Brendan Kenneally (Fianna Fail)

I welcome the opportunity to contribute to the debate on the Estimates. I welcome the Minister of State, Deputy de Valera, to the House. The Estimates have become far more important than in the past. I have been a Member of the Oireachtas since 1989. For a long period, even though we had the Estimates and the Finance Act, everybody watched out for the budget. Over the years the Estimates have become more important, as we can see from the attention paid to them over the past week, which is probably deserved.

To a large extent the budget deals with personal matters, for example, social welfare increases and personal taxation. However, the Estimates are more a mark of the direction the economy is taking and how we are managing it. It is right that they get a greater priority than they did in the past.

I compliment the Minister on keeping expenditure increases at 6%. I am not one of those who agree with the tax and spend philosophy. I neither believe in absurdly low taxation nor a high tax regime. We almost have it right. Taxation aimed at bringing in extra revenue in order to increase spending is always highly inflationary. This has caused us problems in the past and is not the right way to go. The Minister has got it just about right.

I never worry about capital expenditure. I worry when we run away with ourselves on current expenditure but not so much with regard to capital expenditure because it has no long-term implications. Capital expenditure is an investment in our future and there is scope for further investment as the Minister has €120 million of an unallocated reserve, the spending of which he will announce in the budget. I hope he will announce it because I have no concern about spending in that area.

I notice there is a capital carryover of €250 million from last year. This is a welcome innovation. Previously, any unspent moneys at the end of the year were returned to the Department of Finance. In many areas, because Departments knew this would happen they rushed and spent the money rather than return it. Sometimes it was not spent wisely. The carryover gives some breathing space and should be of benefit.

I will make a few brief comments on the Estimates with reference to communications, the marine and natural resources, my area of responsibility. I am glad to see an increase of 22% in the Estimates for coastguard and maritime safety. I welcome this emphasis on safety. As an island nation we have had too many tragedies. Anything that can be done to heighten safety awareness, to provide grants for safety appliances on vessels or to beef up the emergency services can only be good.

The capital funding for fisheries harbours is down slightly but this does not unduly worry me. It can happen that some big project finishes before another is ready to get going. There will always be peaks and troughs in this area. I hope the considerable sum of €19 million provided in the budget sees the start of the development of the almost completely new harbour in Dunmore East. I hope some of that money will be spent towards the end of 2005 on that project and that sufficient finance will be provided in 2006 to complete it.

It is not unexpected that a buyout of salmon drift net and draft net licences is not mentioned in the Book of Estimates. This has not yet been agreed and the Minister cannot provide for it until it happens. It is inevitable it will happen. Approximately 70% of the drift net and draft net fishermen are interested in proceeding this way. They pay for licences each year but are getting no return on them. We are the last in Europe to allow this, so it is inevitable there will be a buyout. I hope the finances will be made available at the appropriate time.

The spending for programmes on information and communications technology is up by 13% to €36.6 million. This increase is to speed up the roll out of broadband. Unfortunately, we have been playing catch up in this regard and are behind the take up in some of the other developed countries. This is surprising as we have been ahead in all other technological areas. We are catching up and I am glad the Minister is continuing to make finance available.

The social welfare provisions show this is a caring Government, despite what others have said. Over a period unemployment has fallen from 300,000 to 150,000. Despite this fall in unemployment, spending in the social welfare area has continually increased. Since Fianna Fáil came into office the unemployment rate has fallen from 10% to 5%. However, spending on social welfare has doubled. The money has not been clawed back and returned to the general pool but has been left in the social welfare area and redistributed to help people who cannot help themselves, for example, the carer's allowance. I was a Member of the Dáil when the carer's allowance was first introduced. The budget for the first year was £8 million. That budget has increased substantially since, but there is scope to go further. The means test for the allowance should be removed but when we suggest that we are told the costs involved would be too high. However, there is still scope to go further. I would like to see the removal of any means testing. We are told that to do this would entail a cost, but that is a cost accruing to social welfare. This highlights one of the flaws in the system of accounting that we use in the public sector. I believe there would be a significant saving in the health area if social welfare was to absorb this cost but the system we use does not appear to be capable of taking that into account. On several occasions I have asked for this change but I do not think any study has been done on what could be saved in health expenditure if this money was given to social welfare. Interaction across Departments does not appear to take place but it should happen.

Significant increases have been made to the old age pension. We fulfilled all the commitments we made in the past, such as the pledge to raise the old age pension to £100 per week. The Government has committed itself to raising it to €200 per week, which we will achieve and go beyond. That is only right. These people helped to build up the economy and I am pleased this caring Government is giving back far more than the minuscule increases they got under previous regimes when Opposition parties were in Government.

Child benefit has quadrupled since the days when the Minister was a member of the Opposition. This is an important payment which generally goes to the woman of the house and, in most instances, is applied in a proper way.

I do not know what the Minister will do in regard to personal allowances in the budget but the carer's allowance must be significantly increased. It was introduced at the time of individualisation, of which I was never a great fan and I said so at the time. The main reason it was introduced was to try and get stay-at-home spouses back to work, which it has succeeded in doing. However, at present single income households where one spouse is at home are finding it difficult. Two earners in a household take longer to get into the higher tax bracket than if there is one earner. This matter needs to be looked at and it could be tackled through the carer's allowance.

To be consistent with what I said earlier, we should not tamper with the current income tax rates of 20% and 42%. The lower rate should certainly not be amended, although there may be a case for bringing the higher rate down from 42% to 40%. Significant progress will have to be made on income tax bands which have not been widened sufficiently in recent years. Many people are getting into the higher tax bracket far too early and I would like to see that addressed.

The Minister spoke at the launch of the Book of Estimates about value for money. As always, we must examine if we are getting value for money in our health service. We have trebled the amount being spent on health in eight years to €11 billion. Even if we were to spend a further €4 billion that would still not solve the problems in the health service. The previous Minister, Deputy Martin, tried to address the fundamental difficulties that exist in that area and I am sure the Tánaiste will continue this process.

Health appears to have an ability to soak up money. Part of the problem is that health inflation will always be higher than inflation in general because so much new technology has to be dispersed to various areas. A few years ago everybody in my area requiring dialysis had to travel to Dublin for three days of kidney dialysis per week but this service is now more widely available around the country, which costs money.

I am very pleased with the announcement regarding medical cards. The 7.5% increase will lead to 30,000 new medical cards. I have heard it said that people would still have to pay for their medicines. At the moment they pay for medicines and GP visits so it is a significant improvement for them. It will also help take pressure off accident and emergency units.

I spoke on cancer services during an Adjournment debate last week. When speaking about the Estimates for her Department, the Tánaiste and Minister for Health and Children referred to the expansion of cancer services. Radiotherapy is badly needed in the south east. It is a nonsense to have two of the three disciplines for cancer treatment, chemotherapy and surgery, but not to have radiotherapy. I hope this will be achieved under the planned expansion of services. There is also a need for a dedicated oncology ward and for the BreastCheck programme to be expanded.

When speaking on the Estimates, most people have a shopping basket for their own area. I have referred to a couple of things already. The Minister for Finance was in Waterford recently at a chamber of commerce dinner. The deputy mayor spoke eloquently and let him know the requirements for the south east so I will not take up time in the House putting it on the record as the Minister is well aware of it.