Maureen O'Sullivan (Dublin Central, Independent) | Oireachtas source

I attended the pre-budget briefing given by the community and voluntary sector yesterday in the audio-visual room, at which it was suggested the first question we should ask was where we would like the country to be ten years from now. In conjunction with this, we should consider what are the core values by which we should be guided when we are examining matters relating to the budget. I accept that we are in a recession, that times are difficult and that we are spending more than we are taking in. There is no doubt that the money which was available during the good years was squandered. Huge amounts of money were wasted on a long list of projects - those relating to a particular prison, the national children's hospital, the purchase of e-voting machines, the development of transport infrastructure, etc. - which never came to fruition. I will not even mention the money that has been wasted on the bondholders.

Our discussions on the economy are usually dominated by figures and percentages relating to GDP and so on. In reality, the economy is people. There is no doubt that the recession is having a disproportionate effect on people in certain sections of society. However, there are others for whom life goes on as usual. This is because they have not been unduly affected by what has happened. Statistics show that the poorest people took the largest hits in last December's budget. A recent survey carried out by the Irish League of Credit Unions of this matter makes for grim reading. Nobody wants to be obliged to accept cuts, but there are those who can afford to do so. If 10% is taken off a salary of €200,000, it is a mere dent. If, however, it is taken off a salary of €20,000, the impact is massive. Social and equality audits are required of all budgetary measures in order that we might gauge their potential impact.

No one wants to see a recurrence of the all-night protest by people in wheelchairs which took place outside Leinster Houses some time ago. People with physical or mental disabilities or both should never be obliged to fear the additional stress that can be caused by the introduction of a budget. These individuals should feel confident that regardless of which group is in power and of the economic circumstances that obtain, they - the most vulnerable in society - will be protected. Some of those to whom I refer have had enough and cannot survive further cuts.

There is a kind of sacred cow in this country which we know as corporation tax. The rate of this tax, 12.5%, is low, but we do not even collect this. It is difficult to obtain information on the actual amounts collected. Transparency International has carried out a study which indicates that the world's biggest companies need to be a great deal more transparent. Transparency International reviewed 105 of the largest companies across the globe - 61 of which are based in Ireland - and only one indicated the amount it paid in corporation tax. In a report it compiled recently the Council of Europe called for an appropriate policy on tax havens. This is because member states are losing billions each year as a result of the tax avoidance, evasion and fraud facilitated by the offshore financial system. This massive tax cheating on the part of wealthy individuals and enterprises is penalising ordinary taxpayers, affecting public finances and reducing the level of social spending. It is also a major threat to good governance.

I acknowledge the work done by Christian Aid and TASC in their report on tax injustice. Tax dodging and tax injustice are global issues and have an impact on people everywhere. The report to which I refer indicates that the consequences of tax dodging for ordinary people - whether they live in Dublin, Darfur, Letterkenny or Lesotho - are real. Every euro or dollar in tax that is dodged by an individual or a corporation must be replaced by governments and this is done by either increasing taxes on ordinary people or cutting public services. Will adding an extra 1% or 2% to our corporation tax rate lead to multinational companies fleeing Ireland? Some of these companies have openly stated it is not primarily our corporation tax rate which led them to establish operations here but rather that the attractions of our educated workforce, climate and stability. I hope that, at the very least, we will collect 12.5% in corporation tax from the multinationals.

There must be country-by-country reporting and there must also be fair policies and transfer pricing in order to reduce the opportunities for multinational businesses to manipulate the reporting of profits and taxes due. We could start the ball rolling in this regard and lead by example in this matter. However, we are not giving good example. I am totally committed to our overseas aid budget, but it is somewhat ironic that we are giving this money which is badly needed to other countries through Irish Aid and we are not vocal on the tax injustice relating to countries in the global south. We are not vocal in this regard because we allow tax injustice to be perpetrated in this country.

If the Government is committed to fairness, its policies must reflect this. We must employ the principle that the more one earns, the more one should pay. A fairer tax system is, therefore, vital. Our total tax take is the lowest among countries in the developed world. Broadening the tax base fairly and eliminating those tax breaks and reliefs which mostly benefit the better off is the way to proceed. The tax breaks and reliefs to which I refer reduce the tax bills of high earners who get more money at the expense of ordinary citizens who endure austerity. I agree with TASC's call to the effect that all tax breaks should be subject to a cost-benefit analysis. I agree that all tax breaks should be subject to a cost-benefit analysis and a sunset clause, which means they expire after three years, with the possibility of renewal only after a positive cost-benefit analysis has been undertaken. Section 23 tax breaks in the property sector encouraged investment, but at what cost? We must separate sovereign debt from banking debt if the country is to survive, never mind prosper.

I refer to the CSO report on children published this morning. It contains grim statistics in respect of children, households with children and the increasing risk of poverty. I note the Minister has left the House. She also missed the debate on my Topical Issue matter about community employment schemes. The cuts to schemes are disastrous for people living in inner city communities.

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