Thomas Byrne (Meath East, Fianna Fail)

I am not clutching at straws. In the past 12 months, the price of food and non-alcoholic beverages has reduced by 7.6%. This deflation has also resulted in a reduction in revenue to the Exchequer by way of taxation. Deputies must acknowledge that money is not flowing into the Exchequer because prices have fallen. For this reason, readjustment is required in pay and social welfare levels, even if none of us likes it.

The level of the old age pension was maintained because the deflation rate for retired households was only 3.35%, half the deflation rate for working households. Expenditure on insurance, for instance, is probably higher in retired households than other households.

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