Martin Mansergh (Tipperary South, Fianna Fail)

It was very important that decisions were taken without further delay to start to remedy the gaping hole in the public finances. Ireland's credit worthiness is essential to sustain public services and jobs. The decisions announced yesterday did not just save €1.8 billion this year or €2 billion in a full year, but also provided the first €1 billion savings of the €4 billion that will be needed next year.

Across the world there is a confluence of banking crisis, widening budgetary deficits, and sharp decline of growth and employment. Every country has been hit unexpectedly. Every country has needed to react on more than one occasion and sometimes revisit decisions made at an earlier point. No country has turned the corner. Unlike in previous recessions, where some countries were relatively unaffected and therefore able to provide a stimulus to the rest, unfortunately, that is not the case in this instance. Ireland has been particularly badly affected perhaps because the boom was so strong and prolonged. As a society, including Government and all sides of the Dáil, very few anticipated the exceptionally hard landing we have had. I accept there were one or two isolated voices.

Despite prudently putting aside considerable revenues into the National Treasury Management Agency and also encouraging private savings, we built up services and incomes to a level that we are now unable to sustain. During the last general election campaign promises were made on all sides of tax cuts and concessions, which in the light of today seem surreal. However, they were made on the assumption of continued growth of approximately 4% or 5%.

Great demands are being made on the Government from every sector of society and the economy when, as recently as a couple of years ago, neo-liberal commentators were half wondering whether government was really necessary at all. We need to focus as far as possible on maintenance of essential services and jobs, including investments that will help sustain jobs now and in the future. We cannot sustain incomes at the levels that existed until very recently. The Government has a choice of maintaining incomes or jobs. Once jobs are lost they are very hard to recover. The clear choice made has been to put the priority on jobs rather than income maintenance.

To legislators across the world it is repugnant in many ways to be bailing out a banking sector from the excesses and greed of some of its higher echelons.

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