John Paul Phelan (Carlow-Kilkenny, Fine Gael) | Oireachtas source

I agree with a large chunk of the comments of the previous speaker, Deputy Shane Ross, although I disagree with some of them also. I have previously expressed my view of the relationship between the former President of France and the German Chancellor. To some extent, their occasional meetings served to undermine the functioning of the European Union.

It seems that Chancellor Merkel, now that there is a new French President, has gone in other directions to seek support. Deputy Ross referred to a meeting which took place recently between the Finnish, Dutch and German Finance Ministers. It was a strange meeting to say the least, particularly seeing as I understand that the Dutch Finance Minister did not even stand in the recent election and will not be a member of the Dutch Government in future. They produced a document which was completely at odds with the agreement on debt, particularly from Ireland's standpoint, as reached by the Heads of Government in June last. I agree with Deputy Ross on that meeting between those three finance ministers and the outcome of it. What was achieved in the agreement between the Heads of Government in June must be delivered from an Irish perspective. We must work with all our endeavour over the next number of months to ensure that agreement comes to pass. I agree certainly with that.

However, I cannot agree with Deputy Ross's shock, horror and amazement at the issue of property tax. He spoke about how this is something that has built up a head of steam in the past few weeks and months. Irrespective of where one stands on the issue, property tax has been on the political agenda for the past two years and each political party had positions on property tax in advance of the last election. I understand the Sinn Féin position speaks about taxing 80% of the value of property. The previous Government had a position on site valuation. A decision has not yet been made as to what form of property tax will be introduced next year.

I agree with Deputy Ross that there must be clear exemptions and treatment for those who have paid exorbitant amounts of stamp duty and those who are in difficulties meeting their mortgage payments at present, but there are a number of people - perhaps Deputy Ross himself is in the category - who do not have substantial debts on their private residences and it is legitimate that a tax would be imposed upon those in that category. It is key, whatever shape the tax takes, that the rate would be affordable and that clear exemptions should be laid out.

The Fiscal Responsibility Bill is born out of the decision of the people a number of months ago and their vote on the stability treaty. The idea that governments would budget sustainably in future is something I wholeheartedly support. Anybody who has even the faintest grasp of economics must support a situation whereby governments would be in a position to sustain themselves in terms of their expenditure based on the revenues they can bring in. There were, until a few minutes ago, a number of school groups in the Gallery. It is completely unjustifiable that in the future we would continue to borrow money and heap debt on future generations because we cannot sustain the present public expenditure. It is highly desirable that balance would be brought to the economic books of the country. It is a symptom of what happened in the worst excesses of the Celtic tiger - the five or six years prior to 2008 - when public expenditure was built completely on an unsustainable taxation source. I suppose we are reaping the whirlwind from that by having to reduce public expenditure at a time when tax revenues are also under pressure. It is correct that any Government should try to reach a position whereby it is not heaping debt onto future generations and whereby it is not continuing to build up the amounts that would have to be paid in interest repayments as well as building up the debt itself. The reality is that the programme in which we are currently involved is constructed in such a way that the correction is taking place over a number of years, not all at once. No doubt it is imposing considerable pressure, particularly on public services. It will continue to do so, at least over the course of the next 12 months, but it is neither fair to the future of the children who were in the Gallery a minute ago and others in schools around the country nor sustainable that we would say that we will continue to borrow selfishly and heap debt onto their heads, debts that they would have to repay in the future. I fully endorse what is contained within the Fiscal Responsibility Bill and I will be supporting it.

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