Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

-----and because of the growth in employment and salaries in the past year or so, we can do three things in the budget and we intend to do them. The first is to balance the books. For the first time in ten years, we will produce a budget which will balance the books. That may not be a politically popular thing to do, but it is the most important thing to do because when an economy is growing, we should balance the books and pay down our debt. We will do both because we will not repeat the mistakes of the past made by other parties, although we will learn from them.

The second thing we will do is increase spending on public services and infrastructure. We estimate that when account is taken of the full-year cost of measures previously announced and commitments made, as well as the additional fiscal space, public spending will increase by approximately 4.5% next year. That equates to a spending increase on services and infrastructure of between €1.5 billion and €1.8 billion. We will do that and also find some space for tax relief. We think that is the right thing to do because 2 million people work hard, of whom 1.4 million pay income tax and USC. They produce the wealth that allows us to do all of those other things and I believe they deserve a break in the budget. For that reason, we will find some space to give them an increase in their take home pay and a tax reduction that they deserve which, in turn, will allow them to spend more on their families and more in the economy, thus creating employment for others.

With regard to the statistic the Deputy used for the richest and the poorer halves, he should bear in mind that 30% of people have been taken out of the USC and tax net. We have taken 30% of the 50% to whom he referred out of the tax net altogether. Is it not right to say to people who are in the middle income bracket and still pay USC and income tax and who very often believe they pay for everything and get very little in return that there should be something in the budget for them also?

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