Enda Kenny (Mayo, Fine Gael)
Link to this: Individually | In context

I would like to ask the Taoiseach a number of questions on money and related matters, the disappearance of it and the use of it. I did not organise that response from the Visitors Gallery. The Taoiseach, the Minister for Finance and the rest of the Cabinet have blown most of the wealth generated over the last ten years, turned a budgetary surplus of €2.8 billion into a project loss of €5 billion this year and preside over a property market in serious decline.

Deputy Cowen's budget for 2008 was based on a moderate slowing of economic growth from 4.8% to 2.8% for this year with a projected moderate slowing of day-to-day spending. However, since he presented that budget the growth forecast for all our major importers — the UK, the eurozone and the United States — has been significantly downgraded and this puts us in a position very different from Deputy Cowen's forecast. The latest figures show a further decline and fall in exports. The Minister for Finance's reluctant and half-baked measures on stamp duty for the housing sector have done nothing to maintain confidence in the construction industry where house prices are falling by €1,500 per month and where the latest realistic projection is that we might reach 30,000 new starts this year. Consumer confidence has fallen to a five-year low, the Irish stock market has fallen seriously and people have genuine concerns about pensions. Irish banks have revealed that they are exposed to a debt of €140 billion due to property speculators, which puts them more in hock than the Japanese banks were before their crisis in the 1980s. International investors are fleeing this country and there is a dissipation of confidence in the Irish economy.

One could be accused of national sabotage for talking about this, but it is necessary that we have responses from the head of Government and the Minister for Finance on the plans they have to restore domestic and international confidence in the Irish economy regarding the issues over which they have control. They are not responsible for such issues as the fall in the American stock exchange, however certain issues at home have changed since the Minister presented his budget before Christmas. What is the response of the Government? What action will it take? What plan has it to restore domestic and international confidence in our economy?

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

In the first week of December when we presented the budget we mentioned the downside risks. The Minister for Finance made it clear that we were examining a number of concerns about 2008. That was one of the reasons we put a fiscal stimulus of 1.5% into the budget, again reformed the stamp duty regime and revised the size of our capital programme to ensure we continue to inject investment into the economy at record levels and higher than our EU partners to sustain and maintain fiscal stimulus during 2008.

It is true, as the world knows, that there are a number of difficulties. It is quite clear that the global economy is characterised now by greater uncertainty than in the third quarter of last year and is certainly worse than the fourth quarter. There are a number of issues which we must take account of, including the potential for further euro appreciation against the US dollar or sterling and the rising probability of a house-production recession in the United States, with knock-on effects in the wider US economy and possibly the global economy. These issues are being discussed daily. The possibility also exists for further oil price increases, although they have gone up and down in the last month. The financial market difficulties which Deputy Kenny mentioned could persist and could spill over and affect the real economy. On the domestic side, there is a risk of a potentially steeper decline in new housing output. These are all issues that we must be clear on.

We have taken action already in the budget, as I have said, regarding the capital programme to inject resources into the economy. The housing market here is slower. I was continually answering questions about overheating in the market some years ago, but there is a correction taking place in that market. Some 88,000 units were built a few years ago. The Department of Finance figure is 55,000 for this year, although the view is that after the correction, we will move back into a more sustained position of building 60,000 units a year.

In the meantime, there is, and will continue to be, a decline in employment in the construction sector. That has already been happening. It happened in the last quarter and will continue into this quarter. However, that does not take away from the huge amount of activity in other areas of the construction sector. The capital programme includes, in one form or another, road building, capital development in health and education as well as infrastructural developments and incentives in other sectors.

As the Tánaiste said on budget day, 2008 will be a more difficult year to manage. However, notwithstanding all of that, the projected growth rate is still in the order of 3%, which is better than many of our competitors. When we look at 2007, we see it was a strong year for economic growth and employment, with strong outturns. We have had surpluses for ten of the past 11 years. I am sure I do not have to remind Deputy Kenny of the strong position of the national finances, whether in terms of debt, the current budget deficit or the fact that we are funding a major capital investment programme from our own revenues, which very few countries in the world could do and we could never do in the past. These are all points on the plus side but it is a year for careful, close management of the economy. As myself and the Tánaiste have been saying for the past few months, this requires close management, close watching of the international situation and the utilisation of our strengths. One of our strengths has been that we are a flexible economy. Our exports are not in decline, as Deputy Kenny maintained, but are on the rise. We must manage these issues in a careful and prudent fashion during this current year.

Enda Kenny (Mayo, Fine Gael)
Link to this: Individually | In context

Nobody denies that the fundamentals of the Irish economy are sound but the perception across the country is that the Government managed to get back into government, climbed into the State cars, awarded themselves between €36,000 and €38,000, closed the doors and said that everything was going to be fine. That is not the position. The situation is very different now from when the Minister, Deputy Cowen, presented his budget just before Christmas. There is clearly an unease and a depth of concern out there and a loss of confidence in a range of sectors in the economy.

Other governments in Washington, Paris, London and Rome have attempted to address the challenges faced by their countries and their people. They have told the people of their plans and decisions. What has this Government done? It has done nothing, except say it will be fine on the day, whether one is whistling past the tenth storey on the way down to ground zero, or not. Ministers say, in clichéd terms, that it will be fine; we will ride out the storm.

I want to know what the Government has decided in respect of dealing with the situation as we find it at the end of January 2008. I will make three proposals to the Taoiseach in that regard. I ask him to direct that there be a 2% efficiency audit carried out across every Department, which, over a four year period, would yield approximately €8 billion to spend on tax cuts or on other areas. Will the Taoiseach direct that there be a real, radical overhaul of the 1,000 quangos at national and local level, which have led to a bureaucratic and administrative bulge which is not delivering the public service for which the people pay their taxes? I further ask him to direct FÁS to carry out a national programme of upskilling and retraining. One must look at the situation in Kilkenny recently and the situation in Arklow today, where workers are being made redundant because of the consequences of globalised decisions from multinationals.

It is not just workers who are unfortunately made redundant who require retraining and upskilling. The nature of the marketplace, with sudden changes of direction by companies, means that workers in situ also need access to a clear, defined programme of retraining and upskilling. The Taoiseach must direct that FÁS does that now, so that people will understand that the Government is not just sitting in its ivory tower in the Cabinet room but has a clear plan in response to this economic lack of confidence, which is causing so much concern to many families. I have made three specific proposals which the Taoiseach can take charge of and direct. Is he prepared to do so?

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

Deputy Kenny asked me three sets of questions, the first of which concerned what governments are doing internationally, that is, what Presidents Bush, Sarkozy and others have been doing in the past few weeks. In response, that is precisely what we did in the first week of December last. The Tánaiste announced a budget that allocated 6% of GDP to a capital programme, amounting to an injection of €8.6 billion into the Irish economy this year, which is a record high. The programme is mainly funded by our current budget surpluses and will make sure that we can drive the economy in a wide range of areas while the international slowdown occurs. It will have the effect of a financial and fiscal stimulus of approximately 1.5% this year. That is exactly the type of action that international governments are now looking at, but thankfully we moved on it two months ago.

With regard to the efficiency review, which the Fine Gael spokesman on finance also raised, I welcome the fact that in the Tánaiste's speech, he moved the next phase of the efficiency review, to ensure that we do not have any waste and that we can gain more efficiencies from our staff and across the range our services to inject more money into the economy. We have continued public sector reform in every way, whether it is in the benchmarking report or elsewhere.

On the matter of the agencies, we have already stated that we are in the process of reviewing them. They will all have their own difficulties but I will welcome support when they come. On FÁS, we have a national skills strategy and a strategy on science, technology and innovation. In the current national development plan, we are investing €8.2 billion. I agree that we must upskill our workers. I have every sympathy and concern and will do all I can with regard to Allergan. The Minister for Enterprise, Trade and Employment, Deputy Martin, has already had a meeting to discuss the situation and we will do all we can. This decision is based on the Costa Rican plant, a newer and more modern plant that has spare capacity and where the wages and salaries are far lower than ours. It sees a competitive advantage for itself in the world market in moving to that plant. Obviously, this creates problems for us. It is maintaining other sectors of its industry in Ireland, but it is not maintaining its cosmetic surgery and reconstructive plants. That is a severe shock and hardship to the individuals involved, but we have a period to try to deal with the issue over the next year or 18 months. We took action today to try to assist and work with the workers of Allergan to deal with the situation.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

This country needs to move on from the Taoiseach's problems with the Mahon tribunal and his tax affairs. Since the House last met six weeks ago, which is a disgrace, we have had turmoil in the markets with consequential worries about jobs, earnings and pensions, hundreds of workers were told that they will lose their jobs, a report detailed rising crime figures, there have been continuing problems in our hospitals and accident and emergency departments, there has been a cystic fibrosis controversy, we do not have the report on what occurred in terms of the women who were given the all clear in Portlaoise but who were called back and, after yesterday, a family is facing financial ruin because the parents tried to get their child an education.

During the break, there were a number of newspaper stories on the Taoiseach, his tax affairs and his inability to get a tax clearance certificate, which no parliament worth its name could ignore on its first day back. In an effort to give the Taoiseach an opportunity to respond to these issues and to enable us to move on, I wish to put to him a number of specific questions arising from the reports. It was reported that the Taoiseach made a voluntary disclosure of his tax affairs whereas the Revenue Commissioners are reported to have stated that he did not. Did the Taoiseach make a voluntary disclosure? If so, does it not follow that there is an acceptance by the Taoiseach that his tax affairs were not in order? Where does that leave the tax clearance certificate that he applied for and received in 2002?

The Taoiseach stated that the Revenue Commissioners cannot finalise his tax affairs until the Mahon tribunal has reported. That does not appear to be the way in which the Revenue Commissioners dealt with the tax affairs of Mr. Haughey or Deputy Lowry while issues pertaining to them were being examined by the Moriarty tribunal. Have the Revenue Commissioners confirmed to the Taoiseach that they will not finalise his tax affairs until the Mahon tribunal has reported?

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

I am very glad to answer the questions and then, as the Deputy has suggested, we can move on from these issues. I will answer them comprehensively.

Regarding other issues, from the Government's perspective, I finished Government meetings with my colleagues on the Sunday of the weekend of 23 December and the Government resumed in full session on 4 January. I admit that was a few days off, but I do not think the Government went away for any length of time from the issues with which the State must deal.

Damien English (Meath West, Fine Gael)
Link to this: Individually | In context

An unaccountable Government.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

The full Government was there and has been dealing with all the issues mentioned by Deputy Gilmore and many more in that period.

If I recall the questions exactly, I am advised that, in the professional opinion of my tax advisers, I am fully tax compliant. I made a voluntary disclosure based on their advice. For the avoidance of doubt, comprehensive and detailed submissions were made to Revenue. I understand that these are being considered by Revenue as part of the normal process. A voluntary disclosure was the normal process, not an acceptance that there was anything wrong. It was on that basis that I was advised to do it. Much of what has appeared in the media concerning my tax affairs in that period was based on leaked documentation, much of it a long way out of date. For legal and professional reasons, neither I nor my advisers have been in a position to respond about the accuracy or completeness of the report.

It is not correct, and if I said so, I was not correct — I cannot recall if I said it, but I did not say, or if I did, I did not mean to say it — that these issues could not be dealt with until the end of the Mahon tribunal. That is not what Revenue said. It said that it was part of the normal process of dealing with these issues. It and the Standards in Public Office Commission believe, and it is similar under the law, that while there is no tax clearance certificate, it is possible to deal with the other process while the issue is ongoing. Hopefully, those issues will be cleared up as soon as Revenue can do so. There is no question that I or my tax advisers have not comprehensively answered. There is no outstanding Revenue matter of which we are aware. We have answered every single question it has asked us.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

I will need to check the written record of the House to unravel the quadruple negative the Taoiseach gave in respect of what the Revenue Commissioners did or did not accept from him.

Regarding the Government's performance, I note the Taoiseach's statement that it was back on duty on 4 January. Unfortunately, we have nothing to show for it. We are back after a six week break and there is no legislation before the House.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

Hear, hear.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

Apparently, there is no legislation before the other House. The Government is paralysed and part of the reason for its paralysis relates to the Taoiseach's difficulties and the associated succession battle occurring under the surface on his side of the House.

We will need to examine the written record to parse the Taoiseach's exact statement, but there is no parsing necessary in a headline that appeared in the Irish Mail on Sunday of 30 December, which stated: "Bertie lied about tax". I cannot recall reading a newspaper headline about a political leader in this State that was so blunt and used the word the Ceann Comhairle will not allow me to use in the House. I assume the Taoiseach rejects the assertion that he lied about his tax affairs. Has he taken action arising from this headline, the type of action most people would take or initiate were such a headline printed about them?

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

Was that a headline from the Irish Mail on Sunday?

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

Yes.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

I would need a whole law library to keep ahead of the actions I would take against the Irish Mail on Sunday.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

The Taoiseach has one.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

I just ignore the Irish Mail on Sunday.

Ruairi Quinn (Dublin South East, Labour)
Link to this: Individually | In context

There was a time when the Taoiseach did not do so.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

On the legislation——

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

He sued Starry O'Brien.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

That was not the Irish Mail on Sunday.

John O'Donoghue (Kerry South, Ceann Comhairle)
Link to this: Individually | In context

We will not discuss newspapers now.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

The Finance Bill will be before the House in this session as will the social welfare Bill.

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context

They must be because of the budget.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

I was pressed at the end of the session to have a comprehensive debate on collusion, which I promised on the last day.

Eamon Gilmore (Dún Laoghaire, Labour)
Link to this: Individually | In context

No written motion.

Bertie Ahern (Dublin Central, Fianna Fail)
Link to this: Individually | In context

At least six other Bills will be before the House shortly and I look forward to all of them being debated in this session.

In case Deputy Gilmore thinks I was trying to confuse him on the issue, he stated — maybe he stated it correctly — that I was on record as saying that Revenue would not deal with these issues until the Mahon tribunal is over. If I am on the record as saying that, I should not have said it. Revenue never said that, which is the point I am making. It said that the matters were under way.