Pearse Doherty (Sinn Fein)

Gabhaim buíochas leis an Seanadóir White as ucht a chuid ama a roinnt liom. Tá a fhios agam gur díospóireacht iontach tábhachtach í an díospóireacht seo. Cuirim fáilte roimh an Aire freisin. I welcome the opportunity to discuss the pre-budget outlook and to outline some of my party's proposals in terms of where we believe the Government's direction should be on 9 December and beyond. There is an onus on parties in Opposition to provide alternatives. There is no point in us continuing to argue that we do not support X, Y or Z unless we are willing to put forward proposal A, B and C as an alternative. We are the only party in opposition that has submitted a range of proposals to the Government which are costed nearly entirely by the Department of Finance and the Commission on Taxation.

This takes me to the point that whether the Government supports these proposals is an issue we can have a debate on, and we can argue the merits of taking from those who are living on €200 a week or taking from those who are earning €200,000 per year. Let us have that ideological argument. I have no problem with this.

Senator Boyle spoke of honesty. I want to turn that point on its head. It is utterly dishonest for the Government and Minister after Minister to say time and again that there is only one option. There is clearly more than one option. We have provided the Government with an option in terms of our analysis of where the budget deficit can be closed, how we create a stimulus package to keep people at work or get them back into work and how we help families in households that are suffering as a result of the downturn in the economy. These options are costed by the Department of Finance in order that when we say that, for example, standardising discretionary tax reliefs will generate €1.1 billion, it is a fact. Let us discuss, then, whether we should do that or not. When we talk about introducing a wealth tax, we do so knowing it is available in many other European countries. For example, France, Norway, Switzerland, Greece and Holland all have a wealth tax. In the 1970s we had our own wealth tax and the introduction of such a tax on those with assets above €1 million would bring in revenue well in excess of €1 billion. The introduction of a third rate of tax at 48% would again bring in revenue that is badly needed for the State in region of €355 million. The capping of public sector salaries at €100,000 would generate €450 million in savings.

These are examples from a range of proposals costed for the Department of Finance in our document, Road to Recovery. We need an honest debate to discuss the fairness in deciding to cut social welfare rates instead of taxing at a higher rate those who have significant assets and wealth. The average person does not follow these debates and the little nuances that different political parties emit time and again. The Government has done a good job in making people believe there is only one strategy, which is to cut public sector pay, social welfare and front-line services. We have shown this is not the only way.

The Government has also been very successful in saying we have the most generous social welfare allowances in Europe. That is absolute nonsense as we have the third lowest rate for an individual, with the second lowest being the United Kingdom and the lowest being Greece. We have terrible social welfare rates when it comes to individuals and with couples, the rate is just below average. We need an honest debate and we must discuss fairness in the budget.

I do not have time to go through every point in this brochure but I made an appeal, from a parochial perspective, last year when we spoke about VAT rates after the budget. We have two proposals that will deal with cross-Border shopping. The first is that we reduce VAT rates. Given that the Chancellor of the Exchequer in Britain is about to increase VAT rates, now is the opportune time to give confidence to those people shopping in the Twenty-six Counties.

Report after report has shown that the primary driver for people in cross-Border shopping is the purchase of alcohol. Some 50% of all alcohol sold on the island of Ireland is now sold in the North. The consumption of alcohol on an island-wide basis has increased; there has been a 7% drop in the South but a 30% increase in the North. The reality is that we have the highest excise duty in Europe on wine and the second highest on beer. The Minister should take that duty in for the month of the December; if the exercise does not work it would cost €18 million but if it does, it will keep people at home to purchase their alcohol and then the rest of their groceries.

We have seen reports today and yesterday that cross-Border shopping could cost approximately 1,700 jobs. Excise duty could be cut on a pilot basis by 20% this Christmas and VAT rates could be reduced in line with what is happening in Britain. We should try to keep shoppers in each county. I am an all-Ireland person; if people want to travel to Newry that is fine but I want the people of Donegal to stay in Donegal, the people of Gweedore to stay in Gweedore and the people of Dungloe to stay in Dungloe. That is how parochial we are. We must build our local economy.

Such action makes sense as we are losing a significant amount of money. I ask the Government to consider some of the proposals in the Road to Recovery document.