

A conversation I had last week with a person from a rural village in County Roscommon offered an insight into the current state of our society. He observed that one cannot get a pint because the pub is closed, one cannot buy a postage stamp because the post office is closed and one cannot buy a newspaper because the newsagent is closed, but there is no difficulty in buying an apartment. The Government facilitated the unsustainable increase in prices in the commercial and residential sectors. My colleague, Deputy Bruton, repeatedly warned the Government about this and emphasised the need to save for a rainy day. However, nothing was done.

Last Tuesday, I had lunch with Senator Anne McEwen from the Australian Parliament. Her Government, she told me, announced its second stimulus package this week, the first having been introduced before Christmas. Both these packages were financed from the reserves built up by the Australian Government during the good years, a concept completely alien to the Government of this State. We are not even informed of its intentions.

Young families who are mortgaged to the hilt are feeling the brunt of this downturn. The blame for this lies firmly with the Government. In 2006, the Taoiseach, who was then Minister for Finance, was privately advised by economic experts that the property price explosion was unsustainable. At the same time, he publicly encouraged young people to invest their future in housing. Why would he not do so given that 35% of the price paid for every house goes directly into the Government coffers? Banks are now setting unattainable deadlines for the repayments of loans. Innovative action is required to address this problem. In return for their recapitalisation, the banks should write off a percentage of property-based loans where it is evident that current repayments cannot realistically be made.

The Government has failed to recognise that the small business sector, which is currently haemorrhaging jobs, is of greater significance to the economy in terms of the employment it provides than multinationals and the State sector combined. Companies that have been in operation for 50 years are going to the wall. Fine Gael has proposed that such businesses should be exempted from PRSI where they are creating a new job with no net cost to the Exchequer. We must also, at the very least, reverse the increase in the VAT rate and allow credit-starved businesses additional time to make their VAT payments and flexibility in regard to tax clearance certificates. Moreover, the Government and its agencies must pay small businesses within the current 30-day deadline. The Government, through the banks, must provide small businesses with the essential capital required to operate on a day-to-day basis.

The Government must also examine the issue of cost savings. Last year, for example, even though the number of asylum applications had decreased and accommodation costs had declined, there was an increase of €15.5 million in the cost of housing asylum applicants. We must deal with the bottlenecks within the system. For example, there is great potential to grow the international education sector, which is currently worth €1 billion. However, we are still awaiting the finalisation of issues in regard to regulation. We have a crazy situation where a person from outside the European Union who wishes to set up a small business here cannot do so without obtaining permission from the Department of Justice, Equality and Law Reform.

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