John Paul Phelan (Fine Gael)

I know perfectly well there is more to the country than Dublin, particularly as I represent a large part of the country that is outside Dublin. We must take a global view and property prices have increased significantly in the eight years during which Fianna Fáil and the Progressive Democrats have been in office since 1997. However, the Minister of State did not include that in his remarks on the various developments that have occurred since 1997.

One of the myths constantly articulated by the Government is that it is a low tax and low spend Administration. Public spending has increased by more than 130% during the eight years in which the Government has been in office. If one was to mention that to any member of the public, the burning question on their lips would be "Where are the improvements?" The health service is creaking at the seams. There are major problems in accident and emergency units, about which we heard last night from the Irish Nurses Organisation, despite the ten-point plan announced by the Tánaiste and Minister for Health and Children, Deputy Harney. There are chronic problems in the area of special education. I appreciate that the Minister for Education and Science, Deputy Hanafin, is examining that area but the Government has had eight years in which to examine it and has done little in terms of solving the problem.

Following the drubbing the Government parties received in the by-elections, there has been reference to the child care area. It appears the Government will become newly committed to increasing availability and reducing the cost of child care for many families throughout the country. I will believe it when it happens. The Government has spouted those same terms for the past seven or eight years. Several debates on that important issue have taken place in this House recently but there is little evidence of how the Government proposes to implement change.

The former Minister for Finance, Mr. McCreevy, appeared to go down the road of promoting the children's allowance as a means of tackling the child care problem. Almost everybody with whom I speak on this issue agrees that children's allowance is not the mechanism which should be used to resolve the difficulties in the child care area. A new and fresh approach would be welcome. I hope the rumblings we have heard recently will lead to an improvement in that area.

An issue I have raised with the Minister of State, Deputy Parlon, on a previous occasion is that of roll-over relief. Other Senators and I attended several meetings recently with those affected by the purchase of land for new motorways. At a meeting last night I spoke with a farmer who is losing ten acres. He put it well when he said that the Government is robbing two acres of his land. He will be paid for ten acres but will have to pay capital gains tax because the roll-over relief has been abolished. This man had no intention of selling land and has never sold a site for development. He is interested in developing his own farming enterprise. Ten acres is being taken from him. In effect, the Government is stealing two acres. That is unacceptable. It is unacceptable that any individual who loses a business or residence would be out of pocket because these changes, which are welcome and necessary, are being put in place. I ask the Minister of State, who knows much about this issue and whose heart is in the right place, to use his influence in the Department of Finance to ensure a change is adopted in that area, which will be even more important in the next few years.

An area which was mentioned indirectly is that of biofuels. In my constituency we have had the recent announcement of the closure of the sugar factory in Carlow. There is a considerable body of opinion that suggests sugar beet is a viable biofuel and should be included in the exemptions for such fuels. This should be investigated as a matter of urgency in light of the changes that will take place in the European sugar policy, which is currently under negotiation. I call on the Ministers for Finance and Agriculture and Food to investigate that issue.

The Minister for Finance has made some changes to the tax code in the Finance Bill but has done nothing to address the three fundamental issues of principal concern. He has done nothing to address the issue of repayment of PAYE workers who are owed millions of euro in overpaid taxes. This issue was highlighted by my party colleagues in the past number of months. He has done nothing to introduce a cap on allowances which allow a small number of individuals to pay no tax because they can avail of these different reliefs. He has done nothing to bring forward a genuine reform of the tax code which has long been promised but which still has not been delivered.

The Finance Bill cements decisions on the tax code which have resulted in increased taxation from €36 billion in 2002, when this Government was re-elected, to €47 billion in 2005. Despite a revenue bonanza, the Minister has refused to compensate taxpayers for the impact of inflation. The aggregate cost to the Exchequer of tax concessions in 2005 comes to just €250 million which is less than 2% of the tax bonanza reaped over the period since the last general election in 2002. If the Bill is passed, the Minister will require people on the average industrial wage to pay tax at the rate of 48% of their income; to pay an annual tax on the use of their car accumulating to €2,500 and to pay 24% tax on their spending on ordinary living expenses.

Ireland may be a low tax country when it comes to direct income tax but it is certainly not a low tax country when one considers the level of indirect taxation levelled at the PAYE sector. One must question why the Minister has not introduced a cap to prevent any individual from accumulating the huge range of tax reliefs which results in a zero tax contribution from some very wealthy individuals. The conversion of this Government to a more caring agenda has made no mark on the Finance Bill. The need for support for child care has been ignored once again. The relief in stamp duty, although welcome, has already been overtaken by rising prices in the second-hand housing market. The gross inequity of pension relief has been ignored. The Bill merely scratches the surface of the important issue of overpayment of taxes by PAYE workers. Efforts to close tax loopholes and to pin responsibility on financial advisers for aiding and abetting tax evasion are welcome. However, merely adding new weapons to the armoury of the Revenue Commissioners is not the end of the matter; these are powers that must be seen to be used.

We are informed that a serious package of tax reform must await a further review of the tax code. Reviews under the stewardship of this Government have become a refuge for indecision and inactivity. I cite the example of the health service to show where reviews have led to indecision and inactivity. We must wait another 12 months to see if this Minister can kick the habit of the rest of his colleagues.

Like the budget which preceded it, the Finance Bill avoids confronting the really big issues in the public finances. Why are significant levels of increased public spending and taxation achieving so little in the delivery of public services? These are issues which the Minister of State, Deputy Parlon, did not refer to in his opening remarks. Since 1997, Fianna Fáil and the Progressive Democrats have more than doubled the amount of taxes raised, from €21.5 billion in 1997 to €44.5 billion this year, forcing every household to pay almost €9,000 in extra taxes. What can be seen for this extra money raised?

Fianna Fáil and the Progressive Democrats have increased spending on hospitals by €2.2 billion and yet only 500 extra hospital beds have been opened in the eight years of office of this Government. Annual attendances at accident and emergency departments have fallen by 33,000 since this Government came into office in 1997. Annual spending on the medical card service has doubled since 1997, yet fewer people have medical cards. People on the minimum wage do not qualify for a medical card.

The failure to budget properly for major transport projects has resulted in overruns of over €4 billion and yet there is no accountability in any Department to explain how such ridiculous overspends have occurred in the provision of vital infrastructural projects. Since 1997 there has been an increase of 3,500 in hospital staff but only 400 of this number are nursing staff; most of the rest are administrative staff. As I said on the Order of Business, hospital administrators are falling over themselves while wards and hospital wings cannot be manned because of a shortage of medical and nursing staff. Thousands of extra administrators have been recruited into the different arms of the health service.

The Government increased spending on the criminal justice system by €500 million since 1997, yet detection rates have fallen in that period by 6%. Drugs seizures are down by 43%. The issue of public order offences was raised on the Order of Business this afternoon. Such offences have increased by 94%. The incidence of assaults causing harm has increased by almost 600% since 1997. The Government has increased spending on second-level education by €1 billion, yet 17% of students still fail to sit the leaving certificate, including the young man who was deported. The Government has increased annual spending on primary education by over €1 billion, yet drop-out rates in primary education are up. We are all familiar with the difficulties that exist in the area of special education.

At a time when the Government is proclaiming that policing is its priority, there has still been no sign of the 2,000 extra gardaí promised at the time of the last general election.