Pearse Doherty (Donegal South West, Sinn Fein)

I will be brief as I am aware of the time constraints and wish to ensure the spokesperson from the Fine Gael Party and the Minister are able to contribute before the division. Deputy Burton spoke about all the relevant issues. I differ with her only on bankers' bonuses, an issue I will address presently.

My amendment No. 9 proposes that the universal social charge does not take effect until at least 60 days after the publication of an impact assessment of the charge. This issue has been debated on Committee Stage and raised outside the Chamber, notably by those involved in the retail sector. People were taken by surprise by the full impact of the universal social charge when they opened their pay cheques at the start of the year. They cannot get over what has happened to them, especially given that many of those who are already on the bread line have had their pay walloped again by the charge.

Much of our discussion of the Bill has focused on jobs and how to stimulate the economy. Taxation measures serve the dual purpose of stimulating the economy and ensuring that the State has adequate revenue. The universal social charge will damage the potential for growth and result in job losses, especially in sectors that are dependent on expenditure from disposable income. The imposition of the charge on all income for those earning more than €4,004, as opposed to all income above a certain threshold - perhaps €10,000 - is a crude measure which is having a major impact on individuals and the business community. It will result in job losses.

I was fair to the Minister earlier when I spoke about the additional workload for the Department of Finance created by our demands to have reports laid before the House. While I appreciate the Department is under severe pressure given the turbulent times, it is vital to carve out sufficient time to carry out an economic impact assessment of the universal social charge. This is the most important aspect of the Finance Bill on which such an assessment is needed. The consensus on this side of the House is that the charge has the potential to seriously disrupt the domestic economy, not to speak of its impact on individuals.

I welcome amendment No. 17 on bankers' bonuses, having been critical of the Minister and his officials on Committee Stage for not having an amendment prepared. I note it is two pages in length. This provision should have been introduced a long time ago. The only point on which I differ with Deputy Burton in respect of the amendments before us is the threshold of €20,000 provided for in amendment No. 17. It is wrong to allow top bankers to receive bonuses of €20,000. This Bill will enable Anglo Irish Bank to pay out bonuses of €19,999 to all its officials tomorrow morning.

While I appreciate Deputy Burton's point that much of the income of people working in call centres is dependent on bonuses, this matter could be adequately addressed by inserting a new line in the part of the amendment that refers to exemptions for bonuses under €20,000. We could, for example, link the exemption to income and provide that it only apply to those who have a salary of less than twice the national average wage. I have suggested a fairly arbitrary figure because the amendment was only circulated a couple of hours ago. The insertion of such a condition would protect those on low basic salaries whose income primarily consists of bonuses. It would also ensure the top officials in the banks, many of whom were in place before the guarantee and who got us into this mess, will not be paid bonuses. Imagine the furore if The Star, The Irish Times or the Irish Independent contained stories tomorrow morning that every top official in all of the guaranteed institutions are paid bonuses of €19,999. That is twice as much as the 440,000 people in receipt of social welfare receive in a year. I accept the amendment because it at least stops these bankers being paid in excess of €20,000 but to allow them to be paid up to that amount is wrong. If this cannot be done now, it should be dealt with in the Seanad. An income link should be introduced, where the exemption of €20,000 would only be applied to the relevant figure. We are all coming at this from the same side and I believe the Minister's intention is good - we want to stop the bonuses being paid. An income link can be inserted into the legislation to achieve this.

The Minister threatened to withhold recapitalisation funds from the bank if bonuses were paid and those bonuses have not been paid as a result, although legal cases are pending. As a result of the amendment, where bonuses in excess of €20,000 will be captured in the tax net at a rate of up to 90% through the universal social charge and taxation measures, that threat will no longer be valid. The bonuses could now be paid up to €20,000.

I ask the Minister to look at this again. The clock is ticking towards the dissolution of the Dáil but the Bill is fundamentally flawed in this aspect. I genuinely believe the vast majority of the public would not tolerate a situation where hundreds of bonuses would be paid out to officials of guaranteed banks when we are bailing them out. We are taking money from those who earn €80 per week under the universal social charge and under the same legislation we will allow well paid bankers to get bonuses of up to €20,000 without it coming under the universal social charge or being taxed. That is not acceptable and we must look at it again.

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