Peadar Tóibín (Meath West, Sinn Fein)

I would like first to respond to a couple of the Minister of State's final statements. Fiscal responsibility is not just in the gift of the right. Nordic countries in Europe are fiscally responsible yet deliver left wing services. We have a Government that promised Nordic services but US taxes. However, we received neither. Public services fall between the two stools. Sinn Féin believes that Nordic-type public services require a Nordic-type tax scheme. Nordic countries are economically successful and extremely competitive. Also, there is a great deal of social equality in those states. As such, it is achievable.

The Minister for Finance, Deputy Noonan, and Minister for Public Expenditure and Reform, Deputy Howlin, have stated that this budget is about jobs and that it is fair. There is a deep contradiction between the words being used around discussion of the budget and the actions of the budget. The Government must have found a way to operate outside the laws of physics and economics if it believes that taking money out of the economy, cutting capital spend and increasing costs will lead to growth in jobs. That cannot work within the bands and laws of economics.

Despite the claims of job creation, the Government, sadly, has settled upon what it believes to be an acceptable level of poverty, unemployment and emigration. The evidence for this is the Government's statement that 400,000 will be unemployed in this State in 2015. The Government claims to be able to create 100,000 jobs in the interim but the net decrease will be brought about by emigration, based on the Government's figures. It is a shocking indictment that any Government would accept that level of unemployment, poverty and emigration. These figures may be acceptable to well-insulated Ministers but they are not acceptable to our people, our businesses or our economy. To add insult to injury, the Minister for Finance, told us yesterday that the market is flexible and that 125,000 have come off the live register. The inconvenient truth is that under this Government the level of long-term unemployment has grown. The budget announced in the past 48 hours has delivered a body blow to the 450,000 people who are unemployed and the 76,000 people emigrating from this State.

Let us look at what the budget did in terms of promoting growth, tackling unemployment and ending emigration. As discussed by my colleagues, the VAT increase will disproportionately hit people on low and middle incomes, pushing many into poverty. VAT is known to be regressive in that regard. VAT will also have a massively negative effect on business in this State. Drawing a line from Dublin to Galway, everywhere northwards will suffer a lack of competitiveness, in terms of retail, vis-À-vis their competitors in the North of Ireland. The Minister yesterday said that a 3% differential does not make a difference. The Minister earns €170,000 per annum. It might not make a difference to him but to people on low incomes every penny counts. In a similar fashion carbon tax increases will result in job losses, closure of businesses and a reduction in tax receipts. Every year growth and tax receipt projections are reduced, yet we continue with the same policies. The only long-term way of dealing with the issue of North and South swings and roundabouts when it comes to changes in tax is to create a convergence between the tax rates North and South. The Minister would find a willing ear in Stormont in that regard.

Although the Government talks about jobs, apart from minor initiatives in respect of research and development and export support, the only new initiative detailed in this budget was the allocation of €20 million for job training. All the other initiatives that were discussed had been launched during the summer and have yet to be implemented. One should juxtapose this point with the fact the Government has taken €3.7 billion out of the economy and will take a further €3.1 billion out to pay the Anglo Irish Bank promissory note next year. The resources going into the Anglo Irish Bank promissory note are 150 times greater than those being invested in job creation in this budget, which constitutes an obvious underlying of where the Government's priorities lie.

Members have been told the Government will act to create jobs. At the same time however, the Government reduced the capital expenditure budget by €750 million and as a result will put 7,500 people out of work next year. Members were informed of the creation of the JobBridge scheme comprising 5,000 placements. However, 5,000 people are being made redundant and 5,000 people are emigrating every month in this State. The public spending cuts and the new taxation measures will lead to 15,000 people losing their jobs while on the other side, the Government intends to create 6,500 temporary training spaces. The Government's response to the crisis is disproportionate to its scale.

The budget also has sought to revive the spectre of property speculators. For some reason, the Government has decided to reduce stamp duty on commercial property by 4% and to give a seven-year capital gains holiday to new commercial property purchases. This is jobs-free pump priming of the speculative market that would have been announced in the Galway tent five years ago. The Government also has ruled out the ending of crippling Celtic tiger era rents. At the beginning of its term in office, the Government promised retailers that it would reform the upward-only rent review system in this State. Yesterday, the Government buried in the budget the fact that it will not reform this system. Basically, it has promised landlords and speculators that they will retain their upward-only rent reviews into the future and they must be rubbing their hands as a result. The retail sector has offered legal opinion which identifies a way in which this issue can be resolved. As the Government blames the Attorney General for not being able to proceed, it should supply Members with the evidence provided to it by the Attorney General on this issue. Celtic tiger era rents must be reduced across the board because this would make Ireland more competitive and would save jobs. It appears as though the Government again has sided with speculators against small businesses.

Another extremely important point in this regard is that the Government pays €53 million per annum, through the Office of Public Works, which is the responsibility of the Minister of State, Deputy Brian Hayes, to rent out properties in upward-only rent contracts. Were its contracts reduced in line with natural falls in rent, the Government would save €10 million straight away. Again however, this issue is not being tackled by the Government.

The Government is doing nothing about either the regressive rates or investment in information, communications and technology infrastructure. Moreover, investment in transport infrastructure has been stalled and the €18 million going to Enterprise Ireland next year has been taken from this year's budget. In other words, the Government is robbing from this year to pay for a supposed increase next year.

All the while, the Government is buttressing French and German banks from contagion but is not helping small Irish businesses. In case Fine Gael and the Labour Party have not realised, they are democratically responsible to the Irish people and not to the bondholders or the German electorate. The Government has received a mandate to show leadership and not to outsource it to two of the 27 member states in the European Union. It was elected to show leadership, not to call for it elsewhere. The European Union should be a common market and should be a partnership of states. The Government should be defending that concept, rather than scurrying around looking for ways to serve up what remains of our sovereignty to Merkel and Sarkozy. The hand-over of budgetary and tax powers to Brussels will cost thousands of jobs in this State and will condemn this State to at least ten years of cuts and austerity. Misgovernance under democratic self-determination can be ousted at election time. German and French-centred governance, oblivious to Irish needs on the periphery, cannot.

Sinn Féin has outlined costed alternatives in line with best international practice that would prioritise and stimulate growth and would create employment, tackle the deficit and share the burden fairly. Only through growth can one break the cycle of austerity, recession and unemployment. I urge the Government to change tack and prioritise growth.

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