Tuesday, 10 October 2023
Financial Resolutions 2023 - Budget Statement 2024
I welcome the opportunity to present budget 2024 to this House, alongside my colleague, the Minister, Deputy Donohoe.
Budget 2024 is the first budget I will deliver as Minister for Finance. It is an enormous privilege to serve in this historic office and I have a deep sense of the responsibility that comes with it. As Minister for Finance, it is my role, working with colleagues, to balance the needs of our society today, while ensuring the well-being of our economy for generations to come.
This budget will provide further support to individuals, families and businesses at a time when the cost of living is high. The budget will also provide for new investment in the public services on which we all depend and continue to invest in the infrastructure we need for the future, including the largest home building programme for many decades. It will reaffirm the importance of our enterprise economy. It will ensure there is opportunity for all while providing a safety net for those who need it.
By any measure, Ireland is a modern, successful country but we know we can do better, and we will. The annual budget is about setting out how we can help with the needs of today but it is also about planning for the next ten, 20 and 30 years. We have a window of opportunity now that we must grasp. Budget 2024 marks a step change in how we plan for the future by putting in place a long-term plan that will make the economic future safer for all.
Today, I am announcing two major new funds: the Future Ireland Fund, with a potential to grow to over €100 billion by the middle of the next decade, will help to protect living standards and public services for current and future generations; and separately, €14 billion will be put aside in the Infrastructure, Climate and Nature Fund by 2030 to allow for sustained levels of investment in infrastructure in the event of economic downturns and to support climate and nature-related projects. These funds are vital to help to future-proof our economy and our public finances. I will outline more detail on these new funds shortly.
This Government has navigated the Irish economy through unprecedented challenges - Brexit, the pandemic, the war in Ukraine and rates of inflation not seen for some 40 years. With the appropriate Government support, our economy has rebounded strongly. There are many positives, including a country at full employment with a record high of over 2.6 million people at work. This success should not be taken for granted or put at risk. However, we also acknowledge there are capacity constraints in the economy, and these are most obvious in the housing and labour markets. Despite our positive economic performance, inflation continues to make life very difficult for many people. I welcome the fact the rate of inflation has fallen but I am acutely aware that household budgets are stretched for many. That is why we are providing assistance in this budget, with an emphasis on those who need it the most.
Budget 2024 is being framed against a backdrop of considerable global uncertainty, both economic and, increasingly, geopolitical. The outlook for the global economy has deteriorated. As one of the most economically open countries in the world, international developments have immediate repercussions for Ireland. Our key export markets are experiencing an economic slowdown and this has impacted on our recent export performance. While the Irish economy is in a strong position today, I am all too aware of the potential risks that may materialise from global events or sectoral shocks.
In the decade preceding the pandemic, inflation averaged just 0.5% a year. In 2022, inflation averaged over 8% across the year. This has a real bearing on the everyday lives of people and businesses throughout the country. The recent interest rate increases have also had a negative impact on many households and businesses. Thankfully, since this time last year, inflation has eased, with the most recent data showing inflation of 5% in September. I expect this trend will continue in the coming months, improving real household incomes and purchasing power.
For many, the impact of inflation resulted in a deterioration in living standards in the last year. I expect living standards will improve for the vast majority in the next 12 months, with incomes growing faster than the rate of inflation. My Department estimates an average inflation rate of just over 5.25% for this year. For next year, inflation of 2.9% is projected.
We are now finally seeing a decline in consumer electricity and gas prices, albeit at a slower rate than we would like, and I know that as we head into the winter, energy bills will be to the fore of people’s minds. This is why the Government will once again be stepping in to provide direct help with household energy bills.
My Department estimates that modified domestic demand, MDD, a proxy for the domestic economy, will grow by 2.25% this year. For next year, we project it will also grow at the same rate. GNI*, a deglobalised measure of national income, is projected to grow by 2% this year and next, broadly in line with the path for modified domestic demand. These forecasts have been endorsed by the Irish Fiscal Advisory Council.
I am acutely aware that fiscal policy must be carefully designed with inflationary pressures in mind. Careful management of the public finances has allowed the Government to provide €12 billion in direct assistance to help deal with the cost of living pressures since the beginning of last year. In budget 2024, I believe we have struck the right balance between providing support for our economy and society while not unduly adding to inflation.
This House has heard me on many occasions referencing the vulnerabilities of our public finances. My Department is forecasting that tax revenue will reach €88.3 billion this year.
For the first time in a number of years, this is a downward revision for 2023 compared to earlier expectations. This is due to lower than expected corporation tax receipts, as we know, which fell sharply in the summer.
It is, of course, a highly concentrated revenue stream and it is important to note that our strong income tax receipts are also highly correlated with our corporation tax receipts. My Department estimates that windfall corporation tax receipts now stand at around €10 billion to €12 billion.
It is clearly welcome that our public finances are in a relatively strong position, especially given the level of support that has been made available by Government over the last number of years.
However, growth in tax receipts in 2023 was notably more modest than in recent years, and this is also expected to be the case for next year.
I can inform the House that we are projecting a general Government surplus of €8.8 billion, or 3% of national income this year, and €8.4 billion or 2.7% next year.
It is incumbent upon this Government to ensure that while welcoming the strong surplus, we also acknowledge that if we were to remove windfall corporation tax receipts, we would record an underlying Government deficit of €2 billion in the current year. Therefore, we must use these windfall receipts wisely and not allow them to fund permanent expenditures.
Sovereign borrowing costs have been on an upward trajectory and have, in recent days, risen to levels not seen in over a decade as markets appear to be absorbing “the higher for longer” message coming from global central banks. The Irish 10-year yield is currently 3.3%, considerably higher than this time last year.
The structure of Irish public debt, with long maturities and strong cash balances means the debt service bill should stay quite stable for the coming 3-4 years but costs are likely to rise later in the decade as low coupon debt matures and is refinanced, at likely much higher rates.
Our debt is moving in the right direction. On the current path, we will be below €200 billion by the end of the decade, and lower again as a percentage of national income. But this does not mean we can be complacent.
The Government decided in the Summer Economic Statement to temporarily adjust its medium-term spending rule to reflect the reality of the economic backdrop we are now experiencing.
Net core public spending will increase by 6.1% next year rather than the 5% originally set out. This decision reflects the fact that inflation is projected to be above trend for next year. Assuming inflation falls to more normal levels, core spending will be allowed to grow by 5% from 2025 onwards in line with the medium-term budgetary strategy.
Today, I am announcing a total Budget package of €14 billion.
Budget 2024 consists of a core expenditure package of just under €5.3 billion, and a tax package of over €1.1 billion, a total Core Package of €6.4 billion. This is in line with the budgetary parameters set out in the Summer Economic Statement last July. There is also a package of once-off cost of living measures of €2.7 billion, net of windfall revenues from the energy sector.
In addition, there is non-core expenditure of €4.75 billion, including an additional €250m for the public capital programme funded by windfall corporate tax receipts.
BUDGET 2024 MEASURES
I am announcing today a personal income tax package to the value of €1.3 billion.
As incomes rise, it is vital that adjustments are made to our personal tax system. In the absence of this, workers and many pensioners would experience an increase in the burden of tax in real terms, resulting in a drop in living standards.The competitiveness of our personal tax system is also a factor in inward investment decisions.
I am therefore announcing the following changes.
- I am increasing the personal, Employee PAYE, and earned income tax credits by €100 each.
- I am increasing the standard rate income tax cut off point by €2,000 to bring the entry point to the higher rate of income tax to €42,000.
- I am reducing the 4.5% rate of USC to 4%, the first reduction in USC rates in 5 years.
- Following Government approval this morning, as of 1 January next year, the national minimum wage will increase by €1.40 per hour to €12.70 per hour.
- Therefore, to ensure that such workers remain outside the higher rates of USC, I will be raising the entry threshold to the 4% rate to €25,760 in line with the increase in the national minimum wage. A full time worker on the minimum wage will see an increase in their net take home pay of approximately €2,300 on an annual basis.
Taking the example of a single person earning €46,000 in 2024, they will see an increase of over €2,000 in their net income as a result of cumulative income tax and USC changes since 2021.
This year’s Budget has a particular focus on tackling child poverty. I am making a number of further taxation changes to assist families with children. I am increasing both the home carer tax credit and the single person child carer credit by €100 and increasing the incapacitated child tax credit by €200.
I am extending the USC concession which applies to those who have a medical card and earn less than €60,000 per year for a further two years until the end of 2025.
COST OF LIVING
I will now address some of the other elements of the Government’s cost of living package.
I am proposing to extend the 9% reduced VAT rate for gas and electricity for a further 12 months. It is estimated that consumers will save an additional €90 for electricity and those who use gas will save an additional €62 on average during the 12-month extension.
I am conscious that the price of petrol and diesel for motorists have increased in recent weeks, driven by volatility in international oil prices. I have therefore decided to defer the final tranche of fuel excise increases which were due to happen at the end of this month. I will restore the outstanding amounts of 8c on petrol, 6c on diesel and 3.4c on Marked Gas Oil in equal instalments on 1 April 2024 and 1 August 2024.
I will introduce Financial Resolutions on both these matters later this evening.
RENT TAX CREDIT
In last year’s Budget, the Government introduced the rent tax credit to support renters. As of the end of September, over 290,000 Rent Tax Credit claims have been made with close to €166 million claimed to date and I am pleased to be in a position to increase the value of the Rent Tax Credit from €500 per year to €750 per year for 2024.
In addition, I have decided to make an amendment to allow parents who pay for their student children who have tenancies in 'Rent a Room' or 'digs' accommodation to claim the Rent Tax Credit. This will also be backdated to allow for claims to be made for the 2022 and 2023 tax years.
MORTGAGE INTEREST RELIEF
Ceann Comhairle, I am acutely conscious of the impact of rising interest rates and mortgage costs on many households. It is not possible or desirable for Government to attempt to mitigate in full the impact of increased interest rates. However, what we have experienced in the past 14 months is exceptional in the history of monetary union and ten successive interest rate increases have put many mortgage holders under considerable pressure.
I have therefore decided to introduce a one-year Mortgage Interest Tax Relief for home owners with an outstanding mortgage balance on their primary dwelling house of between €80,000 and €500,000 as of 31 December 2022.
Relief will be available in respect of the increased interest paid on the mortgage in the calendar year 2023 as compared with the amount paid in 2022, at the standard rate of 20% income tax. The relief will be capped at €1,250 per property.
Approximately 165,000 mortgage holders will benefit from this measure with an estimated cost of €125 million.
BENEFIT IN KIND – MOTOR VEHICLES
In relation to the benefit in kind regime for company vehicles, I am extending for a further year the temporary universal relief of €10,000 to the Original Market Value which I announced earlier this year.
In order to encourage the use of electric vehicles for company car purposes, I am temporarily suspending the tapering of the preferential BIK relief. I am therefore maintaining the existing €35,000 Original Market Value reduction for 2024 and 2025.
Taken together with the extension of the universal Original Market Value relief of €10,000, this measure will mean that an employee with an electric company vehicle will see an overall BIK Original Market Value relief of €45,000 next year.
MOTOR INSURERS INSOLVENCY COMPENSATION FUND
On behalf of the Minister of State, Deputy Carroll MacNeill, and myself, I am pleased to announce a 1% reduction to the motor insurers insolvency compensation fund levy, benefitting up to 2.2 million policy holders on renewal from 1 January 2024.
In the course of my work as a constituency TD for over 16 years, I have observed that many people do not fully claim all the tax relief they are due. Revenue estimates that €180 million in refunds could potentially be due to taxpayers for 2022 alone. I will shortly be launching an extensive public information campaign with Revenue to raise awareness of the range of tax credits and reliefs available to PAYE taxpayers, to ensure people can avail of their full entitlements and receive any refunds that are due.
Housing is undoubtedly the biggest domestic challenge we face today and remains a top priority for Government. Housing for All represents the biggest investment in housing in our history. Last year, we delivered 7,500 new build social homes, 43% higher than the previous year and the highest number of new build social homes delivered since 1975. The Minister, Deputy Donohoe, will set out our investment plans for next year, with funding for thousands of social, cost rental and affordable homes across the country.
Since its introduction, the help to buy scheme has supported over 40,000 people to purchase their own home.
To give certainty to prospective home buyers and to the market, I can confirm I intend to extend the help to buy scheme to the end of 2025 and will consider across next year if any changes are required to the scheme.
Some people availing of the local authority affordable purchase scheme have found that they do not qualify for the help to buy scheme under the current rules. Therefore, I am amending the scheme to ensure that applicants of the local authority affordable purchase scheme can avail of help to buy. This change will take affect from tomorrow and will run until the revised end of the scheme in 2025.
I have already announced an increase in the rent tax credit for 2024. For every tenant, there has to be a landlord. In recent years, we have seen a decline in the number of small investors in the market owning one or two properties. Some 86% of landlords in the market own just one or two properties and they have a vital role to play.
With that in mind, I am introducing a temporary tax relief which will primarily benefit small landlords. Subject to certain conditions being met, rental income of €3,000 for the year 2024, €4,000 for 2025 and €5,000 for the years 2026 and 2027, will be disregarded at the standard rate of income tax. An important condition of this measure is that the properties held by the landlord availing of the relief must remain in the rental market for the full four years, otherwise the full amount of the relief will be clawed back. Further details are contained in the budget documentation.
VACANT HOMES TAX
Tackling vacancy is a priority for this Government, it is appropriate that every available lever is deployed to incentivise the use of existing housing stock across the country. This includes measures to deter vacancy, alongside supportive measures such as grants. For this reason, I am increasing the vacant homes tax, introduced last year, to five times the property’s existing basic local property tax rate. The increase will take effect from the next chargeable period, commencing this November.
RESIDENTIAL ZONED LAND TAX
The residential zoned land tax, RZLT, is an important initiative to activate suitably zoned and serviced land for housing. It is important that affected landowners have sufficient opportunity to engage with the mapping process and that a fair and transparent process is applied when local authorities consider what land should be placed on the RZLT maps. Therefore, I am extending the liability date of the tax by one year to allow for the planned 2024 review of maps to take place and to afford affected people with a further opportunity to engage with the process.
ENTERPRISE TAX MEASURES
The Government’s ability to respond swiftly with financial support during recent crises was due to our strong public finances which in no small part are a result of the taxes paid by the business sector. From the large multinational corporations, to the small and medium enterprises which operate in every town, village and city across Ireland it is my priority to ensure we have an environment which allows businesses to thrive.
OECD - PILLAR TWO
In next week’s Finance Bill, I will be publishing legislation to implement the 15% minimum effective tax rate for large companies as provided for under the OECD Pillar Two agreement. This is a once-in-a-generation reform to our corporation tax system and marks the culmination of a ten-year, global project to reform the taxation of multinational enterprises.
TERRITORIALITY / PARTICIPATION EXEMPTION
I recently announced that a participation exemption for foreign-sourced dividends will be legislated for in the Finance Bill 2024, with the detailed development work to take place over the coming months. This will be a significant first step in reducing the administrative burden on businesses.
In relation to Ireland’s current regime for interest deductibility, this is a complex area which will take some time to work through and I have committed to engaging with stakeholders on the issue over the period ahead.
Indigenous businesses are the backbone of the economy and upon taking office I set about reviewing the enterprise supports in our tax system to identify improvements fit for a modern and dynamic economy. I have met and listened to business organisations and representative bodies across the country and have carefully considered their proposals and concerns. In this context, I am announcing a package of wide-ranging measures to support Irish enterprise which I believe will make a very positive difference.
The research and development, R&D, tax credit is a crucial feature of Ireland’s corporation tax offering and enables us to remain competitive in attracting quality employment and investment in R&D. I am increasing the R&D tax credit from 25% to 30%. This will maintain the net value of the existing credit for those businesses subject to the new 15% minimum effective tax rate, while also delivering a real increase in the credit to those smaller companies which will not be in scope of Pillar Two.
I am doubling the first-year payment threshold from €25,000 to €50,000, to provide valuable cash-flow support to companies engaged in smaller R&D projects. I hope this will encourage more businesses to engage with the regime.
My Department has completed a cost benefit analysis of revised entrepreneur relief, which is published today with the budget papers. I have asked my officials to examine opportunities to refocus the relief with a view to further improving the incentives for founders and entrepreneurs in the innovative start-up phase and to ensure it is contributing to employment creation.
I am today announcing a new targeted capital gains tax relief for angel investors in innovative start-up SMEs. This aims to assist SMEs in attracting investment and to make Ireland a more attractive location for angel investment. It will allow angel investors to benefit from a reduced rate of capital gains tax when they dispose of a qualifying investment, for gains up to twice the value of their investment.
The employment investment incentive scheme, EII, provides SMEs and start-ups with an alternative source of funding. I will be enhancing the scheme by standardising the investment period to four years for all investments and doubling the amount an investor can claim relief on for four year investments to €500,000. These enhancements will help unlock more equity investment in smaller, early stage businesses which are typically most in need of funding. My officials will also undertake a further review of EII in early 2024 which will focus on the potential for further simplification of the scheme while taking account of the conditionality imposed by the EU general block exemption regulation.
Retirement relief supports the intergenerational transfer of businesses and farms and works to ensure their smooth transition so that they continue to play their important role in the Irish economy. In line with Government policy on the age of retirement, I am extending the upper age limit for the relief from 65 until the age of 70. The reduced relief which was available on disposals from age 66 onwards will now apply from age 70. These changes will come into effect from 1 January 2025 so as to allow for an appropriate transitional period. I will also introduce a limit on disposals to a child up to the age of 70, as recommended by the Commission on Taxation and Welfare.
The key employee engagement programme, KEEP, is an important scheme, aimed at improving the attractiveness of the SME employment offering. I am pleased to announce that I have secured EU state aid approval to commence the outstanding 2022 amendments to this programme.
The amendments include the extension of the scheme to the end of 2025 and a doubling of the limit for the total market value of issued but unexercised qualifying share options from €3 million to €6 million.
These amendments will be commenced by ministerial order shortly.
We have all taken great pride in the huge success of the Irish audiovisual sector in recent years, reflected in the numerous accolades awarded to Irish productions. Top-quality content is being made in Ireland largely due to the funding offered through the section 481 film tax credit. Such productions provide a tangible economic benefit to our country, through jobs, skills development, regional development and spend on local goods and services. They are also vital in the promotion of Irish culture to audiences at home and abroad. Today, I am providing for an increase in the current project cap on qualifying expenditure in the section 481 film tax credit from €70 million to €125 million, subject to state aid approval. This will support the continuing development of a robust and creative film sector in Ireland. In addition, my officials will shortly begin engagement with the European Commission with a view to developing an incentive for the unscripted production sector in line with state aid rules.
VAT REGISTRATION THRESHOLD
I propose to increase the existing VAT registration thresholds for businesses from €37,500 for services and €75,000 for goods to €40,000 for services and €80,000 for goods, respectively. While modest, these changes will provide more latitude to small businesses whose turnover is close to the existing thresholds and is broadly in line with forthcoming EU VAT registration thresholds.
SIMPLIFICATION – BUSINESS TAXES
One of the messages that I have heard clearly from my engagement with the business community is that the rules and requirements surrounding tax reliefs and schemes are complex, which can make them difficult to access. Tax reliefs by their nature are complex, and there are certain requirements that cannot be modified particularly due to EU state aid and other international rules and considerations. However, I am determined to ensure that all businesses, especially small and medium-sized enterprises throughout the country, know what they are entitled to claim and can access all appropriate schemes and reliefs. I know that Revenue is committed to continuing to support businesses by making it as easy as possible to avail of the vast range of business supports schemes that it administers so well on behalf of the State. As part of this ongoing commitment, Revenue will, in the coming weeks, establish a dedicated tax administration liaison committee, TALC, subgroup focused on identifying any opportunities to simplify and modernise the administration of business supports. The terms of reference of this subgroup will be agreed at TALC and a report on the recommendations of the subgroup will be delivered during the course of next year.
I would like to announce that the Revenue Commissioners will shortly launch a public consultation on how we can use digital advances to modernise Ireland’s VAT invoicing and reporting system. In addition, my officials will shortly be launching a public consultation on share-based remuneration, recognising the increasing importance that business places on share-based remuneration in rewarding and retaining employees and the continued globalisation of the workforce. I would encourage all stakeholders to submit their views and proposals on both these initiatives over the period ahead.
REVIEW OF FUNDS SECTOR
My Department is currently undertaking a review of the funds sector. The review is on track to report to me in summer 2024 and will include consideration of life assurance exit tax and the taxation of funds, including exchange traded funds, for Irish investors more generally. Following the completion of the review, I will consider whether any changes to the current taxation framework are appropriate.
In recent weeks and months, we have again seen the devastating impact of climate change on communities around the world. Extreme heatwaves, droughts and wildfires have swept across many parts of the world, and 2023 is now virtually certain to be the warmest year since records began in the mid-1800s. Today, the Government is further demonstrating its commitment to climate action with the establishment of the infrastructure, climate and nature fund. I will provide further details of how this fund will operate in a few moments.
First, I will outline some climate-related tax measures. I am extending the accelerated capital allowances scheme for energy-efficient equipment for a further two years. I am also doubling the tax disregard in respect of personal income received by households who sell residual electricity from microgeneration back to the national grid. From 1 January 2024, an income disregard of up to €400 per year will apply to profits or gains arising to a qualifying person from the microgeneration of electricity. This will provide relief from income tax, USC and PRSI.
I introduced a measure in the Finance Act 2023 to reduce the VAT rate on the supply and installation of solar panels for private dwellings to zero from 1 May 2023. I am extending this measure to schools with effect from 1 January 2024.
I am extending the VRT relief for battery electric vehicles for a further two years to the end of 2025. This relief applies to battery electric vehicles with a value of up to €50,000.
The rate per tonne of carbon dioxide emitted for petrol and diesel will go up from €48.50 to €56 from 11 October as per the trajectory set out in the Finance Act 2020. As per the commitment in the programme for Government, all of the revenue raised from this increase in carbon tax will be used to ensure the most vulnerable are protected from unintended impacts of the tax increase, to part-fund a socially progressive national retrofitting programme, and to encourage and support farmers all over Ireland in the green transition.
I wish to announce a number of other new measures in budget 2024. An issue which has been regularly raised with me, including by colleagues across the House, is the VAT treatment of audio books and e-books. E-books are currently subject to a VAT rate of 9%, unlike printed books, which are zero-rated. Audio books are not currently included in the VAT zero-rating. Therefore, I have decided to zero-rate these items from 1 January 2024.
It is important that the wider familial relationships which foster children have by virtue of their foster parents are recognised for inheritance and gift tax purposes. In line with the Commission on Taxation and Welfare recommendation, I will bring forward amendments to ensure foster children can avail of the group B capital acquisitions tax threshold based on their relationship to their foster parents.
AGRICULTURAL RELIEF MEASURES
Farming is the lifeblood of rural communities across our country. A number of important agricultural tax reliefs are due to expire at the end of this year. These reliefs provide important supports to our farmers and the farming sector generally, as we all know.
EXTENSION OF CONSANGUINITY RELIEF
Consanguinity relief is a vital measure which supports the transfer of farms from one generation to the next. I will extend this relief for a period of five years to provide more certainty to farming families as they plan for the future over the years ahead.
I am also extending the accelerated capital allowances for farm safety equipment.
I am increasing the maximum aggregate lifetime limit of a number of farm-related reliefs to €100,000, which is the maximum allowable under the new EU agricultural block exemption regulation which came into effect on 1 January. These reliefs include the young trained farmer stamp duty relief, stock relief for young trained farmers, and the relief for succession farm partnerships. The maximum amount of enhanced stock relief for farmers who are partners in a registered farm partnership will be increased from €15,000 to €20,000 in line with the maximum permitted under EU regulations.
The land leasing income tax relief will be amended so that it only becomes available when the land has been owned for seven years so that it is better targeted to active farmers.
EXTENSION OF BANK LEVY
It is important that the banking sector continues to make a contribution to the Irish economy following the support banks received from taxpayers during the financial crisis. In that context, I have put a plan in place to introduce a revised bank levy in 2024 to raise €200 million. I will review the levy again next year to ensure it remains appropriately calibrated.
I am increasing excise duty on a packet of 20 cigarettes by 75 cent, with a pro rataincrease on other tobacco products. This will bring the price of cigarettes in the most popular price category to €16.75 and supports public health policy to reduce smoking levels further in Irish society. A financial resolution will be introduced tonight to enact this measure.
In light of public health interests, continuing delays to the revision of the tobacco products tax directive at EU level and the programme for Government commitment to tax e-cigarettes and vaping products, I am proposing to introduce a domestic tax on these products in next year’s budget.
Considerable preparatory work will need to be carried out by my Department and the Revenue Commissioners in drafting this legislation over the period ahead.
CHARITY, PHILANTHROPY AND SPORT
Due to the important role the charity and community sector plays in ensuring the most vulnerable people in our society are supported, I have decided to increase the funds available under the charities VAT compensation scheme from €5 million to €10 million. In simple terms, this will mean that charities will get back more of the VAT they pay on the goods and services they purchase. I am also increasing the threshold for tax relief on the donation of heritage items from €6 million to €8 million.
Ireland, as we all know, has a rich sporting culture. I believe we need to fully utilise the opportunities to invest in our sporting facilities and clubs. Our taxation system currently provides a number of reliefs to sporting organisations and to charities. However, I believe there is potential to do more. To assist our national governing bodies with their capital programmes, I intend to examine how the tax system can be utilised to further support these organisations with the upgrade of their facilities or the development of new ones. This will involve examining the tax treatment of long-term strategic development funds established by approved sporting bodies to promote capital investment in our sports facilities. I will conclude this work next year.
Additionally, I am committed to considering how our tax system can better encourage and support philanthropy. I will engage extensively over the period ahead on this issue.
FUTURE IRELAND FUND
The prospect of headline budgetary surpluses in the coming years affords us an opportunity to prepare now for the challenges we know are on the horizon. I will now provide more details in relation to the two funds that we propose to establish. We will put in place a new savings fund, to be called the future Ireland fund, using some of the windfall corporate tax receipts. To be clear, this is not a rainy-day fund because it is for costs that we know are coming our way in the years ahead. This fund will benefit all of us: the children of today, people of working age today, our pensioners and also future generations. It will help us to meet the costs of running the State in the future and it will make a contribution to the cost of healthcare, pensions, home care and much more. For example, we know we are facing considerable costs in relation to an ageing population. Age-related spending will be around €7 billion to €8 billion higher by the end of this decade than it was at the start of this decade. This is simply the stand-still cost and does not involve any new measures or any new policy initiatives. The twin transitions of digital and climate, while more difficult to quantify, will also involve significant costs. It is imperative that we act now. I am announcing that we will invest 0.8% of GDP annually into the future Ireland fund from 2024 to 2035. This will be a sum of approximately €4.3 billion in 2024. In addition, we will transfer seed funding of just over €4 billion into the fund next year from the dissolution of the current National Reserve Fund. It is expected that with a funding level of 0.8% of GDP annually, the fund could potentially reach a total of €100 billion by 2035. It is intended to preserve the fund over a longer period and that the investment return would be used to support Government expenditure. It will be a matter for the Government of the day when the drawdown occurs to use the return from the fund appropriately. There are of course risks that could crystallise over the contribution period ahead, such as a national or global economic shock or reduced corporate tax receipts. However, as we stand here today in this House, this is a realistic and achievable plan for Ireland. The window of opportunity will not remain open indefinitely and we must seize it now.
INFRASTRUCTURE, CLIMATE AND NATURE FUND
The second fund - the infrastructure, climate and nature fund - will also invest a portion of the windfall corporate taxes and is intended to operate in a counter-cyclical manner in terms of fiscal and economic stress to provide resources for capital investment. The fund will grow incrementally by €2 billion for seven consecutive years when it will reach €14 billion plus interest accrued. In 2024, the first €2 billion contribution will come from the dissolution of the National Reserve Fund. While it is important that we prevent a reoccurrence of "stop-start" public capital investment as we have seen in the past and that we invest through the economic cycle at whatever stage of that cycle we may be, we must also consider the known challenges facing our society and economy. The impact from rising global temperatures as a result of climate change will affect all parts of our society. No one will escape. This Government has taken action to manage the transition to a climate-neutral and climate-resilient society in the knowledge that it will have macroeconomic and fiscal implications for all of us. In this regard, the infrastructure, climate and nature fund will have a climate and nature component worth more than €3 billion, the aim of which is to help the achievement of carbon budgets through capital projects where it is clear our climate targets are not being reached. Both funds will be vested in the Minister for Finance and will be managed and invested by the National Treasury Management Agency, NTMA, subject to an investment policy and investment strategy. The funds will be audited by the Comptroller and Auditor General. I have this morning secured Government approval for the heads of a Bill providing for the establishment of these two new funds. I hope there will be broad consensus across this House in support of this strategically important legislation for our country.
As we stand here today, I believe there is so much in our country we can be proud of.
Full employment, a growing economy, budget surpluses, a national debt that is falling, a population that is rising, and now a plan to secure the future. We can never take any of this for granted and we must always strive to do better. Today’s budget provides help to households and businesses. It reaffirms our commitment to good-quality public services and to investment in modern infrastructure. It seeks to unlock the further potential in the enterprise sector. It underpins our determination to tackle climate change. The budget seeks to make the future safer for all of us. We face challenges for sure, but we face them from a position of strength and we face them together. I commend this budget to the House.
Thank you, Ceann Comhairle.
Recent budgets in this House have responded to Brexit, to a pandemic, to the war in Ukraine, and now to the rising cost of living. In response to all of these challenges, the Government has helped. Businesses received huge support while their trade was disrupted due to Covid. The wages of those impacted by the pandemic were supported. Shelter and warmth have been provided to those fleeing conflict. Significant help was provided and is being provided to those coping with large increases in the cost of living. All of this was done from a position of strength. The Government, the Minister, Deputy McGrath, and I are deeply aware of the needs of so many today. This is why those actions were taken. Ireland is still a great country to call home, a safe place in which to live and a nation that takes its responsibilities to its citizens and to other nations seriously. We are aware of what we owe to each other, particularly our most vulnerable. We are aware of what we owe to generations to come. This strength is mirrored in our economy. In recent years we have returned our public finances to surplus twice, we have now decided to set up funds to make best use of those surpluses, we have reduced the burden of our national debt, and we have never had more people working in our country.
I remember the opposition to setting up the rainy-day fund and then the National Reserve Fund. We know their value now.
This economic resilience, the importance of carefully managing our public finances is, at times, a difficult argument to make, making the case for not spending every cent we have, but it allowed the Government to help last year when prices began to rise. It will allow us to help again as the cost of living is still a challenge for so many.
TEMPORARY SUPPORT MEASURES
COST OF LIVING
Some €12 billion in cost-of-living supports have been provided over the past two years to families, businesses and community organisations, meaning that for many, the supports provided have significantly reduced the impact of inflation. However, even as inflation falls and energy bills begin to decrease, we are conscious that many people listening today are so concerned about rising costs and, particularly, the challenges of lighting and heating their homes this winter.
This budget provides an immediate and substantial response across 2023 and 2024. Our supports are targeted to the families that need them most, to older persons, households with young people and those with a disability. Today, I am announcing that all households will receive a further set of credits to assist with energy bills over the winter period. Three credits of €150 each will be provided between the end of this year and April of next year. A €300 lump sum will be paid to recipients of the fuel allowance in the last quarter of the year. An additional €200 will also be paid this year to recipients of the living alone allowance. For those who are in receipt of regular payments from the Department of Social Protection, I can confirm to the House that the Christmas bonus will be paid in early December.
In addition to this, those in receipt of a weekly social welfare payment, will receive a once-off double week cost-of-living support payment to all qualifying social protection recipients. This will be paid in January and will include pensioners, carers, those on disability payments and jobseekers.
To support those most in need, a special one-off payment of €400 will be made before Christmas to those who receive the carer’s support grant, disability allowance, blind pension, invalidity pension and domiciliary care allowance.
This is a budget that makes concrete progress in ensuring that Ireland is one of the best places in the world to be a child. A double payment of child payment, worth an additional €140 for each child, will be made to all qualifying households before Christmas. A double payment of the foster care allowance will also be made this year. To ensure that our supports are targeted to the families that need them most, I am also announcing that a €400 lump sum payment will be made to recipients of the working family payment later this year. For the first time, this budget provides for a lump sum payment to each child in receipt of the qualified child increase. To assist families with the costs of education, I am announcing an extension of the fee waiver on school transport services for a further year, an extension of the fee waiver for students sitting State exams, and a €60 million capitation payment for schools so they can continue to meet increased running costs and funding for supports for the most disadvantaged groups. I am also providing a one-off reduction of the student contribution fee by €1,000 for free fees students, a one-off reduction of approximately 33% in the contribution fee for apprentices in higher education and an increase in the postgraduate tuition fee contribution by €1,000 for student grant recipients. Recognising that rising costs also impact businesses across the country, I am today announcing a scheme of business supports worth €250 million.
This represents a package of supports over this year and next worth €2.3 billion. The payments I am announcing are clearly substantial. They are needed because the cost of living, as we all know, is still rising. They are, however, of a lower value than a year ago because the cost of living is not rising as fast as it was a year ago. Prices are high, but inflation is falling, and wages and core payment rates are increasing to fill that gap. These supports reflect that.
It is right that temporary challenges are addressed with temporary measures. They cannot become an unaffordable element of ongoing spending. These payments by nature are changing as the level of inflation falls.
I now want to outline our broader approach to public spending. It is based on a commitment to safe public finances. The Government can deliver further cost of living measures because we have run budget surpluses and our public debt is manageable. While we cannot meet every demand, we do our best to meet most needs for today and tomorrow. This budget is a further step in that direction. In devising our strategy, we ask ourselves if we should spend the current receipts from corporation tax, or plan for progressive growth in public services while retaining exceptional receipts to invest in and for future generations.
We entered this year in a strong position. Our resilience in the aftermath of the pandemic and energy price shocks is mostly due to the public spending policies the Government pursued over the past number of years. These policy choices did not happen by accident. To maintain this balanced and planned approach while smoothing the impact of inflation, the Minister, Deputy Michael McGrath, and I announced plans in the summer economic statement for an overall budgetary package of €91.2 billion for 2024. This includes an additional €5.3 billion over what was announced this time last year and €1 billion more than had been initially planned for 2024.
In capital, an additional €900 million is being made available under the national development plan, NDP. This will support the delivery of the most ambitious and greenest infrastructure plan in the history of our State. Some €250 million from the corporation tax receipts that we believe to be temporary in nature will further support this ambition and accelerate the delivery of projects that are almost at completion. This is part of a programme of additional capital investment of €2.25 billion over the years 2024 to 2026. These core plans are in line with what was announced in the summer economic statement.
In addition to the temporary cost-of-living measures that I have already outlined, I am announcing further non-core funding of €4.5 billion. This will support the response to exceptional circumstances, including the ongoing impact of Covid-19 on our health services and our humanitarian response to the war in Ukraine and the increased demand for international protection in our country.
The past year and a half have seen a dramatic increase in the number of people arriving to our shores seeking our help. Ireland has always been a welcoming country and I commend communities across our country for opening their hearts and their homes and welcoming those fleeing war. The selfless acts of kindness the Irish people have demonstrated during that time to those seeking support and protection highlights the best of our nature. Taken together, these measures will put in place the building blocks for further improvements in the delivery of our public services and will support a fair and equitable response to the needs our people face today.
TACKLING CHILD POVERTY
This is a budget for building a better future for our country. This starts with making our country one of the best places on earth in which to be a child. Ending child poverty remains a core ambition of this Government and a child poverty unit is now established in the Department of the Taoiseach. In August, the Government published a programme plan on child poverty and child well-being to transform the lives of our youngest citizens and that plan is reflected in this budget. We will continue to improve our understanding in this area, and I have allocated an additional €1 million to the Central Statistics Office, CSO, for the growing up in Ireland survey to meet this goal.
In addition to direct supports to family income that I outlined as part of our cost-of-living package, I am announcing the following permanent changes to our social protection payments, specifically targeting the well-being of children: I am raising the qualified child increase by €4-----
-----to €46 per week for under-12s and €54 per week for over-12s; the hot school meals programme will be expanded to a further 900 primary schools in April 2024; and parents benefit will be extended to nine weeks from August 2024. I am also: increasing the monthly rate of domiciliary care allowance by €10; extending the child benefit payment to 18-year-olds in full-time education; and raising the income threshold on the working family payment by €54 per week.
QUALITY AND AFFORDABLE CHILDCARE
Building on this, I am allocating a further €338 million to the core spending of the Department of Children, Equality, Disability, Integration and Youth. We are building on last year’s investment in childcare. The national childcare scheme will see a further 25% reduction in childcare costs, which is evidence of our commitment to making childcare affordable and will be implemented from September 2024.
We are increasing investment on the supply side through additional core funding. This will support providers, support workers and help to maintain the fee freeze. We will increase the statutory foster care rate by the end of 2024 by €75 per week-----
-----for children under 12 and €73 per week for children over 12, bringing it to €400 and €425 per week, respectively.
Further supports to that Department will provide €64 million for investment in disability services to deliver 90 more additional residential places; further development of respite services; 1,400 day places for school leavers; increased personal assistance hours; and rate increases for staff who are providing these home supports.
SUPPORTS FOR EDUCATION
Education, as we know so well, is vital for investing in our children and vital for supporting our future. That is why this budget will allocate €10.5 billion to the Department of Education in 2024, including a capital budget of €940 million. This will facilitate the continued roll-out of urgently needed school building projects, including the 300 already under way. A further 200 will commence construction over the course of 2024 and 2025.
This builds on the progress we have made in building a more inclusive education system and will provide for over 740 additional teachers to support those with special educational needs in special classes, in special schools and in mainstream settings. I am also providing for over 1,200 additional special needs assistants, SNAs, giving us the highest number of SNAs we have ever had in our education system. This will provide additional resources to special schools to support them in the vital work they do in supporting our most vulnerable students.
A Cheann Comhairle, reducing the cost of education is also a priority for this Government, which is why I am providing funding to extend the free schoolbooks scheme to all junior cycle pupils in recognised post-primary schools within the free education scheme from September next year. This will benefit over 200,000 pupils.
Further measures include capitation payments to schools from the beginning of 2024 and a €50 million increase in funding for school transport.
These announcements represent further important strides in transforming the quality, the affordability and the inclusivity of our education system.
While providing supports, we also need to ensure that our welfare system improves living standards and helps all to fulfil their potential. I am announcing a social protection package for 2024 worth almost €1.1 billion. It is targeted to those with the greatest need, in particular our children. This includes: for an individual in receipt of a weekly social protection payment, I am providing for an increase of €12 per week; and to support those with a disability further and to support our carers, I am increasing the carer's allowance means test disregard to €450 for a single person and €900 for a couple, allocating additional funds to provide free travel for people medically certified unfit to drive, and reducing the minimum weekly hours threshold for eligibility for the wage subsidy scheme from 21 hours to 15.
The Minister for Finance has announced, as a one-off tax scheme, a plan to further offset increased mortgage costs for eligible claimants in early 2024. Further to this, my colleague, the Minister for Social Protection, will work with the Minister to provide a payment, where necessary, through the Department of Social Protection, with the details to follow.
It is also important that we begin to address the long-term sustainability challenges faced by our pensions system. Earlier this year, the Government decided against increasing the pension age but instead decided to take a measured approach to increasing PRSI contribution rates on a phased and gradual basis over a number of years. It is therefore appropriate that we act now to increase PRSI contribution rates. So, from 1 October next year, all PRSI contribution rates will increase by 0.1%. This measure, which will raise €240 million in a full year, is a modest but necessary step to secure pension entitlements for this and future generations. The Minister for Social Protection will also bring forward proposals on a new pay-related benefit in advance of the Social Welfare Bill.
Taken together, the measures that we are introducing throughout the remainder of this year and next year represent substantial levels of State support for our most vulnerable. Over the past two years, the Government has successfully combined increases in core social welfare payments in combination with a series of targeted cost-of-living packages to provide the most protection to those households with the lowest incomes from the impact of inflation. This budget builds on that approach.
To continue to provide support where it is needed, the provision of housing continues to be an absolute priority for this Government. Housing delivery is performing strongly, with more than 21,000 new homes started in the first eight months of the year, meaning that we now expect to exceed our target of delivering 29,000 new homes by the end of the year. As a result of this progress, around 400 first-time buyers are purchasing their own homes each week. Next year, we will accelerate this progress with just under €7 billion of funding to the Department of Housing, Local Government and Heritage, of which €2.6 billion will be capital investment in housing. This will be supplemented by Land Development Agency investment and by Housing Finance Agency lending, resulting in an overall capital provision for housing of over €5 billion for 2024.
Some of the measures included in that are as follows: €1.9 billion in capital funding to deliver 9,300 new-build social homes; €265 million to support the delivery of 6,400 affordable homes; €242 million for homeless services and accommodation; a further €35 million to support the Housing First initiative and to home homeless adults in permanent homes with full supports; €90 million to the retrofitting of social housing in 2024, which demonstrates the State’s commitment to help people reduce their energy bills and to ensure that our country meets our climate targets; and €207 million will also be provided to bring back into supply vacant and derelict units through the voids programme and the Croí Cónaithe towns vacant grant scheme to support the regeneration of towns through the urban regeneration development fund.
These measures renew our commitment to deliver Housing for All, which will see us deliver 300,000 new homes-----
Just as housing has been a challenge for our society, a challenge that we are rising to, so, of course, the last three and half years have been a period of great challenge for our health services. Similar to other countries, the health sector continues to experience the impacts of the post-emergency phase of the pandemic.
In recognition of these challenges the Government has prioritised very significant investment in the health services with a level of spending without precedent. As a result of this, we spend more of our national income on health than many other countries.
This investment is delivering:
- An expansion in capacity through the funding of over 2,500 additional beds in hospital and community settings and
- An increase of over 22,000 staff through additional recruitment.
-----we have reduced the Drug Payment Scheme costs; and we have introduced publicly funded Assisted Human Reproduction.
Budget 2024 continues the very high level of investment in our public health system by providing for a total allocation of €22.5 billion. This includes an €808 million increase in core current funding to address the demographic and service pressures that we know are there.
I am also allocating non-core resources of over €1 billion for Covid and Ukraine spending in the health sector. This will facilitate continued investment in public health measures, including of course our successful vaccination programme.
It also includes further temporary resources beyond those announced in the Summer Economic Statement to fund the post pandemic escalation in demand and activity across our acute hospitals through a Health Resilience Fund.
The value of this record level of health investment needs to be fully realised with a focus on productivity, on governance and how we can consolidate our funding capacity.
Accordingly, this will be accompanied by a programme of initiatives to improve financial oversight across the health system, as part of our reform agenda. This work will be complete by the end of the year.
The Government remains committed to reducing waiting lists in our hospital and community services. This Budget will fund a range of measures to reduce waiting times for inpatient care, and to improve access to community diagnostics.
We will continue our targeted recruitment of additional staff. We will do this to enhance capacity across a range of acute hospital and community settings as well as our surgical hubs. We will continue the reform measures to progress the regionalisation of our health service to make it even more responsive to each patient’s needs.
I am also ensuring increased supports across our community services through additional funding for mental health services – noting that today is world mental health day, social inclusion services, older people, and health and well-being initiatives are therefore so important.
€1.23 billion is being provided as part of the National Development Plan for the delivery of additional health infrastructure to enhance the wider sustainability of our health services.
FURTHER AND HIGHER EDUCATION, RESEARCH, INNOVATION AND SCIENCE
Looking to the future and looking again to the role of education, investing in further and higher education, in innovation and in creativity is our future. In 2024, I am committed to allocating over €4.1 billion to these sectors.
Reflecting their vital role in our economic success, I am providing €60 million to address the sustainable funding of Higher Education, as set out in Funding the Future, as well as additional funding for greater capacity in medicine places.
I am also providing additional supports to allow greater access for students already attending third-level education, including increases in the Maintenance Grant rates, the restoration of maintenance grants to eligible postgraduate students on a similar basis to undergraduates and improvements to the thresholds for maintenance and student contribution grants, from September.
In 2024, I am providing €67 million for the Craft Apprenticeship scheme to over 16,000 places next year. This is to help us do better with regard to our climate challenges. It is to help us do better in building more homes.
I also want to turn briefly to the National Training Fund. It plays a vital funding role in how we future-proof the skills needs of the labour market and ensure workers can readily access lifelong learning opportunities.
I am keen to ensure the fund is used in an effective and sustainable way. It is in surplus because of the combination of increases in employers’ PRSI and the number of people at work in our country. At the same time, there are funding needs for Higher Education but meeting those needs is always inside the parameters of each budget. I want to re-examine this to find a way of better meeting these needs.
To that end, officials will bring forward options, including legislative changes for the future operation of the fund.
We will do this because a highly educated workforce creates the investments, creates the ability that we need to support our country and to create an enterprising and productive economy.
This sector is the lynchpin to our economic growth, to our future well-being and to prosperity.
This is why, as a Government, we have invested heavily to protect enterprises through the challenges of Brexit, of Covid and of the consequences of the energy crisis. The fruits, the consequences of this support can be seen across a range of economic measures, not least the fact that over 2.6 million people now work in Ireland.
As I mentioned earlier, a €250 million package of temporary supports will be developed to support businesses through the current challenges associated with the Cost of Living.
Today, in addition to this, I am allocating an additional €35 million to the Department of Enterprise, Trade and Employment. This money is in conjunction with the existing resources available to the Department to allow it to do the following:
- €9 million for our local enterprise offices - these are the hubs for enterprise creation and business start-ups in local towns and communities, and this money will allow them to extend their supports and extend their mentoring programmes to a wider cohort of local businesses;
- €3 million for the Digital Services Coordinator to support enforcement of the Digital Services Act, and
- An increase in the IDA’s capital allocation of €27 million to accelerate its Regional Property Grants Programme, to ensure balanced regional inward investments.
This is because a better connected, a more regionally balanced Ireland is at the heart of our National Development Plan. It is a blueprint for building a more sustainable and forward looking country. Today, I am providing an additional €900 million in 2024 for essential investment in more schools, more and better hospital infrastructure and for better public and road transport.
Today also marks the first Budget since my Department took the mandate of accelerating delivery of the National Development Plan. That is why I have amended the Public Works Contract. It is why I have developed new Infrastructure Guidelines, which will be published in the coming weeks, to ease the administrative burden of approving National Development Plan projects.
An independent evaluation of these priorities and capacity of the National Development Plan will soon inform the delivery of priorities. This is also why a time-limited fund to accelerate key priority capital project over the years 2024-2026 will also be provided, funded by windfall Corporate Tax receipts.
The Minister for Finance has already spoken about how the establishment of long-term savings funds will help with the investment of some of these receipts, which is why the infrastructure, climate and nature fund is so important. It will protect our investment and protect our capital expenditure in the event of an economic downturn, enabling continued investment in large projects that can drive growth.
A further plan, the climate action plan will deliver positive change for our climate while improving the lives of communities all over Ireland.
Accelerating the green transition is the best way of protecting the security of our energy supplies, breaking our dependency on imports and protecting our people from fossil fuel price shocks. Ireland is already number one in the world for the share of electricity demand met by onshore wind.
By 2030, in just over six years’ time, we aim to meet 80% of Irish electricity needs from renewable energy. This budget provides funding for the staffing of agencies to deliver that goal.
To help households with the green transition, the budget provides a further €380 million to residential and community energy schemes. This will reduce greenhouse gas emissions and energy bills, meaning households throughout Ireland will be warmer and healthier, while having more money in their pockets. Within this funding, a record allocation will be made to the warmer homes scheme that provides free energy efficiency upgrades to the homes of those who need it most.
Funding will also be provided to accelerate community-based partnerships to deliver energy savings, for solar supports that will allow households to profit by selling their energy back to the grid and for a new low-interest loan scheme that will work alongside the Sustainable Energy Authority of Ireland, SEAI, grants to allow everyone the opportunity to benefit from energy savings. Individual households, schools, farms, local businesses and community enterprises, including sports clubs and community halls, are all eligible for support through schemes that have already installed solar panels on 70,000 buildings across the country.
Applying an appropriate price to the climate-harmful effects of carbon through the carbon tax remains an important measure in how we work together to meet our goals. Today I am announcing an additional €165 million of carbon tax revenues to be available in 2024 to support a just transition and to help to address fuel poverty, bringing the total carbon tax revenue available for investment to €788 million. Almost half of this, €380 million, will be invested in improving the energy efficiency of our homes.
In addition, the carbon tax will fund €262 million of social protection spending next year. An additional €44 million of targeted social welfare measures, namely, the increases to the qualified child payment and the changes to the income eligibility threshold for the working family payment, will ensure that the most vulnerable are protected from unintended impacts of this tax increase.
An additional €32 million in carbon tax funding will be provided to the Department of Agriculture, Food and the Marine next year in order to support up to 50,000 farmers to improve biodiversity, climate, air and water quality. To continue to cut down on our carbon emissions, the national development plan will prioritise investment in sustainable, active, accessible transport.
It is transport that plays a critical role, not only in our connectivity but also in those climate ambitions.
To that end, this budget will provide €3.5 billion to the Department of Transport, comprising €892 million in current and €2.7 billion in capital funding.
Current funding will provide for the continuation of the temporary 20% fare reductions until the end of 2024, the roll-out of further services through BusConnects, Connecting Ireland and new town service plans, and the transition to a world-class fuel efficient maritime and inland aviation rescue service. This funding will support the construction of MetroLink, the Cork commuter rail project, investment in electric and hybrid-electric buses and the essential infrastructure required for new bus and rail fleets such as the electrification of bus and rail depots, as well as €1.35 billion for the development, protection and renewal of our roads network.
As part of the cost of living package, eligibility for the young adult card is being extended to cover adults aged 19 to 25. In addition, I will be working with the Minister for Transport in respect of further public transport affordability measures targeted at those under 18, with a view to implementation in 2025.
This Government has invested heavily in walking and cycling infrastructure and improved public transport. We will continue to meet our commitment to invest almost €1 million per day in cycling and walking infrastructure. Investment in greenways is envisioned through an all-island lens. This is why construction on the southern sections of the Carlingford Lough greenway is due for completion this December, with the Northern Ireland route to be completed in 2024, linking our communities across borders.
Our transport infrastructure is just one of the means of keeping our communities connected. Digital innovation has also allowed our communities to stay connected even when we are physically apart.
BROADBAND AND COMMUNICATIONS
The national broadband scheme is at the heart of our digital connectivity. The Government is keeping its promise to ensure every citizen in Ireland has access to quality, high-speed broadband, connecting rural communities, workers and businesses, supporting remote working and online education and allowing us to keep in touch with friends and family. The national broadband scheme expects to reach 200,000 premises by the end of this year. Next year, a further €348 million will be invested to provide another 100,000 homes with the opportunity to connect to fibre broadband. This means that nobody will be left behind as we move towards a more digitised society at the forefront of global and European technological progress.
As our dependence on digital networks increases, so does the risk of disruption. The Government is determined to protect Irish citizens and their data as well as digital infrastructure and services. We will provide for the continued expansion of the National Cyber Security Centre, NCSC, to strengthen cybersecurity and build resilience, address the cyber skills gap and develop the cybersecurity industry in Ireland. All of this means better access to broadband, breathing new life into so many communities.
RURAL AND COMMUNITY DEVELOPMENT
The funding I am providing for rural and community development in this budget supports vibrant, inclusive and sustainable communities across our country. The budget provision of €431 million for this Department provides over €205 million for rural development and more than €220 million for community development. This will support investment in regional, rural and local communities and on our islands, as well as many initiatives to support social inclusion. In addition to this funding, I am providing a targeted social inclusion support of €11 million to provide assistance to new arrivals through the social inclusion and community activation programme, SICAP. I am also providing €10 million to projects approved under the community recognition fund, which acknowledges the contribution of so many communities in welcoming and hosting arrivals from Ukraine and other countries. All of this is done with the aim of promoting social cohesion and supporting the development of communities throughout our country.
AGRICULTURE, FOOD AND THE MARINE
Agriculture and farming households are, of course, at the heart of our rural communities. They play a crucial role in supporting our economy, protecting our landscape, enhancing our environment and producing world-class food. This sector is an important driver of our rural economy, which is why I am allocating €1.9 billion for the Department of Agriculture, Food and the Marine to broaden the roll-out of the nearly €10 billion CAP strategic plan to 2027. Over €700 million is being provided in 2024 for farmers participating in agri-environmental actions, including through the agri-climate rural environment scheme, the areas of natural constraint scheme, forestry, organic farming and other agri-environmental schemes. In addition to this, the Department of Agriculture, Food and the Marine will be administering over €1.2 billion of EU funding-----
-----in direct payments to farmers.
TOURISM, CULTURE, ARTS, GAELTACHT, SPORT AND MEDIA
The budget today provides €1.17 billion for the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media. The allocation will support enterprise and employment in our tourism sector, through targeted measures to support businesses impacted as a resulted of the war of Ukraine; support our creative arts sector; fund our national cultural institutions; support our audiovisual industry; and support Irish as a living language. As we all know, recent weeks have reminded us of the inspirational potential of sport. This is why this budget will promote the contribution of sport to a healthier and more active society, and promote the increased participation of women in sport and invest in our sporting infrastructure. We will continue to invest in our Irish-language broadcasting.
As we plan for a better future for the people of this country, I recognise it is essential not only that the people who live here are safe in their communities but also that they feel safe. That is why I am committing to a package of €172 million in 2024 for the justice sector to enable continued investment in existing services. I am pleased to announce funding for recruitment next year of 1,000 gardaí and up to 250 Garda civilian staff in specialist roles to free up more gardaí for front-line duties. In addition, an additional €25 million in the annual overtime budget will mean that gardaí can be deployed as needed to tackle crime and antisocial behaviour, leading to stronger high-visibility policing in our cities, towns and communities. This budget will provide for additional staffing in our Courts Service, our Prison Service, the Data Protection Commission and the Policing Authority, as well as an increase in a range of domestic, sexual and gender-based violence initiatives and an extension of the youth diversion programme throughout the State.
Staying with our safety and security, and in recognition of the continued reform and importance of the defence sector, I am announcing an allocation of €1.23 billion for the Department of Defence. This includes additional-----
-----current expenditure of €21 million and an additional €34 million in capital expenditure, compared to the original plan, to further progress the priority recommendations of the Commission on the Defence Forces and the independent review group, as well as funding the first year of the tribunal of inquiry. We will do all of this because increasing our Permanent Defence Force numbers is key to building capacity and further progressing the reform programme which is under way. This allocation will provide for the recruitment, training and support of a net additional 400 military personnel next year, as well as posts across the Department of Defence and the Defence Forces, to implement reform and in important roles such as cyber-responders, data analysts and cyberanalysts. This recognises vital work of our Defence Forces here at home and abroad.
This is also because we play such a proud role in world affairs. We are known for our contribution to global peace. In 2023, Ireland provided the highest ever level of official development assistance, in cash terms and as a percentage of our gross national income. I am proud that we have met the twin challenges of providing for war refugees without losing sight of other crises, including the drought in the Horn of Africa and the awful floods in Pakistan. In 2024, I am providing €776.5 million in funding to Irish Aid in the Department of Foreign Affairs, which is an 8.4% increase on the level of funding last year, allowing this to reach a record level. We will also provide at least half of the additional funding necessary to achieve the Government’s 2025 climate finance pledge.
OUR SHARED ISLAND
Supported by European Union funding, the Global Ireland strategy supports the development of our country at home as well as our values elsewhere. Last month, I attended the launch of a new round of PEACEPLUS funding, supported by the European Union and agreed with the United Kingdom. To support this work, €1.1 billion in funding will be invested in projects that support shared peace and prosperity across Northern Ireland and the Border counties. The Government has to date allocated €247 million as part of our own shared island initiative.
We recognise that half a century as a proud member of the European Union has been transformative for Ireland and its people. Our interests are best served by active, engaged membership. Recent years have highlighted the importance of solidarity with our European family. The €1 billion of funding reserved for Ireland from the Brexit adjustment reserve is the largest single allocation for any member state. It continues to help with the consequences of Brexit. The recovery and resilience facility, under which Ireland is set to receive almost €1 billion in EU funding up to 2026, supports us in mitigating the effects of Covid, as well as allowing us to continue on a path of a greener and more digital recovery. REPowerEU funding will also help to accelerate our green transition, and cohesion funding continues to play a vital role in our efforts.
SUSTAINABLE PUBLIC SPENDING
A Cheann Comhairle, budget reform remains central to public expenditure management and is a key part of the work of my Department. Performance, equality, green and well-being budgeting, along with the spending review, are examples of how this work will be done. The paper on the well-being impacts of this budget will follow shortly. Our public servants are key to this work, in meeting the needs of our growing and changing population and enabling this reform. The current public service agreement, Building Momentum, expires at the end of this year. Later this year, my Department will enter talks and endeavour to reach an agreement that is fair for public servants and affordable for taxpayers. Of course, I expect that the significant package of cost-of-living and taxation measures provided for in this budget, which will benefit public servants, will also be factored into those discussions.
We will enter these discussions in a world that continues to change, and change quickly. We know of the opportunities that this change brings, particularly for an economy that is so skilled and so entrepreneurial, in a country that is open and committed to our role in the European Union and in the international community. We also know of the challenges, and of the risks too, including the existential risk of climate change and the threat of violence and to the rule of law around the world. In my introduction today, I acknowledged how all recent budgets have been defined by these challenges. Any one of those challenges, at other points in our history, could have caused long lasting-harm to our economy, but this has not happened because our public finances were gradually, step by difficult step, returned to health, from deficit to balance to surplus. This budget, presented by the Minister, Deputy Michael McGrath, and me today, continues that approach. We are not spending every cent today; we are leaving some aside for tomorrow. We are helping with the cost of living, but changing that help as inflation slows. We are spending more on public services and building more homes, more schools and better public transport, but we are not basing that spending on money we may not always have. That is why this budget will help with the cost of living and with better public services, and will give more children a better start in life. That is why I commend budget 2024 to the House.
The number one issue facing workers and families is the housing crisis. It permeates every facet of Irish life. Young people are left without hope, children are growing up in emergency accommodation, businesses cannot get workers, schools cannot get teachers, and gardaí, nurses, members of our Defence Forces are leaving their profession because they cannot find somewhere to live. This should have been a budget to resolve the housing crisis, but today, the Ministers for Finance and for Public Expenditure, National Development Plan Delivery and Reform have failed in that regard.
Fine Gael and Fianna Fáil have caused the housing crisis and today's budget is further confirmation that they are not the ones to fix it. We needed a budget for renters; instead we got a budget for landlords. A Sinn Féin Government would have introduced a budget that would have got to grips with the housing crisis and built the homes our people so desperately need.
Access to healthcare is one of the most fundamental needs of any citizen - knowing your child will be able to receive critical surgeries or mental health services when and if they need it and having confidence that a loved one will be treated with dignity. That is not the Ireland we live in today. Instead we have an Ireland where young and old are waiting hours upon hours to be admitted to our hospitals and emergency departments, an Ireland where many of them are consigned to trolleys on the hospital corridor. It is an Ireland where our children are forced to wait years for critical spinal surgery with devastating consequences, an Ireland where a child was forced to wait for five years, in which time her spine contorted by more than 90 degrees, leaving her in pain and sometimes unable to breathe.
Any modern society will be judged on its ability to deliver on these most basic needs. Has there ever been a point in the history of the State when a Minister celebrated billions of additional euro in the State's coffers when so many children were condemned to homelessness or forced to wait years for critical surgery? Is that the society we want to build? Today's budget offers no more hope to these children than they had yesterday. It has failed them again. A budget is about setting out a path for the future. It is about setting a vision of our values, a vision and values that are about compassion, dignity and respect. This Government and this budget need to be judged on that basis, and on that basis they have clearly failed.
Ba cheart do cháinaisnéis a bheith ann a thabharfaidh aghaidh ar an ngéarchéim thithíochta, ach inniu theip ar an dá Aire. Ba iad Fianna Fáil agus Fine Gael ba chúis leis an ngéarchéim thithíochta agus tá a fhios againn uilig nach iadsan atá ábalta an ghéarchéim seo a réiteach. Tá muid inár gcónaí in Éirinn inniu ina bhfuil othair os cionn 75 bliain d'aois ag fanacht suas le 14 uair an chloig inár n-ospidéil ag iarraidh fáil isteach i leapacha agus iad ag fanacht sna ranna éigeandála.
The housing crisis is the Government's greatest failure and ending the housing crisis is Sinn Féin's number one priority. Delivering the biggest public housing programme in the history of the State is Sinn Féin's number one priority and it needed to be the number one priority of this budget, but under this Government, entire generations have been locked out of homeownership. More than two thirds of our young people are forced to live with their parents and more of them are reaching the conclusion that their future is not here but elsewhere. Homeownership is falling under this Government. House prices are rising, rents are spiralling out of control and the level of homelessness has broken all new records month after month.
What an indictment on this Government, which has billions of euro at its disposal, that nearly 4,000 children woke up this morning in emergency accommodation. Can any one of us here really imagine what that is like? Imagine a child not being able to invite a playmate over to their home because their home is a hotel room or a bed and breakfast. Imagine what it is like for a parent wondering what they have done wrong that they are raising their children in these conditions. They have done nothing wrong. It is the Government that has wronged them and shame on it for not changing course and setting a path to make things right in this budget.
The reality is this Government has normalised child homelessness and that should never be accepted in this State. Is this the society we want to be? It is not. The two Ministers have been in government, as the Minister, Deputy Donohoe, said, for just over three years now. Let us look at their record on housing. Since taking office, average rents have increased by 33%. That means the average renter is paying €5,000 more in rent every single year since this Government took office just over three years ago. Those who want to buy a house have seen house prices increase by €60,000 since this Government took office three years ago. God forbid someone would live in Wicklow because they went up by €90,000 there, or €70,000 in Kildare. That is the record of this Government. The Minister for Housing, Local Government and Heritage has said the Government has turned a corner on the issue of housing. What planet is he living on? He is certainly not living on this one. Is í an ghéarchéim thithíochta an teip is mó ag an Rialtas. Thabharfadh Sinn Féin tús áite don ghéarchéim thithíochta. Faoin Rialtas seo tá na glúnta daoine ann nach mbeadh seans acu a gcuid tithe a dhíol ná a chíosú. Léiríonn an cháinaisnéis seo nach bhfuil plean ag an Rialtas feabhas a chur ar shaolta na ndaoine seo.
The Government's abject failure to deliver affordable homes to buy and to reduce rents is crushing the living standards of ordinary people and it is punishing those so desperate to build for the future. The Government and the Minister for Housing, Local Government and Heritage, who is sitting over there, have missed every single target he has set on affordable housing. He has missed every single one of them, year after year, since taking office. What is more fundamental is that the plan that underpins this budget and the targets, even if they were reached, is doomed to fail. We know that, the Ministers know that and everybody knows that. These targets are universally acknowledged as being too low. What has the Government done in its budget today to respond to all of that? It did not increase the targets at all. Not one additional home is it planning to build on top of what it has already set out. Not one additional home. There is no ramping up in housing under this budget. Last year, for 2023, the Government allocated €2.6 billion to the capital housing programme. This year, it has allocated the same amount of money. There is no increased investment and no increased urgency. In the middle of a housing crisis, it is shameful. You could not make it up that the Government has decided not even to ramp up housing delivery before what it has planned.
It is a clear message, if there ever was one, to workers and families that under this Government, in terms of housing, things will not get better. Indeed, they will get worse. Sinn Féin has set out a plan. We said very clearly that what should have been in this budget was the biggest State-supported construction of social, affordable and cost-rental houses in the history of the State, delivering 21,000 public homes next year. That is what it is needed. That is the ambition and the scale of the crisis but the Government has failed to meet that.
We need to increase the supply of affordable homes to rent and buy.
For many years, Sinn Féin has also called for the introduction of a refundable tax credit to put one month's rent back into renters' pockets and for this to be introduced, crucially, alongside a three-year ban on rent increases. For years, this proposal was criticised time and again by the Government and by these Ministers. Last year, the Government performed an embarrassing U-turn and introduced a botched tax credit which more than half of renters have not even received. Even in rent pressure zones, rents are increasing more than the increase in the tax credit. The Ministers know this. If someone lives outside of a rent pressure zone, then God help them because the rents are increasing by multiples of that. Without a ban on rent increases, the Minister for Finance may as well have written the cheque himself and stuffed it into the pockets of the landlords because that is where it is going to end up. It is a direct transfer of money into the pockets of landlords. They are not my words; they are the words of the Minister sitting next to him. They are the words of Deputy Donohoe last year. The Government simply does not get it. If it does not ban rent increases, then what it is doing is transferring this money from the State into the pockets of landlords.
Not content with writing one cheque for landlords, the Government has decided to write them another one by giving them a tax break of €600 next year, at a cost of €160 million. The Minister for Finance has gone even further than that. He will increase this tax break for landlords year after year until it reaches €1,000 by 2027. How much is that going to cost? It will be €270 million to landlords. He is shaking his head but the tax paper he published shows the full-year cost of this to be €160 million. He may be embarrassed that that is what he is doing but let us call it what it is.
He has decided to put taxpayers' money into the pockets of landlords.
You simply could not make this up. In this budget, the Government has provided nearly twice as much to landlords as it has to struggling renters. The Minister knows fine well, because the experts in his Department told him, that the vast majority of these landlords never even thought about leaving the rental market. This sop to landlords will go down as one of the stupidest tax reliefs ever to be provided by a Minister for Finance in recent times. It is shameful what he is doing with public money in this regard.
Do not just take my word for it; listen to what the experts in the Department of Finance have said. The Minister's own Department made clear this summer that tax is not the reason landlords choose to sell their properties. The tax strategy papers are published for us all to see. The Department also warned that personal rates of income tax have always applied to rental income and that any favourable treatment to this income would raise legitimate questions around social equity, but we know what side the Minister is on. He is always on the side of landlords. It is for the Government, therefore, to explain why a nurse should be taxed more than a landlord. It is a legitimate question. That is what the Minister has done in his proposal today and it is shameful. It is absolutely wrong and the worst thing is that it is not even going to work, and if the Minister had listened to his own Department, it would have told him that. Today's budget is grim news for renters and aspiring home-buyers, but what is most shocking is that the Government has announced a housing budget that it knows falls far short of the needs of our people. This budget is a further confirmation, if ever we needed it, given we have known it for some time, that the Government has given up on housing. It is clear only a Sinn Féin Government can deliver the type of change we need, the types of homes our people need and the type of energy and determination needed to cut through the red tape to deliver and to end the crisis created by the two parties opposite me.
For too long, under Fianna Fáil and Fine Gael, our health service has lurched from crisis to crisis. Overcrowding in our hospitals is out of control and waiting lists continue to go up. Our young doctors and nurses are looking abroad, and in this budget the Government has given them no reason to stay at home and plenty of reasons to leave. They cannot afford a home and they cannot provide the quality of care they were trained to deliver, because of the conditions in which they are forced to work. Let us turn to the state of our hospitals. Over the recent period, the number of patients in emergency departments has broken all records and represents a damning indictment of the Government's lack of planning in respect of this crisis. It lacks urgency and prioritisation and that has caused significant distress to many patients and families. They are not my words; they are the words of the Minister's party leader, Deputy Micheál Martin, in 2018.
What has happened since Fianna Fáil took office? In January, the Government broke new records, with 931 patients languishing on trolleys in a single morning. Since then, the Minister for Health has set a new target that no more than 350 patients will languish on a trolley on any given day. A decade ago, 350 patients on trolleys in corridors in our hospitals was a national scandal; today, it is a Government target. How shameful. That is the ambition the Government has; it is now a target. A total of 710,000 people are waiting just to get a date for a hospital appointment, or 40,000 more of them since the Government took office three and a half years ago. There are 250,000 people waiting for a diagnostic scan and patients with cancer, children with scoliosis and older people with broken bones are told to wait and wait again. The same applies to children's mental health and children's disability services. Waiting lists for children have more than doubled since the Government took office. More than 15,000 children are waiting for first contact with their specialist disability team. At the other end of the scale, 6,000 older people who have been approved for home help have been left waiting with no help. The same challenges are faced by people with a disability. In every section of our society, from young to old, from people with disabilities to people with mental health issues, it is clear our health service is going in the wrong direction.
What do we have in the budget, given all those facts showing we have been going in the wrong direction since the Government took office? What has this budget done? It has done next to nothing. Very little in this budget will give any comfort to patients or parents who are struggling to get access to basic health and basic care services. There is no urgency, no vision and no compassion, and that is the reality. The Government decided just to forget about health. It has failed time and again to invest in the workforce and plan for the future. Today the Government boasts about record tax revenues, yet it has delivered a standstill budget for health. There is no new funding for additional hospital beds and there is less capital investment for health than was promised in the national development plan. In fact, the health capital budget would not even keep pace with inflation.
Real-time cuts are happening to a health service that is crying out for investment. The Government has decided at Cabinet, in all consciousness, despite the resources we have as a State, to leave the health system, which is breaking at the seams, as bad next year as it is this year. Indeed, it is probably going to be worse, because the reality is the Government has underfunded for the ELS. This standstill budget is not even enough to keep pace with what is happening. That tells us the Government has decided very clearly that it is throwing in the towel on health, that it does not have any vision, that it has nothing to offer anymore in terms of improving the conditions faced by healthcare workers or patients or, indeed, that it has no interest. Tá an tseirbhís sláinte ag fulaingt faoin Rialtas seo. Ní féidir le hothair leapacha a fháil inár n-ospidéil agus tá páistí ag fanacht blianta le haghaidh obráidí criticiúla. Is iomaí dochtúir agus altra atá ag fágáil agus is léir go bhfuil an Rialtas seo tar éis éirí as an tseirbhís sláinte.
For Sinn Féin, improving access to healthcare and reducing its costs is a key priority. We have proposed a major investment in healthcare in our plan, including to roll out 1,800 additional beds over the next three years, to invest in modern diagnostic equipment and fit-for-purpose CAMHS units that support children and their families and treat them with dignity and respect, and to reduce medical costs, extend medical cards to an additional 400,000 citizens and abolish prescription charges. The Government could have done that, but it has decided not to. The difference is that we in Sinn Féin have an ambition for our health service; instead, the Government has thrown in the towel. It has given up on patients and given up on our healthcare staff.
In the past year, more and more workers and families have struggled under the cost of living. The high cost of living has impacted on every corner of our society, young and old, and those working hard to pay the rent or make their monthly mortgage payment have felt it hard. Citizens with a disability have felt it really hard, as have many others. Energy bills remain too high, food prices and fuel costs have shot up, and instead of moving forward, far too many people believe they are moving backwards. Le breis agus bliain anois tá oibrí agus teaghlaigh ag fulaingt de bharr an chostais maireachtála. In ainneoin an rud ceart a dhéanamh dóibh tá an Rialtas dá ligean síos.
In the past year, as the Minister knows, mortgage costs have soared. According to the Central Bank, two out of every five households will have seen their annual mortgage costs increase by more than €3,000. One in five households will have seen their mortgage costs increase by a staggering €5,700. Mortgage prisoners who have had their loans sold to vulture funds, in sales both Ministers opposite me actually facilitated, have felt it really hard, as they have seen letter after letter fall through the letterbox, one after another, telling them another punishing interest rate hike is on the way. For months now Sinn Féin has put forward a clear plan to help workers and families with the soaring mortgage costs with temporary and targeted mortgage interest relief, and for months the Government opposed it, over and over again at every turn, including the Minister for Finance. He opposed it right up until recently. He himself argued for 100% mortgage interest relief, did he not? He is Minister for Finance today and he has provided 20%. At the time he was arguing for 100% mortgage interest relief in 2016, the ECB's interest rate was zero. It has never been as high as it is now in the history of the State, and he has dithered and delayed.
Even now, after the announcement, we find out that people will not even be able to benefit from this until 2024. Instead of implementing the plan we have put forward for many months, the Government decided to implement a scheme that appears to lock out tens of thousands of households who have seen their mortgage costs go through the roof. There is no rationale for why the Minister would do this - none whatsoever. The idea he was scrambling at the last minute, trying to put a plan together for how to do this, is just ridiculous. We have been raising this since December of last year. The Minister has had plenty of time to design this measure and he has decided consciously to lock out tens of thousands of people who have seen their mortgage interest rates rise. The mortgage interest relief the Government has proposed will not be available to households who have an outstanding mortgage balance beneath €80,000. Does the Minister know that somebody with a balance of €75,000, if they have been on a tracker rate or are with the vulture funds, will have seen their interest rate increase by nearly €2,000 in the past year, and he is deciding to do nothing for them?
Some of these individuals are older people who have started to pay to pay down their mortgage. The Minister has decided to lock them out. There is no rationale whatsoever to do this. What does he say to people looking in today who have seen their interest rates increase on ten separate occasions since July last year, who are paying €2,000 more than they were last year, but whom, because their outstanding loan is less than €80,000, the Minister for Finance and the Minister for Public Expenditure, National Development Plan Delivery and Reform and the Government have basically told they are on their own and it will not support them? That is absolutely shameful and must be dealt with in the Finance Bill. Again, it is testament to how this Government takes a good idea from Sinn Féin and decides to make a mess of it.
What the Minister should do, and what we have told him since last year, is to provide mortgage interest relief up to €1,500, absorbing 30% of the interest that has been increased since last year, and that should be available to everybody who has seen their interest rates increase. There is a way to do it. Let us not mess it up. The Government should not try to be different just because we came up with the idea. The Government has made the U-turn and acknowledged that we are right. Let us now get this policy right and support individuals.
Workers and families continue to spend too much on heating their homes and keeping the lights on. In recent months wholesale prices have fallen sharply. While electricity prices for households have fallen across Europe, Irish electricity prices remain unacceptably high. Sinn Féin has been clear. In government we would provide the energy regulator with the power to stamp out anti-competitive behaviour and regulate standing charges. We would force the hand of energy companies by setting a price cap above which they could not charge consumers, reducing energy bills for households at a time of crisis. In March, the Taoiseach promised to take action against energy companies that failed to pass on reduced costs to struggling households. No action was taken. Instead, the Government has allowed energy companies to continue fleecing households with unaffordable bills.
Sinn Féin put the high cost of childcare on the political agenda in the election of 2020. We did it by committing to cut childcare fees by two thirds. However, what the Government has announced is too little, too late. It is a 25% reduction, but people will not get it until September next year. People need to see reductions now. There should be no delay until September. We need to see these bills coming down from January. I urge the Government to again heed Sinn Féin's call and reduce these costs by two thirds in total - 55% next year as we have planned.
Even before the spike in energy prices and inflation, more and more of workers' hard-earned money was being spent on extortionate childcare fees, rents and energy bills. We have been one of the most expensive places to live in Europe for some time. In recent years, half of all households have seen their incomes fall or stagnate. Despite doing everything right and working hard, the economy has not been working for them. We in Sinn Féin have said for some time that the fairest way to reduce taxes and put money back in workers' pockets is through cuts to the USC. This budget needed to deliver a fair tax package. In 2020, we stated our intention to remove from the USC tax net the first €30,000 a worker earns. We will deliver on that if we get an opportunity in government.
That road could have been started today - by abolishing the first rate of USC, by slashing the second rate of USC in half and increasing the point at which the third rate of USC is applied. That is what Sinn Féin has proposed. Instead, what we have is what the Government has announced. The most expensive element of today's tax package is a €2,000 increase in the standard rate band, which well over half of workers will not benefit from. The package will see a worker earning €35,000 benefit from €320, while someone on €200,000 will benefit from €890. That is not a fair tax package in anybody's books.
We also know that the rise in fuel prices has added further financial strain to households throughout the State. In September the Government increased the price of petrol and diesel with a tax hike. At midnight tonight it will push ahead with another tax hike, pushing up the price of petrol further. We will submit an amendment later tonight to try to stop that price hike going ahead. Because where I come from, and what the Government fails to understand, and in many parts of Ireland, driving a car is not a luxury. Driving a car is a necessity. It is how you get your kids to school. It is how you travel to work. It is how you make your way to a hospital appointment. Rural transport or affordable or accessible public transport does not exist in many of these communities. Yet, the Government is hell bent on continuing to increase the price of petrol and diesel through further increases in carbon taxes at midnight tonight and again next year. Not content with that, in May of next year, it will increase the cost of home heating oil, which more than one third of households rely on to heat their homes.
The first test of a republic is how we protect the most vulnerable. The decision to increase payments for citizens with disabilities by only €12 given the high cost of disability, which everyone seems to recognise apart from the Government, is unacceptable. What should have been provided and what Sinn Féin would have provided is a €20 weekly increase in the rate of disability-related payments. The qualified child payment to the poorest children will be increased by only €4 per week. Sinn Féin would have increased it by €5 for the under-12s and €10 for the over-12s. The Minister also failed to increase child benefit. Fianna Fáil and Fine Gael have both cut child benefit in the past. To this day, child benefit payment remains less than it was in 2008, so the Government is neglecting children. Child poverty will deepen as a result.
Our economy has faced significant headwinds in recent years, from the pandemic to an energy shock. In the past year we have faced emerging and interrelated headwinds - high levels of inflation and a tightening monetary policy. These challenges have placed significant pressure on households and businesses. Rising interest rates pose a risk to future investment and infrastructure delivery, most crucially in the areas of housing. That will require a greater State response. The growing threat of climate breakdown and our duty to transition to a low-carbon economy poses challenges and opportunities to our society and the wider economy. However, despite all of the rhetoric, the Government is failing on climate action. At the beginning of this year, we had the highest rate of greenhouse gas emissions in the EU. Under this Government our emissions are increasing. This is a perfect example of all the Government bluster - all talk but no action. What has been announced today to provide alternatives to households? We have a meagre increase in the budget for residential and community retrofits. We remain with a retrofitting scheme that is only available if an applicant has €25,000 lying about in a bank account which he or she can afford to spend, thus locking out low and middle-income households from support where they are hit with further carbon tax hikes. We can do much better, and Sinn Féin outlined how we can do better in terms of climate. We have proposed an additional half a billion euro to expand retrofitting, making it accessible to low and middle-income households, to reduce transport costs and accelerate our transition to renewable energy.
Today, the Government announced an increase in the research and development tax credit. We welcome that, because Sinn Féin has for years been calling for the research and development tax credit to be increased to 30%, to simplify the application process and support SMEs, and to provide tax credits to Irish startups in one instalment in the first year to drive innovation among Irish startups and firms. Next year, the domestic economy is expected to grow by 2%. The ultimate task is to convert economic gains into increasing living standards for our people, and for too many the Government is failing in that task. Tax revenues have grown and will continue to grow over the next year. A key driver of revenue growth in recent years has been corporation tax. We know a significant amount of this revenue is highly concentrated and comes from a small number of foreign-owned multinationals. As such, the future course of this revenue is uncertain. Next year will also see the implementation of the OECD tax agreement for the digital age, which Sinn Féin supports, and we will scrutinise the legislation underpinning this agreement in the coming weeks.
Today, the Government has stated its intention to create two separate funds, and Sinn Féin supports the principle of establishing a fund to increase and support public investment in the years ahead. However, while it is important to keep an eye on the future challenges, we cannot lose sight of the problems our people and our economy face here and now. As the State's tax take bulges with surpluses billions of euro in the years ahead, we have a unique opportunity to tackle the housing crisis and infrastructure deficits that harm living standards and undermine our economy. This budget was a squandered opportunity in that regard.
Tá a fhios agam ó mo cheantar féin an ghéarchéim atá sa Ghaeltacht. Tá líon na gcainteoirí laethúla Gaeilge tar éis titim don dara daonáireamh as a chéile agus níl ach teaghlach amháin as achan cúig teaghlach ag tógáil a gcuid clainne trí Ghaeilge. Cá bhfuil an scéim labhairt na Gaeilge a gheall an tAire Stáit, an Teachta O’Donovan? Cá bhfuil an maoiniú breise a theastaíonn d’Údarás na Gaeltachta, ó phleanáil teanga go dtí na coláistí samhraidh atá i gcruachás agus 30% de na mná tí tar éis éirí as ó 2018 i leith? Níor éirí leis an Rialtas fiú €5 milliún breise a chur ar fáil i dtreo na Gaeilge agus é dírithe ar scéimeanna taobh amuigh den Ghaeltacht.
Cuirfeadh Sinn Féin €12 milliún breise sa bhuiséid malartach don Ghaeltacht amháin, €11 milliún breise don Ghaeilge, agus €10 milliún do TG4, mar go bhfuil sé mar thosaíocht againn. This budget needed to make life more affordable for our people. It needed to reduce the cost of living, accelerate the delivery of affordable homes, tackle overcrowding and unacceptable waiting lists in our health service and use the opportunity to deliver lasting change and better living standards for our people. In the time to come, this budget will be remembered as one which wasted that opportunity. It bears the hallmarks of a Government that is out of touch, out of ideas and out of time.
Never has it taken so long for Ministers to say so little of significance. The budget the Ministers have outlined has a wider context, involving international events and economic forces beyond their control. There is another context for the budget, however, one for which they are responsible, namely, the years of successive Governments failing to address the biggest issues people face. One of the Ministers said that these policies did not happen by accident. He is absolutely right. These policies have constructed the crises in housing, health and many other areas. Cost-of-living pressures have become entrenched. Those in government have had 13 long years, yet they have failed to deliver for ordinary workers and families. People are bearing the brunt of inadequate investment in housing, health, essential services and vital infrastructure. While this budget may help some, it will not bring the change people are demanding. The word “continue” was used over and over. This is yet another back-slapping budget from the Government. It is a case of “Fair play to ourselves".
There are two tiers to the economy. Macroeconomic headlines mean nothing to people who are struggling to keep their heads above water. As we sit in this Chamber today, there are 785,000 people living below the poverty line. After housing costs, one in five people is existing - not living - in poverty. These people include renters, lone parents, children and adults with disabilities. Almost half of all renters are at risk of poverty. One out of every two lone parents is at risk of poverty. Some 14% live in consistent poverty. Half of all people living with a disability are at risk of poverty. This State has the lowest employment rate of people with disabilities in Europe. Why? Because the barriers to employment for people with disabilities have never been tackled.
The Government is economically short-sighted. It has failed on the biggest challenges we face in housing, health and the cost of living. Not only has a generation been forced into a life of renting, but the Government has turned the State into a renter. Private companies are being given more and more control of our public services. Outsourcing, private consultants and leasing contacts are siphoning off vast amounts of public money. Private companies will now own 90% of all primary care centres, with the State just a tenant. We are paying €20 million a year in rent. This costs more in the long run, and the sites and buildings involved will never be owned by the State. It leaves future health budgets in the hands of developers and landlords.
The Government is doing the same thing in third level education, with controversial public private partnerships for technological universities. The latter are developer-led, with the Government paying for 25 years for the right to use the buildings. The European Court of Auditors criticised this as bad value for money but the Government chooses to ignore these warnings, pushing ahead despite the long-term impact on public finances.
There are 40,000 civil servants and 900,000 sq. m of office space. The Government chooses to rent 40% of this office space. This is despite a Government report stating that it is 30% to 40% cheaper to buy office space. Still it chooses to continue to rent. Why are we expanding in all these areas when we have the money to do things properly? This is an obvious step the Government could take to reduce costs in the medium term. We need a government that thinks and plans beyond the annual budget. Huge costs are associated with the failure to deliver social and affordable housing.
I am reminded of the first budget speech made by the Minister, Deputy Donohoe, in 2016 after five years of Fine Gael in government. We have had seven more years of Fine Gael and seven more budget speeches. Addressing this Chamber that day, the Minister stated that housing was "a core priority". He went on to say: "Forty-seven thousand new social housing units will be delivered by 2021. " The truth is housing has never been a Fine Gael priority. We see from today’s budget that it is still not a priority. We know that because only a small fraction of those houses were ever delivered. Had those in Fine Gael kept their word, people would not be locked out of home ownership, rents would not have skyrocketed and the number of people who are homeless would not have doubled.
As we sit here looking at all the seats in this Chamber, we should remember that the number of children without a place to call home could fill the Chamber 25 times over. Yet the Minister, Deputy Donohoe, says that this country is one of the best places on earth to be a child. Tell that to those children. That does not even include those who are crammed into rooms with relatives. Imagine what it is like to be the parents of those children. More than twice the number of children are homeless today as when that budget speech was given and when we were told that housing was a priority for Fine Gael.
Hundreds of thousands of other lives are being put on hold. Two out of three people under 30 are living with their parents. It is hard to believe that in a country as rich as ours, there are 522,000 adults living with their parents. This is up substantially since 2016, and one of the highest rates in Europe. Most of them are in employment but a job no longer means you can afford somewhere to live or start a family. This budget tells me that the Government cannot and will not get to grips with the housing crisis. There is no increase in their targets and those targets are universally seen as too low. Sinn Féin would deliver 21,000 social and affordable homes. This reflects the scale of investment and the sense of urgency that are needed. We have an opportunity to make a lasting difference in people’s lives by addressing housing. People need a government that is willing to stand up for them. Ending the housing crisis is Sinn Féin’s number one priority.
The Government has not only overseen a deepening crisis in housing, it has also overseen a deepening crisis in health. In 2016, the Minister, Deputy Donohoe, also stated that health was "also a core priority". As of this summer, there are more than 880,000 patients on hospital waiting lists. That is almost 1 million people and double the number in 2016 when health became a Fine Gael core priority. How can anyone trust this Government to deliver? Hospitals are operating at dangerously unsafe levels. They broke a new record, as Deputy Doherty said, on Tuesday, 3 January 2023, when 931 patients were left on trolleys. It is heartbreaking to see average waiting times in some hospitals reaching over 27 hours. I struggle to imagine the hardship and turmoil that must cause patients, families, and staff.
In a letter to the Government this week, 78 Donegal GPs wrote “we cannot continue to sit back and watch our patients wait for hours in ambulances at the door of the ED or on hard chairs waiting for treatments”. That is what the Government has done. Is it any wonder that 9,000 people leave emergency departments every month without even being seen? Again, more than twice as many as in 2016 are leaving without having received emergency care. Staff are at breaking point as conditions continue to deteriorate.
It is not just in our hospitals. The failure of successive Fine Gael and Fianna Fáil Governments permeates deep into community healthcare. Dental care for the least well-off in our society is collapsing. Access to timely GP care is no longer guaranteed in many communities. There is a severe lack of community beds. Nursing homes are struggling to stay open. The lack of investment in mental health has destroyed lives and wrecked families. Nowhere is change more badly needed. For too long under Fianna Fáil and Fine Gael, our health service has lurched from crisis to crisis.
Patients and healthcare staff deserve better. The Government brought forward a budget with essentially no new measures, and €100 million in a budget the size of the health budget will have no impact whatsoever. When I listened to the Ministers’ speeches, I thought that this Government had thrown in the towel on health.
Sinn Féin would invest in health services. We have seen the alarming rise of poverty among older people and people with disabilities, and one of the burdens is the cost of healthcare and medicine. Sinn Féin would reduce the maximum monthly drugs payment to €50, abolish prescription charges and extend medical cards to 400,000 additional people. This would take some pressure off people and be a step in the direction of universal healthcare. Every year under Fine Gael, people have to travel further and wait longer to access healthcare. Sinn Féin has a multi-year plan to fix the health service, starting with a €1.3 billion investment in capacity, workforce planning and cutting the cost of healthcare.
People living with disabilities and parents of children with disabilities have been let down by this Government over and over again and it continues to deny their basic human rights. They have to fight each and every day for access to the most basic of services. The disability action plan agreed in July of this year is already in jeopardy. The €55 million outlined in the budget goes nowhere near far enough to make that plan viable. I am mindful that there are parents of children who have been impacted by sodium valproate and they are still waiting for a pathway to care. These children have been harmed and they still do not have the pathway to care that they need. It is unacceptable that the Government has failed to provide adequate and appropriate residential care and that so many people remain in unsuitable congregated settings. Why are there young people with disabilities living in nursing homes? Elderly parents of children with disabilities need to know there is an agreed care plan for their children. The Government is failing to provide enough adult day services, respite services and home care packages, pushing carers to breaking point and leaving them in financial stress. Sinn Féin would invest over €140 million to deliver the disability action plan. We need to ensure that people with disabilities are not further harmed by the cost of living crisis.
The fact is that people are already in arrears and do not have enough to make it through the winter. Sinn Féin recognises that we are in a cost of living crisis, a crisis that is deep-rooted and that cannot be fixed with one-off measures alone. We do not have to wait until budget day to know how difficult the winter is going to be. Every year, a Christmas bonus is announced as if it is some type of gift. People who rely on State pensions, disability payments or any other payment deserve certainty. Many are struggling to get by. That is why Sinn Féin set out a proposal to invest €1.7 billion in social protection.
Sinn Féin would increase child benefit and would really address child poverty. Poverty among retired people has also been increasing in recent years, which is an alarming trend. An increase in pensions alone will not tackle the consistent poverty faced by some. More targeted increases to the living alone allowance and fuel allowance are required and this must also be combined with a plan to ensure older people have secure housing. Sinn Féin would also target greater support to children and families.
The €7 million allocated by the Government for capitation for schools is shocking. Schools are struggling with increased costs and this will continue to push the cost onto parents, even through the so-called voluntary contributions. There is nothing on student accommodation. There are thousands of student beds that could be unlocked if the Government was serious about addressing the annual crisis in student accommodation. That is why, in our alternative budget, we allocated €100 million in capital to unlock all of those projects. The student union told the Government last week that accommodation has not been provided. This €100 million is good for students and parents and would take the pressure off the private rental market.
The Government has finally been persuaded and pushed into action on childcare. Despite the Government commitment, parents will be forced to wait until September 2024 to see any reduction in their fees. Since 2017, our spokesperson on children, Deputy Kathleen Funchion, has fought hard to convince the Government of the need and the importance of investing in childcare. Now, we urgently request that it addresses the issues for smaller providers, particularly those within the ECCE model. The wage talks must continue and workers in the childcare sector must have their qualifications and professionalism recognised. People, particularly women, are being pushed out of the workplace by unaffordable childcare. We have labour shortages when we desperately need affordable childcare.
Sinn Féin recognises that the causes and effects of climate change are not equally shared. The wealthiest 10% of the population emits nearly as much as the bottom 50%. At the heart of any green transition must be fairness. The only way we are going to deal with the climate emergency is through transformational and brave leadership, empowering households, communities and various sectors of the economy to take collective action. The allocation of windfall corporation taxes into a green infrastructure fund that cannot be accessed until 2026 raises questions about the investment that is needed here and now. We are in the bottom three in the EU for the share of energy use coming from renewables. It does not go unnoticed that the climate plan pushes all the hard work down the road, ensuring all the heavy lifting is beyond the lifetime of this Government. Even the lower targets the Government has set itself have not been met.
This is because too many people are being left out. The Government’s retrofit scheme does not work for most people and Social Justice Ireland has argued that it is deeply regressive. Last winter, one in three people in the State experienced energy poverty. The extent of energy deprivation is often hidden. We just do not know how many people do not turn on the heat because they fear they cannot afford it.
The Government still prioritises those with the greatest means over those in the greatest need. A wealthy householder can access €25,000 of taxpayer-funded grants for a deep retrofit whereas many with far greater need cannot access basic measures, such as attic or wall insulation. At the same time, the Government is punishing people who rely on solid fuel for heat, households that are often cold and rural homes with the highest emissions. We need to help households to move away from solid fuels rather than just penalise them. That is why Sinn Féin would introduce a specific scheme for households relying on solid fuels. The only way to meet retrofitting targets is to reform the unfair system and ramp up investment. Sinn Féin would allocate an additional €182.5 million for residential and community retrofitting and solar under the Department of the Environment, Climate and Communications. The Government’s increased funding of €24 million in the face of a climate emergency is totally inadequate. Sinn Féin would provide an additional €45 million for retrofits and solar under the Department of Housing, Local Government and Heritage. We would allocate over €500 million in additional spending to climate-related policies. We would double funding for the solar PV scheme, as well as putting solar panels on every school.
There is no other country with the same nature as Ireland. Our biodiversity is unique. We need to protect and enhance our biodiversity for future generations. Only 2% of our land is covered by native woodland. Sadly, there is nothing in this budget that reflects the scale of the emergency. With the right policies, this can be restored. The Citizens’ Assembly on Biodiversity stated: “the ambition of the State needs to be significantly increased to reflect the scale of Ireland’s biodiversity crisis”. This budget does not do that. The citizens' assembly goes on to state that this is likely to require substantial and sustained increases in expenditure, which should be made available immediately and guaranteed in the long term. We would invest €75.5 million in biodiversity, establishing a €50 million voluntary nature restoration fund.
Investing in public transport is vital if we want to cut emissions. Sinn Féin recognises that projects such as the western rail corridor and the Navan rail line, among other projects, are not an optional extra. The Government should make the 20% fare reduction and the 50% fare reduction for young people and students permanent. It absolutely needs to be permanent if we are serious about climate change. It is not the fault of people who live in rural areas that they do not have a public transport option. They should not be punished for the Government’s failure to provide them with public transport. This should be done alongside a ramp-up in spending on the Connecting Ireland rural bus scheme, giving people alternatives and making a lasting difference in people’s lives.
The just transition must be for individuals, communities and regions. For far too long, areas of certain regions have been falling further and further behind.
It is vital that we begin to really invest in infrastructure in the regions and the rural areas. It was mentioned in the Minister's speech that we have a fund for another economic downturn. In the west and the north west, we cannot wait to invest in infrastructure in that way as part of a fair and just transition and to undo years of underinvestment.
This looks like another budget that will not reduce regional inequality. I am greatly concerned that expenditure is not even being assessed in terms of regional inequality. The GDP of the north west has fallen 11% further below the EU average since Fine Gael came into power. The gap between incomes in the north west and the rest of the State is now three times higher than it was when Fine Gael took over a decade ago. The EU regional competitiveness index shows the scale of the infrastructure deficit in the north west. Out of the 234 regions across the EU, the north west ranks 218th for infrastructure, which places the region in the bottom 7% alongside some of the poorest regions in the EU.
This Government has no plan and no vision for rural Ireland, the west or the north west. This is evident in its unwillingness to commit to road and rail investment. It is evident in the lack of ambition for grid infrastructure for green energy. The region urgently needs road and rail infrastructure, including the N17 and the western rail corridor, investment in Knock Airport and our regional airports, and a grid capable of maximising the opportunities of renewable offshore energy along the western seaboard. We have the expertise, determination and local leadership to deliver on the promise of the Atlantic economic corridor. To do this, the west and north west need an infrastructure stimulus package. We did not see it in this budget. What is good for the north west is good for the State as a whole. Pressure needs to be taken off the bigger urban centres.
In agriculture, we need to support family farms and fishing communities to ensure they are sustainable and financially viable. We are asking more and more from farmers in terms of climate and food security. Farmers and fishermen want a government that will work with them, and not against them. Sinn Féin has long called for an increased payment of €20 for ewes and far greater supports for suckler cows. We would have liked to have seen a €300 payment per cow. I am concerned to see only €33 million in additional core funding to cover the new measures. Obviously, we will need to see those in detail.
When we look at justice, the increase in the trainee garda allowance is the right decision, as Sinn Féin outlined in its alternative budget when we called for the allowance to be doubled. This is finally a step in the right direction. It should never have taken this long to begin addressing the recruitment challenges. After 12 years of Fine Gael in charge of justice, there is a crisis in policing. This has not just happened; it has been allowed to become worse year on year. Fianna Fáil started closing the Garda stations and Fine Gael just carried on. There are fewer gardaí and fewer Garda stations now then there were before either of those parties took over the last government. People have a right to feel safe in their homes, on the streets or in their communities. Twelve years of Fine Gael and Fianna Fáil in the Department of Justice have done real harm to our justice system.
Our Defence Forces are at a critical juncture due to the failures of successive Fianna Fáil and Fine Gael governments. There is a significant retention and recruitment crisis. In each year the parties have been in office, more people have left the Defence Forces than have joined. The Commission on the Defence Forces set out a need for additional capital expenditure of €250 million, in 2020 figures, each year for ten years. Last year the Government missed the target by €70 million and it has missed by €70 million again today. The single most important thing that can be done to address the retention and recruitment crisis is the application of the working time directive to the Defence Forces. This budget makes no provision to collect the data necessary or to implement the directive next year. Sinn Féin wants to build our Defence Forces-----
We turn then to Irish unity. It seems like everyone is preparing for the reunification of our country except the Government. This budget again allocates no money for preparation for reunification. We have seen the success of citizens' assemblies in addressing the big challenges and opportunities this State is faced with. Setting up a citizens' assembly to look at all aspects of Irish unity is a no-brainer. To present a budget without provision for a citizens' assembly on reunification demonstrates how far this Government is removed from people and communities who want an opportunity to actively prepare for it. While this Government remains in power, it is up to the rest of us - in academia, civil society, sports organisations, the business community, the wider public and the diaspora - to do so. If we are to push forward with preparing for the challenges and opportunities associated with reunification, we need to allocate dedicated research funding to empower people at all levels to continue this work. We need to begin imagining what a new Ireland can look like and what an island without Fianna Fáil and Fine Gael can look like.
Everyone has their own part to play in this. No part is too great or too small. No one is too old or too young. People will see that the Government has again failed to play its part in this budget. Yes, some people have been given back some of their own hard-earned money. We see people who have benefited at the cost of people who have not, but too much of people’s money continues to be squandered. Too much of people's hard-earned money continues to be wasted. Too much has been spent on layers and layers of bureaucracy. Too much has been spent without ever measuring the outcomes or evaluating where people's hard-earned money goes. Week after week, when Ministers and spokespersons week stand up in this Dáil their excuse for everything is that we have allocated this or allocated that without ever measuring those allocations. For example, does the money allocated for disability get to the children with disabilities, to the parents of children with disabilities, to the carers who are caring, or to the people breaking their backs trying to keep this country going? It does not, and the reason it does not is that this Government does not care. I know that this Government wants to continue with business as usual. As everybody can see here today, the fact is that the longer this Government is in power, the worse things are getting for people and their families.
I thank the Leas-Cheann Comhairle very much. I am sharing time with Deputy Duncan Smith.
It is said that RTÉ does too many repeats. So does this Government. There is some truth in the hackneyed description of a "The Late, Late Show" budget, with one for everyone in the audience. It is worse still. It is a "Reeling in the Years" budget in that it is a lazy rerun of all that was wrong with budget 2023. There are tax cuts that favour the better-off again. There is a failure to properly fund the public services on which we all rely and which the citizens of this rich Republic should expect. Again, we get a wall of once-off payments, but no permanent change. Once those once-off payments are gone, they are gone. This is a budget that, again, will be found to be regressive, once lump sum payments melt away like snow on a ditch. Like "The Late, Late Show", we have changed the faces, but the formula is the same no matter who is fronting the gig. Whether it is Fianna Fáil or Fine Gael, it simply does not matter.
In my almost 14 years here, I have rarely seen such frustration and anxiety among the general public. There are many reasons for that. This is the first time since 2010 that a Fianna Fáil finance minister has delivered a budget, and what does he do? He gives nonsensical tax reliefs to landlords. Same old Fianna Fáil. Some €160 million in tax reliefs have been given to landlords. There has been more in tax reliefs given to landlords than provided, cash-wise, to individual renters.
Having fixed the economy, the period 2016 to 2020 provided the chance to fix our society, build homes, invest in public childcare, get to grips with the climate catastrophe, get our health service right, start the work of tackling divisive inequality gaps and build the foundations of a better and more sustainable future. Those years were wasted, however. They are years for which we are still paying the price.
Fast forward to 2023, under Fianna Fáil and Fine Gael, Ireland is a country of contrasts and contradictions. We are rich and poor at the same time. We saved almost €7 billion in bank accounts last spring when two out of every five of us cannot lay our hands on €1,000 to meet an out-of-the-blue bill. More than 20% of us are officially on low pay at a time when Irish corporate profits are breaking records. Yet, we still cannot get the basics of running this country right. As someone who is proud of our country and prouder still of the great country we can be, it gives me no pleasure whatsoever to say that. If a country ever donned the proverbial fur coat, and Deputies know the rest of the crude colloquialism, it is Ireland. The piece in Financial Timeson the Monday before last took a look behind that tatty coat. The article asks the question, "How can a rich country have transport, health, education and water services under increasing strain?" Why can the two thirds of young people number imprisoned in the purgatory of their childhood bedrooms not afford to rent or to realistically dream of owning their own homes? Why are one in ten Irish people on health waiting lists for more than 18 months when the official target is three months? Thankfully, we should be grateful for this. Nobody told them how much it costs a working family to get the kind of child care that citizens of other rich countries such as Denmark and Sweden rightly take for granted. Now that would have been embarrassing.
As Mr. Fergal O'Brien of IBEC said to the Financial Times, we arenouveau riche.He asked what was the point of us being a wealthy country if we do not have the things we need the most, namely, physical infrastructure and social and public services. IBEC got it in one. The Irish Congress of Trade Unions concurred, so both sides of industry are in agreement. However, we have tax cuts. The latter are the perennial Fine Gael answer to the question absolutely nobody is asking. A person unable to get an assessment for their child is given a tax cut instead. Someone else who has been on the housing waiting list for 12 years is being €5 per week. People who could do with more affordable childcare get €10 back on their USC and are told to jog on. We are getting performative tax cuts when what we need are performing public services.
Every euro of a tax cut, if not replaced by taxes elsewhere, is one euro less for the social wage, for schools, for hospitals, for childcare and for community safety. The tax cuts presented today, which disproportionately favour the better off, are as fiscally unwise as they are socially damaging. Throughout our long history, the Labour Party has never been short of vision. It was the resources we were always short of. On the evidence of this botched budget, even though we have the money, it appears the Government is woefully short of the vision we need to transform our society. Some €2.7 billion in once-off measures is no small sum of money. It is a lot of money, but it is being spread so thinly that nobody will be happy. Allocating such a wall of money on lump sum payments is no cause for the kind of backslapping we saw on the Government backbenches earlier. That does not demand a standing ovation. The necessity of these once-off measures should be worn as a badge of shame by this conservative coalition. Why are these interventions needed? They are needed because under the Government's watch, the real value of workers wages has dropped. On the Government's watch, living standards have fallen like a stone for the first time since we waved goodbye to the troika in 2013.
Under Fianna Fáil, the spending power of the pension has been effectively cut for three budgets in a row. Where is Deputy O'Dea when Fianna Fáil needs him?
More than 20% of workers are still on low pay, and deprivation rates went up four percentage points after last year's budget. The Government had to follow this up with a mini-budget in February because they got it so wrong this time last year.
The Government would not need to spend so much today if they got things right then. Those who are most in need are still paying the price for below inflation social welfare increases last year. I remind everyone that there were no increases to child benefit or the living alone allowance last year. The €2.7 billion being allocated in another so-called once-off package is needed because the Government is too ideologically blinkered to make the structural changes needed to make our economy work better and to make it fairer.
Here we have the return our old friend the energy credit. This is the very definition of an untargeted payment. Yes, it is popular but it is also populist. It represents a questionable use of public money, especially from those who pretend to be prudent. Let us put this in some context. This year, the Government has spent €1.2 billion handing out €600 in free money to me and hundreds of thousands of others who do not need it. This figure of €1.2 billion is €100 million less than the Government plans to spend on increases to all welfare schemes next year. It is multiples of what the Government plans to spend on combating child poverty. This simply beggars belief. Labour's €3 billion package of cost-of-living measures targets the money where it is needed most. It would provide for a bonus in October, not just at Christmas, to those who need it most this year, not in January. It would allow for an immediate increase of €15 per month in pensions, carer's allowance and other payments. Our party leader, Deputy Ivana Bacik, has had an innovative idea for a €9 per month climate public transport ticket to relieve pressure on commuters and students and help our climate. We also suggest doubling of the rent credit to €1,000, not €750, immediately. Crucially, we would also provide an emergency €90 million empty homes fund to encourage people to bring homes back to help the almost 13,000 people who are living in desperate homelessness. Our ideas direct the money to where it is needed the most and now.
On every top-line economic and fiscal measurement, Ireland is doing well. Income tax and VAT receipts are up. The rate of employment is also up. The corporation tax figures speak for themselves. We have a surplus. Even when we strip away any so-called windfall corporation tax surpluses next year, we will still report a surplus. We are the envy of Europe on the revenue side but the poor relation in the context of economic equality, childcare, health and housing. For too many people, this budget will not change a thing. If you are poor today, you will be poor tomorrow. Based on what we know, you will be even poorer next year. Politics is about choices. The choices made in this budget, at a time of unprecedented plenty, simply do not pass the tests of social solidarity and fairness. Will it make the permanent changes needed to lift families children out of poverty? No, it will not. Will it truly reward work by using our taxes the way workers want them to be used to fund the care system that is the mark of a decent society? It will not. Will it deliver the step-change of housing our young people and the future competitiveness our economy so desperately need? The answer to that is also a big fat "No".
Labour's €11 billion costed package maps out an Ireland that would work for all, not just for those who earn more than €70,000 a year, those who own their own homes or for those for whom the cost of living crisis is something they only hear about on the news. In the context of work, care, housing and climate we need an Ireland that works for all.
Ireland's low-pay problem is chronic. One in five people is officially on low pay. Having served as Minister for Social Protection, the Taoiseach knows only too well that our welfare system has to do far too much heavy lifting to keep our working poor out of poverty. There is no dignity in our working poor or anybody who works for a living having to rely on cash transfers from the Department of Social Protection merely to exist or, rather, to subsist. That is why in our view, the national minimum wage must be increased by €2 per hour to €13.30 and not by €1.40. It is manifestly obvious that we would not have the kinds of national minimum wage increases we have experienced in the past few years if it were not the introduction by Labour of the Low Pay Commission. There is no way on this God's earth that Fine Gael, left to its own devices, would do that. We need to move more quickly to a real living wage, not the rebranded, watered-down version Government has in mind.
In its costed alternative budget, Labour has ring-fenced €1.3 billion for a new public service pay agreement. The talks have yet to commence, but this would allow for a cumulative increase of in the region of 5% next year for nurses, healthcare assistants, teachers, SNAs, gardaí, council workers and civil servants.
We need to move more quickly to a real living wage, not the rebranded, watered-down version Government has in mind.
In its costed alternative budget, Labour has ring-fenced €1.3 billion for a new public service pay agreement. The talks have yet to commence, but this would allow for a cumulative increase of in the region of 5% next year for nurses, healthcare assistants, teachers, SNAs, gardaí, council workers and civil servants.
We need to move more quickly to a real living wage, not the rebranded, watered-down version Government has in mind.
In its costed alternative budget, Labour has ring-fenced €1.3 billion for a new public service pay agreement. The talks have yet to commence, but this would allow for a cumulative increase of in the region of 5% next year for nurses, healthcare assistants, teachers, SNAs, gardaí, council workers and civil servants.
Looking at the documents, there does not seem to be any Government allocation for Government sector pay rises at all. Where is that allocation? We need to know. Sinn Féin's allocation in its alternative budget should make public servants who require a pay increase next year equally concerned. When we take inflation into account, public sector pay is at 2012 levels and in recent years the rate of pay increases are well below the rates of increase in the private sector.
The Minister for Justice has yet again shown that she has no deftness of touch when it comes to An Garda Síochána. I want to focus on Garda pay. At a time when a record 114 gardaí have hung up their boots already this year, when communities are in crisis, when they are demanding community policing and they are made to feel more secure in their homes and communities, the Government has stuck a few euro on the training allowance. That is a Hail Mary pass if ever I saw one - hoping everything will work out well. How was this figure worked out? Nobody seems to know. It was plucked from the air; it just does not make sense. It is up to €305 from €184, which is less than less than the current rate of the national minimum wage. That is what we are expecting new Garda recruits to exist on. That is an insult to a new recruit.
The Taoiseach has admitted new recruits are often older than former intakes and are leaving jobs - good jobs in some cases - to join the Garda. Some will have families and financial commitments and his public comments admit that. At this rate, they will not be queuing up to join or stay in training in Templemore. They will not be able to complete their training at all. Something much more radical needs to be done. For a small €15 million a year, as proposed by the Labour Party, 900 new recruits could be put on the starting salary for a garda of €35,000 across their training period. If the Minister is serious about making An Garda Síochána an attractive proposition for the right kind of recruit, this is what she needs to do, and she needs to do it now.
We get a real sense of this Government’s priorities when we look at the social protection package. It is incredible that the tax cut and the 2024 welfare package are more or less the same size. However, on digging a little deeper, they are not. The tax package amounts to €1.3 billion in tax cuts while the social welfare package is €1.1 billion; go figure. This is at a time when people are finding it exceptionally difficult to make ends and we know who those most impacted by the inflation and cost-of-living crisis are.
A quick analysis shows that a single person on €75,000 who owns their own home, is up over €2,000 already, thanks to the mortgage interest tax relief along with income tax and USC changes. For pensioners in a local authority house who cannot keep themselves warm, it is about €700 or €800. Who needs a break more? This budget clearly shows the Government has picked a side and is sticking to it. When welfare rates need to be increased by €27.50 a week, it gave €12. This is not a figure the Labour Party has plucked out of the air. When are we going to look at our welfare system through the lens of income adequacy, the well-established benchmark of the minimum essential standard of living?
Society has a settled view that core welfare payments must be set at 34% of average income. Fianna Fáil believed the same in 2007. A lot has changed since then and the Government has moved away from that principle. This year’s budget leaves those who are on small fixed incomes still gasping for air. That is why the Labour Party is clear. We need to grow up and mature. We need to decide as a society to index our social welfare and personal tax systems. It would be the mark of a mature democracy if this were just done automatically and routinely every year rather than using the summer months filling the newspapers with speculation and spin ahead of the budget being finalised, playing with people's lives. That would be a game changer.
The Minister for Social Protection knows only too well that there is an extra cost involved in living with a disability. We need a new cost of disability payment, as the Labour Party has called for, starting at €20 a week in this budget. That is the kind of reform we need for people with disabilities who need help to live with dignity, not the Tory-inspired racket the Government looked set to propose a few weeks ago.
I am pleased to see that the process of pay-related benefits seems to have commenced, at last. We do not have the detail. The Labour Party has gone some way to proposing an initiation of that process in our costed alternative budget. However, the Minister's long-awaited initiative has come far too late for the people I represent who used to work in Tara Mines. I heard the Minister speak of the fate of the workers in Tara Mines on the radio on Sunday.
We believe the Tara Mines job losses could have been avoided in their entirety if Government took the Labour Party’s long-standing advice to establish a German-style short-time work scheme with seed funding of €400 million. We would not be talking now about people who are out of work. We would be talking about supporting people who are in work and with training and skills development when they are furloughed. I note the Government has indicated it is starting to make adjustments to the PRSI base on a cumulative basis over the next period of time. There is a 0.1% increase in PRSI across the board when what is ultimately needed, given that employer's PRSI is well behind the EU norm, are more significant increases to bring the levels of employer's PRSI up to the EU norm.
This is the responsible thing to do for the workers of today and pensioners of the future. Setting up a dedicated wealth fund to help with ageing costs should not mean we pretend that ageing costs are covered. They are not and they could never be covered by a fund such as the Government proposes and which we support. There has never been a better time to start adjusting PRSI. Why do I say that? It is not just my hunch; it is what all the experts say. We have full employment, a red-hot economy at capacity and a precarious and unbalanced tax system. The Government needs to get a move on and stop avoiding unpopular decisions.
The Government is proposing a back-of-the-envelope scheme to help small businesses shoulder extra costs. We understand the motivation of this initiative, but it has all the hallmarks of a sop, a bribe to businesses. How it is designed and applied is crucial, but we do not have the detail. The Labour Party has no difficulty with the concept of support schemes for viable enterprises going through a difficult time. We have shown that time and again. However, in any transfer of wealth from taxpayers to enterprise, there must be social, labour and quality-job and collective bargaining conditions attached. Have we not learned any lessons from the operation of the wage subsidy scheme, for example? We also need to be conscious that, as we read in the media, it seems this money is being taken from commercial rates. Who will fill the hole left in public service provision for our local authorities? Any such scheme much be limited to firms of a certain size and legal structure.
I turn to the issue of child poverty. I must admit my heart danced a little last December when I heard the Taoiseach pledge he would tackle child poverty head on. I was delighted, but I should have been more wary. The Government shamefully has not passed its first test on child poverty. We needed a children’s budget to end child poverty. Instead, we got a budget for landlords, some homeowners and higher earners.
In 2022, nearly 200,000 children lived in households that were below the poverty line and 250,000 children were living in households experiencing deprivation. Child poverty is a national scandal which must be ended, but we know today it will not be ended by this Government. The Taoiseach would have been better off saying nothing in December. This is an insult to the poorest children and the poorest families in the country. He would have been better off keeping his mouth shut and saying nothing. He raised expectations that child poverty in this country could be eradicated and he has done nothing about it.
Labour proposed a series of measures, including making a good start by increasing the qualified child payment to €15 a week for children over 12, and to €10 a week for the under-12s. What did the Government do? It added a miserable €4 a week to the qualified child payment. That is nowhere near sufficient to give every child in the country a fair break and a decent start. While poverty is not only about money, it is always about money. Every member of Fine Gael, Fianna Fáil and the Green Party should hang their heads in collective shame today. The promise has not been delivered on. What we ultimately want to see is a movement towards the kind of programme the ESRI and Community Foundation Ireland have proposed and that is a second tier of child benefit payment for those in real need, targeted at those children who need it most to eradicate the scourge of child poverty.
Nowhere does this budget disappoint more than on childcare. It promised little and delivered less. The Minister only just managed to persuade his Fianna Fáil and Fine Gael colleagues at the 11th hour that childcare fees should come down by the promised 25%. It is an 11th hour job designed to avoid the blushes. Of course, the 25% cut of which the Minister spoke, will not come into effect until next September, that is September 2024. It is almost a year away. This means that parents of children who started creche in 2019 or 2020 will have seen only one reduction during their time in early years. The situation is stark for parents, children and skilled professionals in the sector. The picture painted by the results of a survey recently undertaken by my colleague Senator Marie Sherlock in Dublin Central is revealing. In my experience the results are accurate. Nearly half of parents are cutting back on working hours to make childcare arrangements work. In 21% of cases, one parent had to give up work. There is a severe shortage of places for babies under one year old. Services are barely affordable, if available at all. Small and agile services that have been around for a long time are closing. Any of us representing urban Ireland will recognise this picture.
When will we wake up and decide to revolutionise how we do quality early years in Ireland? The course we are on is manifestly not the right one. We need a system built on quality for children, affordability for parents and fairness for professionals. It is why the Labour Party says we need to get a start on our vision of a universal public childcare system with between 5,000 and 6,000 places at a cost of €65 million in 2024, including a cap of €200 a month in fees and an increased investment of €142 million in core funding as a glide path to fair pay for professionals. The SIPTU Big Start campaign costed this and said a minimum of €92 million was needed to improve pay and conditions by at least €2 an hour. A further €50 million would be then needed to recognise length of service and qualifications. That is what is needed to revolutionise our early years system.
This Government has been criminally ill-prepared for the crisis in care that is developing. The census laid this bare. Between 2016 and 2022 the number of people providing regular, unpaid care increased by more than 50% from just under 200,000 people in 2016 to 300,000 in 2022. What a level of growth that is. We still have too many people who care full time for a loved one whose work is not adequately recognised by the State. We could change that overnight. For a small amount of money we could make sure that at least everyone in receipt of the respite grant gets the carers allowance in recognition of his or her invaluable work. It is time for the lip service to end.
Our party leader, Deputy Ivana Bacik, was not wrong when she said housing is the civil rights issue of our time. However, this Government does not see housing as an issue of rights. For the Government, housing is a commodity. A house is something to transact, an asset to buy and sell. With the eye-catching budget intervention on housing, or tax relief for landlords and mortgage interest relief, what is left of its credibility is gone. Reintroducing mortgage interest relief is an interesting use of public money. Those who fixed their rates last year or the year before are rightly asking today, “What about me?” As far as we know about this scheme, it requires two years of mortgage interest statements to qualify. What about those on fixed mortgages? What happens next year for example when people come off a fixed rate into a very different interest rate environment? That is a question that in its populism, this Government cannot seem to answer. Housing for All is a busted flush. In the lifetime of its signature plan all we have to thank it for is a 50% rise in homelessness, record rents, record house prices, and 4,000 homeless children. Yet, the Government swears blind its grand plan is working. The plan is failing and today's budget indicates that all it is going to do is fail better. The limp, anaemic vacant homes tax is set so low that it had to be reviewed before the bills can even be sent out. It was announced a year ago and the rubber still has not hit the road. The hands-off approach to vacancy and dereliction is an utter disgrace.
It is state-sponsored vandalism and the victims are first-time buyers and communities throughout the country. We have anything between 25,000, 70,000 or 170,000 homes lying idle in the Ireland of 2023. The Government is that switched off it cannot even properly measure the scale of the problem because it simply does not seem to care. Property and property rights mean everything for Fianna Fáil and Fine Gael. Until that changes nothing will change. If a person can afford to leave a home vacant for years or a building derelict and abandoned, his or her pocket should be squeezed until the pips squeak. That is why Labour says “slap a levy of 1% of value or €2,000, whichever is highest, on the owners of vacant homes. Get it moving or the council will put a CPO on it.” Disgracefully, this tells us all we need to know about Fine Gael and Fianna Fáil, they have decided to kick the residential zoned land tax into touch for another year. The farmers and developers got to the Government, which still sneers at Labour’s plans for a million homes over ten years, comprising 50,000 new builds and 50,000 vacancies, empty council homes and derelict would-be dwellings turned around to meet the needs of our growing population and our economic needs. That is the level of ambition we need. It is the level of ambition that Fianna Fail, true to what it likes us to think its values were back in its halcyon days, would do. Yes, there are capacity issues. One way to deal with that is, for example, to pay apprentices at least the rate of the national minimum wage and give the Housing Agency responsibility for construction skills. This could all be done at the stroke of a pen if the political will was there. In the meantime, those who can manage to find a place to rent, need the rent credit to be upped to €1,000, not the €750 announced today. Also, the Government needs to take on board Labour’s renters’ rights Bill and institute a scheme of no-fault evictions so that the law protects people in insecure tenancies. However, there is simply no substite for supply, and public supply at that. The Labour Party’s plan is clear. What we will do, is do much more than the Government is prepared to do this year. In fact, across all capital programmes the Government plans to spend only an additional €250 million. We would inject another €1.6 billion into capital investment to build 2,700 more social homes, building on the Government’s own less than adequate proposals.
The Labour Party is ambitious for Ireland, but is responsible too. I want to speak about the role of the State and the plans brought forward by the Minister today in relation to the use of the surplus. We agree that the surplus in corporation tax should not be spent on current expenditure. It should be used, for example, to build the homes we will need in the future. It should be used as well to make sure the just transition actually means something. That transition phase has not been scoped out for people. We need to make sure the investment that is required for communities throughout the country is injected and is used wisely and properly.
Finally, we need a discussion on tax. It is simply not good enough to say we can continue to spend and tax the way we are at the moment, continuing to reduce taxes while increasing spending. We have yet to have a debate in this House on proposals received from the Commission on Tax and Welfare this time last year. This Government is afraid of it because the commission has rightly proposed that we move away from taxes on income and labour and towards taxes on assets and capital. That is the future. That is what needs to be done. The Government needs to mature and grow up, take on that responsibility and make sure we have a tax system that works to make an Ireland that works for all.
Last year, I stood here with my colleagues in the Labour Party, hoping that we would have a budget that would provide that very thing: hope. Hope for people who are looking for a home, hope to tackle our climate crisis, hope to tackle the cost of living, hope that our health service would be improved and hope that there would be a very real investment for those most vulnerable in our society, people with disabilities and their services. One year on, that hope has been distinguished and absolutely diminished.
Year after year we have been told by Fine Gael-led Governments that we need cautious budgeting. We had it because of Brexit. Then, we had it because of Covid-19. Now, we have the post-Covid-19 budgets. Despite the many riches in our country, we have been told yet again we need to be cautious and that those who need the most investment will be left behind.
We need ambition. We need ambition in the areas of housing and climate. We need ambition for people with disabilities. However, with this tired Fine Gael-led Government, we are not seeing any of that. In this budget, we are seeing higher targets for HAP units than for social housing.
There is no plan whatsoever. With Fine Gael, its senior Ministers seem to be more connected with any vacant role in Europe than they are with their own communities. What have they done? They have allowed any energy in the Government to be led by Fianna Fáil. In this budget, we have seen Fianna Fáil invest in their own reliables: landlords and developers. For people of my generation, it sends a chill down their spines that the fox is indeed right back in the henhouse. Fianna Fáil is beginning to carve up and structure this country in its own image. We know how that ends all the time.
We in the Labour Party know the impact the cost of living has had on all our people. In our clinics, we see it every week. Let us get down to the basics. Let us get down to what the Government has done on wages. It has increased the minimum wage by €1.40 to €12.70. That is nowhere near what we need. We need a living wage of €14.80 just to keep up with basic levels of living standards, but again this Government have fallen short. What comfort can people take when the strength of the economy - the Taoiseach said last week the economy is beyond full employment and I am trying to get my head around what that means - will not manifest itself in the improved living standards of the working class and ordinary people? The minimum wage must be increased and must be delivered as a living wage.
What is crystal clear in this budget is that those with disabilities are the ones who are left behind. We see it first in the fact that there is no mention of what will happen next week with the section 39, section 10 and section 56 workers.
We are a week away from it and there is no mention of it. We will have statements on that in particular on Thursday, but why is there no mention of it? Why is this important? I think it is because these workers are in an area that this Government does not care about, namely, people with disabilities, who are the most vulnerable in our society.
This is a €14 billion budget. It is a “step change” budget. However, it is not a “step change” for people with disabilities. It is the same old case of being forgotten and being left behind. Let me tell the Minister of State that there is a disability capacity review that is two years and four months old. This Government is ignoring it. It launched a disability action plan in the summer for a period of three years. The capacity review goes on until 2032, but the Government launched its own action plan this summer which will go on for three years. It bears no resemblance to the lead in the capacity review - none whatsoever. There are 315 people who are in need of immediate supports in disability services at the moment. There are 315, but this budget calls for emergency supports for 90. Do you know what? That is the exact same figure that the Government called for last year. The Government has rebranded it and called it its long-term disability action plan, but it is no such thing. The Government has not published its own disability action plan, the real one to meet the unmet need in the disability capacity review. There is no way for the Government to spin its way out of this. There is no way to do videos on social media to get its way out of this. It has made a political choice. With all the money swishing around in the coffers of Government Buildings and the Department of Finance, it has made a choice not to invest the €270 million that is needed for disability services. We in the Labour Party would not make that choice. There are no mitigating factors here. The money is there and the Government has made that choice. Maybe it is because it is under the Department of Children, Equality, Disability, Integration and Youth and the Minister, Deputy O’Gorman, could only get a couple of wins or concessions and this was not one of them. I do not know. What I do know is that we met with parents in St. Michael’s House last week and one of them asked us, “Why are we always last?” Well, after this budget, they are still last. Parents of people with disabilities, as well as people with disabilities themselves, remain last. This Government have made that abundantly clear to them.
The few payments the Government has put in their way do not meet the costs in The Cost of Disability in Ireland report, another independent report that was commissioned in the lifetime of this Government and which shows costs ranging approximately €10,000 extra per annum. Again, there is absolutely nothing from this Government that will meet that.
There has been no progress on Sláintecare; it seems to be non-existent. In health, we see investment in beds which we know the Government will not be able to staff because it has not been able to staff the beds it announced last year.
This is the most disingenuous nonsense I have ever seen in a budget.
On free GP care, it was finally extended to children under the age of eight this year and beyond to those under age 12, announced three or four years ago at this stage, and two or three Ministers ago. What the Government could do to actually improve access to our GP services is bring in a pharmacy-based minor ailments scheme. This is in the Labour Party’s alternative budget. That would allow more capacity within our existing GP services and within our accident and emergency services. Yet, again, it does not want to tackle the difficult negotiations it would take to deliver that.
The Government could invest €20 million in a national cancer strategy. That would have a long-term impact on our health service. It will not do that either. It could invest €20 million in new medicines. The Minister, Deputy Donohoe, said they will not leave any children behind, but the Government is leaving the children who have rare illnesses behind when it do not invest in new medicines.
These are relatively small investments that would have a massive impact but no, the Government does not want to roll up its sleeves and get involved in the tricky negotiations it can take to deliver schemes such as these. Again, this is a tired Government that is abandoning its people.
Today is World Mental Health Day. It was hoped by people in the mental health services that maybe they might see something real being delivered for mental health services. Again, there is nothing. We have seen reports that there are nearly 5,000 people on child and adolescent mental health services, CAMHS, waiting lists at the moment. A recent survey by the College of Psychiatrists of Ireland shows that mental health services are on a cliff edge. It shows that 46% of psychiatrists are experiencing occupational stress, while one in three have experienced burnout and one in ten have experienced severe depression, anxiety or stress. That is just one aspect of workers who are involved in our mental health services. There is nothing in this budget that will improve that service; nothing.
It is also important to highlight the lack of action in the HSE in providing early assessment for children with special needs. This is something we have brought up a number of times. At the start of the summer, the Minister of State, Deputy Rabbitte, said she was going to make huge strides in terms of assessment of needs.
Absolutely nothing is happening - nothing. This is not just assessment of needs, which we need for education services. Even though the HSE says that you do not need it in order to get on a therapeutic or clinical list, we know that, really, you do.
We have seen nothing, never mind actually getting to dealing with the lists themselves. We want to see the Minister of State, Deputy Rabbitte, and this Government follow through on their commitments that were made in the early summer. They got them through a 24-hour news cycle that day, but it has not actually followed through to budget day or followed through to the services in our communities up and down the country.
Consistent underfunding in primary care has resulted in huge delays in appointment times and exacerbated waiting times in our accident and emergency departments all over the country. This crisis is not a winter crisis anymore; it is an all-year-round crisis, and again there is nothing. The Government may as well have said it was going to invest in 155,000 nurses or 200,000 nurses. It would be about as real as the 22,000 it said it was going to invest in. It is not investing in safe staffing. That is why it cannot get the staff. That is why it cannot get the healthcare assistants, nurses or people to work in the health service because it is unsafe and the conditions are poor. These are the things the Government should be dealing with, not printing fantasy documents.
On transport and climate, we see there is another reduction in fares, but again it seems like another small concession to the Minister when real, transformative policies could have been implemented.
However, it seems like another small concession by the Minister when actual transformative policies could have been implemented. For two alternative budgets in a row, we have costed a €9 climate ticket. It would have a transformative impact on public transport and the climate. Instead, we are getting piecemeal and minor cuts in taxes and costs. There is no real investment in what we need. There is one line about big projects like MetroLink and the Cork commuter transit scheme, but according to a reply I received to a parliamentary question, €135 million has gone into MetroLink so far and we still have no shovels in the ground. There are no shovels in the ground as regards the Cork community rail link either. These are the types of transformative projects that we need to see delivered, but all we are seeing is a vague commitment to them in a budget every year. Quite simply, that is not good enough.
This Government is tired. It is not just running out of energy - it already has run out. That is incredibly difficult to take when we have a country that is burning and flooding, with homes falling into the sea in coastal counties up and down the east coast. While there has been some investment in the climate space and now we have a long-term climate fund, we are not seeing the just transition for workers or communities that is required. We as a country are suffering in terms of climate and you as the Government are not doing enough about it.
Many of this country's issues are down to the fact that we cannot attract workers for front-line services. I have mentioned health, but we cannot get people to drive our buses, including school buses, in rural or urban areas. There is low-hanging fruit that the Government could invest in to sort out this matter. It could tackle the red tape around waiting lists to get through the Road Safety Authority, RSA, licensing procedure. It can take nearly half a year from the point of application to when someone gets a certification to be allowed to drive a bus. Meanwhile, we have ghost buses up and down the country with services simply not turning up. Workers cannot get to work, kids cannot get to school and people cannot get to hospital appointments. This is what the poverty of ambition in the budget equates to when we boil it down to the impact on the ground.
There will be a further 25% decrease in the cost of childcare. It will be too little, too late. There should be a basic cap of €200 per month on childcare costs. We have costed this and have a plan, which we have presented two years running, but it has been ignored. Instead, there will be another piecemeal cut that the Government will sell at election time. There are workers being paid too little and parents who are paying too much. Some providers, particularly small ones on the community childcare scheme, are going to go out of business.
This is an awful budget that will do nothing to help those who need it the most. When will we have a budget for the vulnerable, for real working people and for people with disabilities? It certainly is not this one.
Sitting here listening to the Ministers, Deputies Michael McGrath and Donohoe, I struggle to understand the aim of this budget. After all the leaks and the spin, to what does it amount? It sounds very much like budget 2023 lite - a budget with a bit for everyone, a fair bit more for some who actually do not need it, an emphasis on short-term measures rather than lasting structural measures, and not a whole lot that will substantially change our country for the better in the medium-to-long term. There was an opportunity with this budget, given the resources available, to do some transformative things, to tackle the big problems facing the country and to ensure that we were not pulling up the ladder and passing on problems to the next generation to solve again. We could have finally begun to address the chronic underinvestment in public services, thereby bringing them up to European standards, ensuring that people got value for their taxes and helping to reduce the cost of living. We could have used some of the large surplus to invest in the potential of wind energy to reduce our fossil fuel use, meet our climate obligations and save on the inevitable fines we are facing. We could have made bold moves to tackle the increasing level of child poverty, to uphold the right of all children to live a decent life, and to end the shocking waste of human potential. We could have taken steps to drive down the cost of housing with a major programme of affordable house building on State land and by unlocking the high rate of housing vacancy. We could have aimed to achieve a fairer tax system and a more equal society, one where we started to close the gap between the better off and the less well-off, which has been exacerbated by recent budgets. We could have transformed the lives of those with disabilities, adults and children, by prioritising vital supports and services. We could have done so much more. Instead, we have a budget that is desperately short of ambition.
Ireland is now the most expensive country in the European Union. The price of goods and services for households is 46% above the EU average. This is largely because successive Governments have tried to treat the symptoms of Ireland’s high cost of living and not the causes. This approach will never get to grips with the problems. The Social Democrats believes that the aim of this budget should have been to improve everyone’s living standards and quality of life with better public services, to create a fairer country and to make our lives more sustainable.
My colleague, Deputy Cian O’Callaghan, will address the housing aspects of this budget, but I will just say that I am concerned about what I have heard so far. Ireland’s housing system is becoming increasingly characterised by privatisation and the abdication of State responsibility for provision. This is at the financial expense of taxpayers and a societal catastrophe for so many of our young people, who are locked out of housing and forced to put their lives on hold. This Government’s housing policy is a litany of failure. Every measure is designed to boost profit and increase costs. Nothing in this budget will change that.
The Social Democrats believes that radical reform is required to facilitate a better work-life balance for families. We know that the first 12 months of a child’s life are important and that many parents would like the choice to care full time for their children during this time. For far too many, though, that is not an option. When couples rely on two incomes to pay the mortgage, rent, energy bills and all of the additional costs associated with having a baby, they cannot absorb the inevitable fall in household income. We know that 45% of women do not get top-ups from their employers when they take maternity leave, for example, which can leave a large gap in families’ finances. It may also explain why fewer than 50% of fathers take the paltry two weeks of paternity leave to which they are entitled. This does not mean that dads do not want to spend time with their babies. They simply cannot afford to do so.
What can we do? In our alternative budget, the Social Democrats proposed increasing paid parent's leave so that it covered the first 12 months. To do this, we would increase paid parent's leave by six weeks to 13 weeks per parent. We also called for the benefit payment for maternity leave, paternity leave and parent’s leave to be increased to €350 per week so that more people could afford to take it. All of the evidence shows that there are significant benefits when both parents can afford to take time off to share in the care of a new baby. It is disappointing that the Government has failed to adopt this measure or to make any significant extension to paid leave. The extra two weeks announced is the bare minimum that we are required to do under the EU directive.
What about childcare? Research suggests that high quality early childhood education and care can have positive and long-lasting impacts on all children’s outcomes, particularly for disadvantaged children. It can have a positive effect on children’s educational, cognitive, behavioural and social outcomes in the short and long terms, but it is important to emphasise that this is only if it is of high quality. We need to invest adequately in this area to ensure that all children have the best start in life and an equal start in life.
I welcome the fact that, after months of wavering and uncertainty, the Government will keep its promise to cut childcare fees by a further 25% in 2024.
However, I raise a concern about the increasing corporatisation of the childcare sector, with the involvement of multinational chains and investment funds. We do not believe the early education of our children should be entrusted to large firms whose main motivation is the return to investment funds. There is enough money in the Government coffers to begin building a not-for-profit, high-quality, public model of early years care and education and we should be starting that process now. The Government should ring-fence a portion of the surplus to acquire and develop early years facilities on existing and new sites, like schools, community centres or housing developments. Many sites earmarked for childcare throughout the country lie idle while parents struggle to find places for their children. Budget 2024, unfortunately, ensures this will remain the case.
The lack of real progress around child poverty is very alarming. When the Taoiseach returned to office last year, we were promised there would be a strong focus on child poverty in the second half of this Government’s term in office, but where is the evidence the Government is going to do that? It does not exist. It is not in the derisory €4 increases to the qualified child payment, a benefit the ESRI repeatedly points out would have great potential to target child poverty were it to be increased. All the recommendations from the agencies working in this area were that there needed to be a €15 increase for children over 12 yeas of age and one of €10 per week for children younger than that. Ambition to tackle this problem is evident in the failure to mention any improvement in children’s therapy services, or the failure to fully fund early education and childcare for children experiencing the worst disadvantage, or in the failure to create a DEIS-plus programme for children in the most disadvantaged schools, or the failure to adequately fund the area-based childhood programmes and extend these to other areas of significant disadvantage.
Child poverty does not just contribute to bad outcomes but has a direct and causal negative impact on children, especially when it starts early in childhood and persists throughout. It affects everything, including emotional development, educational attainment, mental health, physical well-being, career opportunities and income in later life. It destroys and limits lives. The Government had an opportunity to tackle that and ultimately eradicate it, but it failed to deploy that power. Of all its failures and missed opportunities, this will be the most damaging and amounts to the biggest betrayal of this budget. I noted a comment in the Budget Statement, "We will continue to improve our understanding in this area" in relation to child poverty. What on earth does that mean? After 12 years in government, this is a damning admission by the Taoiseach.
I wish to speak about disability. The experience of people with disabilities in Ireland continues to be one of social exclusion. People with disabilities consistently have among the highest poverty rates of any group in Ireland. It is three times that of the general population and more than two in five people with disabilities experience deprivation at any one time. What then has the Government done to lift those with disabilities out of poverty? The answer is very little. A cost of disability payment has been required for years. This payment would be a way for the State to acknowledge the significant additional costs of having a disability, which the Government’s own The Cost of Disability in Ireland report has said is between €9,000 and €13,000 per year. Today, the Government announced a €400 special once-off payment for those on disability allowance, among others. This is the second year in a row a temporary sticking plaster has been placed on the problem. I am certain the Minister for Finance does not think disability is one-off or temporary, so why are supports for disability dealt with in one-off measures? The one-off nature of these payments is not just inadequate but completely misjudged and even insulting. A €30 weekly cost of disability payment, which the Social Democrats have advocated for, would amount to €1,560 over the course of a year, which is more than three times the Government’s one-off payment. It would also send an important message that the costs associated with disability are recurring, unavoidable and often very high. While it would not have solved the issues highlighted in cost of disability report, it would have been a great first step.
As well as introducing a cost of disability payment the Social Democrats would increase disability payments and other core social welfare rates by €25 per week to protect payments from inflationary pressures. This increase amounts to an additional €676 per year in payments compared with the paltry €12 increase the Government announced today. Under our proposals disabled people would therefore be much better off than under the Government’s budget. The Government has heard from disability groups over many years and it continues to ignore the things they require. As it stands, the Government’s meagre €12 increase to core social welfare rates is an effective cut that leaves disabled people and other vulnerable people behind.
The failure to adequately increase core social welfare rates or indicate that they will be benchmarked against the minimum costs of living is hugely disappointing. It is more short-termism from a Government obsessed with short-termism. We should all be clear about the implications of this. This is a deliberate policy choice that will ensure increasing numbers of people, including, pensioners, one-parent families, disabled people and others remain living in, or at risk of, poverty. This is a deliberate choice the Government has made.
There is a huge structural problem around low income In Ireland. Hundreds of thousands of people subsist week to week on incomes which are not sufficient to live a dignified existence. Budget 2024 could have changed that. It could have provided certainty and security. Plenty of research exists illustrating what different households must spend each week to achieve what is considered an acceptable standard of living in Ireland. The most well-known is the minimum essential standard of living, MESL, research carried out by the Society of St. Vincent de Paul, which suggests a single adult would need to spend at least €286 each week to cover basic needs. Core welfare rates only cover about 77% of what is required to meet basic needs this year, and budget 2024’s meagre €12 per week increase means this will not even keep up with inflation. For months, organisations from the Society of St. Vincent de Paul to Age Action to Social Justice Ireland and many others have been pointing out what kinds of increases were required just to maintain the purchasing power of the payments - not to have a real increase, just to maintain their purchasing power. This €12 increase is not enough to insulate the most vulnerable from price increases. As well as increasing core rates by €25, the Social Democrats would also have directed significant additional resources to the fuel allowance payment to provide relief to the most vulnerable in our society. The fuel allowance should also be expanded to those in low-income employment who are in receipt of the working family payment. Doing this would provide low income families with an additional €420 in income as well as a once-off payment of €400.
This would be far more beneficial to families than what the Government has proposed, a once-off €300 payment.
Last week when we in the Social Democrats launched our alternative budget, we pointed out that the income tax package in budget 2023 gave more than twice as much to people earning €100,000 as it did to someone on the living wage. Also last year, a working couple with no children earning €100,000 received more than four times as much as a working couple with two children earning €30,000. Once again with this budget it is a matter of the more you earn, the more you get, widening the gap all of the time. Our alternative budget looked for a fair taxation system with a focus on tax credits, which benefit a broader base of people equally, and a system of refundable income tax credits targeted at low earners. However, once again it is those on higher incomes who will be most rewarded by the Government’s income tax measures. The Social Democrats were criticised when we said we would not reduce the USC but today’s budget announcement has helped us to justify this position. Cutting the 4.5% USC band by 0.5% gives a tenner to someone earning €25,000. That is a tenner over the entire year. Someone earning €70,000, on the other hand, gets €235 or 23.5 times the benefit the low-income person gets. Again, the Government is widening the gap. Was there ever a clearer example of why it is better to ensure we rebalance our tax system through credits which benefit all recipients equally? Under our plans, those gains would have been distributed more fairly.
The indexation of tax bands should be in line with wage increases, and while indexation is justified for middle-income earners, there is no reason this tax benefit should go to very high earners. No effort has been made to claw back any of those gains from those at the very top. The Social Democrats proposed a third rate of tax of 43% on incomes above €100,000 for this purpose. While more than 90% of workers would benefit from our tax plans, we believe those at the very top can afford to pay a little more. In return for that, they will get hugely improved services under our plans, which bring down the cost of living for everyone.
In respect of health, this year’s deficit should have come as no surprise to this Government. It was clear from the very beginning. Why else were attempts made to massage the figures? Why else was the national service plan delayed by more than three months? The financial allocation fell very far short of what was required. This Government needs to realise we have a growing and ageing population, and that means increasing demand. This Government must also accept that reform costs money. There is no doubt that budget controls are extremely important but a number of key enablers are needed for better control. That is why we should scale up funding to accelerate implementation of an integrated financial management system and the digital healthcare strategy. The Minister for Health should be prepared to invest heavily in these critical projects and he must be supported by the Minister for Public Expenditure, National Development Plan Delivery and Reform in that work. We should not need to remind the Minister what the R in that Department's title stands for. If this Government is genuinely committed to reforming our public health service, then it needs to lay out a multi-year funding programme for Sláintecare. The Social Democrats have repeatedly called on the Government to do so and to include this cost in the pre-committed element of the annual budget process, as already happens with the national development plan, NDP, and public pay agreements.
Notwithstanding the urgent need to follow through on Sláintecare reforms, one of the biggest challenges facing our health and social care services is still the recruitment and retention of staff, across all disciplines. We urgently need a national workforce task force to address this. A coherent and integrated approach is so desperately required, not reactive solutions which fall short of addressing the profound challenges facing our health and social care systems. This recruitment and retention crisis is also jeopardising service delivery in the community and voluntary sector. However, this escalating crisis is fuelled by the disparity in pay and conditions between State agency staff and staff in section 39, section 56 and section 10 agencies. If we are to make this sector sustainable, then the funding and staffing arrangements also need to be sustainable. It is time this Government restored the principle of pay parity. In our alternative budget, the Social Democrats called for a minimum of €150 million to begin to address pay and conditions in those sectors.
In terms of social care, a series of interventions is needed to address the increasingly privatised services. Employees within the sector deal with precarious working terms and occasionally other forms of exploitation. This is particularly problematic in the home care sector, which is largely unregulated. Investment in universal social care services is vital for older people and people with disabilities. They must have the necessary supports to reduce dependence on family and friends and to maintain a private, independent life with dignity. Although funding has improved in recent years, outstanding issues in home care require urgent attention, especially in the long-promised statutory scheme.
The other big issue is the cost of accessing healthcare for patients. We have a long way to go to meet the principle underlying Sláintecare of access to universal health and social care based on health need. Budget 2024 will do little to progress the removal of healthcare costs or bring us into line with the implementation timeline proposed in the Sláintecare report.
When it comes to mental health services, we know from all of the agencies working in this area that an additional €120 million is desperately needed in this budget. However, we still have no idea how much will be allocated to mental health after the Minister’s speech. I certainly hope that when we hear from the Minister of State with responsibility for mental health, she will indicate an understanding and appreciation of the level of funding that is so desperately needed.
Education is another area of missed opportunity. It is the single greatest driver of opportunity, quality of life, social equality and economic growth. One of the most radical reforms to our education system would be to make it what it claims to be, to make it genuinely free. Primary and secondary education in this country is supposed to be free but we all know that is a myth. It is a scandal that schools are expected to fundraise for basics like heating, lighting and cleaning. Parents face huge additional back-to-school costs every year, while so-called voluntary contributions are a very unwelcome financial burden. Making education genuinely free would mean fully funding schoolbooks and other classroom resources, increasing the capitation rate to eliminate the need for so-called voluntary contributions, as well as permanently eliminating school transport scheme fees. The Government announced some additional funding in the capitation area but it is quite clear it will go nowhere near meeting the increasing basic costs of running schools. It is a drop in the ocean compared with what is actually required. Why are we stopping here? Why are we not committed, in 2023, to ensuring our primary and secondary schools are genuinely free?
On climate action, this Government excels at climate rhetoric but fails at climate action. We see evidence of that failure everywhere. Failure is baked into its climate action plan. If every measure is implemented, it will only reduce emissions by 29% by 2030, when the target is 51%. Even when it comes to what should be simple measures, the Government comes up short. Climate action is not just a moral and ecological imperative; it is a financial imperative. If we do not meet our 2030 targets, we will incur billions of euro in fines. The Irish Fiscal Advisory Council, IFAC, also warned last week that climate mitigation measures could cost the State up to €5.5 billion every year between 2026 and 2030.
If it is not by now clear to the Government, it should be. We need a huge investment now. The climate fund announced today is a start, but it does not go anywhere near far enough.
The Social Democrats proposed using the vast majority of the budget surplus – about €6.5 billion – for climate transformation. That would be the ultimate rainy day fund. We would set up a new semi-State with a singular focus: renewable energy. We want the State to invest in offshore wind to cut energy costs for families, improve our energy security and get a financial return for the people of this State from investment in our own natural resources. Private companies are the ones reaping all of those benefits at the moment.
In general, it is fair to say that budget 2024 will not change very much. Yes, there are some nice headline-grabbers for the Minister of State and the coalition parties, but the deeply embedded structural problems that make life so difficult for so many in our society will not see much, if any, improvement. The budget fails to tackle the lack of affordable housing, the huge waiting lists for basic healthcare, the absence of social care for so many older people, the threadbare disability services that deny tens of thousands of children the ability to reach their full potential and the soaring costs that make life unaffordable for so many. Instead, the status quoof increased privatisation and erosion of key public services will continue. It is about prioritising profit and a good return on investment, rather than what is in the public interest. When governments facilitate or even encourage this, they betray their citizens. This betrayal stems from a philosophy or ideology which does not understand the importance of equality as a means to bring about social and economic success. It is a mindset which does not appreciate the huge benefits of universal public services and sees the provision of public services as being some kind of necessary evil for those who cannot afford to go private.
This budget could have been transformative. Instead, its legacy will be more of the same. I will finish with a quotation from IBEC:
We have pretty much the same number of public sector workers as we had 15 years ago but as societies get richer, they want their public services improved. These things are all a function of State but the fact is that that State is demonstrably shrinking.
Those comments were made by IBEC because it recognises the need for improved public services. Along with many other agencies in this country, it has urged the Government not to concentrate on cutting taxes and instead to develop and grow our public services. In other words, thousands of additional public sector workers are required to provide the high-quality, reliable and accessible public services we all want and need. I see no plan from the Government to make this happen on the scale that is required. Instead, the Government continues to look to the market and the private sector to provide the public services that should be part of a basic floor that everyone in the State has a right to expect. The causes of the problems we all face as a society have their roots in political choices. Their solutions are also highly political. It is clear we will need a complete change of direction in order to implement the kinds of solutions that this country so desperately needs.
The Government's disastrous approach to housing has meant record rents, record numbers of adults in their 20s, 30s and 40s stuck living in box rooms and childhood bedrooms, record numbers of people living in homeless emergency accommodation and now, shamefully, record numbers of children growing up without a home. At the same time there has never been such an opportunity to solve the housing disaster, with billions available that could be used to build more homes and crucially, many more affordable homes which are needed. With today's budget, never has such a huge opportunity been wasted. Today's budget is a budget for investors, developers, speculators and land hoarders. When it comes to housing, this budget is taken straight out of the Fianna Fáil developer's handbook, and continues the disastrous approach of giving hundreds of millions of euro, in subsidies and tax reliefs, away to investors in measures that will not build one single additional home.
What does this budget mean for renters? Since this Government took office, rents have reached record levels. Rents have almost doubled in the last decade. The average rent nationally is now €1,792 a month. That is a staggering €21,504 a year. That means that someone on the minimum wage putting their entire take-home pay into keeping a roof over their head would still be left €15 short every week before they spend a single cent on food, heating or electricity. Somehow, the Government looks at these skyrocketing rents and figures that it is the landlords who need a dig-out. The Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, said in recent weeks that he wanted to see a €1,000 tax credit for renters to help pay for these exorbitant rents. However, the Government has fallen short today by a staggering €250.
In the fully costed Social Democrats alternative budget proposals, we allocated funding for a tax credit for renters to cover a full month's rent. Where has the funding that could have been used to fund this gone in this budget? It appears that it is being used to provide tax relief for landlords. It is a tax relief for landlords in receipt of some of the highest levels of rent in Europe. It is a tax relief that does nothing to help renters and does nothing to improve security of tenure. It merely requires that the landlord does not sell for a period of four years. The rationale for this relief - that landlords are fleeing - has been debunked as misinformation by the census data. According to the Central Statistics Office, between 2016 and 2022 the number of privately rented homes grew by 7%. Renters paying exorbitant rents and some of the highest rents in Europe are losing out to landlords due to a narrative spun by lobbyists that simply does not match the hard data of the census figures. Is this what decision-making under the Fianna Fáil-Fine Gael Government has been reduced to? Worst of all, this tax relief for landlords will not build a single additional home - not one. What this tax relief will do is it will push up the price that investors are willing to pay for a home, putting further upward and inflationary pressure on house prices.
In relation to the renter's tax credit, raising the credit without accompanying measures to prevent this credit being gobbled up by rent increases is irresponsible and inflationary. Rents are skyrocketing under this Government. Rents have risen by over 10% in the last year alone. The tax credit must be accompanied by a strengthening of rent regulation, or it will act as another incentive to raise rents even further. Receiving a tax credit in one hand, only to immediately hand it back to your landlord with the other, is not what renters consider help from the Government. A report published by the ESRI showed hard evidence of how the rent pressure zone regulation is being flouted and circumvented by a cohort of landlords. We need a three-year ban on rent increases and a nationwide production of rent pressure zones.
In terms of vacancy, the setting of the vacant homes tax at a derisory 0.5% on vacant homes, after years of prevarication, shows a complete lack ambition to get many of the more than 100,000 empty homes around Ireland back into use. In our fully costed alternative budget proposals, we proposed a vacancy tax of 5%. This tax would have clear and fair exemptions so that no one who has a genuine reason for having an empty home, such as having an illness, is penalised. Setting this tax at a meaningful rate would send a clear message to the owner of an empty home to use it, sell it or rent it. However, in this year's budget the Government has failed to grasp the nettle and has set the vacant homes tax at an ineffective and derisory 0.5%.
In relation to the land hoarding tax, the announcement today to delay the collection of tax on land hoarding, the residential zone tax, until 2025 shows yet again that when it comes to tackling land hoarding and speculation, there is simply no urgency at all from this Government.
Is it not aware that we are in the middle of a housing disaster? As the Government delays and dithers, the housing crisis gets worse and worse for people all over Ireland.
On mortgage interest relief, the announcement by the Government appears to be full of holes. This has the potential to be hugely divisive. There does not appear to have been any attempt to target the measure at those in mortgage distress specifically. Excluded are those who fixed their rates before July 2022, those who will be coming off fixed rates in the coming months and first-time buyers who do not qualify for any Government supports. The Minister for Finance should tell us how he came up with the qualifying criteria and how he made the decision about which mortgage holders to exclude.
In the context of affordable housing, analysis published by the Parliamentary Budget Office shows that since Fine Gael took office, house prices have increased at a much faster rate than wages. Since 2012, wages have increased by 27% compared with a 75% increase in house prices. Rents have increased by a staggering 90%. Year after year, housing is becoming less and less affordable. Homeownership levels are at their lowest for more than 50 years. One of the best things that could have been done in this budget would be to give people a chance to buy their own homes by building thousands of affordable homes next year. It is important to remember when we talk about affordable housing that 100 years ago, when this State was newly founded and had very few resources, we were able to build affordable houses in large numbers. This affordable housing was revolutionary at the time and it changed people's lives. One of the best examples of this is Marino, in my constituency, which is a very successful, well-designed and well-built community that is thriving to this very day. However, since this Government took office, it has never come even remotely close to meeting its targets on affordable housing. This year, the Government promised to provide 5,500 affordable homes. In the first half of the year, only 22 cost-rental homes were completed and only 101 affordable purchase homes. In the last election, the now Minister for Housing, Local Government and Heritage, Deputy Darragh O'Brien, promised 10,000 affordable homes each year. Only 424 affordable purchase homes have been completed since this Government took office. This is an abysmal failure.
In the fully costed proposals contained in the Social Democrats' alternative budget, we allocate funding for 10,000 affordable homes next year. Significantly, under those proposals we would also provide early-stage finance to get affordable housing projects off the ground so the design and planning costs could be met. We would also provide for multi-annual funding over five years for modular and off-site construction in order to give the industry the certainty it needs to scale up production to at least 5,000 modular homes a year. This would kick-start an additional supply stream of high-quality and environmentally sustainable homes. Announcing targets for affordable homes is easy; it is building homes that matters. Affordable housing targets that are never met have zero credibility. You cannot live in an affordable housing target.
The people most let down by the housing disaster are those without a home. There are now 12,691 people living in emergency accommodation. This includes 176 pensioners and a record 3,895 children who are growing up without a home. The Government should be moving heaven and earth to reduce the number of people becoming homeless and yet we do not see any evidence of this in the budget. Incredibly, under this Government some local authorities are actually selling off more social homes than they are building. Last year, four local authorities - Dún Laoghaire-Rathdown County Council, Longford County Council, Roscommon County Council and Sligo County Council - sold off more social homes than they built. They are reducing their social housing stock in the middle of a homelessness crisis. The Minister for Finance's announcement earlier about further incentivising and supporting the sale of social housing by local authorities means that next year the number of local authorities that sell more social homes than they build will be even higher again.
Young people living in State care are particularly vulnerable to becoming homeless, especially when they leave that care. Among the proposals the Social Democrats have put forward is one to significantly increase the capital assistance scheme for care leavers. Targeted funding in this area would reduce the number of young people leaving State care becoming homeless. I implore the Government to take on this proposal, which would make a very real difference.
In terms of housing, the one group that has not been failed by this budget is developers. In its fully costed proposals, the Social Democrats suggests abolishing over €400 million in subsidies for developers. We propose to allocate this money instead to building more affordable homes. However, this budget continues to throw hundreds of millions of euro at developers despite all the evidence that this approach is nothing short of a disaster. Analysis by architect Orla Hegarty shows that the introduction of the shared equity scheme by the Government has driven up house prices. In west Dublin, for example, the scheme pushed up house prices on new-build homes by €92,000 a year within 12 months of its introduction. Separately, BNP Paribas has pointed out that new-build house prices in Ireland are increasing at 18 times the rate of second-hand homes. This is specifically due to Government schemes and subsidies. Under this Government, people looking to buy somewhere affordable to live lose out but developers always win.
Housing adaptation grants are extremely important for assisting people with reduced mobility, older people and people with disabilities to stay in their homes. They are an absolutely key measure in adapting housing stock and providing good outcomes for people whose mobility changes and decreases, especially as they get older. A review of the housing adaptation grant scheme was due to be published before the end of 2022 but has still not been released. However, information released to Alone under the Freedom of Information Act shows several local authorities with significant waiting lists for housing adaptation grants. Dún Laoghaire-Rathdown County Council, for example, has 85 on its waiting list, while South Dublin County Council has 95 and Fingal County Council has 194 - and it had already spent almost 100% of its budget by the beginning of August. Dublin City Council has 203 households on its waiting list, Galway County Council has 550 and Louth County Council has 562. Nationwide, there are at least 3,500 older people waiting on housing adaptation grants. It could be more. Budget deficits and overspends are being run up in a number of local authorities. Monaghan County Council has overspent its budget by over €500,000 and Meath County Council by €300,000. That was by the beginning of August. There are huge challenges in this area, and we have only seen a derisory increase from the Government in housing adaptation grants in this budget. In comparison, we set aside €25 million for this in our proposals.
This is a budget that has delivered for investors, land hoarders and speculators. This comes at a major cost for those paying record rents and for the record numbers of people stuck living in their childhood bedrooms into their 20s, 30s and 40s. This Government has an abysmal record of spending hundreds of millions of euro in subsidies and tax reliefs for developers and speculators, using public money to push up prices and profits. Instead, this money could and should be used to build more affordable and social homes, to give people a chance to find somewhere affordable to live and to get people out of homelessness.
The Government is seeking to dazzle and fool people with once-off measures but the reality is that poverty, deprivation, financial hardship and inequality are not once-off phenomena. They are systemic, and once-off measures will simply not cut it. Despite the attempts to dazzle people with these once-off measures, the net fact, when you look closely at this budget, is that taking into account the cost-of-living hikes, the rise in inflation and increasing rents, ordinary workers will be worse off afterwards. People on disability allowance, pensioners and people who are dependent on social welfare payments will all be worse off as a result of the budget than they were before. Of course, the corporations, energy companies, banks and property speculators are enjoying a bonanza in profits.
We have seen a shocking and ever-growing concentration of wealth at the top of our society, being enjoyed by corporations and super-wealthy individuals, and the gap between the very richest in our society and ordinary, working people, who are being hammered with the cost of living and the housing crisis, is getting ever wider.
Given the enormous budget surpluses available to the Government and the extraordinary increases in profits that corporations have seen, we were one of the wealthiest countries in the world going into this budget and we had - the Government has - the resources to eliminate poverty and genuinely protect people with disabilities, pensioners and the vulnerable. What has the Government given them? It has given them a miserable €12 a week that is not even close to compensating for the cost-of-living hikes people have suffered over the past year. Let us put this clearly in context. To be at risk of poverty, you have to be earning about 60% of the median income. That means that to be above the poverty line, you need to earn €318 a week. The Government is giving people a miserable €12 on top of €280 a week for the basic social welfare payment or disability payment, and for pensioners, €12 on top of the €265 they get. This will leave the overwhelming majority of pensioners, people with disabilities and the most vulnerable people in our society living in poverty at a time when we have unprecedented resources available to the Government. When it could have, at the stroke of a pen, eliminated poverty, we will leave hundreds of thousands of our citizens existing still in poverty, crushed by increased in the cost of living.
The failure to provide for those with disabilities and for the additional costs of those with disabilities is utterly shameful. A cost-of-disability report shows people with disabilities incur additional costs of between €9,000 and €12,000 a year. What have we given them? Nothing, effectively. The once-off payment of €400 does not go next to near compensating for the additional costs people with disabilities have to endure. We could and should have given at least an additional €50 a week to those with disabilities. Let us remember that during Covid, when we introduced the pandemic unemployment payment, we set a baseline of €350 for people who were put on that payment. That is what disability activists and campaigners have been saying should be the benchmark for those with disabilities. You could argue that should be the case for everybody, but we should give social welfare increases that at least keep people above the poverty line and genuinely account for the additional costs people with disabilities have to suffer.
In the case of workers, again, the Government is trying to dazzle people with minor reductions in the USC and changes in tax bands and thresholds, but its budget documentation makes clear workers will be worse off. Inflation is running at 5%, although the consumer price index shows there was actually a 6.7% increase in the cost of living over the 12 months to August. What are workers getting? For anyone who wants the reference, it is on page 16 of the document on tax policy changes. Somebody on €25,000 will get 1.1% extra, as will somebody on €30,000 or €35,000. For somebody on €40,000, it is 1%; on €45,000, 2.2%; on €55,000, 2%; and it is similar across the board. Ordinary, low-, average- or modest-income working people will get only a 1% to 2% increase in their incomes against a background of at least 5% inflation. In reality, that is a pay cut. It is a significant cut on top of the pay cuts in real terms that workers suffered in the previous year. That is the truth. For all the smoke and mirrors of supposed tax changes, once-off payments and so on, workers will end up worse off.
Let us put the energy credits in context. Last year, there were three €200 energy credits. The consequence of that, as we discovered with the figures that came out recently, is that, currently, before the winter months start, there are 250,000 people in arrears on their electricity bills and one in four people is in arrears on their gas bills. That is for the summer months, before people have to turn on the heating to stop themselves freezing as we head into the winter, and the Government is going to give them less this year than it gave them last year. What they got last year was not enough to stop hundreds of thousands of people ending up in arrears; this year, it is less. More people are going to suffer fuel poverty, more people are going to be afraid to turn on the hot water, have a hot shower or turn on the heating as we head into the winter months, but do we do anything about the profiteering of the energy companies? Not at all. In the first six months of this year, the ESB earned more in profits than it did across the entirety of 2021. That is absolutely unbelievable. It doubled its profits in the course of two years to over €670 million in just the first six months of this year. The company is profiting off the energy misery of working people, pensioners, people with disabilities and people on low incomes. These people are already in arrears and facing into the winter months. It is quite scary when you consider what they might face.
Then, of course, there is the issue of housing. In that context, this budget is just a shocking, unbelievable failure. The Government has done nothing above and beyond the Housing for All plan, which is failing catastrophically. Record numbers of people are homeless. To give the example of my area, as I have explained ad nauseamin this House, the Housing for All targets in Dún Laoghaire-Rathdown, which will probably not even be met, would result in more people being on the housing list at the end of Housing for All than are currently on it. That is even if the targets are met. This is against a background where, in my area, you would be waiting a minimum of 12 to 15, and sometimes 20, years for a council house if you put yourself on the list. At the end of Housing for All, if we stick to the current plan that is failing so badly, more people will be on the housing list in Dún Laoghaire-Rathdown in five years' time than there are now because the Government's plan fails to take into account the number of additional people coming onto the list who cannot afford the absolutely shocking rents and house prices that are completely unaffordable for the vast majority of working people. More and more people are forced to go onto housing lists but the plans to build social and affordable housing are woefully, shockingly inadequate. In terms of capital investment, to use the jargon of the budget, there is a marginal increase for housing, from €2.3 billion to €2.5 billion. That will only take the cost increases into account, however, so there will be nothing extra and there is no change to the targets for social and affordable housing.
At at time when we have record budget surpluses and billions of euro in windfall corporate tax revenues, I cannot understand why the Government does not see it as a good idea to use those billions to build and acquire more social and affordable houses and refurbish the tens of thousands of vacant and derelict houses across the country. The Government repeats this mantra that we should not be using that money for ongoing current expenditure in circumstances where we cannot rely on it for the future. Even if I accept that argument - it has some merit - it does not apply to dealing with the housing crisis. If you do not build the social and affordable housing with the money we have, you end up spending more on current expenditure - housing assistance programme, HAP, rental accommodation scheme, RAS and leasing - which will be more of a fiscal problem in the future than using the money available now to buy, build, acquire and refurbish public housing. Doing the latter will save us money. It will help resolve the housing misery being faced by people who are trying to find accommodation they can afford.That is like looking for a needle in a haystack for the majority and is driving so many of them into homelessness. If the Government uses that money to build, buy, acquire and refurbish social and affordable housing it will save the State billions in the future. It will put us in a more sustainable financial position than this crazy reliance on HAP, RAS and leasing.
The Government is obsessed with the model of relying on private landlords and is pouring in hundreds of millions of additional euro every year. Almost €1 billion in current expenditure is now going to landlords. Even in that completely misguided system, the Government will not even raise the flipping HAP thresholds in line with rent increases. If it is going to persist with this ridiculous way of trying to address the housing crisis, the least it could do is ensure that the HAP thresholds are sufficient for people looking for HAP tenancies to be able to find somewhere within the thresholds. These people cannot find places, however. The highest homeless HAP threshold for a family in my area is €1,900. If you go on daft.ieor myhome.ieand try to find a one-bedroom home for €1,900 you will not find it. You definitely will not find a two-bedroom home. When you are talking about three- or four-bedroom homes, the cost is more than €3,000 per month. The thresholds are nowhere near what is needed. It is an exercise in futility and despair to be told to find a HAP tenancy in light of the level of rents in most of Dublin, in my area and many of the urban centres.
Of course, there is then another group of people who are not even eligible for social housing because they are over the thresholds. However, there is not enough cost rental because the amount of cost rental the Government has delivered is pathetic. It is not willing to raise the targets, so an increasing number of working people who find themselves looking for rented accommodation are not even entitled to HAP. They are not entitled to rent support. If they are older, they will not get a local authority home loan or a bank loan to buy a house because they are too old. Increasingly, people who have worked all of their lives and who, often, are hitting their late 50s or early 60s are being threatened with or driven into homelessness because there is no support on offer to them. That problem will grow unless the Government deals with it.
I have a couple more brief points to make. Here is something that has not been mentioned. I am a real nerd and I read the fine print of the Book of Estimates. In all of this failed housing policy, there is one interesting item. There is an additional 44% increase in expenditure for consultancy. The amount paid to consultants to dream up the housing plans that have left us with the worst housing and homelessness crisis in the history of the State has gone up. Listen to this, it has increased from €117 million last year - a shocking figure in itself - to €169 million. That is an increase of €52 million in the money going to consultants to dream up the housing policies that have left us with this housing crisis. You could not make it up.
In terms of the renter' credit, the additional €250 is less than the Government has given landlords. Next year, landlords will get a tax credit of €600. They will get €800 the following year and €1,000 the year after that. This is all based on a spurious claim that landlords are exiting the market. The CSO has shown that we have more tenancies than we had in the past and all that is happening with the sale of rental properties is that bigger landlords are usually buying out the smaller landlords. The actual number of rental properties is increasing. We do not have a problem in that there are not enough landlords; what we have is a problem of landlords charging extortionate rents and making extortionate profits, but the Government wants to give them tax breaks. That is as well as what is happening with the really big property investors, like real estate investment trusts, REITs, and so on, who are getting tax breaks on rental revenues and capital gains.
The mortgage interest relief is a joke. I will give one example, who is Lola, a working single mother. Last year she had an €7,000 in interest repayments. She is going to get €1,250 back. How could anybody sustain €7,000 in additional interest payments? That is what is happening. Tens of thousands of people on tracker and variable mortgages are being crucified by banks that are making shocking profits, and that is the best the Government can do for them. Again, there is no action on the profiteering being engaged in by the banks despite our repeated requests that the Government should taken such action.
There are other things not mentioned in the budget, but which will be coming in soon. Carbon tax increases are coming in the next couple of months, essentially undermining the position in terms of diesel and fuel. Other carbon tax increases next year will effectively neutralise any of the one-off measures the Government has given in that area.
All of this is happening against a background of extraordinary increases in profits. This is never talked about. In 2012, the figure for pre-tax profits was €77 billion. The figure for 2021, the latest available, is €250 billion. Although we do not have a figure from the Government for 2022, we know that the corporate tax revenue has jumped to an incredible €24 billion. Extrapolating from previous years, that means we are at well over €300 billion in pre-tax profits for corporations. Those are enormous increases. They are the winners. The Government protects them and has given them an additional tax break to compensate them for the increase to 15% in the nominal corporate tax rate. It has given them another big loophole in order that they will not really pay any additional tax. It has changed the research and development tax credit currently worth €750 million per year, all of which is going to those same super-profitable corporations. It has also increased the research and development tax credit from 25% to 30%. That is tens of millions in extra money going to companies that already enjoy obscene, staggering profits while ordinary people are being crushed by a cost-of-living and housing crisis. I suppose we should not be surprised that is coming from this Government.
What sums up this budget are permanent tax breaks for the rich and once-off crumbs for ordinary people. Many people will not have heard the term "angel investor" before today. However, angel investors will wake up tomorrow and discover there is a new tax break. If you are an angel investor, it is a great budget because there is a new tax break worth almost €500,000. It is a great budget. For the landlords who get a new tax break, it is a great budget. For the tax-avoiding big corporations, it is a great budget. However, for ordinary people who get inadequate, once-off measures, this is a very poor budget.
It used to be there was one once-off measure, which was the annual Christmas bonus, in terms of social protection payments. That was it. Now we have a range of payments, which means the core rates of payment are slipping, bringing people further and further into poverty. The Government is papering over the deepening deprivation of ordinary people who are reliant on a fixed income, be they pensioners, people with disabilities or unemployed people. The problem is poverty, deprivation, inequality and the housing and health crises are not once-off. None of those things goes away; all are permanent unless we have a government that addresses them.
The measure that sums up the budget best is the treatment of landlords versus that of renters. A landlord gets a tax break for next year worth €600; the following year it is €800; and the year after that and onwards, it is €1,000. Compare that with what a renter gets in this budget: €250. The landlord gets almost three times as much as the renter and much of what the renter gets will, in fact, end up in the pocket of the landlord. The justification for this from the Minister in a context when we have record rents, that is, money going into the pockets of landlords, is that for every tenant there has to be a landlord. It is complete nonsense. Why can the State not be the landlord of any tenant currently in a home where the landlord says they want to get out of the market? Fine, let them get out of the market. The State should buy at market rate. The tenant gets secure tenure, the State gets an asset and the landlord gets to leave. The idea we have to incentivise landlords to stay in the market is like saying we should give a tax break to ticket touts to encourage the live music industry. Landlords do not provide housing; they simply rent existing housing. If they leave the market, it is not a problem as long as the State steps in to buy it and ensure people remain in situ. The reason the Government is doing this is that it is a landlord's Government. It is made up of landlords and represents the interests of landlords.
The other striking contrast concerns angel investors. There is €500,000 for angel investors. These are high net wealth individuals - multimillionaires who invest - and the Government has made up a special tax break for them costing the public €55 million. Compare that with how children are being treated. One of the most shameful aspects of the budget is the disgraceful treatment of children. For someone on a social welfare payment who has a child, the Government is increasing the payment by €4 per week. I am getting the beginnings of a sense of how expensive it is to have a child but only the very beginnings because I understand it becomes much more expensive as the child gets older and you have to buy clothes, pay for education and everything else. Four euro per week in a cost-of-living crisis is scandalous. It is even worse in terms of domiciliary care allowance, where there is an extra €10 per month, or €2.50 per week, in a cost-of-living crisis. It is only a couple of months since the Taoiseach launched a plan to end child poverty. It was very ambitious, but this is much more in line with the old Leo Varadkar who said Tiny Tim should get a job. It appears it is now Government policy that the only way these children can pay for themselves is if they go out and get a job.
In education, is it the same policy that informs the idea of extending the schoolbooks scheme, but only up to third year, and suggests that the leaving certificate is some sort of luxury for people? We know of the crisis in recruitment and retention of teachers. That crisis will get worse and there is nothing here to address it: no increase in pay for teachers or accommodation for teachers or other key workers. A paltry sum of €7 million for extra capitation will go nowhere to getting rid of the supposedly voluntary school charges. There is no increase, despite promises, for postgraduate workers. Deputy Boyd Barrett made the point about the stark contrast between a one-income family earning €25,000 getting €52 per year in the tax changes, or €1 per week, and a two-income family on €175,000, who get €992 per year, almost €1,000.
I draw attention to the complete failure of the budget on the question of climate action and the biodiversity crisis. There is a peculiar line. The Government abolished one rainy day fund and set up two rainy day funds to replace it. It calls one of them the infrastructure, climate and nature fund. It will reach €14 billion, on which only €3 billion is actually anything to do with climate and nature. It is just a word. The Minister, Deputy McGrath, said the aim of the €3 billion “is to help the achievement of carbon budgets through capital projects where it is clear our climate targets are not being reached”. That reads like a blatant admission we will not reach our targets. We have not reached any of our targets up to now and are on a trajectory to wildly miss them. It raises the question of what that money will be used for. Will it be used to buy carbon credits or pay fines? Is that the purpose of putting this money away?
It makes no sense to say what we will do in terms of climate action is put money away in a fund that will be invested in something. We are in ecological crisis now. Look around the world. Look at what has happened in Greece: flooding one month, after horrendous wildfires the previous month. The devastation across our planet is happening right now. It makes sense to invest money now to address the climate catastrophe, as opposed to putting it away for some day in the future. This crisis is happening now.
Instead, the Government has provided €29 million extra - that is all - for expanding public transport. There is no indication the supposed 2:1 ratio of investment in public transport versus investment in roads is being kept. It looks like it is a 50:50 ratio in the budget documents. What is needed is not rocket science but is something we have shouted for for a long time. It is contained in our budget documents. It is investment in free, frequent expanded public transport; State investment in renewable energy, as opposed to waiting for the private sector to do it; retrofitting people’s homes massively through a State construction company by installing solar panels and proper insulation; and funding small farmers and guaranteeing them a decent income for a just transition.
The Government made a promise that, in this budget, it would reduce the cost of childcare by 25%. It will claim it is keeping that promise but that is a joke. It says it will do it in September 2024. It was a new innovation when a Government a few years back decided to announce measures in the budget that would not be introduced in January but instead would come in in April and so would be at lower cost. To stretch that all the way out to September, which is almost a year from now, and claim it is done in this budget is really a joke. There is €10 million in extra core funding for childcare. That is all, when the pay claim of childcare workers, an underpaid and crucial group of workers, would cost €142 million. The Government is saying to workers they will continue to work on poverty wages and to parents that they will continue to effectively pay a second mortgage for childcare. In our budget document, we propose and budget for free childcare from next year and outline a road to a proper national childcare service provided free at the point of use at no extra cost to ordinary people, paid for through progressive taxation.
A question arises. In one of the richest countries in the world on a GDP per capitabasis, how, while running a massive surplus, can the Government produce a budget that fails the vast majority of people in the country so dramatically and blatantly?
The answer is that it is because the Government's budget and its policy are based on the idea that the capitalist market is going to provide the solutions for the problems people face. We shall incentivise angel investors to come and invest to create solutions for the climate crisis, or whatever they are going to invest in. We are going to give tax breaks to landlords to enter the market or continue in the market to resolve the housing crisis. We are going to give further tax breaks to multinational corporations that already pay very little in the way of tax in order to keep them here. The Government sees the market as being the solution to the problems we have in our society. That is the root cause of the problem and it is rooted in the fact that, fundamentally, the Government represents those interests.
The problem is that the capitalist market is not the solution; the capitalist market is the problem. The capitalist market is responsible for the housing crisis. The capitalist market is responsible for the ecological disaster we have across our planet. The capitalist market is responsible for the cost-of-living crisis. We know from multiple studies that on a global basis, an EU basis and an Irish basis, two thirds of the reason we have inflation now and two thirds of the price increases are caused by profiteering. What we have is greedflation, so to speak, not inflation. The Government refuses to address any of that because it thinks the market is the solution and because it represents those who are engaged in the profiteering, be they the big oil and gas corporations, the big food supermarkets, the big agribusiness corporations and so on, all of them making massive profits.
We have to point out the reality that, as Deputy Boyd Barrett noted, corporate profits have soared in this country. People would not believe it but they have quadrupled in the course of the past ten years. It is not just corporate profits that have soared. The personal wealth of the richest people in this country has also soared, so for the millionaires in this country, who make up the top 5% of the population, their collective wealth is now €388 billion. We have to say that now is not the time to shelve the proposal for a wealth tax, as Sinn Féin has done. Now is the time to say that the wealth and resources, which are massive in our society, should be taken into the control and into the hands of ordinary people and used to address all of the social crises we have. We do not need a government that manages this capitalist system. We need a left government that implements an eco-socialist budget that transforms things in the interests of ordinary people.
Things do not have to be this way. We do not have to have one in ten families reliant on food banks to get by. We do not have to have a health crisis. We do not have to have a housing crisis. We have enough resources in this country to have a decent life and decent public services for everybody, but what that requires is a mass movement to end the rule of the rich, the tax-avoiding multinational corporations, the big landlords and the big polluting industries, and have a left government that actually serves the interests of ordinary people and implements an eco-socialist budget.
The question for the Minister, Deputy McGrath, is where is the vision. George Bush Snr. famously struggled with what he described as the "vision thing". It looks to me like the Minister, Deputy McGrath, might be the George Bush Snr. of Irish politics because here was a real opportunity. Even if we do not think that budget surpluses will add up to €65 million over the next four years, even if we estimate conservatively that the figure might end up being somewhere between €40 billion and €50 billion, here was an opportunity to put in place a range of public services the likes of which Irish society has never properly enjoyed - free public transport, free State-provided childcare, a health service free at the point of use and publicly owned, and a State construction company to boost construction of not-for-profit social and affordable housing and guarantee a steady income stream for the State for generations to come. But no, instead, the Minister, Deputy McGrath, has decided to spread the surplus very thinly, with a mishmash of half-measures that will genuinely satisfy few. There is no vision. Instead of real change, which people were crying out for, people are being given spare change.
Let us have a look at some of those half-measures. On childcare, the Government is going to reduce childcare costs by 25%. It is not enough but it is better than nothing. However, when is the Government going to do it? In September 2024. To the people who are being hammered by high childcare costs, who feel the burden to be that of a second mortgage, the Government takes the Johnny Logan approach – "What’s Another Year". It is not good enough.
The Government is increasing the minimum wage to €12.70 an hour from 1 January but the living wage is now calculated at €14.80 an hour. The living wage is calculated as the minimum amount required by a person with no dependants for a life of dignity in our society, but the Government has set the minimum wage at more than €2 an hour less than the living wage. That is not good enough either. It is a real let-down for the lowest paid workers in our society.
On mortgage interest relief, the banks are making record profits and it is estimated the banks and financial institutions could make profits this year of more than €5 billion. With a bit of vision and, more than that, a willingness to take on the profiteers, the Minister could have capped mortgage rates at 3% maximum and compelled the banks to cover the costs from their soaring profits. But no, instead, the Government introduces a piecemeal mortgage interest relief scheme that will benefit just 165,000 households, and even those households will only have a fraction of their increased costs covered. I predict that the minority who benefit will be dissatisfied with the maximum payment levels and that the big majority who get zero relief will damn the Government for leaving them out in the cold.
In terms of health services, on which I will make more points tomorrow, the Government has an industrial dispute on its hands and another one on the way. It has decided to freeze administrative posts in the health service instead of cutting back on hiring from agencies. Completely understandably, this has provoked administrative staff to take industrial action and the problems caused by that industrial action will be the responsibility of the Government, and the Government alone. Next Tuesday, indefinite strike action is due to start at 20 section 39 service providers. It is very noticeable the service users, who include some of the most vulnerable people in our society, almost to a man or woman support the workers and oppose the Government on this issue. The Government needs to pay decent wages and restore the pay link with the public sector for these workers. This budget fails to do that and the consequences of that failure will be seen by one and all next week.
On social welfare payments, a €12 increase on the pension is a 4.5% increase but inflation is well above that. It is officially at 6.3% but housing and utilities are at 16.5%. Over two budgets, from August 2021 to August 2023, inflation has been more than 15.5%, yet in that period, under this Government, the pension has gone up by just 9.4% and jobseeker’s and illness benefit by 11.53%. The Government is cutting welfare rates.
On the universal social charge, the Government is reducing the 4.5% rate to 4% next year. In other words, for every €9 the Government collects from workers at the current rate, it will next year collect €8, a small enough cut in a tax that is universally hated. The Minister, Deputy McGrath, is the first Fianna Fáil Minister for Finance to introduce a budget since 2010. When the late Minister, Brian Lenihan, introduced his budget that year, the population were given to understand that the USC was a temporary measure.
The current Taoiseach went on to promise in the general election in 2016 that if Fine Gael got into government, that the USC would be abolished in the last Dáil. It never was but it should be abolished now. It is an unjust tax from the austerity era and should be gone.
The Government might say that the State needs that money to run health and other social services. Fair enough, but it can be got from other sources. We need wealth taxes in this society. The number of people in this society whose net wealth is more than $50 million - I am unsure as to why it was calculated in dollars - rose from 655 to 1,435, more than double, between 2012 and 2021. The richest 5%, 93,000 households, a point made by Deputy Paul Murphy, between them have €388 billion and an average wealth of €4.2 million each. A mere 2% tax on that wealth, allowing €1 million for a principal private residence, the family home, could raise nearly €6 billion. If one was to introduce a 50% tax rate for those individuals earning between €100,000, and €150,000, a 55% tax rate for those with incomes between €150,000 and €200,000, a 60% tax rate for those between €200,000 and €275,000, and a 65% tax rate for those with an individual income of more than €275,000, a deeply progressive taxation, it would raise €3 billion.
With regard to corporate profits, these were €75 billion in 2012 and grew to €250 billion by 2021. It more than trebled in less than a decade and has risen again since then. As pointed out by Deputy Boyd Barrett, it is entirely possible when the new figures come in that despite a record corporate tax take, there would have been €300 billion in untaxed corporate profits in this State last year.
The problem which the Government has here is not just the vision thing. It is the fact that it will not take on the profiteers, or the capitalist market, or deal with the root of the problems because the Minister of State and the Government are tied to those vested interests by 1,000 strings.
I raised the idea of a State construction company. I would not just have that set up but I would nationalise at least the big five construction companies in this State, use their resources, and pool them together to tackle and solve the housing crisis, with a massive increase in social and affordable housing. The same approach needs to be taken to the commanding heights of the economy as a whole. We need a society which is run for the needs of the many, not for the profits of the few. We need a socialist government with socialist policies, a complete break with the market and a different way of organising the society. When we have that, then and only then can we have budgets which are organised for the millions in society, not for the millionaires. We need socialist policies and a socialist budget.
Budget 2024 had two big issues hanging over it. One was the corporation tax receipts and the second was fallout from the war in Ukraine and its impact on the cost of living.
I welcome the announcement by the Government of the establishment of the Future Ireland Fund to set aside the additional corporation tax receipts to meet our future needs. I am really concerned, however, that this fund will be invested in reducing costs in other countries rather than here in Ireland where it could be used to drive down the cost of electricity by investing in offshore renewable electricity. As the Minister of State may know the Joint Oireachtas Committee on Social Protection, Community and Rural Development and the Islands has been looking at the whole area of pensions over the past 18 months. One of the reports we produced was an auto-enrolment. We highlighted in that report that just one fifth of funds of Irish pension funds are being invested in domestic shares and bonds. Our fear is that this Future Ireland Fund will be used to drive economic development in other countries and not used to drive economic development here.
I believe that the offshore renewable electricity sector is a case in point. The Irish Wind Energy Association back in 2020 said that the development of just 3 GW of offshore wind energy off the west coast of Ireland, approximately 4% of the actual potential we have, would create 2,500 jobs during construction and a further 600 permanent jobs right along the west coast of Ireland contributing €1.7 billion per annum to the Irish economy.
We have 220 million acres of a maritime resource off our coast, with the ability to generate 70,000 MW of offshore renewable electricity. We should be using some of the Future Ireland Fund to implement an ambitious programme to clean up our electricity and energy supply by developing a long-term sustainable employment programme for people right along the western seaboard of this country and make Ireland the biggest global renewable energy exporter. Not only would it meet our own long-term needs but it would meet the long-term needs of France and Austria in terms of the amount of electricity we could produce. The net result of this would be to significantly reduce the cost of electricity to Irish families. We all know the impact of electricity costs on our economy at the moment in terms of food costs and the cost of living.
Earlier today the Minister for Finance told us that inflation from 2022 to 2024 is running at 16.15%. We also had an announcement today of a €12 increase in the basic social welfare rates. If we look at the incomes before the war in Ukraine and compare that to the incomes next year, even taking social welfare increases into account, pensioners will be €15 a week worse off, carers will be €12 a week worse off and disabled people will be €9.60 a week worse off. These are the people meeting higher than average energy, electricity and heating costs and these people are being driven further into poverty by inflation which is not being addressed by the increases in social welfare.
In the Minister's contribution in justifying the Future Ireland Fund, he made the point that age-related spending by the end of this decade will be €7 billion to €8 billion higher, which is because of our population ageing. One way to address this problem in the short term is to increase workforce participation rates. Employers want to see it, it is good for the economy, but it is also good for society. The 50% reduction over two years in childcare fees is a positive development but we must reward work and support those who are underemployed at present.
As the Minister of State will know, an issue which I have been consistently raising is the working family payment. The reality of the working family payment, when compared to inflation, is that the only families which will actually benefit are families with one child. They benefit in the budgets from 2022, 2023 and 2024 to the princely sum of 1.22%, which is about €5 as a result of this. If one takes families with more than one child, these are actually worse off, net, over these three budgets. I noted that the family of the Minister for Finance, Deputy McGrath, his wife Sarah and his seven children were here in the Chamber today and it was a great honour for them to be present here to see the Minister, Deputy McGrath, deliver his first budget.
If the Minister and his family were on the working family payment, they would have 8.4% less buying power as a result of those three budgets than they had before that because of the way inflation is eating into the cost of living at present. The difficulty is that this sends out a clear message for working families that it does not pay to go to work. That causes a fundamental problem in terms of our economy at the moment, where we are at maximum employment. There is an opportunity to untap and bring other people into the economy, making it much better in economic and financial terms for those families to be working. It also has long-term social implications by having those people in employment and we are putting barriers in their way to making this happen. I ask the Minister to look again at some of the provisions in this budget that are creating barriers to employment rather than encouraging people into the workforce.
Every person in the country is impacted in some way by the budget and each individual and sector has its own priorities and aspirations. Invariably, no budget will give everyone what they want and believe they should get There is no one-size-fits-all budget and today's is no exception. Given time, every Member of this House could dissect the budget as it relates to their own constituencies. There are common threads throughout budget 2024 that are of serious importance to people everywhere, including health, housing, education and training.
There is an urgent need to invest in existing community nursing units to make them compliant with HIQA requirements. Without this, in addition to the wider roll-out of minor injury units, we are not tackling health needs before they reach a more serious level. This in turn places additional pressure on our seriously and sometimes dangerously overburdened hospitals. This vicious circle just keeps on turning, leaving people languishing on hospital trolleys for what can only be described as an inhumane length of time, in some cases. This is the price that people are paying following the historic decision to close local accident and emergency units with the promise of centres of excellence in bigger regional hospitals. In my constituency, Limerick regional hospital was to take up the shortfall from Ennis and Nenagh hospitals, but this has not happened because we were too slow to invest in the regional hospital. We did not deliver in relation to the bed complement or the number of doctors, nurses, paramedics and ambulance personnel that were required. The ambulance service that serves Limerick regional hospital is underfunded and under-resourced.
Mental health services should be a priority, particularly for children and young people. The services currently available need to be rescrutinised and the voices of those involved in providing them must be heard.
Child and adolescent mental health services have been reported as being staffed at less than two thirds of national recommendations. How can this service, which provides a lifeline to young parents and their families, be expected to operate without proper staffing levels?
I welcome the provision of free schoolbooks at primary level and up to junior certificate level for students. If we can do this, why can we not provide access to counselling and psychotherapy services to all primary and secondary school students? The evidence is there for the need for this, but there has to be a will to implement it.
Every year we throw money at the health service. Leading up to this budget, we were told that the health overrun in the past year has been €1.1 billion. This money was intended to improve the services but invariably the services do not improve and, in many cases, they become worse. This is a major issue for our health service. In last year's budget, a record €225 million additional allocation to address waiting lists was made during the course of the year. What has been the impact of this additional spending? We hear very few positive reports in our constituency offices from that particular fund. Can the reasons for its apparent failure to make an impact be pinpointed? Waiting lists featured again in today's budget, with a promise to address them. How and where was last year's allocation spent and where is the evidence of results? Today we heard plans to increase health staff by over 22,000. With all due respect, this sounds a bit like the story of the loaves and the fishes. Across all grades, health staff are leaving Ireland every single day. Recruitment drives for staff are failing to deliver. How and where will this additional staff complement be found? Will we continue to import staff while our own trained people form queues at airports to leave the country? As public representatives, we need regular updates on where money allocated to health is being spent, how it is being spent and what is the outcome of such investment.
The Regional Group's pre-budget submission on farming and agriculture identified the need for an increase of €18 million in funding for the suckler cow carbon efficiency programme. This was to ensure that all qualifying applicants receive payments. We looked for an increase in the sheep welfare scheme and we also sought the introduction of an €8 payment per sheep to cover the cost of shearing. We also called for the exemption of functional farms and R2 zoned land from the residential zoned land tax and the renewal of the fodder support scheme for 2024.
As agriculture traditionally receives between 2% and 2.5%, an increase of 2.3% or €500 million in the current capital allocations was expected today. The €1.9 billion allocated today for the Department of Agriculture, Food and the Marine has many voids to fill. Our backbone industry is crying out for help. Without financial support, our farming sector faces a winter, spring and summer of discontent, from which many people will never recover. If the Government allows this to happen, it does so at its peril.
Housing remains a contentious issue throughout the country. A place to live is a basic human requisite. It is not a luxury to have a roof over your head; it is a necessity. Many worthy suggestions have been made to help to tackle our current housing crisis. The Croí Cónaithe scheme does not have its worth acknowledged enough. This is available within every county council. It aims to facilitate housing applicants who are willing to refurbish vacant properties. The scheme needs to be enhanced and there needs to be a greater awareness of it. Crucial to this would be the abolition of the capital gains tax liability that the owner of a derelict property is levied with when he or she hands it over to a child or grandchild who can avail of the scheme. This is a major deterrent to what could be an answer to many people having their own home.
I want to highlight a glaring omission in today's housing allocation. Why has the help for first-time buyers of second-hand homes been omitted? It should be possible for thousands of people to avail of this scheme. This needs to be closely examined as families across the country are depending on the scheme to get on the property ladder through the purchase of second-hand affordable housing.
Small businesses in many towns across the country continue to struggle. Last weekend alone, I heard of six long-established businesses in north Tipperary that had closed their shutters for the last time. These included a jeweller's, cafés, a beauty salon and a boutique. Government initiatives have pushed cost and overhead burdens on businesses. The increase in the minimum wage, new sick pay rules, automatic pension enrolment and paternity leave create additional costs for small businesses.
Budget 2024 brings another very positive set of announcements but seriously that is all they are - positive announcements. Nobody listening to the Minister today would think that we are in the worst housing crisis in living memory. We had backbenchers applauding one another when they do not even understand the problem. The Government is clapping itself on the back when people are facing into a winter of discontent under very harsh cost-of-living circumstances. It is congratulating itself on building 30,000 homes a year. Why did we need to put in place a Housing Commission to tell us that we had a deficit for the last ten years of 250,000 houses and that we should be building somewhere between 45,000 and 65,000 homes per year, not the 30,000 that we are trying to achieve and will probably miss anyway?
There is no Ardnacrusha-style idea from anybody in this Government. It is telling us that it will fund 1,000 additional gardaí and 2,000 additional staff to enhance the capacity across acute and social care services. We need more nurses and more teachers. We need more of everything, but the real issue is that there is nowhere for them to live. Irrespective of whether we bring them in or whether we try and get them from Wexford to Dublin to teach classes up here, there is nowhere for them to live. The same announcement was made about An Garda Síochána last year. It is now October. The 1,000 additional gardaí that were funded turned out to be 633. That number will probably not cover retirees, those out on sick leave suspension or those who are leaving in their droves. The real issue is where they would live if we had them. The world knows Ireland has nowhere for people to live even if they come here to work and fill any of those jobs.
The Government claims that people on middle incomes will be better off by €1,500. Let us do the figures on that and see if it stacks up. I will break it down in order that people can better understand how the Government thinks they will be better off and whether it really pays to work. Someone working can only avail of the €1,500 until tomorrow, when the carbon tax increase comes into play. The latter is 2 cent when we take into account the tax on the tax, which is what Government does. The budget booklet figure of 1.28 cent per litre is actually the amount without the tax on the tax, which will be done later. For a middle-income family in a rural area who run two cars and pay the tax for all the others who are receiving social protection, the 2 cent carbon tax increase will drive their fuel bill for the year up by €250 per year. To that can be added the cost of their home heating and every other item that comes into their household.
The Minister of State of all people knows that the Government has driven up the cost of filling every truck, van and delivery vehicle in this country by at least €40 per unit. One haulage company in my constituency will face an increase in its diesel bill of €21,000. It does not go into fresh air; it gets passed on to the consumer to whom the Government gave the €1,500 tax break. Each time I mention something, it erodes that €1,500 down to virtually nothing. As it stands, just those items means the €1,500 turns into €21 a week for working family.
I will now outline the impact the social protection measures in the budget will have for somebody who is on jobseeker's payment. I have broken it down so that people can easily understand it. I am under no illusion that these people also need it. As previous speakers said, everything the Government does has driven the cost of living upwards. Inflation is continuing to climb. It is €12 a week by 52 weeks, which is €624 a year of an increase to the jobseeker. Two double payments amount to €440. A once off fuel top-up payment of €300, a once-off living-alone allowance of €200 and the fuel allowance is €924 for 28 weeks of the year. The total for the jobseeker per annum is €2,488, which works out at €48 per week for a jobseeker, when the actual middle-income earner is in receipt of €21. The latter will be eroded through anything that the minimum wage might drive up and anything that fuel carbon tax increase will drive up.
The question is: does it pay to work? It was mooted that USC is being reduced by 4%. In 2016, the current Taoiseach told people that if he was back in power, he would get rid of the USC. What we get today from a Government led by the Taoiseach is a reduction of 0.5%. Did he forget what he said? Those in government make pronouncements to the effect that they will make sure it pays to work. I am not so sure that is to be seen from the announcements made earlier.
I move on to home care supports. I am just trying to point out that, unfortunately, the Government's announcements are just that. Last year, when it announced millions of euro of an increase in home care support hours, 515 people were waiting on home care support delivery in County Wexford. This year, we have 510 individuals waiting. This represents a reduction of five in the number waiting. However, we are not at the end of the year yet and I expect it to increase over the winter months.
We have 883 children on a dental treatment scheme waiting list in Wexford. Some of them have been on that orthodontic list for over 60 months. A total of 164 special needs children have been waiting on dental care for more than 24 months. I could go on. I very much hope the 25% reduction in childcare costs does not result in a 25% reduction in childcare providers when the Government is sailing off into the wind.
I am very glad that the Minister of State, Deputy Chambers, is here this afternoon because I know he is genuinely interested defence affairs. He was the Opposition spokesperson for defence and was also Minister of State at the Department of Defence for the first two and a half years of the Government's term. I presume he has looked through the defence portfolio relating to the budget. It is very good to have him in the Chamber.
The recurring theme of my contribution will be one of hope. Unfortunately, however, it is the wrong kind of hope. There is this wonderful phrase which says, "It's the hope that sometimes kills you." That is an entirely accurate statement. Most members of the defence community, including me, woke up this morning and said this was going to be a good day for the Defence Forces and that, finally, we would be adequately resourced. There was good reason to expect the Defence Forces to be adequately resourced. There is a war in Ukraine, and we do not know what trajectory that might take. We have had Russian ships in our coastal waters only last year. A war just started in the Middle East 96 hours ago, and we have 500 troops out there. We have no means to get to them or to get there. We have no idea what trajectory that conflict is on.
We have a war on drugs. We have no means of monitoring our airspace - no primary radar. People can fly anything they want into our airspace with the transponder off and we cannot even detect it. During the assault on the MV Matthewoff the Cork coast a couple weeks ago, the Defence Forces had one helicopter available and only one ship. Unfortunately, unless drastic action is taken, I suspect we will not be able to conduct a similar operation even of that meagre resourcing standard in 12 months' time if the problem with retention of staff continues. There was good reason to be hopeful, but what we were hoping for has not come to pass in any shape or form.
At a press conference in Finland this afternoon it was announced that someone has deliberately damaged the Baltic connector, the gas pipeline connecting Finland to Estonia, and it is suspected that it was the Russians. We know this country is no gas storage facility whatsoever. We are the only EU country with no gas-storage facility. We've about 48 hours supply of gas in our pipes and we only have three pipelines bringing gas into this country, two from Scotland and one from the Corrib. We are very vulnerable. We need assets and a maritime presence to protect them, but there seems to be no action whatsoever in this budget.
The only standout measure for me in the budget is the increase of €15 million for defence pensions. I can say for sure that this will be nowhere near enough. This budget has landed very poorly. It has gone down like a lead balloon. If it had landed well, I would have said so. I was hoping it was going to be good, as most people were, but it certainly is not. These views are sincerely held. There is absolutely no retention measure in the budget. Even the sea-going naval personnel tax credit that the Minister for Finance announced is exactly €1,500. That is the same amount as last year. There is not even a remote attempt to try to get some of our ships back to sea even though three quarters of the vessels in our fleet are tied up.
There is supposed to be €1.5 billion in defence funding up to 2028.
In defence of the Minister, Deputy Coveney, he actually mentioned a €2 billion figure which, factoring in inflation, the figure for the defence budget should be €2 billion by 2028 but we are currently at only €1.23 billion. All we are asking the Government to do is to implement its own report, just as Deputy Verona Murphy was saying. This is not a new idea. It has been already agreed, approved and published.
The Defence community learned two lessons today. There is no point in engaging with processes such as commissions of the Defence Forces, strategic documentation or focus groups. They are a waste of time. All they delivered was heartache and false hope. Even as a member of the Committee on Foreign Affairs and Defence, I find it hard to invite RACO or PDFORRA before the committee. They question whether it will be of any use, whether there will be any output or any product at the end. I even wonder about my own position on the Committee on Foreign Affairs and Defence. Does it have any affect whatsoever? We are airing all these views which are not then appropriately dealt with. The second lesson is that the gardaí did very well today and fair play to them. They deserve it. However, the reason they did well is they had a vote of no confidence in their Commissioner, they did not show up for voluntary overtime, they have access to the Workplace Relations Commission and they threatened strike action. They did well. However, the Defence Forces can do none of those things. They are highly loyal, obedient and professional and they get very little as a result. That is the big takeaway I have.
In summary, I sometimes feel like David McWilliams. Throughout the Celtic tiger years he consistently pointed out the risk that was accumulating from a financial point of view, but nobody listened to him. He told us there would be a crash, a day of reckoning, and there was. For the past four years here I have been saying that we are accumulating a massive amount of risk with no mitigating factors against it. Risk management is a basic function of any entity or organisation, any factory, business or company, and it is certainly a major factor for a country also, or at least it should be.
I started on a theme of hope and I will finish on a theme of hope. My sincerely held view is that the only hope for the Defence community now is the hope of a new Government at the back end of next year, properly constructed with a proper programme for Government that can adequately resource the Defence Forces and take on the longstanding structural and human difficulties that have been there for decades.
This is a cynical budget. It is a short-term budget that seeks to rebuild the fortunes of Fianna Fáil, Fine Gael and the Green party, rather than rebuilding the State and its public services. It is a south Dublin budget that hurts many people living in regional and rural Ireland. I will address that last issue first. This Government speaks with measured tones, with deep sympathy, when it talks about people who are suffering from poverty and from the cost-of-living crisis, but at the same time it actually takes more in terms of taxes, excise and carbon taxes on fuel than ever before in the history of the State. We have a situation where the Government is actually taking with one hand in terms of high taxes on fuel and giving it back in so-called electricity credits. The Government is playing a three-card trick on people in terms of these costs. Excise on petrol and diesel increased in June, tolls increased in July, excise again increased in September and today carbon taxes increased. That is four price hikes for commuting families in four months, in the jaws of a cost-of-living crisis. That is not tea and sympathy, that is highway robbery for people commuting. I understand these taxes are in place to change people’s behaviours and to push people onto public transport. For much of this country commuters do not have a choice of public transport. Take my own county, County Meath, for example, which is the largest commuting county in the country. Most commuters do not have the option of taking a train. The bus service is a disaster. Services are dropped on a daily basis leaving people at the bus stops late for work. They have no alternative. Increasing the carbon tax today is not a behaviour-changing tax but a punitive tax and it is impoverishing families. Incredibly, this is an expansionary budget but it will actually reduce by 2% the funding going to the public services in real terms by 2026. This budget will do nothing about getting more gardai, doctors, nurses, teachers and social workers into the system. This is incredible because for the majority of the year this Dáil is consumed with the disaster happening in the public services. We talk about CAMHS, Tusla, and the health service where about a million people are waiting on the lists. Yet, on budget day we seem to forget all of these issues. There is little in this budget about workplace planning. We hear from Irish Fiscal Advisory Council, IFAC, and others that constraints within the economy are seriously damaging supply of products and causing inflation. However, the way to mitigate against constraints is to make sure we have the proper staff in place to deal with it. This budget should have included a serious plan to bring home Irish construction workers who emigrated in the past 15 years. There should have been a real plan in terms of educating more people for construction work, gardaí, doctors, nurses, teachers, psychiatrists and social workers and to keep them in the country.
This budget is also peppered with once-off lump sums which do very little to address the underlying causes of poverty in this country and by God there is poverty in Ireland at the moment. There are 650,000 people currently living in poverty, 280,000 people currently in arrears with electricity bills and 165,000 people currently in arrears with gas bills. Yet, all they are offered is a once-off payment which will make no systemic change to their incomes in the long run. Interestingly, this once-off policy platform is now shared with Sinn Féin. It seems as though they are continuing to flirt with Fianna Fáil, their coalition partner in waiting after the next election. Many of these tax reductions by the Government will do little to help low and middle income families. It seems Fine Gael won the debate on the USC so instead of reducing the lower rate of USC, the upper rate was reduced. What this means is that people on €70,000 a year will get a reduction of €235 in their tax bill but a person on €20,000 a year will get a reduction of €10 on a tax bill for the whole year.
The increase in the pension is lower than the rate of inflation so in real terms that is a net reduction in the income of pensioners. In a clear sign of the Government's priorities, nurses working overtime will pay more tax on their income than a landlord who earns the same amount of money from passive income on a house. It is an incredible situation for a country that is hammered for the lack of nurses. We also have a situation where banks are earning nearly €5 billion in profits but the Government decides to increase the banking levy by only just over €100 million.
Another theme in this budget is that the Government is promising funding for sectors that lack the staff to fulfil those promises. It is as though the Government is delivering a virtual reality budget for many people. The funding exists on paper but it does not exist in reality because it never gets delivered. The Government is looking to decrease the cost of childcare but at the same time actually decreases the number of childcare facilities in the country. The Government is talking about extending free school bus services but we are all dealing with kids who still cannot get a bus service and it is well over a month and a half since they went back to school. The Government is talking about increasing the number of children covered by the GP card but is almost impossible to get onto a GP list at the moment. The Government promises more teachers and gardaí but in actual fact teachers and gardaí cannot live in many parts of the greater Dublin area. Young people are shunning Templemore at the moment because Garda welfare and morale is on the floor. In a similar way, there is talk about more funding for businesses. Much was made of the temporary business energy support scheme, TBESS, when that was launched but, of the €650 million promised, only €180 million was drawn down. That is because when the Government provides funds for businesses it is made so damn awkward to draw down that very little of the money actually gets drawn down. In his speech, the Minister, Deputy Donohoe, repeated, reused and recycled previous announcements. He announced measures that are already in place such as the hospital beds the Department had to delete from its X, formerly Twitter, account. The long-awaited announcement of a graduated social welfare plan for people who have been made redundant did not materialise in this budget.
It is to happen sometime in the future. That is of no benefit to workers in Tara Mines who lost their jobs months ago and who still have nothing to show for it.
Another announcement that was made today is for something that will actually come after the next budget. The statutory foster care rate increase will not happen until the end of 2024. Incredibly, the childcare cost reduction will not be happening until the end of 2024 as well. Can the Minister of State tell me if that says more about the timing of the general election or about the needs of the people the Government pretends to want to help? I agree 100% with Deputy Berry’s statement as well. This Government is in dereliction of its duty to defend and protect this country against the large amount of drugs that are coming in.
This Government does very little in the way of tackling waste, bureaucracy and red tape. Billions of euro in the budget every year are lost to those issues. The national children’s hospital is an example. The 3,500 empty local authority homes are an example. Waste causes inflation, it hurts citizens and it needs to stop.
Before I start, I mark the passing of Ollie Cleary, a past mayor of Waterford and somebody who campaigned tirelessly for 20 years for the South East Technological University, SETU.
It is show time all over again. I feel as though somebody should stand up and question the wisdom of breaking the fiscal rules in developing this budget, particularly given how without the windfall corporation taxes, we are actually operating a deficit in real terms. These are fiscal rules that have been developed by the Government to try to avoid the mistakes of the past and to avoid the pain and trauma of boom and bust.
I somewhat remember the mistakes of the late 1970s. I certainly remember the pain of the 1980s, only to see the mistakes of the noughties - if ever there was an aptly named decade - and to see the horror of the global financial crisis subsequently cutting our country to ribbons. When will we learn that economic indiscipline in the good times causes deep social and cultural carnage when times go bad? In my opinion, on the night before a budget, every Minister for Finance should read Jean-Claude Trichet’s letters to Brian Lenihan. Of course, we need to address the pressures to deliver on health, housing and infrastructure and to meet climate obligations, but every Department and part of the Government is getting a bump, like they always do. We are giving out participation awards without any connection to performance or delivery or even looking at deploying areas of the Government that no longer make sense in the contexts of full employment and the other pressing needs of our citizens.
The Irish Government Economic and Evaluation Service does some nice work, but without political cover, as does the Irish Fiscal Advisory Council, IFAC, but they are being increasingly ignored. Without a serious political effort at a root-and-branch level for spending reviews, we will never clean out the stable and will never make serious reforms. We will continue to fail to meet the public’s demand for better services.
Just look at the slow strangulation of Sláintecare, forgetting that the Irish people were promised universal healthcare in 2011. In 2017, Sláintecare was presented as a genuine, all-party attempt to renew and reform healthcare in Ireland. Yet, even before the pandemic, it looked as though it had been dumped in favour of projects: trophy projects, grandiose projects and the most delusional blue sky projects. We pleased the Dublin and Cork health industries by allowing them to press ahead while other regions were left to starve. Six years later, the only answer to our woeful health system is to throw more money at it. Indeed, budget 2024 throws more money at it than we have spent a decade throwing money at it, but without much progress. If we cannot do a sustainable budget when we have surpluses and full employment, when can we do it? The time to fix our roof is when the sun is shining. Despite all the headwinds and the mixed signals, the Government’s coffers are full, and that means the sun is shining now.
Of course, I can say this. I can emphasise the importance of keeping the Government’s spending under control because I am from Waterford. The south east, like the midlands and the Border region, is not fully at this national spendathon. Regional GDP continues to fall behind in these regions. There is a massive deficit in high-quality, new knowledge economy jobs, which are usually IDA-supported jobs. The kicker is that the Government refuses to undertake transformative capital projects in these regions. Worse, it even refuses to allow transformative projects to be developed, frustrating every step of the tortuous procurement process, meanwhile dancing their own favoured projects through the Government-supported gatekeepers.
Like the Celtic tiger before in which half the country did not fully participate, we will get the hangover, but we will not be at the party. I agree that many of the cost-of-living measures are needed, so I can vote for them. I will likely struggle to support the capital spending plans if they follow the previous and current directions of travel. I have raised these issues privately and publicly on the floor of this House with the Minister and Ministers of State at the Department of Finance, and with senior members of the Government.
Projects are concentrated in Dublin and Cork while the rest of the country starves. The data that are presented on the spending plans are an insult to our democracy and to the credibility of this House. In 2016, we were pinged by the Organisation for Economic Co-operation and Development, OECD, for our lack of parliamentary oversight of spending. Despite the innovation of the Committee on Budgetary Oversight and the Parliamentary Budget Office, PBO, basic data on capital spending is not reported to this House. In fact, you often get more information from tweets by Ministers than from their statements before this House. Billions of euro are dropped into Departments and onwards, and on to a bunch of quangos like the HSE and Higher Education Authority, HEA, which all operate with black holes. The money is never seen or heard from again.
I will have to wait to see if there is any improvement, any fairness or any transparency in capital spending before I vote for these measures on a vote-by-vote basis. Overall, I cannot agree that this is the budget this country needs. I believe it breaks the fiscal rules and it certainly breaks, in my opinion, the spirit of fiduciary responsibility. It harms our credibility as a country, and it will likely feed inflation. Who knows what is around the corner for our small, open economy? What levers will be left to pull? Where will these levers be located? Based on the Government’s record of strategic infrastructure development to date, contemporary history tells me they will not be available in the Border, the midlands or the south east. That is more than a great shame.
Ar an gcéad dul síos, I congratulate the Minister for Finance, Deputy McGrath, on his first budget. I am delighted that his wife and seven children were here to listen. However, it is a failed opportunity. It is a typical accountant’s budget that just moves the figures around and manages them.
The Minister, Deputy Donohoe, said it was a great country in which to be a child. Goodness gracious, what is he thinking about? How could he say this? It could not be further from the truth. It is certainly not the reality for our children with additional needs. Our disability services are failing in every aspect. Our children cannot get essential therapies, such as speech and language and occupational therapy. They wait years for an assessment with little or no hope available.
Regarding children and mental health, there are no child and adolescent mental health services, CAMHS, teams. We know what happened with the Kerry CAMHS. There is the whole situation regarding disabilities. Young children and everybody with disabilities are suffering. The Minister of State, Deputy Rabbitte, promised in May that if people did not get assessments by 1 August, because they said they were not operational, she would pay for them herself. There is no sign of that in this budget today. These are again empty promises from this Minister of State. It is shocking.
The measures introduced today do not come close to meeting the needs of people with disabilities and there has been no mention of pay parity and preventing the impending strike of section 39 workers. That is a huge issue. Is the Government in a cul-de-sac here or do its members have bags over their heads, because they do not know what is going on? Have they all gone into the new kitchen to test out the cuisine? Somebody said there was going to be Christmas dinner in there tomorrow. The Government members are like turkeys voting for Christmas if they think this is going to save them, but it is not.
Today marks world mental health day. The Minister did not acknowledge where the funding of €115 million is in his budget. It has gone into the big, cannibalised HSE funding and we cannot get any services for mental health out of that because it is a failed entity in its entirety, and it is carrying on.
In our pre-budget submission, we wanted for USC to be abolished. Why? It was introduced back in 2010 as a temporary measure. I remember the man whose portrait is up on the wall today said at one time that it was a temporary little arrangement. I am referring to Brian Cowen. USC should have been abolished. The current Taoiseach promised in 2016 that if he were to be re-elected he would abolish USC.
What kind of hollow promise was that? USC is a savage tax that was introduced as a temporary measure during the financial crisis, yet here we are many years later and we are reducing it by a miserly 0.5%. USC costs an average working couple almost €50 per week. That is €2,600 annually. Our ordinary working families are being fleeced. The USC needed to be halved at least. On top of the minimal 0.5% reduction in USC, workers will have to pay 0.1% extra in PRSI. It is a trick of the loop anywhere you go. The Government puts a dolly mix into a cement mixer and only churns out the nice bits.
Regarding carbon taxes, the price of diesel now stands at €1.90 per litre. While the Government has delayed the hike in excise duty, it will press ahead with the carbon tax and add a further 2.5 cent per litre to diesel and 2.1 cent per litre to petrol tonight. We will table an amendment, as will Sinn Féin, to stop this from happening. The carbon tax regime is regressive, especially for rural citizens, who have no option but to drive their cars to commute to work or college, to attend appointments or just to live, yet we continue to penalise them as though they have a choice. They have no choice. Fianna Fáil and Fine Gael are doing this at the behest of the Green Party. It is an awful attack on rural citizens.
Regarding energy, this budget needed to reduce the cost of living. While the energy credits are welcome, we are not tackling the spiralling costs of living. One-off payments are okay, but they will not cut it. The Government will not tackle the energy companies. Our electricity and gas prices are the highest in Europe. They are nearly double those of some European countries. Why will the Government not tackle the conglomerates and big businesses?
Older persons will receive an increase of €12. For goodness sake, it is the same miserable increase as last year. We sought €30 and thought we would at least get €20. Does the Minister of State know what €12 extra will do for pensioners and people with disabilities? Quite literally, it will do nothing.
We welcome the increase in the income disregard for the carer's allowance, but it does not go far enough. Why are we still going to means test all these carers? They do valuable work in keeping loved ones and sick people out of hospital. There are many children providing care to their parents and other loved ones. That is a shocking situation that borders on exploitation. It is disgraceful.
The reduction in childcare fees is certainly welcome, but it will be of little use if the Government does not address core funding. Small crèches in rural towns have been giving good employment and top-class childcare, yet they are not being listened to. They have a major problem with the one-size-fits-all core funding model.
What can I say about our health services? The definition of insanity is to keep doing the same thing and expecting a different result. We cannot identify how much of the €22.5 billion will be for mental health services. We are going to hire more nurses and get hundreds of more beds. From where will we get the nurses? The nurses we have are leaving and going to far off shores. There will be free GP care for many age groups, but we do not have enough GPs. We cannot get them and the Government will not provide anything to support or retain them.
The increase of €20 million in Garda operational funding is welcome. The Garda needs to be supported. There are a lot of them about today. Garda Commissioner Harris was in or around Leinster House today. He should come in more often and listen to Government and Opposition backbenchers, who support the Garda and want it to be respected. What will the overtime bill do? It will bring people from County Tipperary - I meet them - to Dublin to get overtime while living in dirt and increase the opportunity for lawlessness in our area. It is another con job.
The Government nearly forgot about agriculture. Thanks to the Green Party, the Government's main aim in agriculture is to demonise and attack farmers day in, day out. It will not look at the pollution caused by public authorities and industry, but it will get the Environmental Protection Agency, EPA, to do a report that is not honest, straightforward or fair. The EPA will not look at its own issue at all. The agriculture sector had been expecting some meaningful support today for the cattle and sheep industries, but we did not get it. Our primary industry is being reduced when it should be at the top of the agenda so that we can keep food on tables and keep families working and on the land. Budget 2024 has failed to recognise farming as the vital industry it is.
The €90 million for retrofitting social housing is welcome, but there are 24-month delays and only 190 of the approximately 15,000 applicants awaiting retrofits in Tipperary have been done. The Government has known for a long time that the scheme is not working, so why is it not changing the scheme or putting more funding into it? It claims that the money from the carbon tax goes into retrofits, but it does not. That is untrue.
Regarding education, there are some welcome measures in respect of college fees and supports for families. Regarding the announcement of more than 1,200 new SNA posts, though, I suspect we will continue not to have SNAs without there being improvements in pay and conditions. They will vote with their feet and not be available. I welcome the IT grant for schools to buy new equipment, which was expected last year. There will also be a welcome increase of €60 million in the capitation grant for schools.
The Government spoke about how some aspects of this budget would not be implemented until 2025. Why does the Government have to play with the figures and play mind games with people and tell them they will have money in 2025?
I wish to put some figures on the record. Do not get me wrong, as I have nothing against Ukraine, but the expenditure report lists the 2024 expenditure ceiling as €96.6 billion. In 2024, the Government will gift €6 billion of taxpayers' money to NGOs so that activists can use it to ask the Government to implement the legislation they want. The figure increases annually without them even having to look for it. Earlier this year, €5.5 billion was set aside for spending on the Ukrainian situation. The budget signs away €225 million per year of taxpayers' money to be sent overseas to help Third World countries fight climate change on foot of a promise made to Europe to do so for four years at a minimum. That is another €1 billion. By my count, 11% of the whole pot of money today is being put beyond the reach of ordinary families, sick children, pensioners and carers so that it can be spent on fantasy projects, the mushrooming NGO industry and funding for the war in Ukraine. We have to have checks and balances. I always say that we must have a cap on the number of refugees. We cannot just continue heading down a cul-de-sac. None of our people from the cradle to the grave will see even a cent of 11% of today's funding. That money is being put away just to be the good boys in Europe and to support our international friends at the behest of the International Monetary Fund, IMF, and others. I do not know at whose behest it is happening, but our primary duty is to look after our people from the cradle to the grave. The Government has failed miserably and has not respected people or told them how it would respect them in the future. It is like a shower of snow falling in the leafy constituency of the Minister, Deputy Michael McGrath, in Cork beside the sea. It will be gone off with the first ray of sunshine. It is the same with this.
Like many recent budgets, this budget became the most leaked budget in the history of the State. It reminds me of the old bucket you would have long ago for milking cows. It would be leaking at the bottom, so all the milk would be gone out of it, but the Government is only leaking the good news. It leaked all of that over the past few months, and particularly the last few weeks, to give itself a little pat on the back. To be honest, there was no need in having today’s showpiece. Most people knew all the positives that would be announced anyway.
However, no one spoke about the mini-budget last month when the VAT rate on hospitality increased from 9% to 13.5% or about the mini-budget when the price increase at the petrol pump meant every man and woman driving a vehicle – there are 2.2 million vehicles in this country – started paying through the nose for fuel. There were no press releases – leaks, actually, as we will not call them press releases at all – about any of that. At one time, Ministers would be fired for leaks, but now they get a pat on the back as long as the right news is put out there.
Many sectors are asking questions today. Maybe the Minister of State, Deputy O’Donovan, or someone else can answer them as the hours go by. What about section 39 workers? I attended a meeting with the Irish Wheelchair Association and users of section 39 organisation services last Friday evening. Those organisations are in a serious pay parity crisis. They cannot get staff because their competitors in the health service are paying people more. The Irish Wheelchair Association in west Cork is providing a magical service for many people with severe difficulties in wheelchairs. It provides transport and care services and cannot meet the current level of demand because of section 39 funding. A strike is imminent. The same situation obtains at CoAction. The Government seems to be lying idly by. I cannot see where in the budget this issue is addressed.
Early childcare providers have protested outside Leinster House in recent weeks. Many of them are going out of existence. I presume providers in the Minister of State's constituency in Limerick are experiencing the same difficulties as those in Cork South-West.
The issue here is that the Minister for Children, Equality, Disability, Integration and Youth keeps standing up in the Chamber saying there is plenty of money, but he has never broken down the figures. He is hiding behind something somewhere and he has to be straight with the early childcare providers. Is there enough in this budget to ensure they all get something to survive? If there is plenty of money out there, which there is according to the Minister, is there money in the budget for the early childcare providers and their premises, which are closing at the present time?
The same question applies to the nursing homes. The Government is saying the country is awash with money, but is it going to go towards the nursing homes? I have a situation down in Belgooly in Cork South-West where a nursing home is closing and up to 20 patients are still looking for a home. This has been fast-tracked. Jesus, they are trying to throw them out the door as fast as they can, whatever the reasoning is behind it. On top of that, there are 51 workers, quite a lot of whom have been in contact with me today. Those 51 workers have had their rights violated. They do not know where they stand. Nobody has knocked at the door and told them whether they are entitled to redundancy and what they are and are not entitled to. They are begging for information. If any of us were losing our job in two weeks' time, we would like to know where we stood. Surely, with nursing homes closing all over the country, a budget has been put aside to ensure nursing homes end up being viable.
There are so many issues that I could spend two or three hours talking. There was very little today about farmers. We in the Rural Independent Group put in a very good budget submission. It was put together by Brian Ó Domhnaill and Triona in our office and was very strong on the supports farmers need at present because, like Deputy Mattie McGrath said, of the way the Government is treating them. The best way to describe it came from a meeting held by the IFA I attended recently where farmers said they were being treated like they were environmental terrorists. That is what Fianna Fáil and Fine Gael have reduced farmers to under this new green agenda. There should have been a retirement scheme, but I do not see one, and a proper suckler scheme and a ewe rebate for farmers.
There was some mention of farmers, but there was no mention of fisheries by either Minister in their two 45-minute speeches. They have forgotten about the thousands of Irish fishermen who live in this country. Neither the inshore fishermen nor the guys who go out on the trawlers were mentioned. The Ministers have completely forgotten about them. They never mentioned them. I could not believe it. The two speeches never mentioned fisheries. I looked deeper and it appears there is a major budget cut with fisheries, so now we have the reason it was not mentioned. Fisheries is completely off the agenda. I do not think anybody else mentioned fisheries today. Why is that? Why does the Government attack the fishermen? There are thousands of them there. What is wrong with the Government? Can it not understand they are having serious difficulties with survival? There is a fuel rebate in Europe they can pick up, but the Minister, Deputy McConalogue, refuses to apply for it. They are astonished. Every other European country is applying for the fisheries fuel rebate that is available from the EU - it does not even have to come from the Government - but what happens? Ireland says "No", because our blinded Government has a vision we do not need fuel. However, unfortunately, the boats need fuel and the tractors need fuel.
That leads me on to the carbon tax and the hit on fuel. It will be €19 of an increase on a 900 l fill of a tank of oil for the ordinary householder. I think it will be €1 on the bag of coal and 20 cent on peat briquettes. How much will the increase be at the petrol pump? The Government is very nice and has put it off until April. We will have another mini-budget next April and punish the ordinary man and woman again. The few quid the Government gave them it will be sure to steal back out of their pockets again by April. The Government has done it again, as it did it a month ago when it increased the cost of fuel. People cannot afford it. They are telling us they cannot understand why they have such an uncaring Government that does not understand people are suffering. It is usually the working man and woman who are punished to death by this Government. They are squeezed out of their very existence.
I would like to see the roads budget broken down, because we have a scandalous roads budget in west Cork as well as delivery by the previous Minister. That is proved by Transport Infrastructure Ireland, TII, which advised him there would be several deaths on roads. It is proven. The roads are in appalling condition down in west Cork. It is astonishing there is nobody doing anything about it other than Government Deputies giving out. That is a crazy situation to be left with, where the Government's Deputies and Senators are giving out about the Government. There is so much in this budget I could discuss, but it would need far more time than I have.
I declare that I have an interest in some of the issues I want to raise.
I will begin with tax measures. The one thing this Government is not doing is rewarding people who want to work. There will be people who work very hard and do their best to make a living who will be scratching their heads tonight. They are looking for nothing from this Government, only to work and get on with their lives and they are not being treated well by the Government. The disability sector and section 39 workers have been shouting very loudly and very hard for a long time. They certainly cannot take comfort from this budget either.
The Minister, Deputy McGrath, stated "I am conscious that the price of petrol and diesel for motorists have increased in recent weeks" and went on to say he would defer the final increase in excise duties. He failed to mention that tonight, because of carbon taxes, diesel will rise by 2.5 cent and petrol by 2.1 cent. The Minister also failed to mention the rise in our fuel prices is because he pressed ahead with the two rises in excise duty and the Government continues to take upwards of 56% of the price of a litre of fuel. That is being backed here by every backbencher who is supporting this Government.
On social welfare supports, I and my colleagues in the Rural Independent Group asked that a grant of €1,000 be brought back to help people through a bereavement. This was taken away by Fine Gael and the Labour Party in their heyday. The Government failed to take this on board at a time when there was the ability to pay it to people. It refused. Carers save this State thousands and thousands of euro every week, so why will this Government not give them a fair payment? People caring for their loved ones at home do so much work in the home and in keeping their loved ones at home. Our group proposed they receive €350 per week. This would be money well spent by the Government, but unfortunately it is failing again to recognise the good work they are doing.
While the renters' tax credit being increased by €250 to €750 per year is welcome, it would not even cover one month or even half a month's rent in many cases. Some 86% of people who rent houses own one or two properties. Forget for a moment about those who own multiple properties and have them rented out. The 86% provide a much-needed resource in our housing market and people who offer a home to Ukrainians, for example, can get a tax-free payment of €800 per month or €9,600 per year completely tax free. The rent-a-room scheme has been extended to people who live in a local authority house and they can earn €14,000 per year tax free. However, if a person owns one or two properties he or she will get €600 relief in the first year, €800 relief in the second year and €1,000 for the final two years. That is it. Rent, therefore, to people from outside this country and you will get nearly €10,000 tax free but rent to a young Irish couple and you will get €1,000 tax-free. How does that make sense? That certainly was not thought through.
The Labour Party is saying this is a property owners' budget. It is the party that stated it will build 1 million homes. Very mysteriously, it still has not explained how it will manage that. At the same time, its members are continually objecting to houses in their own constituencies. They are serial objectors. Many of the people making speeches here this evening - the Minister of State, Deputy O'Donovan, will be interested in this - and jumping up and down about housing tonight are objecting to thousands and thousands of homes being built in their constituencies. It is one of those things I will never be able to understand. I will never be able to get my head around it. I could name them and point at the seats they sit in. They have objected to 2,800 homes, 3,000 homes and there is one person, a fairly new Deputy, who objected to 5,000 homes being built in a constituency. We would really want all night to figure that one out.
On business, while the increase in the minimum wage is of course great for the person receiving it, the small business that will have to pay it is certainly suffering. The Government has said it will put in place measures to help those businesses, but last night, from Beaufort to Fossa to Milltown to Killorglin, up into Glencar, back to Glenbeigh and down into Cromane, doing my tour of clinics last night, the thing small businesses were telling me was they were going to find it extremely difficult to keep their doors open. This Government is letting businesses down.
I want to quote Dan Horan again. I quoted him on the plinth of the Dáil last week. He is a shop owner in County Kerry. He has a number of small shops throughout Kerry and up into Limerick. He went on Radio Kerry recently and gave a great account of himself. He said if the Government keeps going, small businesses are going to close.
Our group has met with the umbrella group for nursing homes. Nursing homes are closing and it is wrong. There is nothing being done for the small nursing homes. Again, those people are providing a much-needed service in our communities.
I want to speak about farming and fishing. One of our Ministers went seven minutes over time when making his Budget Statement today, despite the good control of our Ceann Comhairle, who always does great work. He let him run on today but no matter how long the Ceann Comhairle let him run on, the one thing he was not going to mention was fishermen or farmers. Quite simply, he does not seem to appreciate, understand or realise that we have strong farming and fishing communities that we are trying to keep going. If they keep going, it will be in spite of this Government and not with its help. The simple fact is that the people on that side of the House really do not care about business people, particularly small business people. They really do not care about farmers and they definitely do not care about fishermen. Until a while ago, when Deputy Michael Collins mentioned fishermen, I had not heard the word in here all day. Whether the Ceann Comhairle had let them go seven minutes or seven hours over time, no one from Government was going to mention fishermen.
I am glad to get the opportunity to talk about the budget. Of course, I welcome the increases in social welfare but I wonder how far they will go or how much they will alleviate the situation for people who are having problems and who can barely exist and keep going.
Health is so important and is the first thing I want to talk about. We have a lack of GPs in Kerry and I am sure it is same all over the country. There is also a shortage of nurses in our hospitals and chaos in accident and emergency departments, particularly in University Hospital Kerry, where people are waiting for hours on trolleys and chairs. Waiting times for replacement hips, knees and cataract operations are excessive. Myself and Deputy Michael Collins started running buses to Dublin for people who were suffering agony in the garden with pain in their hips and their backs and whatever and many would have gone blind. I am asking the Minister of State, but there is no Government representative here now, wherever he has gone-----
I am asking the Government to provide a minor injuries unit in Killarney and a separate one in Tralee to help to reduce the waiting times in the accident and emergency department in University Hospital Kerry.
Our disability services are severely lacking and the people who operate those services, many of them section 39 workers, are not adequately paid. Residential care is practically non-existent. I dealt with a patient a few months ago who was told that the only place that could be found for her was in County Meath, up beside the Six Counties in the North. There has been much debate about the childcare assistance but people will not see any improvement until next September, almost 12 months away. Middle income earners are struggling with the cost of rent, food and electricity. Energy providers have been let run amok and can charge what they like. People are also struggling with the cost of running a car and fuel costs. Many do not qualify for social welfare. The squeezed middle cannot get on the social housing lists and they cannot get planning permission in many parts of Kerry. The planning regulator is ensuring that. On childcare costs, they are getting no help, as I said, until next September. On mortgages, interest rates are an issue. The banks are doing what they like. The Government says that it cannot increase anything because it will drive up inflation but the banks can do so. The cost of gas is increasing. We had one chance in Kerry of ensuring that we would have continuity of supply, and maybe at a lesser price, with Shannon LNG but the Minister for the Environment, Climate and Communications stopped it. It will not get the go-ahead, even though it would have cost the Government nothing.
For the people that suffer with depression, the Government has increased the price of cigarettes by 75 cent. It is totally unfair to be blaming them for something. Many young people do not smoke because they are aware of the consequences but there are elderly people out there who cannot just give up and the Government is trying to drive them into the ground.
The Government is putting up the price of a bag of coal by €1 and there is an additional 20 cent on a tank of diesel for the house. The Government has promised free school transport for all but only some children are getting it. Children from this country have to abide by the 2-mile rule to get free school transport but children from another country, even if they are only half a mile or 800 metres away from the school, get free transport, including taxis. That is not fair and that has to be addressed.
Small and medium-sized employers have been hit with increased energy costs and they cannot source workers. They have difficulties with the minimum wage, which the Government is increasing. I do not begrudge workers and agree they should be paid properly. The honest truth is that if employers do not pay people properly, they will not get workers but the increase in the minimum wage should be planned better. It should be done gradually, with staged increases every year so that employers know where they are going. There are many medium and small businesses closing. I met the owner of a small restaurant the other day who told me she is closing down because her ESB bill for 48 days was €4,800. That was €100 per day for a small café supplying sandwiches and light food.
The housing cap needs to be increased. As I said, many people cannot get on the housing list. Many house owners will not rent out their property because of the tax they have to pay and because they are afraid they will not get their homes back. I ask the Minister to do something about that. Many local young people cannot get planning permission in Kerry, particularly if sites are beside national roads or in areas deemed to be under severe, urban-generated pressure. These are the main reasons people are not able to get planning permission. I am speaking here about sites that are 10 miles outside Killarney and the same is true in Kenmare and Dingle. People who want to build a house for themselves just cannot do so.
On agriculture, we got 17 lines in 64 pages from the two Ministers today. Farmers are being vilified and terrorised every day. We have the likes of President Higgins sticking his nose into what hard-working people are eating, telling them to eat plant-based foods. I say to him that people working hard need meat. The Tánaiste, Deputy Micheál Martin, was in New York and said he was worried about global food security but at the same time, he is culling cows here in Ireland. The Taoiseach was boasting about eating vegan food and said that it was better for him. Why is the Government treating the farmers like this?
Tá áthas orm an deis a fháil chun labhairt ar an mbuiséad seo atá leagtha amach os ár gcomhair anocht. I welcome the opportunity to speak in this debate. In many ways, this is the Goldilocks budget. It is too hot for some, like the ESRI which urged constraint; too cold for others, who believe it did not go far enough; and just right for the Government, which believes it has struck the correct balance. Many thousands of households, farms, small businesses, restaurant owners, tourism operators, pub owners and hauliers have been looking on anxiously, awaiting confirmation that they will have received something of substance in today's announcements.
Today I want to outline my broad response to the budget. I intend to fully deal with some of the specific measures in it tomorrow . The question I asked myself today is whether this budget meets the key tests, if not the only tests, that really matter. Does it secure the stability of the public finances?
Does it materially assist disadvantaged and working families, farms, businesses and communities, thereby enabling them to survive and thrive? Those are the key and fundamental questions. The sense is that while most people will have got something, almost everyone got little enough to make a big difference.
However, to be fair, there is much that was announced today that will be welcome. The increase in social welfare payments and carer's rates will all be welcome, even if they do not go quite as far as me and my colleagues in the Rural Independent Group would have liked and as we had proposed in our budget submission. I welcome the targeted mortgage interest rate relief and further supports for childcare, even though they do not go far enough and will be slow to bring relief. I also note the lump-sum payments to those receiving social welfare, including €200 for the living alone allowance, €400 for the carer's support grant, €400 for the disability support grant, €400 for the working family payment and €300 for the fuel allowance. It would be nonsensical to stand up here and say that nothing good has been delivered. The increase to third level grants and the partial restoration of some of the postgraduate funding grants is indeed welcome. A decision to fund the free book scheme at post-primary level is necessary and will be welcomed, but our schools are crying out for funding, especially for major and minor work projects. Commitments in that area have to be delivered.
At the more specific financial level, we also know that changes to the VAT rates and structures were desperately needed by many sectors and workers rights across the board. It is here that I would like to add a note of balance to the Government's entirely understandable sense of self-congratulation. We know, for example, that today's budget announced a range of measures in the order of almost €7 billion, but that money is generated on the back of Irish taxpayers. In 2022, gross VAT receipts amounted to €26.7 billion, which represents 23% of the total of growth tax receipts, while the net back receipts were €18.8 billion, a 22% increase from 2021 and approximately 23% of the overall tax yield to the Exchequer. While this of course reflects an increase in consumer spending, it also reflects the extraordinary level of tax that consumers and households are paying on goods and services. While almost €7 billion of measures was announced today, we must be honest and clearly place that within the context of an expected net VAT yield in 2024 of €20.4 billion.
I really believe that this budget must also deliver for transport and the haulage sector. The haulage sector is a vital cog in our economic machine in Ireland. It is vital for keeping supply chains open and it is essential. It contributes so much tax and everything else. The sector must be looked after and protected. We know that the majority of revenue yields from energy taxes come from fuels used in road transport. Indeed, CSO data also show that households have paid up to 54% of all environmental taxes, while the services industry has borne 33% of the environmental tax share. Households have also paid the highest level of environmental taxation, at over €207 of environmental taxes per tonne of CO2 equivalent.
There is a point that we should not tire of repeating. Yes, there was much in today's budget that was good and that we can all support, but such measures were only possible because of the massive levels of environmental and other forms of taxation that bear down upon households, which I disagree with. The Ministers touched upon some of the upcoming challenges in their speeches. These were also reflected, as the Minister of State will be aware, in a presentation of the tax strategy group by Brendan O'Connor, the head of the economics division of the Department of Finance. Mr. O'Connor recently noted that in terms of the global economy, modest improvement is likely but Ireland will face a low growth, high-risk environment. In the medium term growth is slowing, while we also face structural challenges related to decarbonisation. This is going to place massive social and financial costs on all sectors, including our farmers and transport sector. That is why we need to do everything possible to ensure we robustly strengthen Irish home-grown industry and the agri sectors. We cannot rely long term on revenue sources such as the likes of corporation tax. Our agri sector supports 170,000 jobs. Not enough is being delivered. There has actually been a reduction of 17% in the amount of money being delivered to agriculture. I am concerned about it. I hope that all sectors, including dairy, tillage, beef and our sheep farmers, get adequate supports. I will be asking further questions about that. I was disappointed with the lack of detail and, indeed, the vagueness of today's agriculture budget.
I am going to start by referencing the Law Reform Commission consultation report for a Bill that was never enacted. According to the abstract of the 2005 report:
The Report deals with the liability of corporations for the death of human persons arising from gross negligence. The Report recommends that an offence of 'corporate manslaughter' should be introduced, to be prosecuted on indictment only, where gross negligence involving a significant risk of death or serious personal harm causes death.... The offence would apply to “undertakings,” which would include public sector and private sector corporate entities and also unincorporated entities... The Report also recommends that there should be a separate offence of "grossly negligent management causing death."
I thank the Ceann Comhairle for his indulgence. I reason I brought that up is because if this Bill had been enacted, every Member on the other side of the House would be in jail now. There would be none of them on the benches of this House because of their gross negligence in minding the people of this country at a time of need. We must stop driving inflation through the roof because it is putting stress on people in this country. Young families are fighting to try to survive, families are trying to get on the housing ladder and all the Government can come up with as a housing policy is to put funding into the LDA plans which only work 15 minutes from the cities, which wipes out a lot of the towns and villages. Where I live in Limerick, it takes out two thirds of the towns and villages for infrastructure. If there was infrastructure in County Limerick, there would be houses built in all the towns and villages, which would then encourage businesses to stay open. Our school numbers would be up and our sports club numbers would be up. Across the board it would be self-contained because they would support each other. When towns and villages come together even to have a sports game, three or four parishes are joining together to have a team. Why? Because this Government is failing to invest in the towns and villages in rural Ireland outside of the cities. If they were supported in the counties, in turn they would support the cities because then we could make a plan for infrastructure and for a transport network to bring people in and out, whereby they would support both. The Government is just putting investment in one spot, like Dublin and the airports. We have seen that is wrong. Now, Shannon and Cork airports are growing because of this diversion of traffic. We should do the same with people, and allow our children to come home. There are people who want to come home to Dublin but cannot do so because it is overpopulated. People cannot come up here and work because they have no place to stay, so we are reducing their opportunities.
Looking at hospitality, in its mini budget the Government brought VAT from 9% back up to 13.5%, which adds €1 to the cost of every plate of food in a restaurant or hotel. That is what the Government has done for hospitality. It does not make any sense. On one hand, it is increasing the minimum wage, which I welcome, but on the other hand it is taking it back again in taxes.
Then there is the fuel tax. We look at the haulage and farming industries that produce our food, and the taxes that they have to pay on fuel to produce our food at the moment. The Government is taking 50 cent in every €1 back in tax.
What did it give back to the farmers today? Next to nothing. Representatives from Macra na Feirme were here recently fighting their case. The Tánaiste - the Taoiseach at the time - said to give him their model and he would look at it. They had a model done that was costing €8 million. They did not even get a look-in today. They were led up the garden path again. The Government has given some grants to the farmers for machinery. Contractors in this country do about 70% of the work for the farmers but it gave nothing to the contractors for machinery, which could reduce costs for farmers getting work done.
Let us look then at the Garda. We are going to have 1,000 extra gardaí. The Garda cannot keep the ones it has. They are counting the days and hours to get out because 98.7% have no confidence in Drew Harris, who was appointed by the Government. Again, it has left no voice for the gardaí and now it wants to encourage gardaí to come into the service. Why would they when their own Government or the head of the Garda would not listen to them? Why would somebody go down that line? Our protectors are our nurses. Our protectors are our medical staff. Our protectors are our gardaí. What does the Government do? It puts in its earplugs and pretends they are not there.
I will go back to the law reform Bill again. The Minister for Transport, Deputy Eamon Ryan, refused to take advice from TII on resurfacing and restructuring roads. TII said deaths would happen on the roads and he ignored it for road infrastructure. That is negligence on his behalf.
That is gross negligence on his behalf. People have died on the roads because funding has not been put into infrastructure. People have died on the roads because the local authorities do not have money to fill potholes on the basic roads. People have died on the roads because of rules that hedges cannot be cut at certain times of the year. Every road in Ireland - I said road only - should have 1 m in and straight up of hedge cutting allowed. It protects pedestrians, it protects cyclists and it protects the buses going to school. It protects tractors, transport and trucks. It protects everyone. That is what you do when you look at things from a common-sense point of view and try to save lives. What the Government has done today is an absolute joke. I will say it again. If that law reform Bill was introduced, a lot of Members over on that side of the House would not be on those benches. They would be somewhere else.
The budget announced today - I suppose it was not really announced today but announced in press briefings for the past fortnight - does, in fairness, have much to commend it but it is also disappointing in certain ways. As Independents we speak independently. It is not with regard to the balance between spending and saving and not spending all the money we have right now and all of that but with regard to how some of the money is spent. Some very small measures that could have been taken that might make lives a lot better are not being taken.
A schools capital budget of €940 million was announced. That is going to provide for the 300 building projects currently under way. I presume they have been budgeted for already. Then there is €200 million for schools building projects that will commence over the course of 2024 and 2025. How much of that €940 is new money and how much is money that is being announced again? As well as announcing a budget through press briefings, this Government is quite good at making the same announcement more than once. I suppose when good news is limited you announce it as often as you can and hope the media will broadcast it as new. Any capital expenditure on schools is very welcome and I welcome it.
My question is with regard to existing schools and the difficulties they are increasingly facing with funding. I hope there will be an announcement and some detail on this. There is no mention of it in the budget but I hope there might be some increase in the capitation fee. I know this from schools across Clare. It is obviously more expensive now to run a school than it ever was. Insurance costs are up for no apparent reason because we were told insurance costs should be coming down. The Government has taken various measures to drive down insurance costs, none of which seem to have been successful as of yet. Nevertheless, insurance costs are going up. It seems inexplicable to me. While I am keenly aware that not every national school is owned by the State - in fact, very few if any are and the vast majority are owned by religious communities across the country - they are all run by the State. They all have to be insured so why is every single national school in Ireland paying out for insurance? Surely the Department of Education, which is funding each and every one of them, could bring them together and form a self-insurance scheme. It is certainly big enough to achieve that.
The insurance industry is making a killing here. I want to be careful with my words. Nobody is suggesting it is doing anything illegal but it is being facilitated in making a lot of money off the backs of communities across Ireland through the insurance of these schools. The profits must be huge from insuring those schools. I am aware of one school in Clare that applied for an insurance refund for all the time the school was closed during Covid. I think it was offered €50. It beggars belief that schools have to insure themselves and there is not some Government scheme in place whereby the public liability of schools is brought into the general public liability of State institutions because effectively, that is what national schools are. The State says they are not because they are owned by religious bodies. That is correct but in the O'Keeffe case against Ireland in the European Court of Human Rights, the State was certainly found liable for everything that went on in the school. If there is an upside to that, it is that the State should look at insuring schools and taking that cost off them. In any event, even if it was to do that, energy costs have risen dramatically and parents have less disposable income so schools are finding it harder to make ends meet. I do not see anything to do with capitation in this budget.
The other thing I wish to raise is disability. Again, there is €64 million for disability but no mention of the disabled drivers' scheme criteria, which have been promised. That was a nasty little detail brought into the first budget passed by this Government to change the criteria. There are 1,200 people who cannot appeal the decision against them at the moment and no movement on that despite repeated promises by this Government throughout this term.
With regard to agriculture, is the best farmers can hope for now to be forgotten? That is essentially what has happened in this budget. Yes, the residential zoned land tax is not going to be implemented this year so they can engage with their local authority but the difficulty is that the engagement process is flawed. Farmers across the length and breadth of this State have applied to have land dezoned and local authorities have said they are going to continue to zone their land. What more can they do? They have engaged. There is no change, unless there is going to be a change to the procedure of engagement or a change in the finance Act. The Minister of State is nodding. I look forward to seeing the finance Act. I hope there will be more to it than just putting it back a year and kicking the can down the road. I hope there will actually be legislative changes.
The other issue is the flat-rate top-up change, from 5.5% to 5%. It seems very small, I know. It is a small amount but it is not something that will cost the Government anything because it is supposed to be revenue-neutral. The amount farmers get back was reduced because it has to be revenue-neutral in accordance with EU law and the incomes were increasing, as were outgoings. This year, as the Minister of State will be aware - or I hope he will be as a Minister of State in the Department of Agriculture, Food and the Marine - farm incomes are well back and there is no change whatsoever as of yet. I have written to both the Minister for Finance and the Minister for Agriculture, Food and the Marine about this. Hopefully there will be an announcement in the Finance Act.
With regard to designated areas, the Government continues to promise there will be a scheme to replace the hen harrier scheme and the Burren Life scheme.
There was no mention of it today, yet farmers are told they should have confidence in how the nature restoration law will be applied and that they will be compensated. There is no compensation whatsoever available to them, however, for the designation of their lands.
Lastly, I wish to mention the three-card trick with regard to the funding of childcare. In September of next year, it will be 25% less, but there will be fewer childcare providers by then, given they are going out of business because they simply cannot provide a service for the level of money they are receiving due to rising costs.
In my few minutes, I want to focus on the complete and utter lack of any systemic plan of action in budget 2024 to address the historical underinvestment in the northern and western region and the lack of ambition by the Government to deliver balanced regional development. Before I get to that, I want to mention one or two other issues, to which I will return over the coming days and weeks as we discuss these proposals in detail.
I welcome the increase in the income disregard for payment of the carer's allowance. It is precisely the level of increase my Private Member's motion called for last March, and while it brings carers back only to the level they were at in 2008, it means more carers are now eligible for the carer's allowance.
One-off measures in this budget constitute a total of €2.5 billion of the total sum. While every euro is welcome, one-off payments do nothing to address the underlying causes of poverty; they simply paper over the cracks. They are a "now you see me, now you don't" type of payment, in that last year's payments have disappeared. They are not building blocks. It is like starting from ground zero every time. That means people with disabilities, pensioners, carers and other vulnerable groups are worse off because core social welfare increases have not kept pace with inflation. Pensioners' spending power is now €19 less per week than it was in 2020, and that is similar for people with disabilities and carers. Speaking of people with disabilities, they experienced utter shock and disappointment when they saw that the cost-of-disability payment of €500, which had been acknowledged and introduced for the first time in budget 2023, was not continued. It is gone. The cost of disability is ongoing and these people, who hoped it would continue, have been left without it. While one-off payments are headline-grabbers and do make a difference, they are just like the lights on the Christmas tree - when you switch them off, the tree goes dark again.
For the rest of my time, I want to concentrate on the non-delivery of any positive discrimination towards the northern and western region, which has endured historical underinvestment year after year. The Northern and Western Regional Assembly's recent budget submission underlines the stark realities of why the region is falling further behind. The Minister, Deputy Donohoe's, own Department calculated in its report that the number of projects of scale, funded by the NDP, that are to be delivered to the northern and western region account for about 14% of the regional allocation, yet the region's share of the population is 17.6%. Rather than address historical underinvestment, the Minister's Department is adding to it.
Some in this House might ask why we need front-loading, so I will give them plenty of whys. The gap in disposable income per capitabetween the northern and western region and the eastern and midland region increased from ten percentage points in 2010 to 25 percentage points in 2021. This has led the European Commission to downgrade the region to the status of “lagging”, while the Commission’s 2023 country report on Ireland tells us there is a stark difference in the disposable income of households among the regions. The northern and western region has a below-average concentration of technology and knowledge-intensive jobs, where we are 7% below the State average. The region's economic performance has worsened compared with the EU 27 average; I will not give the statistics but they are pretty stark. In funding for higher education, the Higher Education Authority, HEA, has stated institutes in the northern and western region received general capital funding of €93 less for every graduate between 2010 and 2021 than did any of the other regions.
Those figures are simply unacceptable and those stark statistics make not just the argument but the strongest possible case for immediate action to combat the unsustainable rise in regional inequalities. This budget needed to implement a stimulus package of about €500 million, as the Northern and Western Regional Assembly asked for - sizeable but not huge in the overall context - to deliver higher valued economic activity in the region. That would include front-loading many of the projects in the NDP, such as the urgent need to upgrade the N17 from Sligo to Tuam.
It is not just roads, rail, housing and education infrastructure we need to front-load. Just over 12 months ago, more than 50 consultants in Sligo University Hospital wrote to the Minister for Health, in complete frustration and desperation, outlining the myriad problems being faced at the hospital. Just two days ago, 78 Donegal GPs wrote to the Minister for Health calling for urgent action on the emergency department in Letterkenny University Hospital. The call, however, is not just from the regions. In May of this year, just five months ago, the Irish Hospital Consultants Association issued a statement saying patient health in the west and north west was at risk due to excessive delays in care. Hospitals, groups of GPs and national organisations are all saying the same thing, namely, that the Government is not delivering for the northern and western region.
The evidence is there. The Northern and Western Regional Assembly sent it to the Government and it has not acted on it. This budget, other than for a few soft words from the Minister, Deputy Donohoe, about balanced regional development, said nothing and did nothing to address systematically the ever-widening regional imbalances or to begin, in any real way, to deliver on balanced regional development. In a budget of plenty, the regions have been short-changed again, and I am beyond disappointed.
Anything extra going into people's pockets is welcome, even if they were underwhelming increases of €4 in some cases. What I saw today, however, as did most people in this country, was a Government that is out of touch. We live in a time of declining standards of living. Wages have fallen behind inflation and there are record figures for homelessness and evictions, as well as record costs in housing, healthcare, energy and the other necessities of life. What we needed today was a radical budget for real change; what we got instead was a budget to buy time for a broken system the Government does not have the political will to fix. There is a fundamental difference in the standard of living for the rich and for everyone else who lives in this country. We know from Oxfam’s Survival of the Richest report of earlier in the year that the wealthiest 1% in Ireland now own more than one quarter of the total wealth. For every €93 of wealth created in the past ten years, €31 has gone to the richest 1% and less than 50 cent has gone to the bottom 50%. If you are not rich, you face a low-wage economy, a broken housing market, extortionate energy and grocery prices and a failing healthcare system and other public services, and I have a lot of examples of those situations.
Successive Governments have caused this growing inequality through neoliberal policies started in the 1970s, austerity and privatisation and now, with budgets such as this, there is more profit and wealth for the rich and more vulnerable people are being pushed into poverty. This is not some sort of organic crisis; it was caused by political decisions made by Fianna Fáil, Fine Gael, the Labour Party and the Green Party to serve vested interests at the expense of ordinary people's ability to live a decent life in this country. I read that the period after the banking crash was the "proudest period" of Deputy Howlin's career.
Deputy Howlin stripped the copper wiring out of our country and sold it to the highest bidder. He chose to push thousands into homelessness and hundreds of thousands into poverty. He chose to decimate our councils, our communities and our public services. We are still fighting that fight. Section 38 and section 39 workers are going on strike next over years without pay restoration. The crises we are in are a direct result of those political choices made by Deputy Howlin.
What we needed today was a budget that started taking back what we lost during austerity and stop the growing inequality in this country. This has been framed as a giveaway budget. To whom is it a giveaway? Every budget that pushes people into poverty while keeping the tax burden on ordinary people is just a giveaway to the wealthy. The Government fiddles around the edges to keep our public services on life support while making no real changes. Poll after poll has shown that people want to see investment in public services rather than tax cuts. This was all done and justified with talk of financial stability. There is not a financially stable person on low pay in the country. The clearest examples are these one-off payments. We welcome them, but the cost-of-living crisis has decimated people's savings and their wages, and put many into debt and arrears. A poll at the weekend showed that 39% of people could not afford a €1,000 bill in an emergency . Some 65% of people have less disposable income than they had last year and one quarter of people cannot make ends meet.
This crisis will affect many people for years. It is not a once-off. More than once-off supports and payments will be needed to buy time because the Government does not have the political will to fix the crisis. I have raised this before. When these once-off payments end people on social welfare face a significant pay cut, a worse standard of living and increased poverty and deprivation. How many have been pushed into energy poverty? St. Vincent de Paul says that it has been at least 40% this year. Charlie Weston pointed out in a recent article that one in eight homes is now in arrears on energy bills. That figure comes from the Commission for Regulation of Utilities.
This crisis will affect many for years. It is not a once-off. I have been dealing with an elderly woman who has energy arrears of more than €1,200. That is after the €700 she got in energy supports. She does not even turn her heating on anymore. She was made an offer to pay that off over ten weeks, on top of her current bill. That is more than €130 extra per week with all of her usual costs. She is on a pension of €248. She contacted me when she was told she that her case was being transferred to a debt collection company to which she would have to pay €35 for the privilege of facing intimidation over money she cannot afford to pay. This budget will do nothing to help her or anyone else in her situation. That is the reality. That is why we need a real increase for those in receipt of social welfare payments. Most groups have been calling for a minimum increase to social welfare rates of between €25 and €27.50 per week. The Pension Promise Campaign is trying to hold the Government to its own roadmap for social inclusion, which would raise pensions by €53. Instead, it has given us another €12 increase after years of either no raises above inflation or none at all. This is a political decision to put more of the vulnerable in our society into poverty. It is s a broken promise to our pensioners and disabled people. We already received a response to the budget from the Disability Federation of Ireland, which has said that the measures introduced today do not come close to meeting the needs of people with disabilities. It is difficult to understand how the cost of disability payment of €500, acknowledged and introduced for the first time in budget 2023 has not been continued. The Minister for Finance said last year that it is important to acknowledge that persons living with disabilities face additional costs. They were not reflected in this budget.
This budget is buying time for a broken system. The Government is hoping we can grow our way out of these problems. Economic growth cannot fix this problem because we live in a society where most of proceeds from economic growth go straight into the pockets of the billionaire class. We have seen that quote from Survival of the Richest.We need real structural State interventions and we need a government that can provide radical solutions to our problems. This Government lacks the political will to do that. It is just not interested. We need to bring core social welfare payments to a minimum of between €25 and €27.50 with a promised index to average earnings, which the Pension Promise Campaign is fighting for. The minimum wage must be raised to €15 per hour so everyone is guaranteed a decent wage. It was increased by €1.40 per hour, but I have not seen any increase for under-18s. I want to see if that is coming through.
A State construction company must be created in order to allow people to retrofit their homes, to build the hospitals we need and to start a public housing campaign on the scale of the 1950s and 1960s in order that the average worker is guaranteed a home. We must fund the retrofitting of council houses and stop the slum-like conditions for our tenants. Dublin City Council has said it will not be able to retrofit all homes before 2034. Will this €90 million be able to facilitate that? I have to check that out. The Industrial Relations Act must be repealed so workers can fight for their own rights.
While there are positive measures in the budget, they are all once-off in nature. It fails to take into account the background in which this budget is being passed. This is my seventh budget since I was elected in 2016. Since then we have declared a climate emergency and a biodiversity emergency. We have a serious and volatile geopolitical situation. We have had a Covid pandemic, and the message from that was we simply could not proceed with business as it was. We had to have a new model. We had to have transformative action. Unfortunately, I have seen no sign of transformative action. This budget - I will have to check the minutiae of it, which will take time - has put an emphasis on once-off payments that would be welcome, in a sense, if they were within a package of transformation, which they are not. It is a budget to curry votes and is completely out of touch with the feedback in every single election since I started standing as a candidate. All of the time, the appeal to us was for straight talking, honesty and public services in return for tax. Yet, the Government through Fine Gael puts constant emphasis on tax reduction or tax expenditure. We would all welcome that, except that it is at the expense of services.
We are dealing with this budget having looked at the previous one. Social Justice Ireland does a great analysis, before and after. It tells us, as have many Deputies, that the gap between the rich and the poor is worsening. The CSO data show that in 2022 the richest 20% of people had four times the income of the poorest 20%. According EUROSTAT, Ireland is now the most expensive country in the EU, with prices 46% higher than the EU average.
Child poverty has been mentioned by the Ministers, Deputies Donohoe and Michael McGrath. I cannot let pass the cynical use of language by the Minister for Public Expenditure, National Development Plan Delivery and Expenditure. He stated: "This is a Budget that makes concrete progress in ensuring Ireland is one of the best places in the world to be a child." He proceeds to talk about an additional one-off payment. There is absolutely nothing for long term. He repeated that what is being done in the budget is to ensure "Ireland is one of the best places on earth in which to be a child". That is a cynical misuse of language when you look at the figures for poverty in Ireland. The CSO survey on living conditions stated that 13.1% of people in this very rich country were at risk of poverty. That was up by 11% from 2021. Seven in ten persons experiencing consistent poverty are living in rented or rent-free accommodation. Some 7.5% of our children were living in consistent poverty in 2022. That is again an increase on 2021. There are 671,000 people living in poverty, of whom 188,602 are children. The statistics go on and on, and yet we talk about making this the best little country for a child to be reared in.
An OECD report was brought to my attention by a Fintan O'Toole article in The Irish Timesa few weeks ago. I thank him for that. The report states that the average cost to the economy of childhood socioeconomic disadvantage is approximately 3.4% of GDP. That amounts to €20 billion. In other words, the cost of poverty is €20 billion. Let us take in the cost of domestic violence. At a conservative estimate it is €2.7 billion per year, which I have repeated over and over. We could go on about the failure to deal with our mental health crisis and so on. On every level, this country is failing to acknowledge the problems that cost physically, mentally, emotionally and psychologically. It is also failing to do so on a fiscal basis.
It is costing the economy, year after year, billions because we are failing to deal with it.
I am bamboozled by the figures I am being given for housing. I always try to go back to simplicity when I am bamboozled by what I have read. I look at Galway and at the Department’s figures. From 2009, not a single public house was constructed in Galway. We will take it from 2016 forward from the Department’s figures: 2016, zero houses in Galway City Council; 2017, zero; 2018, 14. This is in a city that has had a housing crisis for a very long time. In 2019, the figure was 29. In 2020, the year of Covid, we really excelled and built 99 houses. We went backwards in 2021 and built 74. In the first three quarters of 2022, we built nothing; by the end, we had built 26. I mention that because we have a huge waiting list. The number of households with children living in appalling accommodation waiting for public housing is unbelievable.
Deputies are used to these figures being thrown out, but let me try and break it down again. Simon Communities of Ireland constantly does a quarterly report that spells out the position in plain English. Galway city has not a single house that can be rented within the discretionary rates. Yet if we take HAP, RAS, long-term leasing and the other schemes, over €1 billion is going directly into the private market. I do not mean to belittle landlords. We need landlords, but it is an obscenity we are putting, through those schemes, over €1 billion into the housing market and not one house is available in Galway. Then in the budget, the Government brings in favourable tax relief for landlords, does a tiny bit for the renters and utterly fails to grasp that house prices and rents have to come down. That will be done only by a massive programme of public building on public land. In Galway, that is not happening. We have a Land Development Agency, another layer of bureaucracy and administration, working with the company in the docklands to provide premium housing on public land - not council or public housing, but premium housing.
I have failed to mention health. I hope to come back to the minutiae of this tomorrow. Both Ministers gave excellent delivery of their speeches but whoever is writing them might take out the part about this being a very good country to live in, particularly if you are a child or have a disability.
I was just looking at a few things earlier. The Department Public Expenditure, National Development Plan Delivery and Reform had to take down a tweet stating that 2,500 beds had been delivered in the health service because it was not correct.
The headlines of the press release by the Department of Agriculture Food and the Marine state that the budget provides €700 million for agri-environmental schemes. I will deal with agriculture. It is stated that there will be €100 million in supports for beef and sheep farmers and the €200 relating to suckler cows. I will go through it bit by bit. The €200 for suckler cows was announced this time last year. People had to apply last spring. We attended meetings all over the country. Farmers around Ireland need to know the €200 on the suckler carbon efficiency programme, SCEP, was announced last year. There is no new SCEP this year opening for next year. Any young farmer who wants to go into a scheme relating to suckler cows should know that there is no new scheme. Get that clear and ignore some of the stuff that is being printed in the media. Ewes were at €10 and are now at €20. I have done the tally. It is about €27 million extra.
The targeted agricultural modernisation scheme, TAMS, was announced earlier this year. There is nothing new in TAMS other than the slurry storage scheme. The next thing they have up is €8 million in targeted support for tillage farmers. Unless my memory has gone wrong, that was announced a week ago. Why are they telling us again today that it is in?
On agri-taxation, we read during the week that three quarters of farmers are not making money. Taxation does not bother some of them poor devils.
I welcome the piece where big businesspeople cannot go in buying land but have to hold it for seven years before getting the tax relief. That is a tax relief so is not costing money.
The article refers to the expansion of the agri-climate rural environmental scheme, ACRES. I will go into this for the people who have been listening to talk about carbon tax for the last number of years. We heard that the new ACRES was to be a brand new scheme and that we would raise the carbon tax in order to ensure those people got good money and farmers would be brought into environmental schemes all over the country. We used to have the green low-carbon agri-environment scheme, GLAS. At a time when we had no carbon tax and no great promises about what would happen, 47,000 farmers were involved in GLAS. There were a few more but they were thrown out of it. Under the new scheme, we took in 40,000 last year. You would imagine that if the Government was intent on being as environmentally friendly as it is talking about, then whatever came in this year they would open it for the same number. However, I understand that it is for 50,000 farmers - end of story. All the money being collected through the carbon tax, which was promised to this – bear in mind that under the last scheme there was no carbon tax – is now not going there, from what I can see.
On the soil scheme, everyone got their soil tested last year. That scheme was announced this time last year. Some €57 million has been announced for organic farming. I know there is extra money this year for organic farmers, but for conventional farmers - let me make it clear - what I have said is accurate.
The Department refers to €110 million being provided for an ambitious forestry drive. Last week, I attended a meeting of the agriculture committee. I was in Brussels a month ago. It was explained to us that the allocation was €304 million for the period 2023 to 2027, even though the Government said €1.3 billion. That €1.3 billion is for the ones that get it 15 and 20 years but, of course, the spin doctors hammered it all together. There is no new announcement on that.
The €6.5 million for dairy beef has been on the go for the past few years. Every farmer should know that it is not new money. There is reference to €5 million funding for the genotyping programme. I spoke to heaps of farmers earlier this year who had it done because it was in the budget from last year. The €8 million for capital investment in the food sector was there and the national strategy for horticulture money was also laid out before this.
Farmers have been betrayed. What has been put aside for nature and that is 100 times more than the €27 million – because that is basically what is in this budget – for the sheep sector, which needed it. We need to be honest with farmers and tell them straight out that this budget gives a clear reflection that they are not wanted by the Government because the Green Party is wagging its tail. That is especially the case if you look at this budget in the context of the Border, midlands and western region, as some Deputies before me have spoken about. A report was done and sent up here. Some of the Government’s own cronies were involved in putting it together. It explained the deficit in that area when it comes to balanced regional development. Did it get anything in the budget? Absolutely not.
What will pay the €27 million for the poor old sheep? I will tell Deputies what will pay it. The Government is driving the carbon tax up tonight and the fella making the bit of silage or feeding the cattle this winter with his tractor is screwed before a penny comes in for the ewe. The reality is that the ewe premium will be next October, a year’s time, before anything happens. This is the spin-doctoring that is going on. If we do the maths for the agricultural sector, we will see that people are going to be down money.
On other initiatives, have a look for rural Ireland. We need more transport but with joined-up thinking on how we operate it. Where is the budget for that or for the likes of road infrastructure from Galway to Donegal or the M20? We need balanced regional development in order to create opportunities for people.
I welcome the childcare measures but, once again, I have found out from other Deputies that it is a case of another push down the road, wait for a while and, sure, mammy and daddy will be all right for another year and they will survive. In fact, they may not survive because many of the creches are under ferocious pressure.
What we are trying to do is give this impression that we are going to mind you, look after you and give you a heap of money because there is a heap of money in the kitty but, in fact, damn all is going to come. The Minister should be honest, open and straightforward with people and not try to doctor up money that he did not give to anybody.
I am grateful for the opportunity to contribute to the debate on budget 2024. I want to give particular thanks to RTÉ and the media for, as usual, giving us a full rundown on the budget this morning before the Ministers even arrived to deliver it. There was a time when leaked budget information resulted in the resignation of Ministers but these days, it is standard practice.
We could be forgiven for confusing last year’s budget with this year’s, given it is just as underwhelming and nonsensical. Against almost every organisation’s advice and budget submissions, the Government has again introduced once-off lump sum payments that do nothing to help with the ongoing cost of living crisis and the high rate of inflation. Energy credits are again being thrown out to those who do not need them, which, in my view, is a particularly stupid way to spend €1.6 billion or 13% of the total cost of living expenditure. This is more than we are spending on health, housing and childcare. Incredibly, this budget has proved even more disappointing than previous ones. I was shocked to see both Ministers failing to address some very important issues and even more shocked to see such major gaps within the budget document itself.
Despite acknowledging that today was mental health day, the Minister for Public Expenditure, National Development Plan Delivery and Reform mentioned cybersecurity more than he mentioned mental health. The Minister for Finance did not even mention it at all. The published budget document does not even allocate mental health its own section, while the likes of Covid-19 and Met Éireann both get their own sections within the document. This demonstrates just how troubling the Government's priorities are.
There has been a serious decline in the mental health budget in Ireland from 13% of the overall health budget in 1984 to just 5.1% in 2023. This is despite a rise in those experiencing mental health difficulties to around 40% in Ireland and the fact that Ireland’s prevalence rates of mental health difficulties are relatively high in comparison to international estimates. In its budget submission, Mental Health Reform asked: “Is mental health the forgotten crisis?” I think the two Ministers have shown us today that, sadly, the answer is “Yes”.
Our disabled community has been completely let down by this budget. To celebrate the creation of a national savings account while there are hundreds and thousands of disabled children and adults who cannot access basic support, services and equipment is an insult. A €12 increase is sorely inadequate. We need at least a €50 weekly ongoing cost of disability payment on top of the existing allowance. It is very hard to understand why the Minster has decided not to continue the cost of disability payment, acknowledged and introduced for the first time in budget 2023 at €500, and I know disabled persons organisations, DPOs, are feeling particularly let down by this. I am also disappointed that the income threshold for those on disability allowance was not increased.
The Minister raised the income threshold for carers but I ask why it exists at all. Carers are providing the State with a crucial service, not to mention the financial burden they are removing from the State. We know that disabled people are more at risk of poverty than any other cohort, with Ireland’s dismally low records and the lowest rates of employment for disabled people in the EU. Why is the Government insisting on perpetuating poverty by limiting the ability of carers to provide necessary care and earn or work within their chosen sphere? It is a breach of the right to equality, as well as being blatantly cruel, classist and discriminatory.
Many areas within this budget do not seem well thought out at all. After reading through the changes in take-home pay, I cannot fathom how someone on €25,000 a year will see an increase of €5 a week, while someone on €100,000 a year will see an increase of €17 a week.
I was also extremely disappointed to see no new spending on culture, arts, Gaeltacht, sport and media for next year. Tá sé ríthábhachtach go n-aithnímid an tábhacht a bhaineann lenár gceantair Ghaeltachta chun ár n-oidhreacht náisiúnta a choinneáil. Caithfimid na Gaeltachtaí a chosaint agus ligean dóibh fás agus forbairt. Is píosaí ríthábhachtacha dár gcultúr iad. We need to recognise the importance of the role our Gaeltacht regions play in upholding our national heritage and we need to protect our Gaeltachtaí and enable them to survive and grow. They are vital pieces of our culture.
With regard to housing, Housing for All has failed. Since publishing the strategy in September 2021, homelessness in the north-west region has increased by a massive 80.2%. I would love to say I was surprised at the lining of landlords’ pockets but, sadly, given the Government’s track record, I am not surprised. However, I am shocked, as anyone with an ounce of empathy would be, that the Government can use the budget to provide relief to landlords under a sham pretence that there was a risk they would leave the market, while renters are facing soaring rents and uncertainty. We need to implement emergency legislation to cap rent prices and reinstate the eviction ban, and we must not delay in allocating the €210 million necessary to ensure 100% redress for mica-affected homeowners.
Regarding rental shortages, in Donegal, 21% of families are renting and 14% of adults are living with their parents. There is no shortage of properties in Donegal; the properties exist, but they are being used for Airbnb and holiday rentals. We need to incentivise landlords to switch existing short-term letting to long-term. That is important and will become even more important as the mica redress gets under way and people need somewhere to live while their houses are being repaired.
We know that the cost of living has taken a massive toll on all households. We have a Taoiseach who recently made reference to “Benefits Street” yet forces low and middle income families to deliberate as to whether both parents can even afford to work because the crippling childcare costs are terrifying. The State should be prioritising a universal, publicly-funded childcare programme. This should include a scheme similar to the access and inclusion model, AIM, in the early childhood care and education, ECCE, scheme to allow for the accommodation of disabled children and children with complex care needs. We need to assist our most vulnerable in meaningful ways.
I had to laugh when the Minister said he is ensuring Ireland is one of the best places in the world to be a child. Currently, more than 671,000 people are living in poverty in Ireland, of whom 188,602 are children. Last year, 539 people sought support from the North West Simon Community, including 244 children. As the Children’s Rights Alliance states, addressing the socioeconomic rights of children is not a charitable process and it is not an opportunity for the Government to pat itself on the back and say it is a job well done. This is a basic obligation. At the beginning of this year, the UN Committee on the Rights of the Child urged the Irish Government to raise social welfare rates to reflect the cost of living as a key means by which to ensure children have access to an adequate standard of living and it urged Ireland to address the root causes of homelessness. The Government and its budget have failed to do this, while at the same time trying to make us believe that a slight reduction in childcare costs and a measly weekly increase in qualified child rates will create a global haven for children in this country. Where is the universal childcare? Where is the security of a home to call their own? This country is a haven for the rich, not the children, and that is what this budget shows.