James Carroll (Fianna Fail)

I welcome the Minister of State, Deputy Mansergh, to the House as this is my first time here when he has been present. I look forward to his reply.

Yesterday's budget was tough but necessary. It would certainly not be fair to weigh down the generation in my age group in their 20s or the next generation with excess debt. By the end of this year, the national debt will be approximately €76 billion, double the level at the end of 2007. Delaying action accelerates the increase in the national debt and, consequently, the cost of funding will rise substantially. Every extra €1 billion in interest on the national debt would be the equivalent of the annual salaries of 21,500 new teachers or a 6% reduction in general social welfare rates, none of which we want to see. Postponing action would result in additional cuts of this nature in the years ahead, leaving future generations with the bill. This is what was done previously and it can never be allowed happen again.

There were positive elements in yesterday's budget. The car scrappage scheme is a win-win situation from an environmental and an economic perspective. At least €1 billion has been lost in tax revenue following the collapse of the new car market which resulted in the loss of up to 10,000 jobs. At least that number of jobs again is under serious threat in the sector. A scrappage scheme will have the dual purpose of increasing the number of more environmentally friendly cars on the road and help to stimulate the industry, protecting jobs and bringing much needed taxes into the Government coffers. The scheme will run from 1 January until 31 December next year. Those participating will be able to avail of VRT relief of up to €1,500 per new car purchased when trading in cars ten years or older. The Government will also focus on environmentally friendly cars and the development of new technology in this field. The Government needed to provide a strong stimulus package in conjunction with the necessary cuts introduced yesterday, and we need to provide every encouragement possible to get people spending again. A car scrappage scheme has the potential to go a long way in this regard. It has worked in both Germany and the UK and I am confident that it can work here also.

The provision of €130 million for energy efficiency measures, including a national retrofit programme in the 2010 budget will help create and maintain jobs in County Louth and east Meath, which I represent. Some €130 million is being provided in next year's budget for energy efficiency programmes, including a new national retrofit programme, which I mentioned earlier in my speech on climate change. This is the future, at least in the short term, for the construction industry.

Boosting energy efficiency is good for the environment and for the economy and it has significant benefits at both local and national levels. It is a practical and forward-looking move because it will help create and maintain jobs and also lower energy bills in the future. It is hoped up to 5,000 jobs will be created across the country next year alone in this sector. This significant fund will help build on the good work done already. I have personal experience of the warmer homes scheme and the home energy savings scheme which have been an overwhelming success.

Obviously, not everything in yesterday's budget was ideal. We reduced jobseeker's allowance from €204.30 down to €196, representing a 4.1% decrease. The reality is the support provided by the State to those on welfare is far more generous than that of the neighbouring jurisdiction, the Border with which is close to my home. Welfare rates in the Republic of Ireland have doubled since 2000. What is most important is that we have a strong welfare system in the future and we do not sacrifice people now to maintain too high a level of benefit which would affect people in the future. Unless we cut back a little now, there would need to be drastic cuts in the future and nobody wants that. The Government's principle has been to try to protect the purchasing power of people on social welfare so that they are not made worse off, and this is vital.

The Government increased welfare rates by approximately 3% in the 2009 budget and they are being reduced by a little over 4%. This amounts to a net reduction of approximately 1.1% and brings social welfare back to around 2008 levels. However, the cost of living has come down by over 6% and is back at 2007 levels. Child benefit is being reduced while every effort has been made to ensure there is no decrease in the spending power of people who receive welfare and-or child benefit.

The essential message to go out from the Oireachtas this week is that we have not touched the State pension because older people have contributed so much to this country. They simply do not have the option of going back to work to supplement their income. They have worked all their lives, earned their living and got the country where it is. They should not have to rely on their children or grandchildren to live in dignity.

There were further boosts in yesterday's budget. These included a reduction in excise duties on alcohol, a lower VAT rate to assist hotels, catering and the retail sector, tax breaks for start-up companies and continued investment in research and development. There is additional funding for agriculture and forestry, including the capital provision of €116 million to plant a further 7,000 hectares of trees next year, which is a vital potential growth area for the agricultural sector.

There is also support for a marketing drive and investment in visitor attractions in the tourism sector. The Budget Statement's recognition of the importance of tourism is to be welcomed. I note that the tourism services budget is to be increased by 2% to €155 million. More than €44 million has been earmarked to promote Ireland as a domestic and international tourism destination. My home area of County Louth is a superb location for tourism. There is a fantastic product there and throughout the country. As I mentioned on my first day in the House two weeks go, my home parish of Monasterboice, with its round tower and high crosses, is a phenomenal resource, but its full potential remains untapped. I hope both the Minister and the Joint Committee on Arts, Sport, Tourism, Community, Rural and Gaeltacht Affairs will take note of that great potential.

A few weeks ago, Deputy Seán Connick came up with the novel idea of possibly giving away €30 million worth of flights to get people to come into the country. Once here, they would spend multiples of that amount on food, drink and accommodation as well as all the accruing ancillary expenditure.

Those who have been hit hardest by the recession are those who have lost their jobs. Our main priority must be to get them back to work as soon as possible. We cannot delay recovery, as happened in the 1980s, and allow jobless people to become long-term unemployed. That was a lost generation. I have friends who have lost jobs, but I do not want to see them being forced to emigrate. To repeat that mistake would be the unfairest step of all.