Jim O'Callaghan (Dublin Bay South, Fianna Fail) | Oireachtas source

I am sharing time with Deputies Carey, Christopher O'Sullivan and Richmond.

I want to address four issues related to the Finance Bill and the budget. The first concerns youth unemployment. The biggest threat to this country's economy in the short and long terms is long-term youth unemployment. We are aware from other economies, our history and the history of other countries that it can destroy not only an economy but also a society. I welcome the fact that the pandemic unemployment payment, PUP, has been reintroduced at the high level to ensure anyone who has lost a job recently may benefit from it. The Government needs to be commended on the employment wage subsidy scheme. It is an important piece of our armoury to protect young people who are in various vulnerable jobs but who can be protected by the State's stronger financial arm to ensure their jobs persist. We need to ensure this continues to operate for as long as we are introducing restrictions. The Government, however, needs to consider whether companies in receipt of the payment under the scheme are at the same time paying out dividends to their shareholders. This would be against the spirit of the scheme. I raised this with the Minister for Finance in a parliamentary question but I did not get a full answer.

A second issue we need to discuss and keep a close eye on is the continuing role of foreign direct investment, FDI, in Ireland and its importance to our economy. We can see that as a result of the downturn because of the pandemic and the associated restrictions, the domestic economy has suffered significantly. What is noticeable, however, is that the multinational sector, the FDI part of Ireland's economy, has continued to operate very well. We see this in the fact that the revenues coming from the FDI companies are continuing. This underlines the importance of the sector to our economy. The Government should be aware of it. We have to be careful to ensure we protect that aspect of our economy. In that regard, it is noticeable that in the budget, an immediate change was introduced to the capital allowances regime under section 291A of the Taxes Consolidation Act. Irrespective of the merits of that change, we have to be careful about introducing changes that affect FDI investment that are immediate or unannounced. There should be greater engagement with the sector to ensure we can retain the large amount of Exchequer revenue that comes from it, which supports the Irish economy.

The third point I want to make concerns the employment investment incentive scheme. A strange feature of it is that investors in a qualifying company can get 40% tax relief provided they are not a connected party. The effect is that tax relief is available to those with surplus income in respect of such investment but not available to a person who has developed a small business and wants to develop it further by investing his earned income in it. The scheme should be amended to ensure small businesses can secure investment from those most interested in developing. Why not encourage someone who has invested in a small business to develop it further? The Government should look into this in respect of the scheme.

The fourth and final matter to which I want to refer concerns the help-to-buy scheme. We need to recognise that for people earning €40,000 per year or less, it is still very difficult to avail of the scheme because of the requirement to get a mortgage. We need to recognise that we should not have circumstances in which purchasing accommodation is beyond the means of those earning a standard or average wage of €40,000, or, rather, a low wage, because that is what it is. We need to examine the scheme to ensure house ownership is available to persons at the lower end of the income ladder and to ensure our economy can progress by having people operating within it who have the stability and security of a home that they know they will own owing to their hard work and investment.

See this speech in context