Michael McCarthy (Cork South West, Labour) | Oireachtas source

I make the historical point about a fundamental mistake which was made not in the last five or six years, but in 1977. The manifesto which led to that year to an overall Fianna Fáil majority is remembered nowadays for the abolition of rates on houses and tax on cars. That is democracy. People have a menu of policies options for which they can vote, but it led in many ways to the destruction of the economy in the late 1970s. On two occasions in the 1980s, Fine Gael and the Labour Party attempted to clean up that economic mess. One could argue reasonably and logically that it was not dealt with until the early 1990s and the rainbow Government which was, in effect, almost the same Administration which has dealt with the current economic catastrophe. It took generations and a number of different Dála to deal with the fundamental economic mistakes made in the 1970s.

In a major way, that led to a narrowing of the tax base. While I will not overburden the debate with statistics, during the Celtic tiger years, from 1995 to 2000 we had export-led GDP. It was a healthy, thriving part of the economy. From 2000 to 2005, it was the property bubble, and anyone who offered a contrary view or warned of the dangers of a property bubble and the reliance on building houses and selling them to one another was accused of talking down the economy. That, along with the banking crisis, has led us to where we are now. At the end of February 2011, the easiest decision for the current Administration was to remain in opposition but the people had spoken clearly. The rate of economic recovery is slow and arduous but it exists. There is political stability in the country, which we did not have, on top of an economic crisis, for many years. In many respects, that led us to being the basket case of Europe. When the last Administration went to Brussels, cap in hand, we know how low our standing was in Europe by the very bad deal the Irish taxpayer got.

Coming out of that, tackling the banking crisis, fixing the economy and tackling the major unemployment problem is the preoccupation of an Administration working night and day to do so. Any political party worth its salt, which puts forward constructive proposals on how to win back economic sovereignty and get the country working in every respect, is worthy of a mention. This is populist politics that will not work. All parties will be known by their policies but the Sinn Féin policy proposed on the bank holiday earlier this year was ill-advised although not populist. This Bill is populist and will not work. It would add to and exacerbate the economic abyss the Government must fix.

Some 80% of the property tax will go to local services. Anyone who wants to see playgrounds, development, public lighting and footpaths must believe in the principle of a local property tax to fund those initiatives. On a house valued at £150,000 in Antrim, the property tax is just under €1,300. A house valued at £75,000 in Coleraine pays just under €600 and a house valued at £100,000 in Strabane pays property tax of €840. Once Sinn Féin proves in the North that abolishing property tax works, I am sure the Government will be favourably disposed to look at the ingenious policy behind the proposal and may even test it here.

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