Joan Burton (Dublin West, Labour)

The point is that our difficulties are not unique. If one decides to follow the deficit hawks and kill the economy, one will not gain kudos from the bond markets. What they really want is a twin-track approach. Whatever option is chosen has immense risks. As the Taoiseach is fond of saying, we are where we are. It is where he and the Minister have brought us. The Minister does not like to be reminded of that but it is the undeniable truth. He does not deserve and will not get a moment's peace in this House from the Labour Party. This is his legacy.

Earlier today the leader of the Labour Party, Deputy Eamon Gilmore, reaffirmed the Labour Party's commitment to the four-year timetable for deficit reduction. He did so because we know the country needs to be able to return to borrowing at reasonable rates of interest between mid-January and mid-February. There is more than one timetable involved. In many ways, we do not just have a four-year timetable to meet but a four-month timetable.

The 3% deficit target has been the core of public policy since the starting round of emergency budgets in 2008. There have been four-year plans aplenty sent to Brussels. There is nothing unusual in this procedure as it is a long-standing part of the Stability and Growth Pact. We are subject to the excessive deficit procedure.

The plan that must be submitted in a few weeks will be subject to a tougher-than-usual stress analysis. This is because the last two budgets, despite the pain the people took as a consequence and despite the painful measures we all have had to endure on foot of the various special budgets since the summer of 2008, failed to reach the intermediate targets set out.

I have to hand the Minister's previous effort. One line refers to €2 billion for 2011, €2 billion for 2012, €1.5 billion for 2013 and €1 billion for 2014. This is why the Opposition has problems with the Department's arithmetic. What does such a line mean? I am referring to the book the Department of Finance presented to us. All I can say is that it is a short book and it is not convincing. We are seeking information that is credible, presented with conviction and which allows us to explain the position of the Government.

The dismal and repeated failures of Government banking and budgetary policies have left a cloud of international doubt over the capacity of the Government to deliver the goods. This is the Minister's problem. Only a change of Government, a new Administration, will make the bond markets feel Ireland is again on the up. This would be because the Government's mentality would be characterised by freshness, vigour and a desire for change. Credibility must be the principal feature of any revised four-year plan. The plan must not be about cuts and more cuts.

The most depressing feature of this debate is that our national predicament is presented in Parliament as a choice between one extreme and another. One side maintains the country must be purged of its crippling debt in a really tight timeframe regardless of social or long-term economic consequences while the other side refuses to acknowledge that international creditworthiness is an issue at all. Then there are those who wilfully ignore the continuing fragility of the banking sector, as if it were not an issue at all in budgetary calculations. In this regard, one should consider what the Bank of Ireland had to pay yesterday and today for raising some funding. It is paying the shadow rates the Irish Government is being asked for. The ordinary citizen watches in considerable bewilderment as the argument rages.

My party accepts the necessity for spending cuts yet remains alarmed at the prospect of a prolonged recession and social disruption. If the right balance is not struck in the coming budget and if public spending is cut by too much too fast, the knock-on effect on business and consumer confidence will surely make matters worse. One should remember that private businesses are the main beneficiaries of public investment. Private builders build and maintain our schools and hospitals and small private suppliers sell goods and services to local authorities and Departments. If this source of custom is cut off, businesses will fail in every county. People in both public and private sectors are not spending but hoarding cash, as is evident from the level of savings in the country. They are worried about their jobs, their children's jobs and whether they will have to help out by meeting extra mortgage repayments. Many mothers in my constituency tell me they are giving their children so much money per week to help with the food bill to allow them to concentrate on trying to pay the mortgage. This is a reality for many people in my constituency.

One can measure the loss of confidence in the Government through the RED C polls and others and one can note the same loss of confidence in the tales from the front line of businesses, big and small shops, hotels, suppliers and contractors, and from the anxiety of parents who are watching sadly as their qualified children, including graduates and apprentices, prepare to emigrate. The Government's economic policy is a wild gamble. Banking policy has failed utterly. The promissory notes tactic to fund the Anglo Irish Bank bailout has blown up in the Minister's face at a huge cost to the State.

If ever there ever were two rogue characters in this Hallowe'en horror story, they must be bankers FitzPatrick and Fingleton. We now have a €31 billion mortgage for this country, payable over a ten-year to 15-year period. The deficit has increased from €7.5 billion to €15 billion largely because the Minister or one of his advisers did not account for the approximately €1.5 billion per annum that the promissory notes would cost. This is the main reason the Minister's figures have gone adrift. He acknowledged this by talking about the rise in interest costs. If interest rates continue to rise as they are doing, the country may well be paying up to €6 billion in interest costs next year.

When I popped into the Minister's Department to meet the very pleasant and courteous officials, they were not able to pull out a sheet of paper stating the figures. I had to drag out of them the €1.5 billion annual interest charge on the promissory notes. That is not good enough. Perhaps the Minister told his officials to invite us but not to tell us too much. We do not know what their briefing was but we certainly wanted the kind of information I have outlined.

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