Seanad debates

Friday, 5 December 2008

1:00 pm

Photo of Donie CassidyDonie Cassidy (Fianna Fail)

I am aware of that from personal experience. We also have examples from the Government that was in power from 1973 to 1977. As a party we always had to come in and get the economy moving again. That is the reason the people of Ireland returned us to Government three times in a row. They knew we would continue the positive policies we implemented. We experienced difficulty in 2001 and 2002 but it was the great policies of the Fianna Fáil-led Government that put us where we are today.

At certain times interest rates were 17% and 18% but today we see rates of 2.5%. Who would have thought we would see that day? With a margin of an additional 2% or 2.5%, the rate would be still only 5%. The money for projects is very manageable in terms of increasing confidence, particularly for those people paying mortgages. Someone paying a mortgage of €1,600 per month will have an extra €400 per month in their pocket compared to the position three months ago.

Inflation figures in 1987 were in double digits. Inflation today is down to approximately 4% and may reduce to 3% or even 2.5%. Income tax was paid at 65% on the high rate and 35% on the low rate, and there was a 2% levy. If one was lucky, one would take home 33% or 40% of their salary. Compared to the bands today, it was a very high rate in terms of encouraging people to continue to work and invest. At the time 1.1 million people were working whereas today 2.2 million people are working, which is a major advantage.

We have many advantages, and corrective measures must be taken, but I want to refer briefly to the small and medium-sized businesses, including family businesses, that employ more than 800,000 people. When such companies were in difficulty in the 1970s and the 1980s, they could go to the Government agency banks such as ICC Bank or ACC Bank, where they got assistance and understanding. That opportunity does not exist for a company struggling today.

I am concerned about the small Irish-owned businesses because they are the ones that will stay with us. They and their families may not make any money for the next two years but they are resilient and they will survive. Those are the people who should be a priority. The Minister called on the banks last week to come back to him within ten days to see what could be done to make funds available for those people who had a track record of three, five or ten years, regardless of whether they employed 30, 40 or 100 people, to allow them to continue that good work and ensure priority is given to jobs. The priority of the Government in the coming years must be to retain existing jobs, support the people providing employment and ensure that continues because the alternative is unthinkable.

This is a difficult time. The nation, the Taoiseach and Cabinet Ministers are facing a serious challenge, but I hope some of the suggestions made in the debate will bear fruit. It is important we hear the views of the membership of this House. I thank the leaders and all those who are of enormous help to me in the running of the House for their understanding in waiting for this very important debate and for the debate on the Finance Bill, which will take place this day two weeks. I thank the Minister of State for attending and giving us the opportunity to contribute. As I said, the Government should give priority to small and medium-sized businesses in tackling the problem we currently face.

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