Alex White (Labour)

I begin by repeating a comment I made on the Order of the Business when I described as a spectacle the scenario that this House has been invited to have a debate on the economy, one which has been correctly facilitated by the Minister and the Leader, in circumstances in which the presentation made to us by the Government, through the Minister of State, Deputy Mansergh — I do not criticise him personally — is almost completely devoid of detail in respect of the Government's proposals to take us out of the crisis described by Senator Boyle. At precisely the same time as the Minister of State is appearing before the House, a document, described in the media as a framework document, is apparently being presented to the social partners and one is asked to believe it contains specific proposals as to how we are to proceed. It is a spectacle and it is wrong, notwithstanding that Senator Boyle said decisions will be made by Government and these Houses and it is just a matter of consultation.

I enthusiastically support social partnership, but what is the problem with the Government sharing with the public and these Houses the bones of its proposals on where we are at? Why, day in and day out, must we pick up the newspapers, read informed and less informed, inspired and less inspired speculation on what will occur? Pay freezes, pay cuts, tax increases, public expenditure cuts are all mentioned. I ask the Minister of State to deal with this matter directly in his response.

It seems to me that kites are flown for a day or two to see how far they travel and are then drawn in by Government when they do not achieve a particular outcome it hoped for. That is no way to conduct this debate. I doubt if any democracy in the world would conduct a debate about a crisis such as this in that manner. What is the problem with the Government setting out its proposals and strategy to these Houses? It clearly has not been done. Why has it not been done? Why can it not be done? I understand the process of negotiation and the requirement for people to be circumspect on particular numbers, whether it concerns pay increases, reductions or freezes and so on. We are dealing with more than issues concerning pay. We are dealing with the broader sweep of the economic crisis we are facing. Senator Boyle correctly described it as a crisis.

To put it mildly, it is not good enough that we are treated to something that is not really a debate. Out of deference to these Houses, I will not describe it as a farce, but that is what amounts to, particularly in circumstances where the real action is taking place somewhere else down town. Somebody needs to explain that situation to the people we represent in these Houses. I agree entirely and enthusiastically with what I understood Senator Boyle proposed, namely a committee of these Houses to examine and report on the banking crisis and the financial situation that has arisen as a consequence of the collapses of recent months. Some examples are the Government nationalisation of Anglo Irish Bank, the various other steps taken on recapitalisation and the bank guarantee scheme.

Ministers and the Government often decry Opposition Members and journalists who want to talk about how we got here. I can understand Ministers not wanting to talk about it. That is a perfectly human response on their part, because if we are to have a debate on how we got here they will not come out of it particularly well. The Minister of State and I had an exchange here on another occasion when I reminded him and colleagues of remarks by the former Minister, Mr. McCreevy, that when he had money he spent it and when he did not have it, it could not be spent. In fairness to the Minister of State, in his response to me he expressed the same level of unhappiness with that type of sentiment as I expressed. In the opening remarks of his speech, he talks about the words of the psalm. He uses the word "perhaps", the least useful word in the sentence. He said, "In the days of our prosperity, perhaps we should have heeded the words of the psalm." It is manifest that in the days our prosperity we should have heeded the words of the psalmist.

Senator MacSharry may say that hindsight is all very well and we did not realise these things at the time. There were plenty of people making these points and talking about the overheating of the housing and construction markets. A person with a good reputation, Dr. Peter Bacon, was recruited by the Government to examine this issue. He brought out a report in 2000 which made a number of proposals which, as I recall, were calculated to take the heat out the madness of growth in the housing sector. It was a mirage rather than real growth, based on productive activity. Dr. Bacon suggested, among other things, the introduction of a 2% or 3% property tax, which would not have to be paid if a speculator signed up to various standards in accommodation and so on. He also sought major reform of stamp duty, with staggered rates, depending on whether the purchaser was a first time buyer. Changes were made later, but these recommendations were made in 2000. Bacon is an expert economic consultant who was retained by the Government, not a solo operator writing op-ed pieces in a newspaper. He made it very clear at the time that property prices would continue to go through the roof and if the situation was not brought under control it would cause huge difficulties down the road, which is precisely what occurred. People cannot say, "This is all a big surprise, we could never have known." Likewise, the Minister of State cannot seek to persuade us that what occurred is like a natural disaster.

I hope to raise this issue again in the House. Senator Boyle made a proposal to establish a dedicated committee of these Houses to consider the banking crisis. I would have thought that the Minister of State, as a historian, would agree with the general proposition that it is very difficult for the Government, the Houses of the Oireachtas or the community to buy into — a phrase which I hate — have confidence in and be party to difficult proposals on cutbacks to services, pay cuts or anything else unless there is an honest assessment made of how we have reached the stage we are at now. It is not good enough for the Government to give the impression that once proposals have been put through the social partnership process, there will suddenly be a set of proposals to solve everything. I am not suggesting the Government thinks it will be that easy — because clearly it will not — but it would be vastly easier for the country if people were spoken to honestly and frankly on how we reached the current situation.

The nature of political debate and discourse in this country on issues such as taxation has been, in my opinion, almost poisoned in recent years by a mad rush to encourage people to see that wealth, the future of their families and future well-being reposed in property, whether it was a first, second or third property. There was no serious debate. Allied to that was the complete failure, across the board, to have an adult debate on the relationship between taxation and public services. We have not had such a debate in this country for 20 years or more. People have become petrified by the notion that if one talks about the need for a broader tax base, one is a tax-and-spend merchant coming in from stage left, and all one wants to do is raise taxation and spend people's money. Glib dismissals of those kinds of issues have made it difficult for us to have an intelligent adult debate on taxation.

I heard a Government colleague criticise Senator Twomey, saying that the Opposition's only solution was to raise taxes. I remind the Minister of State and my colleagues opposite that this Government raised taxes dramatically in the recent budget. Let nobody say that the income levy is not a tax. Does anybody believe that levy will be a temporary provision and will not be continued, perhaps being integrated into the tax code itself? We all know the levy is there for good. We also know that it is only a matter of time before taxes will be raised. The tragedy is that taxes are being raised when the Government has its back to the ropes and must levy moneys to provide services to which it is committed, rather than having had a more serious debate over the past ten years about the proper level of taxation consistent with the required level of public services. It is almost an emergency situation. Meanwhile, we have pushed many public services into the private sector, most spectacularly in the health service. In child care and other areas we have been content to say that people ought largely to provide for themselves rather than having a robust State system to do so. While it may be for the wrong reasons, there is a genuine opportunity now to debate in this House, in the community, in the course of elections and in the media the level of public services we want. In that way we can match it to the necessary level of taxation.

The Commission on Taxation is due to report in the summer. Its work is complex and there is much pressure at the moment because there is a major crisis. Various options must be up for debate, both here and among the general public. Can some consideration be given to bringing forward that commission's report, or to having an interim report to assist our debate on tax? The commission was given a reasonably lengthy timeframe because of the complexity of its work, but it is a pity that it is impossible for us to have a truly comprehensive debate on all these economic issues because the tax issue is being put off until the summer when the commission reports. We should not go off on our holidays and table it for debate when we come back in September or October. I understand there are complex issues and that it is easier said than done to bring forward such a report. However, in our particular circumstances, and in view of the peculiarly important role of taxation in the context of the economic crisis and the kind of public services we aspire to have in future, it would be useful if that report were available for deliberation. Is it possible to have an interim report from the commission, which might guide the debate on that crucial issue?