Noel Harrington (Cork South West, Fine Gael)
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I wish to share time with Deputies Twomey and Kyne.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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Is that agreed? Agreed.

Noel Harrington (Cork South West, Fine Gael)
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I welcome the opportunity to speak on what has been a very difficult budget. It has been one of the most challenging budgetary processes this country has experienced. It goes without saying that any effort to correctly balance Ireland's books by €3.5 billion could be expected to meet with approval or popularity. Nevertheless, it had to be done and it is worth noting it was agreed by all parties in this House that an adjustment of €3.5 billion was required. Ireland is lumbered with many great challenges, the greatest of which is a significantly inflated unemployment figure which has proved to be a crippling obstacle to growth and greater prosperity. The desire to deal with this millstone around the neck of our country is fundamental to every decision taken as part of this budget. There are too many people, hundreds of thousands, who rely entirely on State benefits. We all agree every effort must be made to provide for an environment to get these people, too many of them on long-term unemployment, back to work.

There is less agreement, however, on how that environment needs to be created. Making work more attractive as an option is a way with which I agree. It is interesting to note that Sinn Féin, with all its rhetoric and polemics, not once referred to jobs. Attracting capital and foreign direct investment has to be encouraged. People are enterprising, hard-working and resourceful. Given the chance, they will respond positively.

Similarly, investors and entrepreneurs need one measure more than any other – stability. Even in a poor economic environment, a predictable and stable State provides the basis to create jobs. We have to take indecision, fear and negativity from any consideration by these entrepreneurs and investors to make their decisions. Our tax regime, our competitive environment and an ability to take hard decisions will pay dividends. We are beginning to see small but encouraging signs in this regard. This time last year we were completely locked out of the bond markets. Our yields were 10% but are now less than 2%. There is increasing confidence in our economy and unemployment is slowly beginning to fall.

A second challenge we need to address is debt, both national and personal. Again, it was an issue not referred to by earlier speakers. Even if our bank debt was struck out, our borrowing requirements for next year would only fall from €13 billion to €11 billion. If that striking out involved default, we would still need €11 billion from the very bond markets we told we would not repay by defaulting on our bank debt. Overnight, this would have catastrophic economic consequences with ATMs drying up while public service pay, pensions and welfare payments would be halved.

No one in this House should be satisfied, content or smug about the situation in which we find ourselves or how and when we will recover. It is the people who work every day of the week and on whose shoulders that this country will re-emerge leaner, more competitive and with a fairer society. We must get the country back to work. Subsequently, everything else will fall into place. These budget measures were difficult and not popular but needed to be taken. Hopefully, as the weeks and months progress we will see genuine and real improvements in our economic situation.

Liam Twomey (Wexford, Fine Gael)
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The extreme peak of the Celtic tiger was in 2006. Since then, there are 350,000 more people living in Ireland, 50,000 more students in our schools, 30,000 more students going to third level and 80,000 more people receiving a State pension. However, there have been some negative developments too. Over half a million more people are medical card holders while 200,000 more are seeking jobseeker's payments. All of this has happened against the background of economic collapse of our public finances and significant changes to the lives of the people. Every budget must be measured against these parameters.

To get a steer on the way Members were approaching this debate, I listened to several contributions from the Opposition. Some were measured but one would also need a sense of humour to listen to some of the drivel that passes for debate from the Opposition. I know the Opposition parties could not have been bothered to get their alternative budgets costed by the Department of Finance. Some of the Members who receive €40,000 of taxpayers' money to run parties of one were alternating between collapsing the economy completely to the unusual suggestion that we should follow the blood sacrifice of 1916 and Irishmen and Irishwomen should start killing each other over the local property tax. That was surpassed by a former Fianna Fáil Minister lecturing the Government on how unemployment figures have impacted on people. One would never have believed he was part of a government that essentially destroyed the sacrifices Irish people made and the gains they achieved since the foundation of the State. All of these were thrown away by the former Government. It is up to this Government to restore these.

It is acknowledged by Members, especially Government Members, that circumstances are very difficult for some of our citizens and they have every reason to be angry and frustrated. Unfortunately, it is easy for some to exploit the raw anger, genuine frustration and the fears so many of these citizens have. I hope we can identify those most in need and help them as best we can as we modify this budget and government policy over the next several months. It is left to Fine Gael and Labour, as collation partners, to work together - with a certain amount of friction I accept - and debate the serious financial and social issues that so clearly need to be resolved in this country. Unfortunately, we have not got the interaction one would expect from the Opposition. The debate from Members opposite, as previous speakers have said, is just drivel and polemics from people trying to make space for themselves in the political arena rather than having a genuine concern about what some people are going through. I hope we will come through this crisis in three years' time. I hope the negativity that seems to have infected the Opposition will dissipate to some degree over time. Political opportunism will be seen for what it is by the people outside of this House. Many Ministers have made sterling efforts since we came into office to make life better for the people and minimise the impact of some difficult policy choices. It will be left to the Government's backbenchers to hold our Ministers to account to ensure these budgetary impacts are lessened.

Seán Kyne (Galway West, Fine Gael)
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In February 2011, the Government - Fine Gael and Labour - received a mandate from the people to regain our economic sovereignty, restore our economy, jobs and investment, and put our country back on the right, sustainable, compassionate path. Budget 2013, although undoubtedly difficult, is part of the process. The Government faces the most challenging task it could face: to rebuild our economy on solid foundations of jobs, enterprise, exports and innovation rather than the old, shaky foundations of property speculation and financial trickery.

We are a long way from the days of Charlie McCreevy’s giveaway budgets when populist but short-sighted measures were compounded by the squandering of public money, which often found its way to those in society who least needed it. Unfortunately, every decision in budget 2013 has been drawn up in one context, the reality that must be clear to everyone inside and outside the House. The painful reality is that the country is spending close to €17 billion more each year than we raise through taxes and revenue. This is not sustainable and cannot continue.

Some in society would prefer deep cuts in social welfare and other spending areas while others prefer higher taxes or levies. The challenge we face is to listen to the different interests and to reach a compromise rooted, first and foremost, in fairness. Despite the denials, our tax system is the most progressive in Europe, a fact espoused by the OECD, the ESRI and the European Commission. Those most able to pay taxes and charges in Ireland do so and budget 2013 continues this. For example, capital gains tax, capital acquisition tax and DIRT have all been increased by 3% following last year’s increases. Tax relief on pension contributions has been significantly reduced and capped, and PRSI and the tax base have been broadened with unearned income now subject to tax. However, despite these new measures, the primary weekly rates of the many social welfare benefits and schemes have been protected. I believe in the safety net social welfare provides as it is a system on which all citizens will depend at some point in their lives.

The confirmation of no income tax increases, no reduction in tax credits and no changes to tax bands as well as no VAT increases is welcome news to workers grappling with the effects of the recession. To help as many citizens as possible reduce their need for social welfare, a Government must support job creation and small to medium-sized enterprises. Budget 2013 achieves this with the ten-point tax plan for SMEs to help reduce administration costs, to protect and increase cashflow and to assist Irish SMEs compete on the global stage. Competing abroad requires efficient transport systems, and the rebate on diesel for our hauliers will help achieve this. The positive support the tourism industry has received will continue with the retention of the lower rate of VAT introduced in the stimulus plan of 2011.

Repairing the damage takes time but it also requires reform in order that we learn from the mistakes of the past. The Government has begun fundamental reform in the delivery of public services to safeguard essential services while maximising value for public money. Public representatives, Deputies and Senators cannot be, and are not, immune from reform. Budget 2013 is the first in many years to specifically cut public representation expenses, abolish ministerial severance payments and inject much needed transparency by abolishing entirely the system of unvouched expenses.

This budget is unquestionably a difficult one. However, there was not a credible, workable alternative put forward by any Opposition group in Dáil Éireann. The fact that no Opposition group sought the assistance of the Department of Finance for costing and estimating proposals is proof of this. Budget 2013 will be difficult for all as we try to maintain public services while closing the gap between State income and spending. We are on the correct path and about 85% of the measures needed to restore sustainability and economic confidence have been put in place. To succeed, everyone – young and old, public sector and private sector, urban and rural-based - must work together. The future of the country depends on it.

Maureen O'Sullivan (Dublin Central, Independent)
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I propose to share time with Deputy Joan Collins and Deputy Tom Fleming. I listened to the tones of assurance and confidence with which Ministers spoke yesterday and the conviction that the decisions they were making were the right ones and the positive language, such as "success", "growing and developing economy", "well on the road to recovery" and "protecting the most vulnerable to the greatest extent possible". There was a disconnect between hearing that and the reality on the ground. I left the House at 5.30 p.m. to attend two community meetings in Dublin Central. I looked at the reality from the point of view of those groups. A number of the people involved were senior citizens. While the primary weekly rate for older people is maintained at current levels, such people will have to pay more out of the amount because of the reduction in the household benefits package. People were delighted the free travel scheme was kept but they were particularly mad about the trebling of prescription charges. Low-income groups and the unemployed are disproportionately affected by the budget. I think of families struggling in communities across Dublin Central who see few, if any, real benefits to them. Instead, they must contribute more and, at the same time, the quality of services in health, social protection and justice are further stretched.

The reduction in child benefit is particularly hard because it is not fair. It targets everyone the same, regardless of their circumstances. The sum of €10 will hit the less well off much harder than those on high incomes. I acknowledge the effort to offset this by the provision of child care supports for lower income families and disadvantaged communities, but the sum of €10 is gone immediately and the supports may take a while and involve bureaucracy before they materialise. This time last year we heard about the Scandinavian early school model but we are still waiting to see it in action.

With regard to corporation tax, no one wants to drive multinationals out of the country but we want multinational companies making billions in profits to pay their fair share of tax. If we are interested in transparency and accountability, we will show exactly how much corporation tax is paid. The Chairman of the Committee of Public Accounts is just back from Africa where he investigated corruption and possible fraud. The Committee of Public Accounts in Westminster called in multinationals to meetings in Westminster to examine the billions of pounds of profits and systematic underpayment of taxes. Our Committee of Public Accounts is more concerned with ensuring money going to Uganda and Mozambique is monitored and accounted for. That is all very well because no one wants to see the money being wasted. However, what about what is happening in our country? We are not getting the full 12.5% which, if collected in full, would more than cover the €10 being taken from child benefit.

Yesterday, the European Commission presented a package to fight tax evasion and aggressive tax avoidance by multinationals. It estimates that European countries lose €1 trillion in much-needed revenue every year. Our tax revenue cannot be used to reduce the overall tax bill of transnational businesses. Apart from ethical considerations, there are economic benefits to Ireland. Even a modest financial transaction tax would bring in much-needed revenue.

Despite submissions from reputable organisations and a report by the Commission on Taxation in 2009, the site value tax was not considered. If the recommendations in the Kenny report of 1973 had been adopted, we might have been spared the reckless planning and crazy rezoning that took place when landowners and property speculators made huge profits. We must stop the possibility of another property bubble and a site value tax would have gone a long way towards preventing it. It would also have been a fairer way of assessing value and reducing dereliction.

The Minister mentioned seeking targeted incentives in already identified regeneration areas. Three such areas exist in Dublin Central: O'Devaney Gardens, Dominick Street and Croke Villas. Regeneration is not just about houses but also facilities and services.

We should have a draft budget some months before in order that we can have a real debate. There should be equality proofing in order that there is social impact analysis alongside each spending measure or reduction. We need specific policy measures on women and children with disabilities and young people. At the heart of every budget should be the principle of not increasing inequality. A social impact analysis would show what taxes on the wealthy would introduce. Alcohol and tobacco are costing enormous amounts in the health budget so it is very disappointing that nothing was done on minimum pricing of alcohol or a social responsibility levy on alcohol sales and betting transactions.

The building of youth facilities will take people out of St. Patrick's Institution. Where are the resources to ensure they do not end up in those places? We note the proposed changes and the increase in the numbers of people on community employment schemes, but some of the programmes are unlikely to attract those who most need them, namely, lone parents. The number of lone parents in Dublin Central is far above the national average. Community employment has been very progressive in moving people into second chance education and training. I welcome the development aid budget and the mental health budget and while the sum of €35 million is ring-fenced, we need to see movement on it if it is to be spent where it is intended to be used.

Joan Collins (Dublin South Central, People Before Profit Alliance)
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Last year, when I made my first contribution in the Dáil, my first comment was that I welcomed the "coalition of cuts" to the Dáil. Unfortunately, I have been proved right. The democratic revolution spoken about by Deputy Kenny was a rout of the Fianna Fail Party but because of the lack of an alternative we have seen the continuation of the same Tweedledum and Tweedledee politics of the past 20 or 30 years.

A couple with two children and earning €25,000 a year are the working poor. They are putting in long hours and feeling the pressure of austerity budgets. The budget is a savage assault on their living standards. Assuming they live in an average family home, they will pay property tax of €315. Their increased PRSI payment will be €264 a year, the cut in child benefit will be €240 a year and their back-to-school allowance will be cut by €100. This amounts to a total loss of €919 a year, or €18 a week. The Irish League of Credit Unions reported that a huge number of people have €100 or less of disposable income per month. The budget cuts will take another €18 a week from the pockets of that average family.

To cut the income of a family who are trying to survive on €25,000 a year by almost €1,000 is an outrage. The cut of €26 million in funding for the annual respite care grant is an outrage. Increased prescription charges from 50 cent to €1.50, to raise €84 million, is an absolute outrage. The cut to the homecare package for electricity, gas and telephone is shameful. It is more than an outrage.

Our Lady of the Wayside national school in my own area has been in the media recently. It has been affected by cuts and cannot provide proper heating or maintenance for classrooms. The school asked for a reverse of cuts so that it could provide pupils with the education working class children in a DEIS school deserve and should receive. Those previous cuts should have been reversed in the budget.

I have three words for members of the party of Connolly and Larkin who will vote for this outrage. They are shame, shame and shame. There are no Labour Party Deputies in the Chamber but I hope they are watching the television screens in their offices.

Inflicting this pain on the poor, in this case the working poor, is not only immoral and unjust, it is completely unnecessary. Reversing the cuts and tax increases that have hit those on low and moderate incomes, including removing the universal social charge from all earning less than €40,000, would cost €3 billion. This could be replaced by an emergency 5% wealth tax on the top 3% to 5% who control huge wealth, and a financial transaction tax. Alternatively, the Government could have raised money by making the 12.5% corporation tax an effective rate of tax which would have brought €5 billion into the economy. This is not a lot of money to ask corporations to pay to keep citizens alive and to put more money into the economy. The Government could have raised money by making the marginal tax rate on individual incomes above €100,000 an effective tax rate. That would have brought in €2.5 billion. The Government did have choices.

The budget is an insult to those who are on the dole or who have emigrated in their thousands. It offers nothing for these people. When the United Left Alliance raise the need to tax wealth, high incomes and hugely profitable multinational companies, we are told it would drive these people out of the country and create a brain drain. What about the tens of thousands of our best and brightest young people who have been driven out of the country by the failed policy of austerity?

Some speakers seem to have the impression that austerity is something that is not really happening. The IMF has said austerity measures are not working and that every euro taken out of the economy actually means €1.70 is taken out, because of a lack of growth. Is the choice between keeping our young people here and giving them a role in the economy and society and satisfying a handful of bankers and CEOs who will not work for less than €500,000 a year, the untouchables? That choice is not difficult.

Tom Fleming (Kerry South, Independent)
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This is a totally regressive budget. It is an attack on the householder, the sick, the elderly and the families and children of Ireland. It has compounded the layers of austerity imposed in four previous budgets by, once more, stripping the weaker sectors in society who have already had to endure job losses, negative equity and mortgage default while billions of euro are handed over to foreign bondholders.

The budget offers no hope to the hundreds of thousands of exiles who have left our shores over the past five or six years. It is likely that the exodus will accelerate after this week.

The property tax is being introduced at the most inappropriate time, shortly after the property crash. The property market is still on the floor and prices have not even bottomed out yet. A number of months ago, Deputy Peter Mathews ascertained, in a parliamentary question to the Minister for Finance, that more than half a billion euro could be accrued from a third rate of income tax, placing a 5% surcharge on incomes over €120,000. Deputy Mathews subsequently proposed that this would fund the annual income derived from the property tax. I am disappointed that his proposition was neither considered nor acted upon. The proposal was not simplistic and nor would it have been complex to implement. The method of collection would be straightforward and I believe the troika would have agreed to it. It does not matter to the troika where money is derived from so long as it is paid. The proposal by Deputy Mathews was never followed up on and many people, myself included, are disappointed that it was not pursued. The tax would also have been based on ability to pay.

The huge mortgage arrears crisis has gone out of control and the vast majority of people will not be able to pay the property tax. Up to date statistics indicate that 170,000 people are in arrears or are having their mortgages restructured.

The proposed format of the cut in child benefit it crude and cruel. A family of four children will suffer a reduction of up to €700 per annum. This is a hammer blow to the average Irish family. The only fair and equitable system is to means test child benefit and let reductions apply to those at the upper end of the income scale. Child benefit to those earning between €70,000 an €90,000 could be reduced by 25%, to those earning between €90,000 and €100,000 by 50%, to those earning between €100,000 and €120,000 by 75%, and abolished after that. A huge hardship and sacrifice is being imposed on those people who really need the benefit and are on the breadline. The system I have outlined would make essential welfare money available for those who most need it.

On the child benefit issue and with regard to the respite care grant, household benefits and medical cards, the Government will have to get back to the drawing board and consider reversing and amending these very harsh measures. They are neither fair nor equitable. Surely the Minister for Social Protection can renegotiate with providers of utilities, get better value for the €61 million being expended and spread the money around better.

The abolition of PRSI exemptions is a drastic decision. The reduction in the back-to-education allowance and the taxing of maternity benefit will drive families further into poverty. The threefold increase in the medical card prescription charge, from 50 cent to €1.50, is amazing and is another hardship on those at the lower income level.

The means test for medical cards removes the allowance for the card to work - people are not even being allowed essential improvements to their homes because of the means test. With the weather conditions we have seen in recent years, this is a retrograde step. In rural areas people need a car; there is no Luas or bus service. We should have made allowances for that. I am amazed at the €17 million reduction in child family resources. I hope this will be reversed and that we will look after those with disabilities and special needs, and home helps. We have a caring society so I ask the Ministers to take note of what we are saying and address the deficiencies over the next month, while ensuring the HSE gives proper money to those I have referred to.

Leo Varadkar (Dublin West, Fine Gael)
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This has been a very difficult budget to frame. Every Department has had to make hard decisions. Nevertheless, I have been able to protect spending on vital areas like marine safety and the Coast Guard. I have also been able to safeguard spending in some areas of tourism and sport by ameliorating the reduction in spending agreed in the comprehensive review of expenditure published last year.

The Department’s total allocation for 2013 is €1.7 billion, representing a reduction in spending of €387 million or 20%. This is a significant cut in spending, the single biggest cut in any Government Department in terms of capital spending, and the biggest cut of any Government Department in terms of overall spending after the Departments of Health and Social Protection. Capital spending drops by €314 million to €900 million in 2013, a cut of around 26%. This accounts for three quarters of the total €419 million cut in overall Government capital spending for 2013. I am satisfied to make this contribution and in doing so, I know that I am allowing the Government to avoid deeper cuts in education, health, and children’s services and even more taxes on people and business.

The current expenditure provision for my Department for 2013 is €758 million, a reduction of €73 million, or 9%, on the Estimate for 2012. This €73 million in savings includes a base saving of €38 million on the original current expenditure provision for 2012, plus €35 million for the once-off payment of €36 million to CIE, which brought the subvention paid to the group to its fifth highest level ever. Nevertheless, there are welcome measures in this budget for hauliers, for tourism, the aviation sector and job creation in the broader economy, in particular the diesel rebate, the aviation package and the increased VAT threshold.

Hauliers have sought a fuel rebate for some time and I have long been sympathetic to their cause. The Government has now announced a rebate on diesel which will come into effect next July. This will be crucial for hauliers who have felt the impact of the rising global cost of fuel. It will also benefit exporters by helping to control transport costs. Excise duty on diesel and petrol remain unchanged by the budget, although carbon tax will rise next May.

This week, the Government announced plans to restructure the State-owned airports. We have identified that Shannon and other airports have the potential for significant job creation. This potential has been acknowledged in the budget through a package of aviation measures. New incentives will be put in place to facilitate the construction of hangars and other assets at airports to attract aviation business to Ireland. The package could benefit Shannon Airport when it becomes independent in the near future, as well as all airports across Ireland whether in public or private ownership, as all airports may avail of it. The Government will also consider the feasibility of new funding sources for airlines, and for aircraft financing and leasing companies. More details will be announced in the finance Bill.

In 2013, we will see an additional reduction of €16 million or 6% in subsidies for public transport PSO services on the 2012 base, or 19% taking account of the once-off provision of an additional €36 million to CIE in 2012. CIE is currently preparing a revised five-year business plan to address its financial situation. It will have to take a range of steps, including the realisation of non-core assets; the reduction of its cost base, including payroll reductions; multi-annual fare increases; and the curtailment of its own-funded capital programme. The emergency bailout of 2012 cannot be repeated next year - I just do not have the money. However, it has provided some breathing space to the CIE group to implement its recovery plan by selling assets, rationalising services, securing new borrowing facilities and reducing labour and other costs. Good progress has been made in the past few weeks. It is essential that management and staff in the CIE companies use this window of opportunity to address the group’s serious financial position. There is no time to waste.

Current spending on national road maintenance will fall by 1%, from €42.3 million to €41.6 million, a drop of €633,000. Current spending for grants on regional and local roads will fall from €96 million to €82 million, a cut of €14.5 million, or 15%. The main programmes affected are the restoration maintenance grant and the urban block grant. As a result, regional and local road maintenance will have to be reduced by 500 km. The Department’s grants are not, and never were, intended to cover the full maintenance cost of regional and local roads. Local authorities have other revenue sources to assist with the funding of such works, including the new local property tax.

Maintenance of the national road and motorway network will be reduced by over 1%, saving €634,000, and €13 million will be saved in reduced operational payments for PPP roads. A reduction of over 7% will be applied to rural transport, saving €637,000 by reducing spending from €9.7 million in 2012 to €9.1 in 2013. Almost €3 million, or 4.5%, will be saved from reductions to the administrative budgets of the NRA, RPA, Railway Safety Commission and MBRS. Funding for the Green Schools programme will be maintained at the current level of €1.9 million.

The allocation for the Road Safety Authority will be reduced by €5.9 million, or 42%. The reduction in the RSA allocation for 2013 is possible due to the impending increase to the RSA’s revenue stream following the transfer of the driver licensing function from local authorities to the RSA in 2013. The RSA is expected to become self-funding in the longer term. The new plastic card driver licence will be introduced from 19 January. From that date all driving licences and learner permits issued will be in the new plastic card format, replacing the current paper licences. This is an EU initiative to introduce a secure, compact style of licence in all member states. Anyone who applies for a licence or learner permit after 12 January will receive the new version.

I also intend to transfer responsibility for the driver licence service to the Road Safety Authority from 12 January. Last year, the Government decided that the RSA should take over the operation of the driving licence service. The RSA already oversees the driver theory test and driver testing. Customers will now have a one-stop-shop for all matters related to the driving licence. Although the RSA will have responsibility for the service from 12 January, the new structures will be developed over a number of months. Local authorities will continue to operate the applications during the change-over, including front-line desk operations. This means that applications for licences and learner permits can still be submitted to local authorities during the first half of 2013.

As part of this change-over, new licence fees will be brought in to cover the cost of the service, and to reduce the RSA dependency on Exchequer funding. The cost of a ten year licence will rise to €55 from 1 January. A three-year licence fee will be €35 and a one-year licence will be €25. Under the terms of the EU directive, the three-year licences will only be available to those over 60. This new price for a full licence compares favourably to the €85 cost for a full licence in Spain, €62 in Britain and more than €100 in Australia. It is also better value than a ten-year Irish passport, which costs €80. The new fees represent the first licence fee increase since 2001. In recognition that older citizens must change their licences regularly and often must pay for eye tests, the current exemption from paying any fees for the licence for the over 70s will remain in place.

I intend to maintain funding for civil aviation at the 2012 level of €22.2 million for 2013. This includes a small increase in funding to the Air Accident Investigation Unit in 2013.

The final allocation for maritime activities in 2012 was €46 million, but this will increase to €65 million in 2013, a rise of 41%. The Irish Coast Guard responds to 2,000 incidents annually and assists around 3,500 people. Around 160 of these could have died without Coast Guard intervention. Our waters are being used more and more for leisure purposes by the public, with the Coast Guard responding to around 600 pleasure craft incidents a year, involving the use of helicopters, lifeboats and coastal rescue units. Current funding for the Coast Guard will increase substantially next year from €38 million to €58 million, an increase of €20 million or over 50%. This increase is largely due to the provision of a new fleet of search and rescue helicopters. As a result, the capital budget for the Coast Guard rises from €4.9 million in 2012 to €18.4 million in 2013, an increase of 276%.

Although it is considerably more expensive, the S92 is a modern, safer aircraft with a significantly greater capacity, range, and speed. It is configured for search and rescue operations with a range of 270 nautical miles. The Coast Guard also launched a new helicopter emergency medical service, HEMS, last July and has completed almost 100 missions. This service will expand further in 2013.

The Coast Guard is fortunate to have an extensive voluntary service at its disposal, with 900 Coast Guard, 2,000 Royal National Lifeboat Institute, 300 community rescue boats and 500 mountain and cave rescue volunteers providing a 24 hour on-call service to respond to emergencies at sea, on our cliffs or on our coasts. Without these volunteers, it would not be possible to provide the same level of emergency response. Similarly, funding for the RNLI, mountain rescue, weather buoys and the Marine Casualty Investigation Board will be maintained at current levels through to 2016. These are essential services and much of the cost is met by volunteers. I cannot justify any cut in these budget lines.

The boxers, Paralympians and individual athletes, along with our national teams and local and county sports people, lifted the nation’s spirits throughout the year, and we are grateful for that as a nation. Moreover, rising levels of participation in sport suggest that our policies are working and investment in sport is producing a real return. In recognition of this, I am reducing the planned cut in funding to the Irish Sports Council from 5% to 2.9% for 2013, representing a marginal decrease in funding from €44.4 million to €43.1. Funding for the National Sports Campus will be maintained at €1.5 million per annum, leaving aside the provision of an additional €300,000 on an exceptional basis. The Minister of State, Deputy Ring, will expand further on funding for sports in his contribution.

The 2013 allocation includes €7 million in funding for The Gathering Ireland 2013. In 2012, I allocated €5 million to The Gathering, and it is important to increase resources next year when the events and festivals are being held. The budget for Fáilte Ireland will be reduced slightly from €65 million to €63.3 million, saving just over €1 million, with a further reduction to €53.2 million planned for 2014 and 2015. However, plans are under way to merge Shannon Development’s tourism functions with Fáilte Ireland's in 2013, and their combined spend on tourism will amount to €65.3 million, representing a small increase in current spending on domestic tourism. The tourism marketing fund will be reduced by 5% or €2 million to €37.2 million. The Minister of State, Deputy Ring, will provide further details.

Alan Kelly (Tipperary North, Labour)
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I start by acknowledging that it is a difficult time for public transport in this country. Retaining services will be a major challenge in the year ahead for private operators, public operators, taxi drivers, passengers and those dependent on the rural transport system, but one from which we will not shy away. We have found ourselves in an horrific economic situation left to us by the previous Administration, where we have had to make cuts to funding with which we would not otherwise agree. We have reduced and will continue to reduce public transport subvention. Unfortunately, this is a necessity.

Having said that, I acknowledge the contribution of the three main Opposition parties, namely, Fianna Fáil, Sinn Féin and the United Left Alliance, to the public transport debate. Despite constantly moaning in this House about the cuts to public transport, I can take it from their pre-budget submissions that they are in favour of the enforced reductions in subvention to public transport. When it came to putting forward a constructive proposal on the matter, not one of them even mentioned the possibility of reversing reductions in subvention, which is amazing. We can only conclude that either they support the measures the Government is taking to balance the books or, alternatively, that public transport is quite low on their priorities, either of which is quite worrying. The United Left Alliance's 34-page pre-budget submission makes no mention of increasing the public transport subsidy. Sinn Féin's 29-page pre-budget submission makes no mention of taking away the public transport subvention, while Fianna Fáil's pre-budget submission is exactly the same. The only conclusion one can draw is that they support the Government's position in this difficult time or they simply could not care less.

However, as challenging as it is for the public transport system right now, there is a positive story to be told by the Government. The free travel pass has been maintained. While I believe we should do more to tackle fraud and abuse of this privilege of which we are aware, maintaining it was certainly a challenge. With the Leap card, real-time passenger information signs, the introduction of Wi-Fi and the national journey planner, we are beginning to see some form of stabilisation of passenger numbers and, hopefully, this will militate against further reductions in future.

Since November 2009 it has been the responsibility of the National Transport Authority to contract for PSO services with the CIE bus and rail companies on the basis of total funding advanced by my Department. In recent years the total subvention paid to the three CIE subsidiaries has been reduced from a high of €308 million in 2008 to €242 million originally earmarked for 2012. On 24 July, the Government decided to provide additional funding of €36 million to CIE to ensure the companies could continue to operate for the rest of 2012. This would bring the total subvention for this year to €278 million, which is higher than the subvention level for 2010 and is the fifth highest level of subvention ever. At this very difficult time for the public finances, it was not easy to find a large amount of additional funds. It involved very difficult decisions in terms of having to divert funding from other very worthwhile and important projects and initiatives, and imposing sacrifices on others.

Despite our economic problems and the reduced sums available for capital and current expenditure, the Government will continue to prioritise the role of public transport. Unfortunately, the amount that can be made available for PSO subvention must be reduced again. Further reductions of 6% per annum for 2013 and 2014 will be applied. As stated previously, the Opposition does not seem to have any issue with this.

The additional funding for this year only provides a very short breathing space to CIE. It is essential the management and staff in the CIE companies implement proposals to cut costs that can help to address the serious financial position in which the CIE group finds itself. In this regard, I am anxious that the current negotiations between management and unions at the two bus companies are concluded as soon as possible. In view of the difficult financial situation of CIE and the need to finalise its business planning for 2013, it is imperative these discussions bring forward a positive outcome in the coming weeks.

There are some positive elements to the transport budget. The Government has maintained smarter travel and carbon reduction capital investment in 2013 at the same level as the 2012 allocation, which is €17.4 million. If we want to take people out of cars and onto bicycles and public transport, we must invest in the necessary infrastructure to achieve this. We are achieving this through the smarter travel demonstration areas programme, active travel towns programme and the national cycle network. We are actively seeking a private sector sponsor to extend the dublinbikes scheme to other cities. All of these are designed to encourage people to cycle while also focusing on important elements of infrastructure.

This is only a small part of what my Department is actively doing. Working with the Minister, Deputy Varadkar, we are maintaining public transport as much as possible in what is a very difficult time. Public transport is not by its nature profit making. It is a social need that facilitates consumer spending and one that we are actively preserving and improving as much as practicable.

Seán Barrett (Dún Laoghaire, Ceann Comhairle)
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I call Deputy Ó Cuív, who is sharing time with Deputy Troy. As we are due to adjourn at 4.30 p.m. and you have 12 minutes, Deputy Ó Cuív, you will probably bring us to the adjournment and Deputy Troy can follow later.

Éamon Ó Cuív (Galway West, Fianna Fail)
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Before I deal with the details of the budget, I wish to express concern over some underlying trends. The Government would claim that one of the failures of the Celtic tiger period was that the overall picture was missed when looking at the detail of budgets. Considering there were contributions from two Ministers, yesterday's budget had the longest speeches but contained the least amount of information. Most of the information had been leaked beforehand and other information has been coming out in dribs and drabs in the 24 hours since the budget. Estimates, which seven or eight years ago were quite detailed when they were published, have now become four-liners giving total figures for Departments without giving any indication of the breakdown.

More seriously, the overall economic performance was glossed over in the Budget Statement by the Minister for Finance. He blandly stated that we had achieved a debt-to-GDP ratio of 8.2% and that this was beneath the troika target. He did not expand on how that was achieved despite the failings of the budget last year.

The budget normally concerns itself with tax revenue and voted Government expenditure. When we look at the voted Government expenditure for the past year, we see that the sums were on the wrong side by an alarming amount. The only way the Government half saved the day was by cutting further into the capital allocations. When we look at the Exchequer returns at the end of November and the projections for the end of the year, we see that the capped expenditure - the one that is productive - is way under target but that the two big Departments are operating as runaway trains. Between the Department of Health and the Department of Social Protection we, without very much debate, passed supplementary budgets of about €1 billion. The problem is that this is not a one-off occurrence but must be carried forward into the new year.

As I have pointed out time after time, there is a hidden time bomb in respect of the Department of Social Protection because it is storing up ever more applications that must be back paid to the day of application when approved. For example, it has one year's worth of applications for carer's allowance on hand. That is not accounted for because we do not have an accrual system. Therefore, what we are getting here is a potential liability because if all of these applications are approved - the vast majority will be - we will find there is a significant charge on the Exchequer. Similarly, invalidity and disability reviews are being rejected by the Department and the appeals process takes a year and a half. The Minister cannot go on forever extending the date of the processing of applications so some day this cash flow management will fail. Let us not talk about the obscenity of having people wait that long for a decision. There is also the issue of the effect of the pent-up demand on these Votes that is not taken into account because of our accounting system.

On the tax side, we see that income tax receipts are falling below targets. When we take the total tax bundle into account, we can see it did not raise the revenue expected this year. A similar failure next year if one did not have the lucky dip of getting extra non-tax receipts, particularly this year from the Central Bank and the guarantee, would lead to a failure to reduce Exchequer borrowing. This will lead us from the current stagnation into total recession. I am concerned that this Government has massaged the figures but that sooner or later, the financial chickens will come home to roost.

I accept that we must close the gap between expenditure and income and have no problem with taking hard decisions. It is well known that I believe it is imperative that we do a deal on bank debt and I would have thought that last spring was the opportune moment. What I do not understand is the obsession with hitting families. What has the Government and the Minister of Social Protection in particular got against ordinary families who are struggling? The entire budget targeted them, as last year's budget targeted rural people and women. I do not know what this Government has against people in rural Ireland and women and particularly struggling families.

I will give the Minister an example. The tax rises tend to have an effect on a household, therefore irrespective of the wealth of the household, the tax and social welfare changes have an equal effect per household with possibly a slight variation in the household charge. Let us take a couple with three children. What did the Government do? It hit child benefit by €9 per week, while the household tax will come in at, say, €8 per week. Motor tax increases will add €1 per week where one person is working and €2 where two people are working. PRSI increases will be €5 if one person is working and €10 per week if two people are working. We must remember that this PRSI chips in regardless of whether one gets €400 or €4,000 per week. That means that an average household is now facing an extra cost of €23 per week before it has any social life and the odd pint of beer or glass of wine. If one adds them in, it comes to a minimum of €25 per week. A sum of €25 per week comes to €1,250 per year but to have that money to spend, one would need a salary of double that, at about €2,500 in a one-income family and over €3,000 in a two-income family. The Government can say it did not hit income tax but it hit them on the come down. It hit virtually every household with children in the exact same way irrespective of their ability to pay. It is totally regressive.

On the other hand, if one the burden had been imposed on the top end of income tax and, for example, if an extra charge on the PAYE worker earning over €100,000 was imposed, the extra revenue generated would amount to €200 million. Therefore, this Government seems to have an obsession with hitting families. Let us look at the situation of a single person or a person who does not own a house with an excellent job. The Government has hit the drink and increased motor tax by €1 per week and PRSI by €5 per week and it stops there. Who has more disposable income? Let us take the case of the couple who have paid the mortgage on their house and whose children are grown up and compare them with the household whose children are in college. Over three years, the Minister of no fees has added €750 per year for a student starting college. This adds to the bill I have outlined. In three years one will need another €1,500 in gross income to pay the bills. This Government is completely anti-family and I do not understand the logic behind it.

I give credit to the Minister for Agriculture, Food and the Marine because he took on board some suggestions I made to the agriculture committee. I took the risk of engaging in the process and he did listen. I would not agree with everything he has done. The suckler cow scheme at €20 is too low. I do not agree with the changes he made to the disadvantaged area payments but I recognise that he did not hit the farmers in the mountains this year and for that I am grateful. What is wrong with the Minister for Social Protection and what has she got against rural people?

The Minister will cost a farmer with an income of €100 from farming €30 a week. A farmer with three children in receipt of the farm assist payment with an income of €200 from the farm will have to pay a total of €72 a week, while an income of €400 a week from farming would mean a cost of €132 a week. This is obscene. The Minister has placed a 100% tax on farming. This is a Government afraid to raise taxes for those earning more than €100,000 but has no problem with effectively taxing at 100% farmers in receipt of farm assist. I hope between now and when the social welfare Bill comes before the House the Minister of State, Deputy McEntee, will persuade the Minister to change this meanest of cuts and on behalf of the agricultural community he and his colleague, the Minister for Agriculture, Food and the Marine, Deputy Coveney, make a stand for the people of rural Ireland.