Simon Coveney (Cork South Central, Fine Gael)

I am glad to have a chance to speak on this debate, which is quite crowded as many people are trying to have their say before we break for Easter.

If the Government wants to introduce a budget such as that introduced yesterday, it must have an effective communications strategy if it expects people to accept the kind of hardship it is imposing on them. It expects people to have a bond of trust with the Government over a period of four years during which we will go through great hardship and it will be asking for more and more sacrifice. This year we have saved €3.5 billion; next year it will be €4 billion and the year after another €4 billion. The way in which the Government started this process yesterday was extraordinary. It stuck to the firm line that Ireland is experiencing the same hardship as all other countries in the Western world, that this is a global recession and that we have just hit a wall, as the Minister for Foreign Affairs, Deputy Dermot Ahern, says. A bit of humility would have gone a long way towards building a sense of honesty in Government. If in this budget it is asking families on middle incomes to take an income reduction of €4,000 or €5,000 after asking them to take a cut of about €2,500 last September, the least it can do is to be honest with them in terms of how we got here and who made the mistakes that have resulted in our having to slam on the brakes now. However, it does not seem to be able to do that.

I am pleased the Minister here is a Green Party Minister, who is largely not responsible for the mistakes that have been made in the past five to six years. I appeal to the Minister, Deputy Gormley, to reach out to the public with that type of honesty. People are not fools. They know mistakes were made in particular domestic policy decisions. They know this country was excessively reliant on the property sector for taxation revenues and that current expenditure was built on the back of this entirely unsustainable income. They know Ireland has become uncompetitive and sloppy and that it is expensive to do business here. They know we have allowed this to happen in the last four to five years. Ten years ago, we were highly competitive. People are aware of the wasteful expenditure that has taken place. They know that in the boom times, when we were lucky enough to have surpluses, we should have been preparing for a downturn or for the deep recession we are now experiencing. However, that is not what happened.

Is it too much to ask that a Government which expects the populace to shoulder the burden of its own mistakes should at least be honest about those mistakes? I acknowledge that the current crisis is being added to in a significant way by a global banking collapse and a difficult exporting environment to which Ireland is particularly vulnerable. We are all aware of these realities. However, if the Government is asking people to accept the need for hardship and for everybody to come together in a unified effort to bring about national recovery in a time of emergency such as we currently face, the least people deserve is a dollop of humility and honesty from the Government. Instead, all we have had is the type of arrogant speak we heard yesterday which saw fit to refer to the budget as evidence of the Government's leadership, courage and vision. What a load of waffle. The measures announced yesterday are decisions into which the Government has been forced. Leadership and vision were required last September when the Government bottled it in introducing its unsuccessful first emergency budget. It was only in view of collapsing revenues and the realisation that the country is heading towards the abyss in terms of our ability to borrow to meet the deficit requirement that the Government was forced into making the decisions it made yesterday. So much for vision, courage and leadership.

The budget includes some measures that I support, including several of the initiatives on taxation. There is undoubtedly a need to bring more money into the Exchequer and to close the widening deficit. However, other challenges were totally ignored in this budget, the main one being job creation. We in Ireland are faced with a dual challenge. Like most countries in the western world, we must find a way to put in place a new banking structure that can ensure credit flows into the economy so that economic activity can be sustained and rebuilt. There is new thinking in the budget in this regard. I may not agree with the specific proposals but I recognise that there is at least an effort at new thinking.

The problem Ireland has which other countries do not is our massive and increasing revenue deficit. We must deal with this at the same time as we deal with other issues. The limit of the Government's imagination is evident in that its response has merely been to engage in a cash grab, largely from the middle income families who are always hit when there are tax increases. How can the Government expect that making up 68% of a required saving of €3 billion or €3.5 billion through tax increases will be of benefit to an economy that is on its knees? Such measures will merely ensure that consumers are brought to their knees. Any fragile remnant of confidence in terms of the willingness of consumers to part with their money will disappear with the introduction of this budget. Moreover, people know the situation will get even worse. Who will buy a television, a laptop computer or a new car when average annual incomes are dropping by €4,000 to €5,000, with even more severe reductions expected next year?

Is this the Government's economic strategy for recovery? Crises always bring opportunities but there is no evidence of imaginative thinking on the part of the Government in this crisis. For example, there is an opportunity to bring about dramatic and fundamental reform in the way the public service does its business in terms of rewarding initiative and performance and cutting out the fat and keeping the muscle. However, there is no evidence of such a necessary initiative. We still have an entire layer of middle management in the Health Service Executive, comprised in large part of staff who are not required, while staff are desperately needed in other areas of the public service and Civil Service. The budget contains no measures for flexibility in public sector staffing.

We have an opportunity to put people back to work on infrastructural developments in areas of the new economy which are of particular concern to the Minister, Deputy Gormley, such as energy, information technology and water. New State companies should be set up and there must be an examination of new structures of finance that would not impact on Government deficit. We put our cards on the table and asked the Government to consider such measures, but we got nothing in return. This budget will anger people not because it is tough but because it is unfair and because it takes Ireland in the wrong direction. It will deepen and prolong the recession rather than lead us in a new direction with new thinking.

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