Richard Bruton (Dublin North Central, Fine Gael)

The exercise of power in our society must be met with probing scepticism by those responsible for regulating. Instead, it was met with accepting faith. The whole system got far too cosy and they got sucked into believing, as Lord Denning believed, that the appalling vista that the system was perverse could not be contemplated. That is what motivated much of what went on, why people turned in the other direction when strange things took place, why they did not ask probing questions about legal advice and why information rested in the Department and was not acted upon. These are symptoms of a system that is far too close and cosy. It must be changed totally.

We do not want to get into a big debate about institutional architecture, of whether there should be joint, separate or combined boards and who reports to whom. What must change is the ethos, the culture, the people, what they believe, what they do and how they react to dysfunction. Ethics must be brought back into the system. I do not want the House to spend six months debating Bills, with institutional architecture changing, when the core issue is to get rid of the personnel, the policies and practices and make a fresh start. That does not need much legislation although it may need someone to set signposts and directions. This should be happening already and I deplore the delay. I am frustrated that the only body examining regulatory failure is the one that failed us, the Financial Regulator. This is not good enough. There must be a break and these things must happen together.

Fine Gael has recognised that public service pay must be addressed. Fine Gael does not support this pension levy but recognises that the underlying issue must be addressed. This must take place in the context of all other elements being addressed. In the Minister's defence of the Bill he states that the contribution by the low paid is fair. His statement refers to the move in 2004, to the effect that those on low pay would not be confined only to an increment over the social welfare pension and that they would get more benefit. I cannot recall the exact provisions made in 2004 but I am surprised that the Minister has not set them out. A porter will pay 4% in PRSI, a 6.5% pension contribution and now the 3% levy. If the Minister believes the arrangement made in 2004 compensates for this burden we need to see those figures presented. If that is the contention of the Minister, that this constitutes fair treatment of such low paid public servants compared to those higher up, let us look at the data and see if he can convince us.

The Department should also publish the actuarial cost of pensions in different categories. My recollection is that the actuarial value of the pension of low paid people was 6%, as calculated in respect of the contribution needed to fund the pension they receive. The contribution required to fund the pension of the Secretary General is approximately 40%. The Minister is asking people on low pay to accept that they pay 3% while the Secretary General pays 9%, with tax relief at 48%. That will not wash and people do not see it as fair. These actuarial tasks should be presented. If this levy is to balance the actuarial value of the pension we give people, we must see these tables as they apply to both sides. We could then begin to have a more meaningful debate about the fair allocation of the pension levy if this information was published.

Over the course of several debates, including the Labour Party motion on Private Members' time, the perverse interplay between the levy and tax relief has been raised. People earning €30,000 will pay a higher percentage than those on €45,000. How is this justified and what changes are proposed to allow for this? It is the amount that is taken out of people's pockets that matters to them and the net levy should be the basis on which one assesses the fairness of contributions of this nature. I do not know if the Minister is open to amendment; he seems to have given very little scope for it because he does not provide analysis of how he came to regard these elements as fair in the context of a pension payment. We must see change because people must have a sense that they are not being singled out and that there is fair play. This has not been conveyed.

There are two matters that I cannot figure out in the financial presentation. I cannot figure out how those writing the tax forecasts in January knew exactly what would emerge in February and built into their tax forecasts the correct buoyancy factor to compensate for these payments and the various cuts that were proposed in fees. Any other budget presentation has the gross cost or savings on one side of the measure and the tax buoyancy impact on the other side. They are presented on the same day and people can see them. For some mysterious reason, we are not seeing the tax buoyancy element and we are asked to believe it has been put into a flimsy document which has just one number as far as tax is concerned. It has not been justified.

Where did the saving go from deferring the September pay increase in the public service? This saving has not been recognised in any of the documentation. From a parliamentary question answer it was expected to cost €279 million but it has not appeared anywhere in the flimsy data with which we have been presented.

I will turn now to the fee restraint provisions in the Bill. Everybody recognises that this element of the Bill seems fair in that this is an opportunity to get savings in the various costs taken on by the Exchequer. I am unclear as to the full scope of this. If we are including professional fees, why are we not including rents or other elements of what the State contracts in services? It seems to have singled out certain categories and not others.

The more important question is whether the legal basis on which this money is taken is robust? In the past we have seen cases where a Minister is given the power to be a sort of judge and decide what is appropriate, and this has been challenged. The Oireachtas is the only body that can legislate for what is appropriate but we seem to be giving the Minister the power to decide what is appropriate, albeit after discussions and considering various issues. At the end of the day, the Minister will make these decisions by fiat rather than legislative authority. It is proposed that they will be tabled later and if they are not annulled, they will come into effect. I do not know if this is sufficient to give the Minister the right to rewrite people's contractual agreements. I notice there are many citations detailing how we are in a crisis and that there are greater problems. Perhaps that is designed to say the normal rights of private property are now balanced by public interest issues and, as a result, Ministers have the right to make certain administrative decisions.

I would like to ensure these will not be challenged. I have not had the time to consider the matter but I recall that when the HSE made similar moves to unilaterally alter the terms and conditions of pharmacists, there were very significant problems and the HSE ultimately had to back down on the basis that the matter was legally doubtful. The Minister should clarify the basis on which this power has been given to the Minister and whether it is adequately overseen by the Oireachtas in constituting legislation that is not vulnerable to challenge in the courts.

I will finish where I started. We recognise the country is in a deep crisis, that we must make significant savings in the public finances and that savings in the public service pay bill will inevitably be a part of this. We also recognise that the country will not be governable unless there is a sense that contributions are being made from people right across the range and there is a credible broader economic strategy, which will lead to people having the confidence to make decisions and spend their money. Until we get that in place, this measure will be seen as isolated and will not command the necessary public confidence. We must think again and put measures like this in a much broader and fairer context.

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