Joe O'Toole (Independent)

I welcome the Minister to the House and I am pleased to contribute to the debate. This is an appalling motion and desperate to the world. The Leader this morning said the Government was entitled to blow its own trumpet but the problem is that trumpets get confused with foghorns now and again and frighten off the horses. If the motion had read that Seanad Éireann acknowledges the policies of the Minister for Finance in pursuing policies that have helped to ensure all those increases listed in the motion, I would have voted for it. The Minister has done things that I have disagreed with and I have disagreed with him in the House. Some two and a half years ago there was a time when my colleagues, Senators Ross and Quinn, raised the issue of inflation time and again in debates in this House. When the social partners and others got together with Government and decided that the reduction of inflation was an objective for all partners in the social partnership they were laughed at. I admit the Minister held the line. He can claim due credit for these improvements and for the growth in the economy.

The Minister is entitled to examine competitiveness and growth. I will deal specifically with the former, an interesting issue about which I am more entitled than most Senators to speak. Competitiveness decreased marginally last year and increased this year. One of the reasons for the decline was the benchmarking payment. As had been predicted, we had a big bang when a number of factors combined.

The Minister stood by his side of the bargain and paid the benchmarking increases against considerable opposition from many quarters. I appreciate it when somebody sticks to his or her word through hard times and good times. Many Senators on this side were not in favour of paying the benchmarking increase. It is important to place on record that the Minister looked after public servants and I have no difficulty doing so.

We have emerged from a period in which competitiveness declined and inflation and growth increased. The other important issue is employment. Much of the Fine Gael Party amendment is factually correct, whereas other aspects send out an erroneous message. This is a developing, changing and flexible economy. The fact that P45s are being handed out is not the issue; the real issue is the net figure in terms of the difference between jobs created and lost and the sectors in which jobs are being created and lost. Everybody knows that certain forms of traditional industry cannot continue. During my years in the trade union movement I have repeatedly asked that we be honest and inform our members that we cannot produce certain items as cheaply as other countries without diving to the bottom of the pile in terms of pay and reward. It is necessary to recognise this trend.

We need to examine how we spend our revenue. The most crucial feature of the past three years was that for the first time we entered and emerged from a recession within a short period. In the past, we were never economically prepared to come through a recession without first suffering badly for a decade. It is important that we came out of the previous recession and have reached a stage where the spikes and surges in economic activity have been levelled out to an extent and no longer have the same impact.

We had double digit growth in the economy for many years. As I have stated repeatedly, however, we really need consistent growth rates of between 4% and 5%, which are about as high as an economy can sustain without overheating, creating major demands on services or increasing inflation to an unmanageable level. We are moving towards this position.

I disagree with the Minister as regards the manner in which we spend. While I agree with some of the comments expressed by Senators on this side, contrary to the sentiment expressed in the Fine Gael Party amendment, I was happy that income tax was not reduced further last year.

The Minister has €500 million available to him which he had not expected. This money should be used to give the national development plan a boost. A railway link to Navan should be opened and the line between Sligo, Limerick and Rosslare upgraded or reopened as necessary. I spoke recently to the station master in Ennis where a new commuter service to Limerick opened in December. People wondered whether the new route would be viable, yet despite minimal advertising, the number of people using the line has already doubled.

The Shannon stopover and plans to break up Aer Rianta have caused a major row. The Minister should give the Minister for Transport a cheque at the next Cabinet meeting and ask him to build a railway into Shannon Airport. This would make it the only international airport with a rail head and give new impetus to the west. This, combined with a rail line from Cork to Sligo, would open up the west.

I ask the Minister to address one issue as regards the rural renewal initiative. A couple of years ago, to widespread approval, he cut back on tax reliefs for hotels in certain circumstances because the scheme was being abused through partnership deals and so forth. Fine towns, including Kilrush, Ballinrobe, Tuam and a long list of others, do not have a hotel which is inhibiting investment. I ask the Minister to examine the matter.

I hope that when I raise my final concern in more detail in the House in the coming weeks the Minister will come before us to address it. It is clear that interest rates will increase in the coming years, creating problems for people making repayments on their houses. I have examined the policy of other countries on this matter. In certain states, legislation has been introduced to require that in the event that interest rates increase, repayments may only increase by an amount not greater than inflation. Lenders may then raise repayments in line with inflation the following year as a means of catching up, as it were. If they find they cannot catch up, they may extend the repayment period. With people worried about the possibility of interest rates increasing in three or four years, similar legislation here would protect those with mortgages without depriving lenders of their money, although payments could be delayed. This approach has worked in other countries. I will address the matter in greater detail at a later date.

The economic indicators are solid and the Minister can take credit for this. My argument with him concerns the areas in which he spends. I have many ideas in this regard and Senator Cummins also made some valid points about areas in which we should invest. There is no point having money if we do not spend it.