Martin Mansergh (Fianna Fail)

I welcome the Minister to the House, thank him for the time he has given us at a pressing time of year and congratulate him on the Book of Estimates. How many Finance Ministers in Europe are in a position to continue to reduce the national debt, provide substantial relief in taxation and fund substantial increases in public services without any undue strain? I suggest very few of them are in this position, which is no doubt the reason the Financial Times decided the Minister was the most effective Minister for Finance in the eurozone.

The Estimates are only the first instalment in the budgetary process, which will be filled out later by the budget and Revised Book of Estimates. There are little quirks in the budgetary process, for instance, the outturn for this year will be somewhat less than what was provided for. For this reason, the figures people cite for the increase in expenditure this year over last year are probably at least one percentage point lower than the true figure. One must rememberthat these calculations are made on a moving scale.

Older Senators can only look back in wonder at the development of the country and public finances over the past 20 years. The particular contribution made by my party has been to establish and then provide a sound financial basis for the growth, investment and increase in employment that have taken place. We have not looked back since 1988 when Charles Haughey and Ray MacSharry reduced the Exchequer borrowing requirement, with the help of the tax amnesty, to 3% of GNP.

Senator Ryan implied yesterday that the rainbow Government had left the budget in surplus while subsequent Governments had failed to do so. Figures from the Department of Finance show there was never an Exchequer borrowing requirement surplus between 1995 and 1997. It is true, however, that retrospective calculation of the general government deficit produced a small surplus in 1997, that is, in one year out of three. In the past ten years there was a small deficit on the general government deficit in only one year, 2003, and two small deficits on the EBR. We have been managing comfortably with a large margin of safety and in a way that in most years has not significantly constrained capacity to do what needs to be done.

On some specific points, one would get the impression from the public debate that the Estimates provide for increased expenditure across the board. I note the Minister set a good example in his own Department, no doubt for good, technical reasons. I am not suggesting the allocation for the Department amounts to a cutback but the current budget is 8% below last year. In some areas, the allocations have not been significantly increased. Critics in the other House said it was scandalous that various allocated moneys had not been spent, yet the Government is constantly lectured about the importance of achieving value for money. One should not spend unspent money at the end of the year unless there are pressing needs and priorities for doing so. The critique in this regard shows inconsistency.

The Estimates provide welcome increases, by and large across the board. I welcome, for example, the increase in the allocation for child care, which is badly needed. Child care facilities are being developed all over the country. I also welcome the increased budget for primary schools. Even small schools one visits have resource, special needs and ancillary needs teachers and experience difficulty finding space to accommodate them. Enlarging many primary schools to accommodate these staff is an important priority.

The Government's investment in road and public transport is making a considerable difference, specifically in my county. I am sure new motorway links across County Tipperary have contributed to four positive job announcements in the past four months. These links make the county more accessible and have made a palpable improvement. My constituency of Tipperary South, as with the Minister's constituency, is in a central position.

Public transport was discussed in the House yesterday. Previous Governments, not only the rainbow Government, did not generally invest Exchequer money in capital improvements in public transport. The Book of Estimates for 1997, produced by the then Minister for Finance, Deputy Quinn, featured a zero Exchequer input into public transport investment. Moreover, public transport was not mentioned in the 20 point election plan at that time. It is a bit much, therefore, to be criticised about alleged deficiencies.

A sum of €777 million will be invested in public transport next year. We can see the effects of badly needed improvements in the system. If one adds current expenditure to capital expenditure, the final figure of approximately €1 billion amounts to two thirds of the investment in roads in the national budget. The Luas, which I often use when in Dublin, no longer features in the Book of Estimates because this successful project became self-financing much earlier than anticipated.

Senator John Paul Phelan alleged that housing policy had been a disaster. If that is the case, it is a wonder so many houses are being built in practically every village. Somebody, somewhere must be buying, acquiring and living in the majority of these properties. A cooling off in house prices is needed and some of the measures in the pipeline will help to achieve this. As regards some of the suggestions on inflation made in the debate, if one wished to stimulate rip-roaring house price inflation, one would abolish stamp duty.