Michael Kitt (Galway East, Fianna Fail)

I thank all the Senators who contributed to the debate. The purpose of the Bill is to seek a modest increase in motor tax as a contribution to ensuring that local authorities have the resources to provide good quality local services to the public across a range of areas. The general purposes grants, financed from the local government fund, are an important source of local authority funding and they represent about one fifth of the total current income. They are discretionary and may be used by authorities to fund whatever day-to-day operations they consider necessary.

The major changes introduced to the motor taxation system in 2008 will make a real contribution to reducing emissions in Ireland. The Minister intends to keep the system under active review to ensure that it meets its twin objectives of securing more sustainable motoring, while ensuring that motor tax continues to contribute sufficient resources to local government funding. This is just one of a broad range of measures that will be required if Ireland is to meet its EU and international climate change obligations.

The Minister was here for most of the debate and he agreed with the points made by Senator Coffey about the need to invest in public transport and in all modes of sustainable travel. The Government is investing record sums in public transport and further policies will be outlined in a new sustainable travel and transport strategy, which the Minister of Transport is preparing. We have a huge challenge to meet if we are to reduce our emissions. As the recent SEI figures have shown, there have been major energy efficiency gains in recent years. It is clear that transport is a difficult area that requires concerted effort.

The Minister pointed out that the Government has introduced new incentives on electric cars. There has been a significant objective to put 250,000 electric cars on Irish roads over the next decade. There is no VRT on electric vehicles and there is a low motor tax charge that has not increased in the past two years.

There is merit in taxing fuel. The Government raised petrol tax by 8 cent per litre in the recent budget. The Government is continuing to look at carbon taxes and will keep these issues under review. Not everybody lives in Dublin and the costs on people who are car dependent and who do not have access to public transport must be considered. Senator Norris raised the issue of cars for the disabled and the Minister has taken that up. The Minister was also impressed by the points made by Senator O'Toole on electric vehicles. The Minister for Transport and the Minister for Communications, Energy and Natural Resources have resolved to roll out the electric charging infrastructure to which the Senator referred. I will pass on his comments to my colleagues.

Senator Hannigan suggested that the new system of taxation will present challenges in respect of protecting income from the local government fund. These changes are being made on the basis of revenue neutrality. They will continue to be kept under review. The recommendations of the Commission on Taxation, which was mentioned by Senator Boyle, will also be important.

A number of Senators raised issues which come under the remit of the Department of Transport, including rail freight, road construction, the national car test and toll roads. I will pass the Senators' remarks on these matters to the Minister for Transport. I regret that I was not in attendance for Senator Glynn's comments on some of these issues.

Senator John Paul Phelan raised the possibility of introducing a form of taxation to support local government. The levy on second properties, which was announced by the Minister for Finance on budget day, will be set at €200 per property. The more general issue of local government funding, to which Senator Boyle referred, is being considered by the Commission on Taxation, in accordance with its remit to examine all issues of taxation.

Senator Buttimer bemoaned the loss of the Cork city tram service. The loss of a rail service, which has been experienced in many parts of the country, is always regrettable. I will pass to the Minister for Transport his comments on the possibility of developing a new light rail service in Cork city. The Senator made a good point about rest areas on motorways. As someone who uses the road between Dublin and Galway quite frequently, I am aware that the section between Dublin and Athlone is now quite good. I hope the motorway will be extended as far as Ballinasloe next year. I accept that there is a need for rest areas on such long stretches of motorway.

Senator Cummins spoke about rail freight. I am conscious that good work is being done to facilitate the transportation of freight by rail, particularly along the western rail corridor which was closed in 1975 but is now being redeveloped, with the section between Ennis and Athenry set to open next year. I hope more progress will be made with the transportation of freight and passengers along such railway lines.

I consider the proposed increase in motor tax rates for 2009 to be reasonable in this challenging economic period. I am grateful to all Senators who contributed to the debate on this Bill.

Question, "That the Bill be now read a Second Time", put and declared carried.