Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

I am not going to give a budget speech today for obvious reasons, as Deputy Howlin will understand. As a result of the sacrifices made by so many people and businesses in the past decade, Ireland is in a position to spend nearly €7.5 billion on capital next year. That is an increase of 25% in expenditure on schools, hospitals, roads, social infrastructure and housing, among other things. As a country, we have worked hard to create that possibility and to ensure we can spend more to look after the population in the way that a modern economy should do in terms of societal support.

The choices we make next week will be on the basis of trying to spend in appropriate ways without overspending or overborrowing and in order that we do not start all over again the cycle that we have repeatedly had of moving from boom to bust as Governments overspend when they cannot afford to do so. The Minister for Finance, Deputy Donohoe, will not allow that to happen. What we are doing is maintaining, protecting and preserving a sustainable growth story in the economy that will continue to allow us to put very large sums into projects that are needed throughout the country. We will be able to do that for the first time in many years with appropriate levels of capital spending next year. I hope Deputy Howlin is not suggesting that we should start spending money that we do not have.

In addition, we will have to raise some money to be able to fulfil the demands and pressures that exist. We want to give some relief to middle income earners, the squeezed middle who pay for everything. We are very unusual in the context of the European Union and the OECD that we ask earners to pay at the higher rate of tax when they are earning less than €35,000. That is not normal.

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