Paschal Donohoe (Fine Gael)

I welcome the Minister of State, Deputy Mansergh, to the House and thank the Cathaoirleach for the opportunity to speak on this Bill.

I wish to refer to two groups that, so far, have not featured much in the debate. The first group comprises people working for low pay in the private sector. They have clerical jobs in banks or multinational companies. They work in the construction sector and are worried that they will not be able to work for much longer. A considerable amount of tonight's discussion has been on gardaí, nurses, social workers and so on. There is no doubt that those groups must be represented and supported.

However, Members must keep in mind others who work in the private sector and who provide the capacity that allows the entire economy to continue ticking over. The reason this group must be mentioned tonight is because the one thing they will need and will rely on Members to provide for them to maintain their incomes and jobs is sound public finances. If there is one lesson that can be learned from the experience of other countries that have turned themselves out of the difficulties into which we now face, it is getting the public finances under control quickly in order that there is confidence for people who are living in our economy to spend and for those who live outside of our economy and businesses inside the economy to invest in it.

The other group to which I wish to refer briefly are the financial markets. For obvious reasons, whenever anyone talks about the financial markets, there is a sharp intake of breath. We talk about their greed, avarice and so on. However, we do not often talk about how often they have been correct in respect of some of the issues Members have discussed in this House. I will provide the analogy of the banking sector. For the past year, the Government and different people associated with it have been saying there is no problem with the banks, that everything is under control and nothing is going on that we will not be able to handle at some point in the future. During that period, the financial markets considered what was happening with the banks and decided not to believe us. The share prices plummeted month after month and that assessment has turned out to be correct. That is the assessment upon which we are acting and the analogy, unfortunately, on which Members now must draw, pertains to what is happening to our standing within the financial markets at present. While I have raised this point in this House in recent weeks, the financial markets currently believe it is a safer bet to buy Israeli Government debt or debt from Thailand, Malaysia or similar countries than it is to buy Irish Government debt. The implications are so great for our country that they require radical and strong action and I wish to emphasise three points in this regard.

There has been a great deal of discussion in this House about the need for an overall plan for the economy, the need to find €2 billion worth of savings this year, €4 billion next year and €4 billion the year after. I have to hand the document from which all those figures come. It is entitled Addendum to the Irish Stability Programme: Update, and was published in January 2009. I encourage every Member to read it. I particularly encourage them to read page 5 of that document which contains the table on which everything is based. I will examine some of the economic assumptions on which this plan is based. It assumes that next year, in 2010, gross national product, GNP, will contract by 1% and that it will grow by 2% the year after. It assumes that unemployment this year will peak at 9% and at 10% the year after and that it will begin to fall the year after that. Many Members within this House have observed that the economic conditions we face are far worse than what is laid out here. I have an awful fear, which I must raise in this House, that the figure of €16.5 billion that everyone is discussing is based on a document and a strategy that repeats the mistakes Members have debated for so long, namely, that one comes up with an assumption to allow one to get through this year, this month or the next budget.

Three measures are required in this regard. First, there is a need for complete honesty with the people and, more importantly, with ourselves about the true state of the economy, the our society and the dangers that lie ahead. I do not say this with any joy but I am convinced the assumptions upon which Members are basing their debate at present will not stand up and, unfortunately, that some of them are too optimistic.

Second, we must have a more buoyant and determined outlook as to what we are going to do. I am not an accountant. Before I entered this House, my profession in the private sector was as a salesman and I was proud to be one. When contemplating a hole in my figures, I did not think in the first instance about how I was going to pare back. My first instinct was to ascertain how I would create the activity and business that would allow such figures to be filled. I am convinced that the piece of work that must happen alongside this measure is to identify what parts of our economy and what industries can be developed and guided that will deliver the requisite tax revenue to ensure essential services are provided and to ensure our taxation levels are on a par with maintaining a spirit of enterprise within our country and on a par with allowing us to have a spirit of social solidarity. What worries me so much is that having examined the aforementioned document that guides Government thinking, none of this is present at all. None of that is clear.

I wish to conclude with some words I heard President Obama speak in his address last night. He used one phrase that struck me, when he said, "We cannot afford to govern out of anger or yield to the politics of the moment". Obviously, this is highly true of America and is even more so of Ireland. The situation we face is of the utmost gravity. While there is a need to be honest with the people, there is a far greater need to be honest with ourselves about where matters stand. We must acknowledge the situation we are in. Undoubtedly, public expenditure will be cut and taxation and unemployment will rise. We must be honest with ourselves that such things will happen. However, together with such measures, there must be an absolute, rigid and unrelenting determination from all Members of this House, but especially from the Government, which has the privilege to lead, to come up with the ideas that will fill the holes in this document. While this can be done, if we do not, our national morale and economy will be strangled.