Marc MacSharry (Fianna Fail)

I join others in welcoming the Minister of State to the House for what seems like his fortnightly visits. I welcome the publication of the four year plan, The National Recovery Plan 2011-2014. There is no question but there are positive points in it. Notwithstanding that, it is unlikely to receive accolades from the vested interest groups. In any economic context no one would try to introduce the measures included here. In recent weeks when contributing in the Chamber, I have reflected on the past 30 years. One line in the report reads: "We have eroded the income tax base to an unsustainable level". That says it all. From the mid-1970s, consecutive Governments from all sides of the House have presided over a redefinition of entitlement to its current meaning, which is completely unsustainable. I welcome the measures included in the report that seek to replace some element of local service contributions.

I refer to the abolition of domestic rates in 1977, which were unfairly calculated. They often penalised those with big houses and who had raised big families. When the children were gone, they had to pay higher contributions. That was unjust. To create at the time a surreal environment that led people to believe in the lack of contribution, which is not the case in most other countries, was wrong and unsustainable. It ravaged regional capabilities to develop on their own steam and underlined the unfair reality that one depended on the proximity of a Minister to bank a capital project. In that context, I welcome underpinning contributions to local services through a property tax. Although it is €100 in the first year, it is envisaged to be approximately €200 by 2014. By 2013, a suitable valuation mechanism will be set up. That is good and it will serve future generations, unpalatable as it may be in that it marks a change that none of us has had to face since the mid-1970s. That is positive.

I also welcome the widening of the tax base. Over recent years we have taken too many people out of the tax net. Painful as it is and given where we have come from in the relative prosperity of recent years, it seems draconian to ask people on incomes as low as €15,300 to make a contribution, but it is essential.

It is also appropriate that those in receipt of generous State pensions take a reduction. It is not sustainable for them to continue on the levels they were at in line with incomes before. In many other areas, savings must be made. The reduction in the minimum wage was mentioned recently in these Houses. It was one of the highest in Europe at €8.65. Times have changed and we must change with them. The joint labour council agreements for the agricultural, catering and construction sectors and the various contributions made by NERA in enforcing the laws served in their day to give adequate protection to workers. Unfortunately, they have increased activity in the black economy and have been an impediment to employment creation in recent times. I welcome these measures. Obviously I do not expect the trade union movement to welcome these. I watched Mr. Jack O'Connor of SIPTU say these measures will contribute to a loss of jobs. I do not accept his analysis. This change will enhance the prospects of younger people to get employment.

The plan was published only a few hours ago so it is difficult for us to get through the detail. Several debates over the next few weeks will facilitate us teasing out the detail. Social welfare will be cut by €2.8 billion. Very few of us will agree where €2.8 billion can be cut but there is no question that people have opted for a lifestyle dependency on social welfare. I spoke to a crèche owner involved in the State scheme for children under four years of age. Having gone through an expansion and attracted more children, there was scope for three additional child care workers. Having advertised in the media, the owner could not secure three adequate people to take those jobs because she kept coming across people who said they would only work for three days. They were suited to the lifestyle whereby they could claim for two days and work for three days.