Frances Fitzgerald (Fine Gael)

I welcome the debate on the economy today and I welcome the number of speakers from all parties who are contributing to this ongoing debate. It is critical that we speak about the economy in this House, as we were promised a rolling debate on the economy. It is important that we all get an opportunity to have our input on the current circumstances, which are changing very dramatically, including the reduction in interest rates, the falling price of oil and the decreasing rate of inflation. As Brendan Keenan writes in today's Irish Independent:

Many people will gain unambiguously from these effects. For someone with a large mortgage, or other borrowings, and a secure job, it is all good news. For many others, the threat of unemployment will outweigh any gains.

He goes on to state, "Yesterday, Davy Research predicted that private sector employment will fall by more than 140,000 over the next two years, pushing the jobless rate close to 12pc." That is his prediction. Obviously, construction will be a key area in this regard, but now the crisis is spreading into other areas. He talks about people going to Newry to shop and says it is likely to continue, and he talks about the fallout for the services sector and the very serious implications for so many people in our country. He states, "It is . . . a time for . . . hard thinking, and even harder decisions."

The Minister in his speech referred to the demonisation of the public sector. That is an inappropriate comment from the Minister, because I do not think anybody has been demonising the public sector. In Fine Gael we have been calling for the protection of front-line services, and that is about the public sector.

The recent budget was not people-proofed. It was not politically proofed either, as we have seen so many changes, the latest yesterday on education. We saw that it was not people-proofed when the elderly marched to protest against the removal of the automatic entitlement to a medical card, in the response of teachers, students and parents when they realised what was going to happen in schools, and when the Minister for Education changed his mind yesterday on the matter of substitute cover, having realised there would be chaos in our schools in January when secondary school pupils were sent home. We saw it in a range of decisions. In the Minister's speech today he mentioned changing the back to education allowance. I welcome this, because such changes are necessary and will give people some hope. There is no doubt that hope and confidence are extremely important in any economy, and they are very important at this time. The public were ready for hard decisions and would have accepted tougher decisions than the Government made in the budget, but they must be the right kind of decisions and not decisions that affect the elderly, who need their medical cards, or young children who may lose their book grants.

How can a Government with the kind of money that has been around this country, even in changed financial circumstances, withdraw the book grant from needy children? This grant is given out to the neediest of children in our schools. I received an e-mail from a teacher in one of the schools in Clondalkin in which she asked how she could approach the children who were not going to get their book grants or their uniforms this year. That is the kind of front-line cut that we were saying should not be made. That is why the Fine Gael economic policy has focused on other areas. That is also why the Minister is wrong to say we are demonising the public sector. There is a strong argument to be made that in fact the public sector has been more undermined by actions of the Fianna Fáil-Progressive Democrats Government than anything we could say. I could point to a number of actions, including decentralisation and the instability this has created for our Civil Service. It has created major instability, concern and uncertainty and has had a major impact on governance in this country. The kind of division in governance that this unplanned-for decentralisation caused could be argued to have done more to undermine the public sector than any other development in recent times. One could argue the same about benchmarking and the way it was handled, without being linked, as we said it should be, to productivity targets. One could also say — this is a key point — that the lack of public sector reform has done more to undermine the public sector than anything else.

I wish to consider two reports. The first is the report on public sector reform which was brought out on Friday and which I read with interest. The first question that arises——-