Thomas Pringle (Donegal South West, Independent) | Oireachtas source

With two months until the budget, the kite flying from Ministers is already under way. We have already heard about the slashing of child benefit and I dare say this is only the tip of the iceberg over the next eight weeks of rumours and so-called leaks. I would like to remind the Taoiseach of one thing before the Government begins its next round of imposing penalisation on the people. Last year's budget has proved to be one of the most regressive in the history of the State, disproportionately affecting those already struggling. As the Nobel Laureate, Joseph Stiglitz, has said, austerity never works to resolve economic downturns. He said that austerity instead turns downturns into recessions and plunges recessions into depressions. A succession of budgets dragging down domestic demand and delaying recovery is not the answer. There are other options if only the Government would consider them.

Increasing the effective tax rate for high earners by just 1.5 percentage points would generate an extra €650 million in additional revenue. A wealth tax could also generate more than €200 million. The Government would effectively get €850 million just by a moderate targeting of high earners. Those are just two proposals the Nevin Economic Research Institute has published in its strategy for an alternative adjustment which would lead to the same deficit outcome of 7.5% of GDP but also provide for the protection of front line services and social protection.

The Government's plans will result in the loss of 29,000 jobs next year, whereas this costed proposal would save 21,000 of those. While there is no way to fast-track economic recovery, the path the Government is taking is the wrong one. There is an alternative to penalising people while still generating the revenue required. Does the Government intend to continue to burden those who cannot take any more or will it ensure that those can pay do?

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