Róisín Shortall (Dublin North West, Social Democrats) | Oireachtas source

Yes, that is right. We agree with the point which IBEC has made, which is that we should use those official figures to enable us to leverage additional fiscal space in order to begin catching up on the glaring underinvestment in infrastructure in so many different areas across the country.

The other context in which we are discussing the Finance Bill is that of the Government's attitude to taxation generally. While the Taoiseach talks about giving something back to people, we know that the approach taken in cutting income tax and reducing the USC has had a very minimal impact on the vast majority of people in this country. There is a lot of talk about giving something back. Strategically, it was a mistake to do that. The €300 million, or whatever the precise figure is, which was used for this tax package would have been much better spent had it been concentrated and focused on reducing the cost of living. Instead of doing that, we had a mish-mash of what Fine Gael wanted and what Fianna Fáil wanted.

That resulted in a situation in which our income tax system has become even more skewed and more regressive than it had been. For example, as a result of the changes to income tax and the USC in the budget, a single person earning €23,000 will benefit to the tune of €1 per week. A single person who is self-employed and earning €70,000 will benefit to the tune of €10 per week. Where one person in a couple is working, and the family's income is €35,000, they will benefit to the tune of €4 per week and yet where both people in a couple work and earn €70,000 they will gain €9 per week. Those tax changes have turned out to be quite regressive. We know that the majority of workers earn less than €35,000 per year. The majority of income earners earn less than €35,000 a year. For the vast majority of those people, the tax changes in the budget will be of little or no benefit. At most they will deliver €1 or €2 per week, which would hardly be noticed by most households.

If one looks at what has been happening in respect of the cost of living over the past number of years, particularly during the austerity years, families have increasingly been hit with very significant rises in costs in areas such as housing. In this morning's The Irish Timeswe read that the cost of renting in Dublin now represents 55% of a person's take-home pay. It is 55% when the standard is expected to be approximately 30%. That is entirely unsustainable for people who are caught in that trap. We also know that the cost of health care is a huge barrier to accessing care. There are issues with the cost of insurance; the cost of child care; the fact that we do not have any paid parental leave; the cost of public transport, with fares are rising all the time; the cost of energy; and the cost of education, as we do not even have free primary education in this country yet. All of these very significant costs are impacting on family budgets, meaning that people have little or nothing left in discretionary income at the end of the week or the end of the month.

For many reasons - equity being one, but also competitiveness and dampening down wage demands - we would have been much better off as a country if whatever funds were available for this year's budget and the associated Finance Bill were used to target the cost of living and to bring it down for all families. That could have happened if the Government had taken that kind of approach. If the Government had listened to what people said last year during the general election, they would know that people are not stupid. They know that it makes much more sense to have good quality public services, which are available to people universally, because they benefit everybody, as opposed to taking this approach of cutting taxes. This approach is not sustainable in the long term because we need to maintain our tax base. We should not be eroding it. That is how we pay for good quality public services. It really is very disingenuous to pretend to the public that the integrity of the tax base can be run down and undermined while still providing people with decent public services. It is simply not possible to do that. Examples of our approach are seen right across Europe, particularly in the Nordic countries. The social contract which should exist is that people pay a fair share of tax relative to their income and, in return, everybody gets decent public services. That is how to create a decent society. Unfortunately, this Government has taken a very different approach.

The other very disingenuous argument which is often used for cutting taxes is that we need to attract people back home - entrepreneurs and the many Irish people who are currently living all over the world. That argument does not stand up at all. IDA Ireland has made it very clear that the big obstacle preventing people coming back home to live and work is the exorbitant cost of housing. IBEC made a presentation to Members of this House which stated very clearly that when it comes to attracting companies to locate here or attracting individuals to return, the two big obstacles it has identified are the crazy cost of housing and the lack of access to decent health care at an affordable cost. IBEC made that very clear. It is not about taxes, it is about the services. If people are considering coming back from Canada, Australia or wherever, they are thinking about whether there are decent schools and good public transport, whether housing is affordable, and whether there is decent public health care. Those kinds of things matter much more to families than getting tax cuts.

While I am on that topic I want to raise the issue of the special assignee relief programme, SARP. It is a nonsense. It is deeply unfair. We should not have it. The SARP tax relief is aimed at reducing the cost to employers of so-called high-end staff by providing special tax benefits. The employee must be on a salary in excess of €75,000 and we know that a great many of them are on massive salaries. This is really a scam to help high earners to avoid paying tax. Not only that, but they are also subsidised in sending their children to private schools.

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