Kathleen O'Meara (Labour)

I welcome the Minister of State to the House and thank him for being here for this important debate. The issue of tax evasion and compliance is important for us as law-makers and is extremely important for the community. The Comptroller and Auditor General's report on this area issued last week exposes serious matters.

The Minister, in his address to the House, did not refer to tax evasion in the construction sector which is pointed out in the Comptroller and Auditor General's report and has been substantially covered in the media since then. We probably all agree that there will always be attempts to evade tax. It is almost a given in human nature that certain people will do their best not to pay their fair share. It is the role of the Revenue Commissioners to ensure that tax is paid. That is why they have been given widespread powers in recent years. I agree with Senator Kate Walsh that failure to pay tax and defrauding social welfare are the same as stealing from one's neighbour.

In some cases the Department of Social and Family Affairs has been extraordinary in its pursuit of individuals to recover money for the public purse. I wish to compare that with the activities of the Revenue Commissioners. The Minister said that in some cases the cost of recovering money for the public purse could be far greater than the amount recovered.

One must, however, remember the principle at the heart of this issue. The Revenue Commissioners are not recovering the money for its own sake but on behalf of all compliant taxpayers. It is important that the Revenue Commissioners use the full extent of their powers and pursue cases where they have evidence of a sector that is not complying. In that respect one must look at the issue of relevant contracts tax in the construction industry.

I wish to cite an example of the way the Department of Social and Family Affairs pursues individuals, without giving too much detail. It concerned a man whose brother died. It emerged that the deceased had claimed a pension to which he was not fully entitled, since he had sold land in the years previous to his death and so had means. When the property was legally examined, the Department of Social and Family Affairs was able to see that the man had such means that he had not declared. The family was then landed with a bill. His poor unfortunate brother, also a pensioner, was mithered when I met him. He was up the wall with anxiety and concern regarding the sum owed to the Department. One could say that the family had got its fair dues, but the officers of the Department were extremely diligent in their pursuit of the individual and the sum owed to the public purse, which amounted to tens of thousands of euro. The case was extremely vigorously pursued, and that is only fair.

However, when one looks at the construction industry and in particular the report of the Comptroller and Auditor General, one sees that the level of pursuance in that sector, especially regarding relevant contract tax, is simply not the same. Senator Norris referred to a case before Dublin District Court last week involving several building contractors engaged in a scam relating to that tax. That comes as no surprise to anyone working for the Revenue Commissioners on this sector. There are clear indications that the level of non-compliance and abuse in the area is quite extensive. Eric Fleming of SIPTU, a figure well known for his activity on behalf of workers in the construction sector, has extraordinary things to say on the subject. On some building sites, contractors have no employees, since everyone is a subcontractor. That clearly points to a degree of tax evasion that must be examined very closely and addressed.

One must think of the individual subcontractors involved. To what extent are the employers' obligations for holidays, pensions and other benefits to which people are entitled being avoided? What about overseas workers, who can now be found in large numbers on building sites? Without union involvement, are those people fully aware of their rights as workers, or are they being exploited by being termed subcontractors?

There is also the issue of the relevant contract tax. The chairman of the Revenue Commissioners made the astonishing comment to the Comptroller and Auditor General that one reason that subcontractors and contractors are not paying tax is that evasion is a means of gaining competitive advantage. The Government and in particular the Revenue Commissioners must examine that very closely. I am not satisfied from the Comptroller and Auditor General's report that enough investigations or audits are being carried out in the area. Nor am I satisfied that workers' rights are fully protected.

It is not good enough to say that the building industry has always been like that and always will be. We have had that attitude to tax evasion in the past. The Minister's own figures show that when the Revenue Commissioners go to work, they really get results. It is time that they really went to work on the construction industry and got results on behalf of compliant employers, contractors and workers, and especially on behalf of the wider community. I am not saying that social welfare fraud should not be pursued, but one wonders when one sees the work done on that compared with what appears not be done on the other side, particularly by the Revenue Commissioners.