Seanad debates

Thursday, 17 December 2009

Financial Emergency Measures in the Public Interest (No. 2) Bill 2009: Second Stage

 

12:00 pm

Photo of John Gerard HanafinJohn Gerard Hanafin (Fianna Fail)

It was Mr. Micawber in Hard Times who said, "Annual income, twenty pounds, annual expenditure nineteen and six, result happiness; annual income twenty pounds, annual expenditure twenty pounds and sixpence, result misery" and the position has not changed since Victorian times. We must live within our income.

There is no doubt about it, but the result of overpaying ourselves during a period of sustained growth followed by a property bubble is that we have become uncompetitive. There is no easy way to break bad news, but it is easier to make a decision when there is no choice and in this matter we have no choice.

It does not help to suggest not everyone is playing an equal part. The results are already in from the private sector, in which there have been hundreds of thousands of job losses, businesses are going out of business and people are unable to make ends meet. It would be unsustainable in any format for any of us to be within a group which could indefinitely be paid at the highest level such as those at the height of the boom when others who are paying for this were going through such difficulties. It is just a matter of facing the realities. In that time different sectors had been overpaid. Had we been producing the goods that justified that pay level - a level we appear to have reached in 2003 - it would have been sustainable.

A medical registrar in a regional hospital in Ireland earns €57,720 a year while the salary for an equivalent post in the UK is €44,000. A teacher in Ireland is paid on average €61,000 a year, €54,000 in the UK and €39,000 in France. A Civil Service clerical officer is paid €28,500 and the equivalent in the UK is paid €20,400. A police officer is paid €43,000 while the equivalent pay in the UK is €35,000. I would have been very happy to see such levels of pay continue if we could have afforded them.

This Government had certain jobs and we undertook them very well. We underpinned our economy by ensuring a viable banking sector which had been brought low not, as has been misrepresented, as a result of the actions of the regulator or this Government but by international events, and no words can change that fact.

The Government had a job to ensure the public finances were in order. The public finances are in order because many people have undergone hardship at a time when others are facing severe difficulties. We are all in this together and the Government has the figures. It is not the case that the Government works in a vacuum. The Ministers and the Taoiseach hear what is being said. The Taoiseach has the statistical information but also people write to him and give him instances of how they may have invested €2 million in their business and may not have taken any income out of the business in the past year so that they can continue to employ five or eight people and may eventually have been forced to let people go. When we are called upon to do what is necessary, it is our national duty to do it.

There are none the less, positive and welcome signs for the future. This is not the first time the public service has been asked to stand up. It was the public service, through Ken Whitaker and Seán Lemass, which created a strong and viable national economy. The public service is being asked to share the burden. We will turn the corner. Just one and a half years ago, in April 2008, we did not know whether there would be viable banking sectors in Ireland, America or Europe. We did not know whether we were heading for a second Great Depression, but thankfully the lessons of the past have been learned. The last quarter has seen a rise in gross domestic product, as announced today. I know this is tentative and only a start. One hundred new jobs have been announced for Dublin. We are still attracting foreign direct investment. The reason we are still attracting foreign direct investment and the reason our bond market prices have not gone through the roof as is the case in Greece is because we are taking the necessary steps.

I know the Cabinet spent hours, days, weeks and months ensuring parity and fairness. We all aim for consensus but I am conscious of the individual who wrote to us collectively when the first 1% levy was imposed. He was apoplectic with rage that he was being charged an extra 1%. If he could only have seen what was coming down the tracks he probably would have belted the computer. We do not expect to satisfy everyone but we must ensure everybody sees that what we are doing is fair and the reasonable man or woman understands that the action being taken is necessary and in all our interests.

This Christmas, people can know the economy has been underpinned by stability, that it is on a track to 2014, that we will not be wondering in the morning whether the IMF is coming in or whether bonds will be refused on the world market, and that the plan for the economy has been accepted by the EU and praised by the IMF. It has been a difficult time for us. Some people will go through hard times. However, just as a doctor gives a patient unpleasant or unpalatable medicine, we do not doubt that the doctor knows what is right and the Government is only doing what is right.

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