Ciarán Cannon (Fine Gael)

We had a rather passionately drawn analogy a few moments ago from Senator Harris, who compared the nation to a family and described the public service as an uncle living in the attic who goes out every lunchtime to place a bet on a horse. I would like to continue that analogy, which is an appropriate one. The State is like a family - a family in which one or possibly two of the income earners have become unemployed and, as a result of the consequent loss of income to the household, has had to cut back on spending. Any normal family in such a crisis would do two things. First, it would pare back its budget and try to survive on less each week. It would also try to secure employment for one or both members involved. That is where the Government is failing miserably. Our credibility in going to the bond market in February or March to try to secure money to keep the show on the road would be adversely affected by the failure to address this other side of the economic equation. While we have heard many suggestions in the course of debate, until Senators Butler and Leyden stood up there was no discussion by any other Member on the Government side of how we might begin to create jobs again. A very real fear in the international investment market is that the proposed austerity measures, rather than setting Ireland on the road to recovery, unless they are coupled with genuine job creation measures, will send it into an ever-downward spiral of deflation.

The credibility of any four-year fiscal plan will be dependent on the likely growth path to be followed in the coming four years. The Government now projects that higher debt servicing costs and lower growth - now expected to be an average figure of 2.75% - will force it to double its estimates for spending cuts from the previous figure of €7.5 billion to €15 billion. However, there are better possible outcomes. Recently the ESRI outlined a high growth scenario involving a figure of up to 4.5%, which, if it were to materialise, would necessitate a smaller package of fiscal measures in order to reach the 3% target by 2014. Therefore, Fine Gael believes we should relentlessly put the focus on the ways by which we can support growth and jobs as the country repairs the public finances. Any fiscal plan must operate in parallel with a credible growth and jobs plan to reverse the current downward vicious spiral to an upward virtuous one.

When the Taoiseach opened the debate in the Dáil on the economy and the budgetary measures that must be imposed, in his 30-minute speech he made little or no mention of the other side of the equation: how we, as a nation, might begin to support enterprise and create jobs once again. Last week in a debate on how we might do this, I outlined a number of measures that needed to be taken by the Government to keep that other side of the equation alive and active. It is important to outline them again this afternoon.

The bedrock of our recovery needs to be the private sector, as Senator Harris mentioned. It needs to be a private sector completely supported and unhindered by the Government in its efforts to help stage our economic recovery. Three years ago the Government promised to reduce the unnecessary cost of business compliance to the private sector by €500 million. In today's fiercely competitive business environment that is €500 million business cannot afford to spend. To date - we have moved past the halfway stage in that programme - savings of only €20 million have been achieved. Cutting unnecessary red tape must be a key part of a new Government agenda to make the business environment competitive again. When the promise to reduce the cost of compliance by €500 million was made, anyone involved in business would have been heartened, but a few years later only 4% of that promise has been delivered on. The Government cannot blame the recession for its failure to deliver on that promise; it is part of what was recently branded as a "chronic implementation deficit disorder" from which the Government suffers.

The Government also suffers from chronic implementation deficit disorder when one considers its action in recent years on the air travel tax. Facing an unprecedented drop in tourist numbers, more than two years ago the Government established a tourism renewal group, comprising people with a wide knowledge of tourism, which was asked to prepare a report on what could be done to restore tourist numbers. One of its key recommendations was the removal of the €10 air travel tax which was also supported by the Government's own Commission on Taxation, citing that the country was losing more money than it was earning because of it, but the Government chose to ignore its advice.

As I said, there are two sides to the equation in our economic recovery, one side of which is implementing the very painful austerity measures needed, but we will not and cannot restore the confidence of the people which I argue is far more important than that of any bond market and those in the bond market from whom we hope to secure funding early in the new year, unless we actively pursue both sides of the economic recovery equation, of which creating jobs must be a fundamental part.