Fergal Browne (Fine Gael)

Basic personal tax credits have not been increased under the legislation. It relies heavily on increased charges and it has totally failed to reduce levies that are putting homes beyond the reach of first-time buyers.

There is a complete absence of joined up thinking. The Minister is introducing property-based tax breaks, barely 12 months after he won public praise for his decision to eliminate them because they had outlived their usefulness. No ceiling has been placed on the degree to which well placed individuals can reduce their tax contributions through the use of these reliefs. The Minister accepts this because he stated in his contribution that the value of such schemes must be balanced against the important objective of ensuring a wide tax base if low rates are to be maintained. Accordingly, such schemes must be kept under review.

A recent newspaper article estimated the State's urban and town renewal schemes will cost the Exchequer €750 million in lost taxes by July 2006. The two renewal schemes, which have attracted a massive €3.8 billion in investment since they were established in 1989, were due to expire at the end of this year. However, the Minister extended the deadline in the budget for the schemes and eight other property-based tax incentive schemes, even though he said he had difficulty doing so. This is a backward step and such tax breaks should be re-evaluated. Worse still, almost 130,000 people are on waiting lists for social housing. Less than 64% of net average industrial earnings was required to pay off a 20 year mortgage on a standard dwelling in the Dublin area in 1980 whereas this had increased to 82% in 2002 and it is even higher now.

Following the furore over the scrapping of the first-time buyer's grant, the Minister attended the House and indicated that even he accepted it was unfair in the absence of an alternative. He gave the impression he would examine an increase in mortgage interest relief for first-time buyers and scrap stamp duty for first-time buyers on smaller properties but, unfortunately, nothing has been done. I was sore about this issue following the budget. I urge him to re-consider these proposals considering that not only was the first-time buyer's grant abolished but VAT increased on all house purchases and development levies have been increased twofold, if not threefold, particularly in Kildare, his own county.

I refer to the decentralisation programme, about which there is confusion. Bus Éireann is due to be relocated to Mitchelstown, County Cork, but the Minister for Transport plans to privatise the company. How can a State agency be decentralised given that it more than likely will not exist in a few years if the Minister for Transport's plans are implemented? It was disingenuous of the Minister to announce the decentralisation of Teagasc in the Budget Statement. I was amazed when I read under the Carlow heading that, in addition to the 250 jobs that are to be decentralised from the Department of Enterprise, Trade and Employment, which are welcome and for which we lobbied hard, the headquarters of Teagasc is also to be decentralised, because that was a done deal.

The Minister landed in difficulty over this announcement because the Civil Service unions involved were not happy. A deal had been concluded whereby compensation of more than €6,000 would be paid to civil servants who opted to relocate to Carlow. The trade unions felt a precedent had been set, which would expose the Government to payments of millions of euro in compensation for the relocation of civil servants. Will the headquarters of Teagasc still be decentralised to Carlow? Did the Minister jeopardise the move by announcing it in his Budget Statement? I hope he has not because the people of Carlow will be disappointed if that is the case.

Fine Gael will table numerous amendments on Committee Stage because the legislation should address the following crucial issues: revelations that the Revenue is unable to collect enough evidence to prosecute breaches of the tax amnesty or to prosecute officials of financial institutions who promoted tax evasion vehicles; the lack of proper scrutiny of special reliefs in the tax code; the absence of a ceiling on the extent to which well placed individuals can reduce their tax contributions to zero through the use of these reliefs; the need to examine afresh the financial support of families through tax and welfare systems during their life cycles; and the imminent introduction of the carbon tax system, which poses serious challenges in terms of the competitiveness of certain businesses and the capacity of families on low incomes to cope.

The Minister is due to make a decision on carbon taxes at the end of the month and it is expected a carbon tax system will be in place by the end of the year. However, the Minister has given no inkling of the approach he plans to adopt. The Government is obliged to notify its decision on the emissions trading regime for Ireland by the end of the month but people are unclear about it. Perhaps the Minister will address the issue when he concludes the debate.

The Revenue admitted recently that it is unable to prosecute breaches of the 1993 tax amnesty and no evidence has been furnished which could facilitate the prosecution of officials in financial institutions who promoted bogus non-resident accounts. That has not gone down well with the public. The public is also sick and tired of being told no money is available for certain projects while significant infrastructural projects such as Luas go €600 million over budget.