Tuesday, 8 October 2019
Financial Resolutions - Budget Statement 2020
I am delighted to have a chance to say a few words about budget 2020. It was laughable listening to Deputy Michael McGrath and Fianna Fáil spokespersons criticising Fine Gael and the Minister for Finance, Deputy Donohoe, given that once again Fianna Fáil's fingerprints are all over the Budget Statement the Minister read this afternoon. Last year I asked the Taoiseach about the measures he was taking to reduce the high levels of tax expenditure and introduce a sense of accountability for them. Of course, between them, Fine Gael and Fianna Fail have now delivered about a dozen budgets since early 2009. Tracing it back to the crash, in the two budgets that followed, Fine Gael Members trooped in after Fianna Fáil Members. When we got to 2011 and Fine Gael entred into government, Fianna Fáil Members voted resolutely with Fine Gael Members. Since 2016 we have had this bizarre Fine Gael-Fianna Fáil Government. The vast majority were savage austerity budgets. Today, on balance, the two parties have returned to the austerity path, following a few brief years of restoration and easing financial pressures on ordinary citizens. I have noticed that a distinguished journalist, Fionnán Sheahan, is quoted as saying Brexit was used as "a cloak covering the void of vision and Donohoe's 'Bertienomics'''. It is another chapter of "Bertienomics" since 2008.
Today the incomes of our most vulnerable citizens in receipt of social welfare assistance and benefit payments waere frozen, despite crocodile tears from Fianna Fáil and Fine Gael about assisting citizens most exposed to Brexit and mitigating measures to combat climate change. Workers received no income boost whatsoever through personal income tax reliefs. There was no movement towards a living wage. As Deputy Pringle said, if the Minister wanted to create a strong enough demand among citizens, those dependent on social welfare income and those in the workforce, surely this budget would have included some of the mitigating measures in improved personal income tax bands and social welfare payments.
I presented a submission to the Minister on my own behalf and that of my colleagues. It was entitled, A Budget to Protect our People in the Age of Brexit and Climate Change. A fundamental instrument in protecting the people was coming up with some reasonable increase in social protection, pension and benefit payments. I advocated an increase of €7 a week, at a cost of under €500 million a year. The Minister resolutely refused in any way to increase the incomes of the most vulnerable citizens. I am sure the Minister of State, Deputy Stanton, might have supported at least an increase of €5 a week , but Fine Gael and Fianna Fáil froze the social protection budget in a most disgraceful manner. That is one fundamental message.
Far from attempting to mitigate the effects of Brexit and climate change for our most vulnerable citizens, the Government ran away from that challenge. It could have balanced the budget. Deputies Pringle and Boyd Barrett have indicated sources of revenue that we know could have been used. I also advocated an increase in the levy on commercial property, to which the Minister has more or less agreed.
There was a range of other measures that could also have been used to raise revenue to balance budgets. I am a member of the Oireachtas Joint Committee on Budgetary Oversight and on the Committee on the Future of Healthcare that produced the Sláintecare report, which together with the Parliamentary Budget Office, PBO, were among the best reforms of this Dáil and which I hope it will be remembered for. When we have met bodies such as the Irish Fiscal Advisory Council, IFAC, who say to us if the expenditure is to be increased by 6.4% as the Government is doing today get the revenue of 6.4%. We needed a bigger increase if we were to protect our people. The revenue could have been attained but the Minister refused to do it. This is ideological. It is Fine Gael and Fianna Fáil against most of the rest of us. The Government is not prepared to take the steps that are necessary to increase net policy spending to protect the bulk of our people from a crash-out or any kind of disorderly Brexit or indeed from the future impacts of climate change. Curtailing wages and salaries and social protection benefits is a grave error by this Government.
Over the past ten years the gulf between the rich and poor in this country continues to widen. Through its poor performance on housing in particular, Fine Gael is normalising homelessness and robbing a generation of children of their childhood. Vulture funds, co-living developers and other private developers are feasting off our dysfunctional housing and rental market. Hundreds of thousands of people are languishing on a waiting list for health services. Somebody gave a round figure of 1 million citizens waiting for acute hospital services, outpatients, therapies and children with serious disabilities waiting years for assessment. That has happened on this Minister's watch over the past nine painful years.
Unemployment may have fallen to 5.3%. I had it at 5.2% but there has been a huge increase in precarious employment, zero hour contracts, bogus self-employment and Fine Gael with the support of Fianna Fáil has allowed that kind of employment to develop. This is the Ireland unfortunately that Fine Gael propped up by the Fine Gael independents and Fianna Fáil has nurtured and stoked over the past decade, giving to the few and leaving the many to suffer. When the Government ends it will be a shameful legacy. It will probably take several Dáileanna and more progressive Governments to fix.
The European Anti-Poverty Network, EAPN, Ireland and the 30 members of the community platform set out four reasonable tests for budget 2020. They include whether income will be redistributed to the poorest 20%, whether the budget will strengthen access to quality employment, restore and strengthen public services serving people on lowest incomes and whether it will be poverty and inequality proofed. Those four simple tests were failed today by this Government notwithstanding the threat of Brexit and dealing with climate change. They were important tests and a reasonable Government would have framed its response in their context but the Minister did not take them on board. The 30 members of the community platform are well-known, long-standing important organisations which interact constantly with us, such as Age Action Ireland, Focus Ireland, the Irish Refugee Council, the National Forum for Family Centres and the National Adult Literacy Agency to name just a few. They did set out reasonable and generally costed requests to address the serious inequality in Irish society and the significant gaps in service provision. Under the cloak of Brexit and climate mitigation this Government totally refused to address these matters today.
My own submission to the Minister, Deputy Donohoe, entitled A Budget to Protect Our People in the Age of Brexit and Climate Change, I asked for a Brexit fund of up to €2 billion because when we try to cost the kind of very difficult situation our business, agriculture and rural and urban families may be facing we start moving into the territory of between €1 billion and €2 billion. Therefore I welcome the package of €1.2 billion. It is difficult to estimate what could happen if there was a crash-out Brexit after Hallowe'en or later. The Parliamentary Budget Office, PBO, estimated that increases in jobseeker's allowance and jobseeker's benefit alone could be over €100 million in 2020 in the event of a no-deal Brexit, rising to over €900 million by 2029. That would anticipate very significant increases in unemployment in sectors deeply affected by Brexit. It is heartening to know that €650 million is being made available to support agriculture, enterprise and tourism and that €220 million will be ready immediately in the event of a crash out Brexit. Until now it was very hard to find out how much money had been spent so far on Brexit. I think the PBO tried to find out. There are estimates in the order of €100 million to €200 million. Some of the contingency action fund, however, seemed to indicate there was more spending. We do not have a very clear picture of what has been spent. Given the continuing huge burden of our national debt, of €43,000 per capita, for every man, woman and child in the country, it was dispiriting to listen to the Minister say this afternoon that he will have to turn to borrowing again and building up our national debt.
As I reiterated in my budget submission the EU should provide at least 75% of additional costs and impacts on our economy to protect the Single Market in Ireland. The Minister did not tell us today what kind of help the EU will give us. No figures seem to be talked about. I do not know whether the Minister has heard anything. Chancellor Merkel told the Prime Minister, Boris Johnson, that if Germany was leaving the EU it would not have the same issues as Britain leaving because of the situation in Ireland and because we have to insist on the backstop. The Danes however with their huge agricultural exports to Germany might have had some comments to make on Chancellor Merkel's view. Whatever happens, the country most affected should be able to expect very significant additional resources from the EU. We need to see that coming, not just verbal support in the negotiations.
I agreed with Deputy Michael McGrath and others who complained about the lack of detail in the operation of the contingency action plans. After more positive news from early today maybe there will not be a crash-out Brexit at Hallowe'en but we do not have any detail of how businesses, particularly those in the Border region or affected there, will be supported. The Minister for Finance and the Taoiseach should be able to give very detailed plans and to indicate where the funding supports will come from. In this year we have been paying €5.5 billion to service our national debt. That is half of the budget for the Department of Education and Skills, and one third of the budget for the Department of Health. It is a savage sum of money to pay in interest on our national debt. We contribute approximately €2.5 billion to the EU and for the past five years we have been a net contributor to the EU.
The Minister stated adjusting to decarbonising the economy will not be easy for everyone but surely that is the understatement of the day. The €6 increase in carbon tax will raise €90 million, while the 1% NOx emissions-based charge will realise approximately €2.5 million. The important point, however, is that the money does not seem to have been hypothecated. Where is the flow of money to protect the most vulnerable people in energy poverty? The Society of St. Vincent de Paul carried out a study and estimated that up to 28% of households endure some kind of energy poverty. When I was a spokesperson on energy some years ago, we spoke about the figure being perhaps 15%, or one in seven households, that experienced significant energy poverty. There is nothing in the budget papers to indicate how the Government has hypothecated the money to try to help the most vulnerable households. Retrofitting and so on has been discussed but it seems to remain a vague area.
We are told the just transition fund will be commenced but that its starting amount will be just €6 million. There will be a new position of commissioner for the fund but why is such a position needed? Why can the Department of Communications, Climate Action and Environment not establish a just transition fund and administer it itself? The hypothecation in that context, which will result in an increase in the fuel allowance of €2 per week, is derisory. Many of us asked the Minister to increase the length of the fuel allowance season by at least a couple of weeks but he refused to do that.
The question many people will ask is what happened to the Taoiseach's great plans for a tax and dividend approach to carbon taxation, that is, the return of levied carbon taxes to citizens and families most deeply affected by energy poverty. I asked the Minister the question a couple of weeks ago but, again, he did not seem to be able to give us further information. The idea, in addition to other helps, that any additional money that people will spend on carbon taxation, such as for travel costs, would be given directly back to them is attractive but it seems to have disappeared completely from the agenda.
I proposed the equalisation of tax on diesel and petrol, which the UK undertook a number of years ago, helping the British exchequer while also helping to make diesel fuelled cars less attractive. The Minister, again, simply refused to consider going down that road. Compared with the rest of Europe, we are often portrayed by some Deputies as a laggard on climate action. I recently read in The Economist, however, that Germany has considered initiating its carbon tax at only approximately €10 per tonne by 2021. In view of the fact that its green party has been in government several times and is doing well in the polls again, Germany is often cited as a good example of climate action but it seems to be a case of "Do as I say, not as I do."
Moreover, while most people support bringing attention to the urgency of global warming, it is often asked why there is not more focus on the car industry, that is, the industry that builds behemoths of jeeps and gas-guzzling monster vehicles. Why is there not focus on that area to encourage businesses to produce more hybrids and climate friendly, safer vehicles? In general, smaller vehicles, which are less capable of speeding, are much safer. In our country, we are sometimes highlighted as laggards in the area but we do not have an indigenous car industry. A similar example relates to big business and the use of plastic and so on. Households are repeatedly remonstrated with to be more climate friendly but many of the plastics and non-recyclable packaging we are asked to use comes from business. Business throughout Europe must take a different role. We have debated the increase in the carbon tax but it seems the Minister failed in respect of any hypothecation to make it fairer for the most vulnerable families.
During Leaders' Questions last week, the Tánaiste, Deputy Coveney, stated Rebuilding Ireland needed an injection of adrenaline in budget 2020. Housing is a severe problem facing all our constituencies but the Minister for Finance presented the princely sum of €100 million to address what we have to do. Where was the shot of adrenaline the Tánaiste sought? Although he is the former Minister with responsibility for housing, he certainly did not get it. The Minister's budget allocation in 2018 was €2.4 billion, while this year it is €2.5 billion. The Government has singularly failed to deliver the 30,000 to 35,000 social and affordable homes that are the minimum needed every year. Last week, other Deputies and I mentioned the more than 10,000 homeless citizens, 4,000 of whom are children, which is a most shameful record for the Government. Well over 140,000 households are on council waiting lists or HAP. Many people feel they will never have a forever home where they can lay their head and consider it their place. There was an opportunity today to do something drastic about the matter, as the Tánaiste seemed to want to do.
The Minister stated €1.1 billion will be allocated to help deliver 11,000 new social homes in 2020 but the sum of €80 million he has set aside for HAP, the budget for which is almost €500,000, shows that Fine Gael and Fianna Fáil will rely mainly on landlords to house 16,000 new tenancies in 2020. The developer and landlord-led housing programme, an ideological straitjacket into which Fine Gael and Fianna Fáil have fitted for decades, continues. The Government is telling the people we meet day in, day out, on the streets, sleeping in cars and vans or in emergency accommodation, that in 2020 they will not get a home. Some of them have been on the Fingal County Council list since 2005, while others have been on that of Dublin City Council for 18 years.
Sadly, if the Tánaiste was serious about the injection of adrenaline into the housing sector, he has been ignored. Many of us on this side of the House wanted significant funding for the Land Development Agency and the local authorities to start to build a massive social and affordable housing programme, the kind of which that would at long last begin to address the problem. As I outlined last week, in my constituency some 5,000 households and families are on the basic housing list for Dublin city, a further 3,000 are on transfer lists, while on the Fingal County Council lists, there are up to 2,000 households.
The Government did not do enough nationally this year to house the number of people waiting in Dublin Bay North alone. It may be a five-seater, but it is only one constituency of 40. Everything the Government did this year would not help us and there are 39 other constituencies. A massive effort was needed, but it was simply not made. I welcome the minimal help of the help-to-buy scheme which has been extended to 2021, but, overall, this is another budget in which the Government has stood still on housing. The national effort we need and were able to carry out in the years before 2007 is not happening.
Earlier the Minister for Finance had little to say about the ongoing crisis in the health sector. Nearly 1 million citizens are waiting for acute hospital beds and outpatient and therapeutic services. We were told that a supplementary budget of approximately €300 million was needed to support Vote 38 in 2019, despite the staff recruitment embargo which is clearly being operated by the chief executive, Mr. Paul Reid, and the HSE. Despite the embargo, the supplementary budget was still going to be at least €300 million. We have discussed the health budget a great deal at the Committee on Budgetary Oversight. For the past two years it has been obvious that the allocations for health services are too low. One can look at all of the efficiencies one likes, but the simple reality is that we have too few hospital beds, consultants and GPs. When one compares Ireland to exemplars such as the Scandinavian countries, we are not remotely at the races. We have too few social workers and therapists across the system.
The Minister for Finance set out a budget of €17.4 billion. We all deal with health issues day in and day out, weekend in and weekend out, but when one looks through Vote 28 for health, it is disappointing to see the figures with which the Government has come up. For example, there is a new commitment that all persons with disabilities leaving school at 18 years should have access to support. The Minister of State at the Department of Health, Deputy Finian McGrath, will be talking about 1,600 young people. There is provision for respite care services and a programme for those with autism. However, the total additional funding for disability services is only €25 million. I am a member of the informal committee in the Houses on people with disabilities which is chaired brilliantly by Senator John Dolan. The Disability Federation of Ireland and the committee wanted a minimum commitment to an investment programme of €211 million in the next five years, but it is nowhere to be found in the budget. The figure is €25 million. Once again, unfortunately, the Minister of State, Deputy Finian McGrath, has failed to bring to the House the optional protocol on disability services to the United Nations Convention on the Rights of Persons with Disabilities. In that context, an allocation of €25 million is very disappointing. I urged the Minister to increase the National Treatment Purchase Fund by €25 million to bring the total to €100 million which he has, of course, done and which I welcome. I welcome also the extension of GP services to the under-eights and dental services to the under-sixes. One then looks, however, at the allocation of €10 million for palliative care services.
One of the most disappointing allocations, aside from that for disability services, is that for mental health services. My colleague, Deputy Catherine Connolly, has constantly asked the Government to implement A Vision for Change. There is basic funding of €13 million for the national forensic mental health hospital at Portrane, but the Government has refused to meet its responsibilities overall. Chapter 12 of the budget 2020 expenditure report on health spending is disappointing. The overall figure it sets out is simply too low. We need serious and realistic health budgets which should be at least €1 billion, if not €1.5 billion, higher. Far from implementing A Vision for Change, only €13 million extra has been provided for mental health services.
While the €97 million package for older people is welcome, it is less than half of what is properly required for homecare packages and the nursing home support scheme. Besides the investment programme and the implementation of the optional protocol, the informal committee on people with disabilities to which I referred has called for a range of improvements in the disability sector. It is disappointing that in that area and for family carers the Government has failed to respond.
The upsurge in anti-social behaviour and crime in Dublin Bay North and other constituencies demands a vigorous response from the Government. However, the €81 million increase in the Garda budget will not do a great deal to accelerate the achievement of the 2020 target of 21,000 gardaí in the force. The overall increase of €120 million for the Department of Justice and Equality seems small in the context of the Garda Commissioner, Drew Harris's plans for front-line policing and the necessary doubling in size, which we want, of the traffic corps. It is another area in which there has been minimal movement by the Government.
Deputy Pringle referred to public transport and the failure of the Government to expedite and take a more urgent approach to the development of public transport systems. The highest capital allocations for transport are allocated for 2020, 2021 and 2022. In this city, however, we ask where is the progress on MetroLink. In mid-Leinster, including this city, we ask where is the progress in providing commuter rail services. Why is the Government not looking at reopening the Navan rail line? We all support the provision of Luas light rail systems in Cork, Limerick, Galway and Waterford, but they are all at very basic stages of planning. There is no appearance of a serious attempt on the part of Government to use public transport to get cars off the roads. While we can cycle and walk, we need a modern transport system. It is extraordinary that, unlike in every other European capital, in Dublin there is no fixed line system to the airport. Even BusConnects and the railway renewal programme appear to be mired in lethargy.
I refer to childcare services for which there is a welcome, albeit still small, increase of €94 million through the Department of Children and Youth Affairs. In my budget submission I asked for an increase for Tusla of approximately €50 million in circumstances where we had constantly raised in questions to the Department the difficulty in recruiting social workers to carry out much needed assessments and inspections. The Government has increased Tusla's budget by €29 million to €814 million, but it should have gone to at least €50 million. The allocation of €54 million for early learning and childcare services is also welcome. Many of us in all parties in the House were involved in the campaign of the Children's Rights Alliance, No Child 2020. The campaign proposed a range of improvements, including providing a hot meal for children in school, free school books and so on, to improve the life of every child in Ireland. However, the No Child 2020 programme was left completely unaddressed by the Minister for Finance today.
We have all met primary and secondary school teachers in the last year. We met the Irish Universities Association in Buswells Hotel a month or so ago. I also met representatives of my local university, DCU. I note that there is an increase in the education budget for next year.
Due to the quality of our teachers and students and the support of the parents, we have a world-class education system. It is critical that we keep it at that level. I was particularly struck by the submissions of the National Principals Forum, which complained bitterly that the 5,000 posts of responsibility from before the crash had not been restored.
One of the biggest problems that arose in the education area related to autism spectrum disorder, ASD, units. There is virtually no system in place for children with autism who have finished primary school and want to go on to second level. There is a special capitation for children with disabilities at primary level in ASD units but there is no such capitation at second level. We all met a great campaigner from Cork a few months ago, who wants us to replicate in second level schools the improvements in provision for children with disabilities that exist at first level but that is not provided for in this budget.
The Union of Students in Ireland, USI, asked for a €1.26 billion investment programme in higher level education until 2030. The Irish Universities Association is very concerned by recently-published rankings. I do not agree with ranking schools or universities but there are a number of international league tables down which Irish universities have been tumbling. UCD, Trinity, DCU, Galway and all our other colleges were once fairly highly placed. I have been told that there has not been the same level of support of such institutions here as there has been elsewhere. For example, the University of St. Andrews in Scotland is often credited as the number one university in the world. The levels of support which it receives from the Scottish Government, or the levels that the London university colleges receive from the British Government, are simply not provided in our system.
As others have stated in their budget submissions, and as I said earlier, there are potential revenues into which the Government could have tapped. My former colleague, Mick Wallace, brought forward the Urban Regeneration and Housing (Amendment) Bill, which dealt with vacant site levies. The former Deputy, now MEP, indicated that €100 million could be generated by that but the Minister ran away from it.
Many of us have felt that there should be a higher rate of income tax, perhaps 43% on incomes over €100,000, which the ready reckoner tells us would yield at least €364 million. Such a rate on incomes over €80,000 would yield half a billion but the Minister refused.
This is a standstill budget that does not protect our citizens from the impact that a no-deal Brexit could have on Ireland or from the impact of changes in carbon taxation and climate change. All in all, sadly, this Fine Gael-Fianna Fáil budget, perhaps the final one of this Dáil, was a non-event.