John O'Mahony (Mayo, Fine Gael)

I am glad to contribute to this motion on the universal social charge.

Looking back on the recent general election campaign, it was an issue that came up on every doorstep. Many of those who were lucky enough to still have a job showed us their payslips outlining the large chunks of their month or weekly salaries deducted by the universal social charge. As a member of Fine Gael, I would have liked to have been able to say to them that if they put us into Government they would not have to pay that the following month. Unfortunately, because of the state of the economy brought about by the mismanagement, wastage and incompetence of the previous Administration, we were not in such a position and, for once, people really respected the idea that we told them we would review it but we could not abolish it. We promised a review of it if and when in Government, and I am to glad that promise is kept in the programme for Government.

No matter what the review, as the previous speaker stated, we will not be able to abolish it. However, the review is necessary because there is no doubt that low-paid workers at the middle-income level are suffering significantly. I have come across numerous examples, as I am sure everybody else here has, of families that are at their wit's end to pay their household bills. It is unfair to penalise lower middle-income families who have worked hard all of their lives and have never been a burden to the State but now find themselves unable to meet their normal household outgoings, whether it be mortgage repayments or third level registration fees for their children because they are not entitled to grants, or in some cases, to put food on the table. Those on a higher income are better able to cope. It is the lower middle-income group that must be helped when this review takes place.

I also accept the figures given by the Minister of State at the Department of Finance, Deputy Brian Hayes, last evening when he outlined that someone on €100,000 a year pays 93 times the tax that someone on €16,000 pays. I suppose the point we would make is that they are well able to do that. Even though they are only on 6.25 times the income, it does not hide the fact that a person on €16,000 needs some further help in this review when it is carried out.

We saw the previous Government giving a myriad of tax breaks to wealthy high-rollers in the past to such an extent that many of the high earners on €100,000 did not have to pay any tax at all. Fine Gael and the Labour Party had a good record of looking after the underprivileged and the less well off in the past and I have no doubt that when the review is complete, they will do so again. On this occasion, let the tax breaks and the concessions be for the lower paid and lower income families. Times are difficult and the country may be in receivership, but a worker on as little as €77 per week needs some hope and assurance. I have no doubt that the proposed review will give them that.

I was glad to see the Finance Act also introduced a high rate universal social charge applying to large bonuses paid to bankers at the head of banks bailed out by the Government over the past two years. The charge is applied to the bonus at 45%, leaving an aggregate charge of payments of 90% made up of the 45% from the universal social charge, income tax at 41% and PRSI at 4%. That is as it should be. I am glad that the terms of reference for the review of the social charge are being finalised by the Minister and that Sinn Féin and all other interested parties can contribute and make submissions.

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