Larry Butler (Fianna Fail)

This budget was precipitated by a collapse in our tax take. We found ourselves having to bridge the gap between income and expenditure. Fianna Fáil has a fine record in supporting social welfare and pensions for the less well-off in society. Senator Norris touched on the wonderful actions taken by Mr. Haughey for the elderly in terms of free travel and increases to the old age pension. If people say we blew the boom, I am happy to stand over the decent increases we gave to old age pensioners and how we looked after them with free travel. We have done the right thing from a social point of view. This Government has borrowed €20 billion to ensure social welfare recipients can maintain a decent existence. One will not take many holidays on €210 per week but at least recipients have a better standard of living here than they would in most European countries.

As Senator Hanafin noted, prices have decreased substantially across the board. Commercial rents have been reduced by up to 25%. However, one will have to fight with one's landlord to achieve such a reduction. O'Brien's sandwich bars are a shining example of this. I recently attended a speech by Mr. Sweeney at a Chambers Ireland event at which he stated the rents in 50% of his sandwich bars were reduced by between 20% and 25%. He told the landlords that he would be unable to stay in business without substantial reductions. This reveals that one can reduce one's rent by approaching the issue properly.

The Government was then faced with a situation whereby it had to intervene in the banking deposit scenario. Unless the Minister for Finance had acted promptly and swiftly in that case there would have been a substantial run on our banks at the time.

Small businesses are finding the situation difficult at the moment, as the Minister knows. Recently, however, banks have introduced special charges on people with overdrafts, which is scary. The Minister should examine these charges in the interests of small businesses which make this country tick over. These overdraft charges represent an extra cost for businesses and it is not good enough.

A strong effort is made in the Bill to bridge the taxation gap. Senator Quinn was right to mention that there was a period when we were overtaxed and such taxation did not work. Over-taxation led to a black economy, which was not much good to the Exchequer. As this is an interim measure I understand why the levies must be there and they will be regularised in the next budget. It is important to note, however, that we will become very big property owners shortly as a result of NAMA. The Minister should also examine stamp duty because we are getting very little return from the current stamp duty regime. We could charge 50% and the return would still be the same. If stamp duty was reduced it could kick-start the property market again by the end of this year. Some sales are beginning to take place as property prices fall to a certain level and people start buying again. That is very important, but I warn the Minister about property tax. I would examine ways of structuring such a measure. The introduction of a property tax in the next budget would not send out the right message to those who wish to buy property or for hard-pressed people who purchased expensive houses in the past. The Minister should examine what might be done to structure such charges. The United Kingdom does not have a property tax but one must pay a local charge there for services such as water, libraries and the fire brigade. That approach might be considered here.

If we tried to introduce property tax, how would we value it? It is very difficult to put a value on any property at the moment. I know a young couple who bought a house in Bray for €315,000 and spent an additional €50,000 on refurbishing it. A similar house in the same road is now selling for approximately €250,000, which gives some indication of where property prices are going. The price one paid for a house two years ago will not be the same as the price today.

I have covered most of the matters I wished to raise in the context of this Bill. I heard criticism from the Labour Party about NAMA but it has not come up with one solution. Its suggestion is to nationalise the banks but what about small investors in bank shares? They have lost a lot of money because the shares are not worth what they were. How will we deal with these people? I think the Minister is proceeding the right way with NAMA. I encourage him to introduce NAMA as soon as he can because the current situation is inhibiting the banking sector.