Joe Costello (Dublin Central, Labour)

The Fianna Fáil view of the financial crisis is frightening. The sins of the bankers will be visited on social welfare recipients. The less well off must pay for the bailout.

The title of this Bill is the laughable Financial Emergency Measures in the Public Interest (No. 2) Bill. It is a bad political joke from the gombeen party of Ireland. How can it be in the public interest to reduce the minimum wage from €8.65 to €7.65 or by 11.5% and then to cut it further with the universal social charge, an additional tax that will result in a total slice off the minimum wage of at least 14%? Some 50,000 workers on the minimum wage will be hard hit by the provision of this Bill and this budget. The statutory minimum wage is a necessary bulwark against abject poverty and exploitation in the workplace. It should be a core principle in a civilised society. The 11.5 % cut in the minimum wage is not going to add one cent to the Exchequer while it will expose thousands of people to exploitation by unscrupulous employers and to poverty. Moreover, there is a mechanism through the Labour Court that enables an employer to plead inability to pay the national minimum wage. This mechanism has yet to be invoked by any employer.

With their across-the-board cuts in social welfare benefits and allowances and now their cut in the minimum wage the Government has begun a new race to the bottom for the most vulnerable people in our society. Already nearly 120,000 workers are deemed to be living below the poverty line in Ireland. This assault on the minimum wage could open the floodgates and sharply increase the numbers of working poor. The budget is about political choices and political priorities. The Labour Party presented a budget of €4.5 billion revenue raising measures divided equally between taxation measures and expenditure cuts. The Labour Party identified new tax measures such as the 48% tax rate; the Government chose not to touch the tax rates. The Labour Party identified major savings in eliminating pension and property-based tax reliefs; the Government chose to nibble lightly at these reliefs, which are enjoyed by the rich and powerful and influential friends of Fianna Fáil. The Labour Party identified 7,000 tax exiles, who are virtually all millionaires, not paying a tax in this country and yet who enjoy all the benefits of being Irish citizens jetting in and out of the country as the fancy takes them. The Minister for Finance mentioned the desirability of taxing them in last year's budget. It did not happen then and it will not happen now while this Government is in power.

These are the political choices that Governments make. Fianna Fáil has too many friends in high places to go after the big earners. Instead, they have disproportionately reduced the incomes of the middle earners and the less well off. The recent announcement that bank executives in AIB, a bank in public ownership, which received €3.5 billion in recapitalisation from the State, which will receive billions more and whose shares have plummeted from €23.95 to just 50 cent, will receive €40 million in bonuses is outrageous. How these executives could be entitled to bonuses when the bank was being driven into the ground and incurring astronomical debts is beyond any sane person's comprehension. There is a Christmas bonus for the executives, but a cold shoulder for wholly innocent front line staff. These are the people who will experience the sharp edge of public anger. The response of the Minister for Finance is typical. He has announced a 90% tax on such bonuses for the future but he is not willing to tax the €40 million at issue now.

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