John Gerard Hanafin (Fianna Fail)

For an economy that has doubled in size twice in the past 15 years, there is a simple mathematical equation called the 72 rule to work it out. One divides the growth rate into 72 to get how many years it takes to double the size of an economy or of one's investment.

The economy has doubled in size twice in the past 15 years and on top of that it will grow by 2.3% this year. Notwithstanding the fact that the euro is at a very high level, the American economy is going into recession and the price of oil has risen to $110 a barrel, it is a remarkable robust economy that is still growing at 2.3%. The fact that it will continue to grow shows the solid stewardship of this Government. At a time when there is a slowdown, the Tánaiste ensured in the budget that those who were less well off were looked after. The social welfare provisions in the budget are to be commended.

The Finance Bill deals with supporting enterprise, innovation and employment to advance sustainable development and to ensure a fairer tax system. The fact that the top 1% in this country pay 25% of the income tax shows there is a fair tax wedge. The reality is that a single worker on average earnings in Ireland continues to have the lowest tax wedge in the EU and one of the lowest in the entire OECD. This is a balanced budget and this Finance Bill proves it. It deals with issues that needed to be dealt with.

Since the 1960s we have had the largest and most consistent development in economic terms of which we know. What we are doing is modulating that growth. I will explain what I mean. The construction industry was powering ahead on its own steam. When a slowdown came the Tánaiste took the opportunity in this Finance Bill to increase mortgage interest relief so that a single person can get the advantage of another €33 a month and a married couple can get €66 a month. The Tánaiste has within his capacity to increase that. He could have given marginal relief at top rates. There are many measures the Government can take to ensure the economy is modulated and there will not be a significant slowdown. He has also decreased the term in which owner-occupiers must refund the benefit they accrued from preferential stamp duty rates if they let their house from five years to two years, in this Finance Bill. This is because of the movement in the economy and the way people live now.

I suggest there will be continued growth and we will continue on an upward trajectory. From the 1960s, notwithstanding a recession in the 1970s and the oil shock in the 1980s, there was a continuing line. This Government has continued to see to growth. There is a provision for research and development for ten years so that such activity, which is at the higher end of the market, can continue. We are still looking to the future and to the times when we will continue to grow at the rate of growth we had previously.

There are other positive measures within this Bill. The employee share ownership trust, which allows persons the benefit of more tax relief to borrow to buy shares in their own companies, ensures wealth is spread throughout the country.

I suggest to the Tánaiste, now that the UK has introduced a tax on persons of significant wealth and there are those in the UK who might feel an objection to this by virtue of their residency, that there might be an opportunity in the next Finance Bill for us to look to attract some of those people to this country. I am certain there will be an innovative approach by this Government in the future and now that this opportunity has presented itself this year, perhaps that is something that the Tánaiste might bear in mind.

I also commend the Tánaiste on increasing the amount of tax that will be paid by companies drilling for oil. We have a gas industry in this country but not many people know that significant amounts have been expended yearly which have not produced any returns. However, in times past the Tánaiste was generous in his allowances on corporation taxes. Now that events have changed in the world market, the Tánaiste has reflected that by increasing the tax to ensure those companies which benefit significantly from an oil or gas find will pay an appropriate rate, given that billions have been expended with little enough return in many instances.

There have been significant changes in stamp duty and in the way VAT is charged. In the budget the Tánaiste took the opportunity to tidy up many of the outstanding issues for evasion. He also took the opportunity to increase certain reliefs, including the rent-a-room relief, so that the attractive nature of these remained.

By and large, at a time when the economy was uncertain, the Tánaiste took the prudent approach and did what I would expect him to do. He decreased the burdens on business in terms of red tape, increased taxes where they were necessary on windfall profits on oil companies, ensured people who were less well off received significant increases, and ensured workers would continue to pay the lowest marginal rates in the EU and in the OECD. I could only commend the Tánaiste on his work to support enterprise, innovation and employment, to advance sustainable development and to ensure a fairer tax system.