Michael D'Arcy (Fine Gael)

I wish to share the last minute of my time with Senator Keane. I take this opportunity to inform Members that as the Government spokesperson for finance in the Seanad, I am keen to state openly and clearly that I hope to be positive in this role, that we do not get into a Punch and Judy show, the term used by the Leader, and that everyone involved can put forward ideas. Members can use me as a vehicle to put ideas from whatever side of the House to the Minister and officials within the Department of Finance, and I trust this will be part of the positive work we do in Seanad Éireann.

I welcome the Bill. It is important to set the scene. We have been in recession for three years. To put this into context, that is a period of 12 quarters in a row going backwards. Let us compare it with the recession in the 1980s. In that decade, in which there were 40 quarters, the country was in recession for only three of those 40 quarters. This is where we are now and this is the difficulty we face. The calamity that is represented by 440,000 unemployed in the State is not something about which we can stand idly by and not try to do something. The Bill is a start; that is all. The social welfare budget is costing €20 billion of the €30 billion that we take in tax. We must try to do something about it and this is what we are doing.

I describe tourism as foreign direct investment and there is no easier foreign direct investment anywhere in the country. When someone travels here, they have money in their wallet or handbag and they bring it in and leave it behind. Nothing is easier or cheaper. Our nearest neighbours are in the United Kingdom. The number of people who visit here from there has fallen by 50% from seven years ago. In seven years we have managed to lose 50% of our easiest target market. Why have the figures fallen? It is because it is too expensive. Let us consider people on the average industrial wage in the UK. These are the people who come over on the ferry or who fly in on cheaper flights. They bring over a certain amount of money. When they are over here they go for a meal and the main course costs anything from €12 to €19. In the UK pub grub costs £5. This is why they have stopped coming. It is too damned expensive in this country. They have stopped bringing in money and this is impacting on our foreign direct investment. This is why so many businesses have closed and so many people have gone out of business in the restaurant and hotel trade and associated industries. We are trying to do something about it and that is what the Bill is about.

I recall Senator O'Brien describing the travel tax as a bad idea when it was introduced. It remains a bad idea and we have chosen to do something about it, namely, reducing it to zero. We are not getting rid of it, however, and it will remain on the books. The challenge for the airlines is to attract more visitors who will spend money in this country, thus benefiting workers via their wages and business people via the opportunity to make money. Our society is about enterprise. I was going to use the word "capitalism", but it seems to have acquired a bad name and is suggestive of greed. The word "enterprise" is much better because it refers to what keeps businesses trading, workers in jobs and people paying their taxes.

In conjunction with the benefit of increased tax revenues through the airline tax reduction is the reduction in the cost associated with employing staff. I speak as a business person and employer in saying it is not easy for anybody in business to fill workers' wage packets and pay PRSI. In addition, both employers and employees must pay the universal social charge. I also welcome the reduction in employer's PRSI. This will work in conjunction with the other changes to ensure there is a reduction in costs in order that visitors to the State will enjoy better value for money. Most people take X amount of holiday spending money and will stretch it to fit rather than going beyond it. We must ensure tourists' money goes further.

I welcome the provisions relating to research and development. This is an area in which, despite the events of recent years, we continue to enjoy a strong reputation internationally. It is something we are good at, whether in the social sciences or medical research, but we must work to enhance our expertise further in this niche area. The changes proposed in the Bill will help in that regard. However, I have some concerns about the role of IDA Ireland. Our corporation tax has always been a huge benefit in attracting business to the State and helping IDA Ireland to compete internationally for foreign direct investment. Research and development is an important part of this, but I question the success of IDA Ireland in that regard. While our successes in attracting foreign companies are announced with great fanfare, none of us knows what enterprises have slipped through and where IDA Ireland has not been successful. It is as important that we know how the agency is doing its business and how successful it is in order to ensure we are as competitive as possible. For example, some weeks ago Amazon announced the creation of an additional 900 jobs in Scotland. I would like to know whether we were in competition for these jobs and, if so, why we were not successful.

In November 2010, as part of our budget arithmetic, Fine Gael set forth clearly its proposal for a 0.6% levy on pension funds to fund a job creation initiative. That proposal was included in our general election literature and we indicated it would be part of the programme for Government. On all occasions we identified pension funds as a source of income for a jobs initiative which would, of necessity, be cost neutral. It was not a matter of choice; the money had to be found somewhere. I wish we could find it somewhere else, but we have not been successful in that regard. We have implemented the levy in the manner in which we said all along we would.