Phil Hogan (Carlow-Kilkenny, Fine Gael)

There is no doubt the lower and middle income groups have suffered greatly and are now the new vulnerable sections of our community arising from the type of recklessness that has been brought forward by the Minister for Finance in the budget yesterday. The vulnerable have also taken the brunt of serious fiscal retrenchment, including carers, people on blind pensions, widows and disabled persons, who have all taken a hit. So much for the protection of the vulnerable. These people did not cause the problems of the country. They worked their way up along the line in order to fend for their families and their children. They worked hard and are now paying for the financial irresponsibility and policies pursued particularly since 2002 by Fianna Fáil-led Governments.

It seems that in the Department of the Environment, Heritage and Local Government, the area I know best, Fianna Fáil has quickly taken its revenge on the Minister, Deputy Gormley, who, because of his sudden rush of blood to the head in calling a snap election, is now to suffer the largest cut of 27% in his Department's Estimate. This means that vital services, such as fire services, national parks and wildlife services and social housing, will suffer a massive cut of €300 million next year on the back of a huge cut this year. This effectively consigns a large number of our people to social housing lists for far greater lengths of time than should have been the case. No imagination is being applied to ensure we have the demand and supply of houses in the marketplace married with the social housing lists. Great attempts will have to be made in this regard because no direct funding is available from the Department of the Environment, Heritage and Local Government. Effectively, the Minister, Deputy Gormley's legacy in power after three and half years is that of the emasculation of the services of his Department, the considerable reduction of funding in regard to housing and local government and the virtual elimination and stagnation of the Department itself.

The other area about which I feel strongly is the failure of the Minister for Finance to recognise the serious hardship suffered by people who have escalating mortgages and reducing incomes, and who are, therefore, under huge income squeeze. There was no recognition of this in terms of increasing the mortgage interest relief by 30%, as advocated by Fine Gael. The alternative proposals put forward by Fine Gael would mean such people would also get some respite from having no income tax cuts in 2011. Instead, lower income earners are now suffering the institutionalisation of the income and health levies under the universal charge that was effectively legalised and made permanent by the Government yesterday. This charge will apply from an income of €4,000 upwards, and the income and health levies are now effectively permanent in the system.

The Government response to the crisis which is upon us with the advent of the IMF and EU is to hit the lower and middle income groups, to emasculate the services of local government and to introduce more stealth taxes and charges at local level. Its main priority in Dublin is to bring forward a directly elected mayor, which would create more charges for business and customers. We now know the Fianna Fáil-Green priority in local government is a directly elected mayor, another vanity project of the Greens. Unfortunately, the Minister, Deputy Gormley, has been let away with this but, equally, he has been punished by Fianna Fáil Ministers around the Cabinet table for the fact he called a snap election unilaterally some weeks ago.

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