Thursday, 30 June 1994
Dáil Éireann Debate
That a sum not exceeding £85,000,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1994, for Increases in Remuneration and Pensions.
Ireland is forging ahead rapidly, economically, socially and culturally. A real opportunity exists for peace and political progress in Northern Ireland. A substantial portion of the commitments in the Programme for Government have been implemented. While the two parties in Government have separate identities, the combined strengths of both parties have produced extremely fruitful and beneficial results for the Irish people. This Government is providing the right mixture of continuity and change, building on the progress of the past seven years.
Our economy is performing powerfully. The crisis levels of unemployment are falling, with the live register down 20,000 already this year. The ESRI has predicted total employment will rise by 23,000 this year alone.
While the rest of the European Union is shaking off recession, GNP is set to rise in Ireland by 5 per cent in 1994. The European average will be about 1.75 per cent. We remain one of the low inflation economies. This will help maintain our competitive position. Strong export growth is translating into increased real income per head every year, resulting in rising standards of living. Exchequer receipts are buoyant, helping to reduce the debt.
The Community Support Framework for Ireland was approved in principle by the European Commission on 15 June 1994, subject to the opinions of four EU consultative committees. We expect it will then be formally adopted by the  Commission during July, making nonsense of Opposition suggestions that we had been delaying its formulation for a week or two to get by the European elections.
The Government set out its development strategy in the National Development Plan. Its central objective is to ensure the best long term return for jobs through increasing output and economic potential. It is further designed to reintegrate the long term unemployed into the economic mainstream.
The Government's strategy in the plan has been fully endorsed in the Community Support Framework, which identifies the same priorities and key elements. The shortfall in EU aid, which we have all known about since last October, will have an effect only on the pace of implementation.
Some of the operational programmes will be approved by the Commission in July, with the balance in the autumn. The Commission is likely to adopt the guidelines for a series of new Community initiatives shortly. Implementation has been going ahead, in many cases since the start of the year.
These elements combined — the Community Support Framework, Community initiatives, and the Cohesion Fund — represent the largest development effort ever undertaken here, and the best allocation of any of the member states. The total European Union aid of, at a minimum, over £7 billion in the period 1993 to 1999 is the largest single aid package ever obtained by this country. We are ensuring that these resources are used wisely to achieve lasting improvements in the economy.
The overall impact will be dramatic. We will see a continuing major upgrading of our essential infrastructures, strategic investments to enhance our productive capacity, and development of the talents and skills of our workforce. For the first time also, we will see a comprehensive package of measures to encourage, support and deliver on the development potential in local communities.
It is regrettable that Opposition parties spend so much of their time making  vicious personal attacks and engaging in character assassinations of a kind not seen in this House for many years, and which seriously damage the profession of politics. Thankfully, the Irish electorate were not very impressed, as shown by the Euro-election results.
Is it any wonder that the voters of Munster did not believe the Progressive Democrats or their former leader? This is the same man, who stated at the Public Accounts Committee on 10 March 1994, concerning his legal costs with the Beef Tribunal, and I quote —“I did not make any application for costs”. Yet on 15 July 1993, one of his counsel had indeed made an application for his full costs. That is a matter of public record. The deliberate deception of the people in relation to the truth about the filling of the Presidency of the EU will meet the same fate. In relation to the Sutherland affair, I deal in fact not in fantasy.
Mr. J. Bruton: It is, I am asking the guidance of the Chair and I will accept his ruling. Is it in order for the Taoiseach to refer to a person outside this House, who has done nothing wrong, as a person involved in the so-called “Sutherland affair”?
The Taoiseach: I deal in fact and not in fantasy. In relation to the business migration scheme, again I deal with the incontrovertible truth, not in McDowell “fairy tales”. Are the Progressive Democrats and other Members suggesting that a Member who has a profession or business should be discriminated against and should not avail of any scheme legitimately available to him or her? If that is what they are saying, let them come out and say it. Others are saying that should not be the purpose of this House. Come out from behind the smokescreen and make allegations if there are any to make. They have no foundation any more than other allegations during the past year.
The Government's commitment to social partnership has been further underlined by the agreement on a third National Programme. The Programme  for Competitiveness and Work (PCW), like its predecessors the Programme for National Recovery and the Programme for Economic and Social Progress, has enabled all the social partners to discuss and agree how our economic and social development needs can best be served. The establishment of the National Economic and Social Forum is a further important step, bringing to the table and the unemployed, womens' group, the disabled, and environmental interests.
In an economy of our size, all our interests are best served by co-operation and consensus. I took the opportunity at Corfu last week to inform my colleagues in the European Council of the Irish success in the area of social partnership. Considerable approval was expressed for an approach which shows that partnership is fully consistent with economic success and increased competitiveness, and for the fact that this was the third programme since 1987. I will be putting a paper on the Irish case to the European Council in Essen in December, focusing on complementary Community action.
As a result of social partnership, there has, on the whole, been a marked improvement in our industrial relations record. However, the necessity for adaptation and change in the face of commercial difficulties and strong competitive pressures must still be faced up to realistically. There are, of course, long term options to be examined, as well as past mistakes to be analysed but the basic requirements for physical survival must take precedence. It is a short term illusion, whether in Shannon, Dublin, Cork, or Waterford, to believe that, by exerting political pressure, commercial realities can be evaded. It is the Government's duty and determination to do what the situation requires, in the long term interests of continuing employment.
Ultimately, the decision about whether a company survives is in the hands of its management and workforce. The Government will be supportive in material terms, but, under European Union rules, help can only be provided on a viable basis of structural change that offers reasonable long term prospects.
 The local development programme is widely regarded as the most innovative approach to social and economic development. We are arranging structures and programmes to harness the great potential at local level, to build enterprise, create jobs, and tackle social exclusion. The initiative will be local, but with formal back-up and support. There are three strands in the local development programme: county enterprise boards, to enable enterprise creation and development; area partnership companies, targeting designated disadvantaged areas and the urban renewal programme, bringing about real improvements to the physical environment.
My Department has direct responsibility for the disadvantaged areas element of the local development programme, which is EU aided. The aim in these areas is to improve the chances of the long term unemployed of getting jobs, where possible in their own areas; to ensure that those who might otherwise leave school early, get the maximum out of the educational system; to help local communities participate fully in local development; to develop effective community-based organisations; to bring about real physical improvement in the local environment. The partnerships' task is to draw up and implement an action plan based on the needs and resources of the area.
Community employment will be a key resource to the local development programme. Because of its importance, funding for community employment in the 33 designated areas is in my Department's Vote. The target is to have 40,000 participants on community employment at the end of this year, with 22,000 of these in the designated areas. We are well on the way to achieving this.
Within the next three years, places for 100,000 unemployed people will be available across the full range of training and education services. Under the Programme  for Competitiveness and Work, active labour market policies should combat long term unemployment and consequent social exclusion.
Rural Ireland continues to prosper. Farm incomes have increased by some 31 per cent between 1991 and 1993. Premia payments negotiated in the CAP reform contributed significantly to this. We have provided additional resources to expedite the payment of headage and premia payments. So far, in respect of 1993 support arrangements, payments total £440 million.
Another rural initiative, the early retirement scheme is attracting considerable interest. The rural environment protection scheme aims to establish farm practices which take fuller account of conservation, landscape protection and environmental sensitivity. We are also preparing legislation on occupier liability.
Fostering the right conditions for job creation continues to be our number one priority; 1994 has already been a major success story. IDA Ireland has had an outstanding first half year. Major new projects that will yield thousands of new jobs have been secured. I and other Ministers have given maximum support both at home and abroad to the effort to win investment and encourage major expansions of existing firms. There is also encouraging growth of telemarketing, in which several projects have been announced. Some examples of our recent successes include Boston Scientific, Sensormatic and Xilinx, as well as expansions at Motorola, Analog Devices and NEC.
When the Government established Forbairt, we gave it a mandate to foster a genuine enterprise culture and to build up the capability of Irish industry. We are  establishing a world-class manufacturing base, and developing the culture of self-confidence and self-reliance in Irish business. Over the past six months, Forbairt has assisted companies in expansion and investment programmes worth some £96 million. This new investment by more than 190 Irish companies will create 3,000 new jobs over the coming years. Forbairt has recently detected a substantial pickup in investment plans by companies. We are working to convert this growing confidence into new growth and jobs. Figures show that over the past six months, employment growth has outstripped numbers coming onto the job market.
We are focusing too, on the development of links between Irish and foreign owned industry. Last year alone, multinational companies sourced £1.4 billion worth of components from Irish companies. Through Forbairt, we continue to identify those sub-supply opportunities which can be met by Irish enterprise. Such partnerships help develop the competence and capability of local sub-supply companies, and act as a positive incentive for new overseas industry.
We have continued to focus on tourism as an area with tremendous growth potential. We have set a target of 245,000 additional overseas visitors this year. The Government, in co-operation with the tourism industry, launched a major additional £3 million marketing campaign in the United States. Ireland was featured on American television as an attractive holiday destination. Our objective was to achieve a 24 per cent increase in the number of vacation tourists from the United States. We are well on the way to achieving this target. Our current ambassadors in the United States — I am not referring to our diplomats — are supporting such campaigns by their good-natured and generous support of the Irish soccer team.
Tourism has been an important element of the small business expansion loan scheme. The £25 million allocated to the tourism sector will be used to provide loans at a fixed rate of 6.75 per cent for  the fixed and working capital requirements of small tourism business. To date, 88 projects have been approved for loans totalling more than £16 million in 19 countries.
The GATT will be of immense benefit to our export-oriented economy. Measures proposed under the EU-funded Market Development Sub-Programme 1994-1999, are designed to increase indigenous exports by an average of 9 per cent per annum, from £3.9 billion in 1993 to £6.8 billion in 1999. Early indications are that the sector is broadly on target to achieve this growth for 1994.
Some 60 per cent of total employment nationally is now in the services area, compared with more than 70 per cent in other developed economies. The Government is focusing on measures to realise the potential here for growth and job creation.
Two key reports now form the basis of Government policy on services, the reports of the Task Force on Jobs in Services and the Task Force on Small Business. The services report recommended re-orientation of Government policy to balance the treatment, in terms of incentives, between services and other sectors.
The measures recommended in the valuable small business report will complement measures to foster services, since over 80 per cent of small businesses are in the service area. That report concentrates on actions to encourage the formation and growth of small enterprises. We made substantial progress in this year's Finance Act in promoting small businesses.
We are currently examining the extension of the International Services Programme, so that a greater range of internationally traded services can qualify for State assistance and, in some cases, the 10 per cent rate of corporation tax. It is intended to provide for these additional services in the 1995 Finance Bill. We also intend to examine other more long term questions about a lower corporation tax rate for services. We will of course continue our policy of the reduction of personal  taxes with the concentration on widening the bands rather than reducing the rates.
On the Government's part, establishing county enterprise boards, introducing the small business expansion loan scheme, and the recently announced EIB subsidised loan scheme have alleviated some of the difficulties small enterprises face in accessing suitable finance. Because of the unique role played by the banks in the economy, the Government intends discussing with them and other financial institutions, additional ways in which they can improve the range and reduce the cost of services on offer to small business.
Financial services is an area in which Ireland is making its mark. I have taken a personal interest in the development of the International Financial Services Centre since its inception in 1987. It has been a successful Government initiative, making Dublin an internationally recognised financial services centre. We are fully committed to enhancing its stature, through the further development of the Custom House Docks site and new legislation, extending the range of products and legal structures available at the centre.
I have been keen for some time to explore the possibility of attracting new business activity to the centre. The FINEX Division of the New York Cotton Exchange, with whom I had many discussions over the past year, has established a branch of its futures and options exchange here. This signals a new and exciting dimension for the IFSC. The IDA is actively pursuing negotiations with other international exchanges.
Government policy, in this Year of the Family, has been to support and assist the family, the cornerstone of Irish society. This year, we are providing unprecedented funding to the Legal Aid Board, the Family Mediation Service, and the marriage counselling services. We dramatically increased the grant-in-aid to the Legal Aid Board, providing almost £5 million to expand its network of law centres to all counties by the end of the year.
 People with disabilities in Irish society are finally receiving the attention they deserve. The Commission on the Status of People with Disabilities offers the opportunity to bring about a fundamental change in the way society treats disability.
The Family Law Bill, 1994, is currently being considered by the Oireachtas. The Bill seeks to develop and strengthen the law on financial support, and other consequences of marriage breakdown, and deals with the age of marriage.
We hope to publish Equal Status Legislation later this year. It will deal with discrimination in non-employment areas, including gender, marital or parental status, sexual orientation, religion, age, disability, and national or ethnic origin.
We remain poised to make further fundamental legal changes over the next few years, to help ensure a fairer society for all, a society that excludes no-one, a society which supports the family and excludes marginalisation.
We are continuing to improve and develop our health service. In this year's budget, we took radical steps to improve the balance sheets of the health boards and to ensure financial discipline in the future. This clears the decks for the implementation of our new National Health Strategy. As part of it, we have instigated a dental health action plan. Following an initiative begun in 1992, we are introducing charters for the elderly and for people with a handicap, and reviewing the charter for hospital patients. Mental handicap services have been provided with £12.5 million additional funding for the development of a broad range of services. We have also provided an additional £15 million for the development of new child care services. The Child Care Act will be brought fully into operation by the end of 1996.
This Government attaches great importance to education. We have drawn upon the widest range of opinion on the Green Paper, published in 1992, so that we can ensure a system relevant to the needs of all. We harnessed input from all interested parties in the National Education  Convention, and all our consultations and planning will culminate with the publication of a White Paper on Education. The pupil teacher ratio — primary school — will be further reduced; from 24.2 to 23.1, in September. We are providing more remedial and guidance teachers. Investment in improved school accomodation has also been substantially increased. We will continue to improve the access of students from disadvantaged backgrounds to third level education.
In the National Development Plan, improving our roads has a high priority. We have committed more than £73 million to improve county and regional roads this year, up 16 per cent on last year. Investment in the maintenance of these roads has been increased by 170 per cent to £33.3 million. More than £1 billion will be spent on these roads between now and the end of the decade.
The National Development Plan endorses the main recommendations of the Dublin Transportation Initiative. We introduced in May a much needed arrow service to Clondalkin. Naas and Kildare. Planning for the introduction of light rail services for Dublin is continuing. We are urgently seeking a private sector company to build and manage a National Convention Centre for Dublin.
Water and sanitary services will benefit under the National Development Plan from investment of over £100 million per year. The result will benefit industry and tourism, and bolster the economic value of Ireland's “green image”.
A new urban renewal scheme begins this August, taking in additional towns. It will concentrate on remedial and conservation works, residential development in our inner core areas, a better mix of social and private housing, and a greater use of vacant upper floors. A new accelerated capital allowance will be provided for industrial units, encouraging small enterprise units and manufacturing jobs.
The capital provision for local authority housing has been almost doubled to £129 million this year. Up to 3,500 local authority houses will be completed in  1994. The voluntary sector is expected to provide some 1,100 housing units. These programmes, together with other schemes in A Plan for Social Housing, and vacancies in local authority stock, will meet the needs of over 9,000 households in 1994.
Achieving a just and lasting peace in Northern Ireland has been the most pressing political challenge facing this Government. We have met this challenge with an unprecedented level of energy, commitment and determination. Peace remains at the very top of the political agenda of both the Irish and British Governments. The peace process is still very much alive. Considerable obstacles have been overcome since last July. The remaining problems can, and I hope will be, satisfactorily resolved.
The Downing Street Joint Declaration is one of truly historical significance, and constitutes the best opportunity ever for lasting peace and a disengagement from violence in favour of the democratic process.
The protracted process of clarification for both Republican and Loyalist organisations is now over. The substantial clarification provided by both Governments should serve to allay many of the suspicions or fears, which may have existed in the two communities regarding their political future, if we can create a peaceful environment free from coercion. The two Governments are committed to achieving a just balance between the two sets of rights and aspirations, safeguarding each, threatening neither, and seeking to assuage the historical fears of both.
The British Prime Minister, John Major, and I have been firm in our resolve that political progress should not be held up by waiting for the decisions of paramilitary organisations, and that no party or organisation should veto our efforts towards an agreed and equitable settlement. The two Governments continue to pursue urgently our work on the formulation of the joint framework document, which is intended to form the basis for resumed all-party talks.
There is some confusion about the difference  between joint executive institutions and joint authority. The Belfast Telegraph, which editorially represents moderate Unionist opinion, wrote on Monday:
There are many forms of joint authority, some of which — relating, for example, to tourism or fisheries — are uncontroversial and others which would encroach on sovereignty. As the European Union takes hold, it will make sense to have North-South bodies to look after common interests.
This should help to create a real single market in the island of Ireland. Leaving aside their debatable use of the term joint authority in this context, the underlying sentiment reflects the spirit of the Joint Declaration.
There is, however, an important distinction to be drawn between joint authority and North-South institutions. Joint authority could be the joint exercise of power over Northern Ireland from above by the two Governments, without there necessarily being full democratic participation by the Northern parties. For that reason, I can readily see why Unionists should be opposed to it. Joint institutions, however, would represent freely entered into co-operation or pooled effort, in which people of both traditions would work together, on the basis of common interests between North and South.
Frequent reference is made by Mr. Ken Maginnis and other spokesmen of the Ulster Unionist Party to their document lodged on 9 November 1992 at the very end of the last round of the talks process, with the suggestion that they showed great generosity. They proposed an Inter-Irish Relations Committee, within what they called a British Isles structure, which would have had a purely consultative function, without any clear commitment to joint decision-making structures and institutions. Their more recent Blueprint for Stability is even more tentative in this regard. Clearly, these and other subjects are matters for negotiation, but it is wrong to suggest that a more forward position was advanced by  Unionists at the eleventh hour on North-South institutions than in the openness to constitutional change which the Irish Government was also advancing at that time. There has to be a balanced constitutional accommodation within an overall settlement, which creates neither winners nor losers, and which guarantees the position of both communities.
Our two main objectives, peace and employment, are interconnected. If we can create lasting peace, the whole country will benefit from the peace dividend. Peace will do more for national confidence and morale, as well as for the employment that will come from increased trade, investment, tourism and cross-Border co-operation, than any other single measure. There is a potentially exciting period ahead, if we can maintain a steady purpose that will allow us to realise many of our hopes and our dreams.
Mr. J. Bruton: This debate provides us with the timely opportunity to review the Government's term in office. Looking at the performance so far is like trying to read a map, from which all the important place names have been removed. We can see the roads and the well worn paths but have no idea where they are going. If this Government tried to use a compass to plot a course on this map, it would have no north, south, east or west. Who needs direction when he does not know where he is going?
This Government's sole guiding principle is the desire to stay in power. For all the Taoiseach's occasional bluster about strategic management in the public service, the first place he should start implementing it is in the running of his own Cabinet. Then we might start seeing some real performance instead of the fuzzy agenda, the lack of realistic targets, the lack of time limits and the lack of performance indicators. Pragmatism, short term expediency and anything for the quiet life are guiding strategic principles of this Government. The Tánaiste can sit in his Bolinger Box at the World Cup match in New York. The Taoiseach and his ever increasing encourage can  cross and re-cross the Atlantic with such regularity that even the Government jet must be suffering from jet lag. The increasingly regal trappings of the Government were at first a source of amusement but now are a source of frustration and anger among the public. If Ireland qualify next week to play in Dallas, most of the members of the Government will undoubtedly avail of the opportunity to travel there to visit Southfork to get a few further tips on the lifestyles of the rich and famous.
Mr. J. Bruton: The golden circles are doing fine. We have the purchasers, not to mention the sellers, of passports. Families and extended families, united by ties of blood and politics, look after themselves. There are programme managers, special advisers, media consultants, secretaries, drivers and other hangers-on.
When the passports for sale scandal was discovered, the Tánaiste took it upon himself to exonerate the Taoiseach. It was a typical example of this Government's capacity to ignore the legitimate and well-grounded concerns of many people. The passports for sale issue has not gone away despite the Taoiseach's farcical acquittal by his Tánaiste. Questions  were asked and have not been answered.
Mr. J. Bruton: The shady role of the introducers, the deal-makers, the consultants and, indeed, certain Ministers, has never been satisfactorily explained. It is quite clear, however, that the established bodies with a legitimate interest in foreign investment in Ireland, such as the IDA, were casually bypassed as application forms, cheques, passports and lots of money passed with a nod and a wink from one hand to another within the golden circle.
Mr. J. Bruton: Is the Taoiseach trying to pretend that the director of C & D Foods, who happens to be his wife, did not tell him about a £1 million investment in his own company? That is one of the questions which has not been answered satisfactorily.
Mr. J. Bruton: The increasingly implausible and contradictory responses to the scandal from different Government Ministers and others have shown a degree of confusion and conniving that surrounded this episode on a grand scale.
Mr. J. Bruton: It is similar to what happens when a dead mouse is under the floorboards of a house. A great smell may emanate even though its source may not be visible to a visitor. The passports for sale issue is such a source of problem for the Government. The unpleasant smell from the passports for sale affair  will remain until the questions that have not been answered are answered.
Mr. J. Bruton: The Labour Party in Government has lost all sense of identity with its traditional supporters. It has already lost all those new voters it hoodwinked in 1992. The Government has no mandate from the people. In 1992, the electorate voted to get Deputy Reynolds out of office as Taoiseach.
Mr. J. Bruton: Last night, however, the Labour Party did not win as it sold the TEAM Aer Lingus workers down the river. Extravagant promises in the last election campaign came home to roost. As The Irish Times headlined it today “Labour runs with TEAM hare while pandering to Fianna Fáil hound”.
Mr. J. Bruton: Labour was quite happy to sign up for the journey with Fianna Fáil when it looked like the heady promise of power, influence and jobs for the family  could guarantee a safe future. It has rapidly discovered, however, that Government is not only about Meres and perks; it is also about hard work, hard decisions and the national interest. Needless to say the Labour Party is now beginning to discover this. As it does so the cracks begin to appear and the so-called “partners” in Government are distancing themselves further and further from one another. The typically opportunistic nature of this Government has been exposed.
As Fianna Fáil and Labour face into the summer recess, they can contemplate each other with increasing degrees of mistrust as they face the prospect of more agonising and dissent in the autumn, if not sooner, over Irish Steel, the third banking force, the part sale of Telecom Éireann and, before that, the report of the beef tribunal.
Mr. J. Bruton: It is also because international interest rates have fallen, thereby reducing our debt service charges. The reasons for our economic recovery have nothing to do with this Government or any of its members.
Mr. J. Bruton: The Government can, however, derail the process if it continues to increase as it is doing, namely, spending faster than the growth in resources. The Government is, as usual, hiding behind a smokescreen. While our economy is undoubtedly performing well, according to many key indicators, the  most critical, the number of long term unemployed in our society, remains almost unchanged. The Government is interested in short term palliatives, not long term reform.
The unprecedentedly favourable projections for our economy over the coming years provide any Government who might be in office at this time with an opportunity to take radical steps to cut taxes on work. Increased revenue buoyancy should allow this Government to cut taxes now without having to raise new taxes or cut public spending. Instead of doing that, the Government will take the usual populous choice and use the additional tax revenue generated by economic growth to increase spending even further.
The best action the Government could take to help the long term unemployed is to create the conditions in which employers will want to offer them a job. That means cutting taxes on those who employ extra people. Fine Gael believes we should be striving for a situation where the most profitable use any company or individual can make of money that is available to them is to create a job for an extra employee. The most profitable thing anyone not working could do is take that job. Neither condition is fulfilled. The ESRI and others have pointed out that the long term unemployed will be unaffected by the rising economic tide projected over the next few years. They expect the level of the long term unemployed to be no lower at the end of the century than it is now.
The cost of unemployment in economic terms is enormous amounting to almost 7 per cent of GDP. There are also indirect costs linked to ill health, crime and other symptoms of poverty. This is plainly unacceptable but there are no signs that the Government cares about the problem of long term unemployment. The cruel reality is that, for all the Government's talk about boom and good times, the fruits of economic recovery reach a small percentage of people.
How the performance of the economy affects a person depends on where one stands on the track. If one is running on  the inside lane with senior members of Fianna Fáil and Labour and the golden circle of friends and hangers on, then the race is quite easy, particularly if one happens to own property in some town which has been designated for urban renewal status by the Minister on criteria which are hard to discern. However, if you are running on the outside lane, no matter how fast you run those on the inside lane go increasingly further ahead. The vast majority of people are stuck on the outside lane of the economy. They look on in amazement realising that unless they are on the inside lane with those who criss-cross the Atlantic they will never catch up.
Fine Gael's job is to speak up for those who cannot get onto the inside lane until the rules are changed, for those whose jobs are not so secure and for those who have no jobs. We speak for those who must struggle to make a living, those who do not have the ear of the programme managers or of Fianna Fáil fundraisers who organise lunches at £1,000 a plate in different parts of the country.
Mr. J. Bruton: The people whose mortgage and VHI relief has been reduced by the Government, are burdened with arbitrary property taxes and threatened with even more draconian property taxes. A few weeks ago in a little noticed Dáil announcement the Minister for Finance revealed his Department had begun work on the preparation of a general report on property tax from which proposals will emerge for next year's budget.
Mr. J. Bruton: That response by the Minister in reply to a question is a direct contradiction of what the Minister for the Environment said a month or two earlier. Fine Gael believes that the health of the economy is measured by the mood of the people, by what they see and experience and not by dusty economic indicators. The reality is that while the Government tries to tell people they are well off and things are getting better, the vast majority of them have not experienced that. If we cannot provide jobs for the people we cannot give them hope.
Together with the long term unemployed, young people face the biggest difficulty in getting a start in the labour market. The big hurdle or getting a first job must be crossed. It must be made attractive to employers to offer young people their first jobs at home. That is why we have proposed a special income tax relief for people under the age of 23. Unless we can employ young people businesses and services will become less dynamic, our competitive edge will become blunt and our talent will emigrate. If it makes sense to give a grant to a first time house buyer, surely it makes sense to give a tax break to help someone under the age of 23 to get his or her first job in Ireland? Such an imaginative tax change is now possible because of our improving budgetary circumstances but I doubt if the Government will do that because real or imaginative tax reform represents harder work than simply agreeing to the incessant requests for new spending from all the interests pressing on various Ministers. When there is a  choice between radical decisions and easy options, the Government will always choose the easy option.
The inexorable rise in public spending is a hallmark of this Government. The complacent consensus of establishment forces that have drawn Fianna Fáil and Labour together in Government are the forces driving up public spending and increasing the burden of taxation without improving standards of public service. Taxation consistently rises faster than inflation as the Government funk the hard decisions on public expenditure.
New ideas with public expenditure implications constantly appear on the Government's agenda. The recently announced, though long expected, shortfall of £800 million in EU funding for the National Plan revealed a host of new projects that demand additional local funding from our own resources. The shortfall in the Tallaght hospital project funding alone amounts to £40 million. That is almost equivalent to the increase in this year's budget on the old reliables — petrol, drink and cigarettes. Overall, the shortfall in EU funds will amount to a minimum of £130 million a year.
It requires a strong Government with a clear focus to control public spending and this Government has neither. In the last three budgets public spending rose by 21.9 per cent which is faster than the 7 per cent increase in consumer prices in the same period. In order to have meaningful tax reform, public spending must be controlled, not reduced. There is no evidence that the Government is pursuing this policy. Ultimately, the lack of tax reform will confine the unemployed to their misery for an indefinite period as the Government ignores their plight.
The Government continues to live in a fantasy world where a good public relations spin is more important than the facts. Expensive hotels, good restaurants and plenty of foreign travel may insulate the Taoiseach, Tánaiste and Ministers for a while from the hard reality of life for many people but the people will not be fooled for long. They passed a harsh interim judgment on the Government in  the European and local elections this month. They will pass an even harsher judgment when given the opportunity at the next general election.
Miss Harney: The Dáil term concluding this week will soon be seen as the turning point in the life of the Fianna Fáil-Labour Government. It will be a watershed, the juncture at which, despite all the programme managers, advisers and spin doctors, it could not camouflage the inherent defects and monumental misjudgments of which it is guilty. From the mishandling of the Structural Funds to the Masri passports affair and from its petty and begrudging handling of what the Taoiseach called the “Sutherland affair” to its continued failure to tackle the underlying economic problems of excessive taxation on work which is destroying jobs here, the Government is shown to be bereft of any coherent or positive strategy for running the country.
Recently, I thought the Government was drifting, now I believe it is running scared. Perhaps it was the few voices from the Labour backbenches last night, but whatever the reason, everyone knows the Government is running scared of the electorate and the Dáil. It is not prepared to give a commitment that if an important tribunal of inquiry set up by this House reports during the summer it will recall the Dáil. The Taoiseach is scared and the Tánaiste and Minister for Foreign Affairs does not want openness and transparency no matter how many times he tells us it is in the Programme for a Partnership Government.
I wish to refer to the life and death situation in Northern Ireland. We all earnestly wish for peace and an end to the growing cycle of random sectarian murders. From a domestic point of view, we have to realise and understand the ever growing threat of Loyalist violence spilling over on this side of the Border on a horrendous scale.
In this delicate and complex situation where words can be another lethal weapon, sadly the Taoiseach continues to demonstrate an imprecision with language which can often inflame the situation.  The most recent example was his botched use of language in Boston where he again raised the possibility of joint authority. Every sensible party to the search for a solution to the problems in Northern Ireland realises that this is not on. The fundamental question now facing all of us regarding Northern Ireland is whether a permanent cessation of violence can be achieved and what are the preconditions for judging that possibility. I want to make it perfectly clear that it is not tolerable in any circumstances to allow Sinn Féin to be involved in any talks process without a verifiable disarming of their colleagues in arms in the IRA.
Miss Harney: We cannot allow a party to any talks or peace forum to have a discussion document in one hand at the negotiating table and an armalite in the other hand either under the table, outside the door or down the road. The Taoiseach and the Tánaiste and Minister for Foreign Affairs must spell this out very clearly. We have had enough play acting from Sinn Féin which has strung out its alleged response to the Downing Street Joint Declaration for more than six months in order to maximise the publicity and the propaganda advantage to itself.
The Government can rightly claim credit, and justifiably deserves plaudits, for negotiating the Downing Street Joint Declaration, a fair and balanced recognition of the rights and aspirations of Nationalists and Unionists alike in Northern Ireland. However, as I stated at the time, the subsequent decision to remove section 31 and the Government's role in facilitating a visa for Mr. Adams to visit the United States were wrong. These decisions showed serious errors of judgment by the Taoiseach, the Tánaiste and Minister for Foreign Affairs and the Ministers involved. These moves have accorded Sinn Féin and its members a legitimacy they do not deserve. It must be repeatedly stated that a political party which condones the use of violence and refuses to condemn outright the murder, terror and intimidation campaign of the  IRA and which has clear links with that organisation cannot be treated as simply another political party.
There are two bottom line realities which Sinn Féin and the Republican movement must accept: first, participation in any talks or peace process must have as a precondition and verifiable renunciation of the violence of the IRA and, second, in terms of moving forward and being accommodated in any way in a democratic process, there can be no change in the current status of Northern Ireland without the consent of a majority of the people living there.
Nationalism and Unionism are not compatible. The thrust of the way forward in Northern Ireland must, therefore, be the creation of a balanced society, with balanced structures, which enables these fundamental differences to co-exist without one triumphing over the other. We must be able to demonstrate that peaceful constitutional politics can work. This means we must seek to make Northern Ireland a consensus society and a viable democracy for all the people living there. To that end Northern Ireland must have its own constitution and bill of rights. The fabric of society in Northern Ireland must be radically transformed to enable the Nationalist community to be so fully at ease that it will want to give that state its full allegiance and enjoy its proportionate share of power at the very highest levels.
It is only through the creation of such a genuine bipolar society in Northern Ireland, where Nationalists and Unionists can feel fully, freely and equally at home, that progress can be made. That objective must be the priority of the two sovereign Governments in Ireland and the United Kingdom. Ensuring that such an agenda can be successfully pursued will require a wholehearted security policy to deal with the extremists in both communities who will unfortunately but inevitably reject this compromise way forward, pressing instead for a total victory for their tribal and exclusive preferences of a British Northern Ireland on the one side or some form of united  Ireland on the other side. Both these options are a recipe for continued murder and strife and cannot be allowed to prevail.
In that context, the security forces in Northern Ireland and the Republic are now faced with as great a threat from Loyalist terrorists as they faced from Republican terrorists for so long. Apologists for Loyalist violence can no longer explain it simply in terms of being reactive to Republican atrocities. The perpetrators of atrocities such as that in Loughinisland need no excuse whatsoever — they are blood thirsty sectarian killers who must not be allowed to cloak their evil deeds with any spurious mantle of political motivation.
The Taoiseach referred to what he called the “Sutherland affair”. The manner in which the Government, particularly the Taoiseach and the Tánaiste and Minister for Foreign Affairs, have handled that issue has been most unethical and has shown a staggering disregard for the national interest. If the Taoiseach and the Tánaiste and Minister for Foreign Affairs do not quickly wake up to reality and do the decent and honourable thing in terms of promoting Ireland's only candidate with any prospect of succeeding as the next President of the European Commission, the opportunity will be lost and will never come our way again. It is the turn of a smaller country to secure a nominee to that post and also the turn of a person who does not come from the Socialist ranks, as Mr. Delors did. The European Union works on a shared give and take basis and the opportunity exists for Ireland as one of the small countries to capitalise on the deadlock which has arisen in filling the post.
I was disturbed to read in a Reuters report yesterday that Mr. Sutherland has not even been contacted by the Government. How can we take seriously the comments made by the Taoiseach a few days ago that the Government would be prepared to put forward a nominee when he has not even spoken to the one person who has any chance of succeeding to that position? It is not good enough for the Taoiseach and the Tánaiste and Minister  for Foreign Affairs to adopt a helpless, passive position of waiting on other EU governments to take the initiative in this matter. It is clear that if the Government sees merit in an Irish nominee securing the most powerful post in the European Union then it should stop sitting on its hands and take a real initiative in the matter. It is high time the Tánaiste and Minister for Foreign Affairs engaged in positive and proactive canvassing of his European Union counterparts and made it plain that Ireland is willing to nominate Mr. Sutherland, the GATT Director General, for the Commission Presidency and for the Irish Government to demonstrate real support and enthusiasm for him.
The only thing preventing Mr. Sutherland from succeeding in becoming President of the European Union is the veto placed on him by his Government and country. This is the only reason his name was not on the table in Corfu. Will the Tánaiste and Minister for Foreign Affairs — whom I presume will contribute to the debate — say if his Department was contacted by representatives of the Spanish and Italian Governments last week and told that if there was a stalemate they would be prepared to support Mr. Sutherland? Did any Foreign Minister indicate to him that he would be prepared to support Mr. Sutherland and what response did he give to him? What is the position of the Danes on this matter? The Tánaiste and Minister for Foreign Affairs should answer these legitimate questions which I also asked a few days ago.
During a week when this House is debating a so-called Ethics in Public Office Bill, I plead with the Government to do the right thing, to do what it ought to do in this vital area before it is too late. This is what ethics is all about. When this Bill and the Sutherland affair are compared one can see just how bizarre the entire situation is. On the one hand, the Fianna Fáil-Labour Government is so concerned with ensuring that the right thing is done in public life that it has promoted special legislation in this area.
On the other hand, when the first  opportunity arises to do the right thing, or do what they ought to do, they wilfully refuse. The so-called ethics legislation will not paper over the serious omissions of this Government in its handling of the Masri passports affair either. The Taoiseach asked earlier if we believed that Members of this House should be discriminated against merely because of that fact. Of course they should not, but neither should Members of this House, because they sit around the Cabinet table, benefit by virtue of that very fact. That is the issue at the core of what is called the Masri passports affair.
The Labour Party stand indicated in a special way on this issue. That party got a record mandate for putting trust back into politics in November 1992, yet they appear to see nothing wrong with the obvious abuses and conflicts of the passports for investment transaction which took place in December 1992. The Tánaiste on 1 June made a statement in which he said that the business migration scheme excluded the possibility of a soft loan, had to include a permanent and interested residency qualification, and also that any investment in such circumstances would have to be approved by one of the State agencies. He made that statement on 1 June despite the fact that none of the criteria which the Tánaiste himself said were essential was met. He was able to tell us, when he looked at the file, there was nothing wrong, nothing improper. What would the Tánaiste say were he now sitting where I sit? What did he say when Mr. Bernie Cahill went out to Kinsealy for a meeting? I would not want to embarrass the Tánaiste by reading it out now, but I ask him to read what he had to say on that occasion.
This was a transaction that never should have occurred, given that the minority Fianna Fáil administration of December 1992, which completed the Masri passports transaction, was in power in a purely caretaker capacity and should not have taken any policy decision of that kind. It is obvious that there was a total conflict of interest on the part of the Taoiseach, given that he was and  remains the single largest shareholder in the firm which stood to gain massively from the passports for pet food transaction. It is quite clear that a range of conditions that should underline a bona fide investment by a non-national, including establishment of residency and the making of a permanent investment, was not complied with.
The involvement of a number of Fianna Fáil Ministers in facilitating this passports for investment project politically stinks to high heaven. How was it that the present Minister for the Environment was able to give a glowing character reference to a person he had met once only, whom he had been told was going to invest in a project in the midlands, yet he did not even ask the name of that company. Is it not extraordinary that a Minister who sits around a Cabinet table would so easily give a glowing reference to a foreigner he had met only once?
Miss Harney: I find it incredible. Is it not incredible that the Taoiseach's wife, who is a director of C & D Foods Limited, never told him about this major investment? Do the Taoiseach and the entire membership of the Government, particularly the Labour Party, take us all in this House for fools? I wonder what the Tánaiste would be saying if he were in Opposition and the Taoiseach was called Charles Haughey.
In a speech on 1 June the Tánaiste  spelled out the terms which should govern the business migration scheme. He said it did not cover soft loans, that it involved a residency requirement, yet he now knows there was a soft loan given and that the residency condition was not observed. Still he sees nothing wrong with it. He was able to declare he had seen the files and had found nothing out of order.
There is a huge difference between something that is legal and something that is right, as I said when I spoke yesterday on the Ethics in Public Office Bill, 1994. There is a huge distinction to be drawn between them. The Tánaiste and Leader of the Labour Party has a lot to learn. I was amused to hear him criticise the Progressive Democrats in this House yesterday when he stated that we had not included the word “ethics” in any of our Government provisions. This betrays a fatal flaw in his approach. He is simply incorrect. The October 1991 programme for Government we negotiated with Fianna Fáil included detailed provisions for a register of Oireachtas Members' interests and a code of behaviour and disclosure for the directors and executives of State companies. The real point the Tánaiste fails to understand is that ethics is not about words or rhetoric but about behaviour. Ethics is about doing the right thing, and merely writing down particular things does not make them happen. Surely the Tánaiste realises there is no salvation in prayer without good works? When in Government my party never flinched. We were never afraid to take tough decisions and we were not afraid to walk away when it was no longer tenable to remain.
I want to reject also the criticisms the Tánaiste levelled at my colleague, Deputy Michael McDowell, and those levelled at my colleague Deputy Desmond O'Malley by the Taoiseach this morning and yesterday in the debate. These Deputies have been fearless in endeavouring to highlight grave errors of judgment and wrongdoing and will continue to do so. No amount of abuse will intimidate them or me and my party. I do not care how often I hear people tell  me it is holier than thou to raise issues of that kind. If we want to preserve decent standards in public life and to preserve basic democratic values, our job is to ensure that the Government of the day is accountable, to ask the hard questions and not be deflected through fear of being attacked or abused in so doing. The bottom line for this country is that we tolerate a code of practice, a culture and behaviour in public life which would be totally unacceptable in most modern democracies. That is a terrible pity.
As this House faces into its summer recess, it is obvious it will be a summer of increasing industrial discontent and of uncertainty for thousands of workers in a range of State enterprises, in TEAM and Irish Steel in particular. It is quite clear that there is a variety of reasons for the crises which now assail these companies, but I suggest there is one fundamental feature common not only to those companies but to numerous other enterprises which is steadily eating away at their viability and survival. That is the cancer of crippling levels of taxation on work and unemployment in our economy. At the end of the day we cannot repair or maintain aeroplanes, make steel, or produce any service or commodity if we cannot do so in an internationally competitive market. We cannot do that since pay levels simply must be higher than they need be otherwise because of the necessity for workers to discharge a tax liability to the Exchequer of nearly 60 per cent and for employers to pay a range of additional charges on employment. The problem has been so long lasting and pervasive and so much has been written about it that it is difficult to bring home the true extent of the employment-destroying cancer that payroll taxation now constitutes. What I am stating has become a political cliché and, therefore, tends to be regarded as no more than a ritual comment. If we merely perceive the problem in those superficial terms, we will never wake up to the disaster befalling us.
I want to cite a particular example to drive home the point. It is a pertinent  and timely example bearing in mind the crisis in TEAM Aer Lingus. It is quite clear for all to see that the real problem at TEAM Aer Lingus is that it is unable to compete with its international rivals for contracts to repair and overhaul aircraft. Its costs are simply way out of line and its payroll costs are the main reason. How out of line are they? Let us look at the operations of the only other aircraft maintenance operation in this country, that of Shannon Aerospace at Shannon Airport, where the wages of the workers — the basic annual wage being just £11,500 — are only half those at TEAM Aer Lingus. Clearly that wage level at Shannon Aerospace is not a high or excessive one but, even at that wage, Shannon Aerospace is not competitive with many of its international competitors for aircraft maintenance work, though clearly is a lot more competitive than TEAM Aer Lingus.
The really frightening factor about the Shannon operation is that, even at that modest pay level, single workers there pay nearly 50 per cent tax on that less than average wage, that is 48 per cent income tax and 7.5 per cent PRSI. How scandalous and demoralising it is for that company and its workers to pay such penal levels of tax on such modest wages. This is a microcosm of all that is wrong with our economy. It is quite plain that the management of Shannon Aerospace have their finger on the pulse, that they accept the realities of the international market-place in which they must operate and are endeavouring to keep their overall costs competitive internationally. It is equally obvious that they have a first-class workforce prepared to work for modest pay rates. That operation has been undermined not by any outside force but by a factor imposed by our Government; it is being undermined by penal taxation levels that demoralise the workforce and, in turn, threaten the competitiveness of that company in the global market-place. That is the cancer at the heart of the Irish economy and, unless we tackle that cancer at source by cutting the penal levels of tax on work and enterprise,  we will never begin to overcome the unemployment crisis in our society.
That is part of my reason for strongly criticising the Programme for Competitiveness and Work. I am opposed to centralised wage bargaining generally and, faced with the crisis of unemployment, that must be the priority. If we are to have such an approach, and I reject it, at the very least the unemployed should be represented at the table. The market place realities should mean that any pay bargaining is conducted on a localised basis and in accordance with what different enterprises and activities can afford. Ability to pay must remain the criteria.
When we discussed the Ethics in Public Office Bill this week I raised serious questions surrounding awarding public contracts. This is an area where there should be much greater transparency and openness. In particular I want to raise, as I did yesterday, the awarding of a tender worth £4 million for the subcontract element of the Tallaght Hospital. What procedures were followed to ensure that the successful tenderers had their tax affairs and company registration office filing requirements in order? What procedures were followed to ensure that the successful tenderers had a profitable trading record and how many years were investigated? How many of the successful tenderers received, in the last five years, special mitigation of tax liabilities which they were unable to pay? What successful procedures were followed to ensure that the successful tenderers have sufficient experience and competent staff to ensure that they can undertake and complete the relevant contract work? Are the financial resources of all the successful tenderers sufficiently adequate and financially secure to ensure that they are capable of undertaking and completing the contracts? I would appreciate if a member of the Government would respond to the concerns I raised and expressed privately with the Minister for Health because it is causing enormous concern among certain companies here.
 Many in business believe we do not have a fair society or a fair chance to compete for public work. There are companies carrying out public work who do not have tax clearance certificates or if they do they should not have them because of their tax liabilities to the Revenue Commissioners. Why do these companies continue to get more State or local authority work when their tax affairs are not in order?
My understanding is that the purpose of the new urban renewal scheme is to revitalise decaying urban areas and I support such a scheme. Will the Taoiseach state why a portion of land on the west side of Portlaoise was designated for urban renewal under the scheme when it had not been built on? There is now a considerable number of buildings on that land. I want an assurance from the Government that in designating areas local traders and chambers of commerce will be consulted and that we will not have the designation of green field sites as in Portlaoise, Carlow and other areas. I asked the Minister of State at the Department of the Environment, Deputy Stagg, to give me an assurance on that a few weeks ago and he refused. Also I want an assurance that the friends and associates of members of the Government will not have their land designated under the scheme. We need more openness and transparency to which the Programme for a Partnership Government refers. Unfortunately, the rhetoric from the Labour Party is one thing, the reality is another.
I want an assurance from the Government that if the Beef Tribunal reports in the summer that the Dáil will be recalled for a full and complete discussion of its report. This morning the Taoiseach refused to give me that assurance. As I said in my opening remarks, a few months ago the Government was drifting but it is now running scared.
It is time that the man who sought to put trust into politics and justice into economics began to stand up for himself and his party. Trust — some misplaced — was rested with the Labour Party when it went into Government in January 1993  but its members have been keeping their mouths closed and their heads down since they assumed office. All they want is to remain in office. I put it to the Labour Party in the week it is promoting its Ethics in Public Office Bill that ethics is about doing the right thing. Ethics is about not being afraid to walk away from office if it is no longer tenable. The Labour Party carries a special responsibility to ensure there is openness, transparency, equity and fair play and that their pals do not get all the favours which frequently makes many people in business and the public cynical about our political system.
Proinsias De Rossa: The fact that the Dáil is going into recess this year a week earlier than last year is not without significance. Rarely have I seen a Government so anxious for the arrival of the summer recess so that they can be free from what it clearly regards as the irritant of having to account to the Dáil. Rarely before has a Government been so dramatically transformed within such a short period. The Government with the biggest majority in the history of the State, the Government whose members believed that they could do no wrong, the Government whose own arrogance has been a major contributing factor to its own problems, is now limping, bruised and bleeding, and desperate for the relief of the summer recess.
The anxiety for the recess is no doubt intensified by the knowledge that there is a growing list of political time-bombs which are likely to land on the Cabinet table over the next few months and which are likely to add further strain to the creaking hulk of this Government.
Despite the mock heroics last night of the northside two by two, the Government's intransigence threatens to turn the TEAM crisis into an unprecedented industrial disaster. Cork faces a crisis of almost as great a proportion with Irish Steel. The report of the Tribunal of Inquiry into the Beef Processing Industry is reported to be imminent and given the conflicting positions they adopted, it cannot vindicate the Taoiseach and the  Tánaiste. A Government decision on the proposal by Cable and Wireless to acquire a large stake in Telecom Éireann is due this summer. The High Court is due to give its judgment in the claim by married women for arrears of alleviation payments — a decision which the Minister for Social Welfare, Deputy Woods, claims would cost the Government more than £340 million. There are reports that a case bearing similarities to the “X” case is before the courts. More details will be published of the cutbacks in the National Development Plan because of the botched handling of the European funds issue. Who can say that there will not be more disclosures on the passports for sale scandal?
Individually any of these items could threaten the stability of the Government: collectively they constitute a minefield which could blow the Coalition out of the water. Coupled with the poor performance of both Fianna Fáil and Labour in the recent elections and the defections in last night's vote, it is clear that the common assumption that this Government would serve its full term of office can no longer be taken for granted.
What has been most disappointing about this Government during its first 18 months in office has been the failure of the strong Labour presence at the Cabinet table to make this Government different in any significant way from the administrations which went before it. It is true that the Labour presence, initially anyway, led to some welcome reforms such as the decriminalisation of homosexuality and the liberalisation of the laws on contraception, but even in this social area the Government appears to have run out of steam, with no sign of the promised legislation arising from the X case and the divorce referendum deferred again and again.
Who can point to a single issue in the economic area where this Government has adopted a position or taken a decision that might not have also been taken by the previous Fianna Fáil-Progressive Democrats administration or the minority Fianna Fáil Government which went before that? Has the Labour presence  led to a more sensitive handling of the TEAM dispute? There is not much sign of that. Indeed, it is a testament to the feebleness of the Labour presence at the Cabinet that Ministers Spring, Quinn, Howlin, Taylor and Higgins were unable to persuade their Fianna Fáil colleagues to accept a totally innocuous motion on the TEAM crisis calling merely for a round table discussion to try to find a solution. Has the Labour presence led to any new radical approach to the unemployment problem or new measures to secure an equal distribution of wealth? There is no evidence of that.
Immediately prior to the 1992 general election, a member of the Labour Party in Longford was outraged at the suggestion of socialist leanings by his party. “At no given time”, he declared indignantly on Morning Ireland “were Labour ever a left wing party”.
On the basis of Labour's performance in Government so far, who could deny the truth of those words? Far from being in partnership with Fianna Fáil, the Labour Party has now been almost totally assimilated into the political culture which the Tánaiste spoke of in such withering terms in the dying days of the last Dáil. I presume it was the Tánaiste the Taoiseach was referring to when he mentioned that some years ago there was much personal abuse.
I believe one political party in this House has gone so far down the road of blindness to standards and of blindness to the people they are supposed to represent that it is impossible to see how anyone could support them in the future without seeing them first undergo the most radical transformation.
Deputy Spring's remarks were fully in tune with the public mood and without a doubt contributed to the success of his party in the subsequent general election. Following the election, however, and without the slightest hint of transformation  on the part of Fianna Fáil, Deputy Spring suddenly found it possible not only to support but to enter into coalition with the party he had so recently and so vociferously chastised — a case of the blind leading the blind.
Deputy Spring should take note of the recent electoral response to that u-turn, most particularly the response in Dublin South Central and he should be prepared for a similar response at the next general election. The outcome of the European elections and the two by-elections represented a clear warning shot across the bows of the Government and the clearest indication yet that the patience of the public is running out over the failure of the Government to deliver on its promises of real political change.
No matter what positive gloss it may try to put on it, the real loser in the elections was the Labour Party. Not only did its vote collapse in Dublin South Central, but by transferring far more heavily to Democratic Left than to its Government partners, Labour voters clearly indicated to the party leadership that they did not want Labour in government with Fianna Fáil.
The enthusiasm with which Labour cooperated with Fianna Fáil in denying for 18 months the people of Dublin South Central and Mayo West the right to have full representation in the Dáil and its willingness not to ask awkward questions about the passports for sale affair suggests that far from Fianna Fáil being forced to undergo a radical transformation, it is Labour which has changed and changed for the worse.
Those who hoped that this Government would deliver on real political change have been bitterly disappointed. Nowhere has the performance of the Government been more disappointing than in regard to unemployment. While there has been some small reduction in the numbers on the live register this is probably due more to renewed emigration than to any policy initiatives by this Government.
I have no doubt that we will have a series of Government speakers coming in here over the next two days painting a  picture of an economy in boom. There is no doubt that there has been a series of reports, such as the recent ESRI report, which point to a number of improved economic indicators, but unless steps are taken to begin a genuine process of wealth transfer and the implementation of an alternative industrial strategy, there is little guarantee that the poor and unemployed will benefit from the increase in economic growth forecast in the ESRI report and every danger that the unemployed and those on low pay and social welfare will be left even further behind. The jobless regard talk of “an economic boom” as a sick joke when unemployment is still at almost 300,000 and when, even if the most optimistic targets are met, there would be still more than 200,000 on the dole by the end of this decade.
While there has been evidence of an economic upturn for some time, it is clear that the benefits are being shared disproportionately. During the past year many firms reported record profits, the two main banking groups alone raking in almost £550 million in profits; the Stock Exchange has experienced a boom and farming incomes have bounced back.
The other side of this picture is workers having to accept only token pay increases, the PAYE sector still bearing a grossly disproportionate share of the tax burden and £50 million being extracted from the sick and the unemployed through the taxation of benefits.
The economic policies pursued by the Government have led to the emergence of three distinct economic tiers. At the top are a small wealthy elite who are getting even richer; in the middle are the majority who continue to struggle to make ends meet; and at the bottom a substantial minority made up of the unemployed, the aged and the sick, who are in danger of falling even further behind.
If the ESRI's most optimistic forecasts are accurate — as we all hope they will prove to be — it is essential that the growth in wealth is directed at those areas where it is most needed. A key economic indicator in any society must be the numbers  of people in productive, well paid jobs. Irrespective of other indicators, Ireland cannot be regarded as being in good economic health as long as there are hundreds of thousands of people without work.
Despite the supposed commitment of the Labour Party to the public sector, the pattern of privatisation started by the Fianna Fáil/PD Government has continued. The fiasco of the Greencore/Davy affair has been followed by the apparent determination to privatise the Trustees Savings Banks, despite the fact that this will effectively sound the death knell for the development of “a vigorous third banking force from within the state sector” which was promised in the Programme for Government.
It seems that Telecom Eireann is now to be the next target and it is now clear that what is involved is not a modest proposal to establish a new joint venture between Telecom and Cable and Wireless but a plan to allow the British multinational to acquire almost half of Telecom's business. The strategy, it now seems, is to change Telecom into a mere holding company and to establish a totally new company in which Cable and Wireless would have a 40 per cent share to carry on the day to day business of providing telecommunications services.
This would be privatisation by another name and would clearly conflict with the pledge given by the Tánaiste in May of last year that any attempt to privatise Telecom would lead to a break up of the Coaliation Government. When the issue became a matter of public controversy in March last the Minister, Deputy Cowen, kicked to touch and asked the board of Telecom to examine the proposals and report to him within six months. We suggested at the time that the purpose of this exercise was to allow the matter to be deferred until the elections were safely out of the way. Now that the elections are over I expect that the Cable and Wireless attempt to grab a substantial share of Telecom's market will again make its way to the top of the Minister's agenda.
 This Government has also continued to pile on the tax agony. The Minister for the Environment, Deputy Smith, put the political gun to the head of the new county councils in Dublin and forced them to bring in service charges. Dublin Corporation will almost certainly receive the same treatment next year. In addition to the new service charges, thousands of families living in modest dwellings will now find themselves in the residential property tax net for the first time, as a result of changes introduced in the budget. The Government's deplorable decision to subject unemployment benefit to taxation means that the tax take from the sick and the unemployed will now be the equivalent of the income tax take from the entire farming sector.
In addition, the Government continues to deny tens of thousands of women arrears of the social welfare transitional payments to which the European Court has said they were clearly entitled. Irrespective of any other issue, the scandalous manner in which the Minister for Social Welfare, Deputy Woods, has handled this affair would justify voting against the Estimates before us. It is not just that the Minister tried to use every device and strategem to attempt to deny Irish women moneys to which the European Court decided they were entitled, it is also the manner in which he attempted to draw a veil of silence over the issue by refusing to give information to which Members of the Dáil were entitled and — when this failed — his attempts to mislead the Dáil and the public and to abuse me and journalists outside this House.
The failure of the farming sector to make a reasonable contribution to the Exchequer continues to be a political scandal which, it seems, no Government has the courage to tackle. Between 1989 and 1992 the average tax paid by PAYE workers increased from £3,122 to £3,662. This represents an increase of £540, or 10 per cent — more than twice the rate at which wages and salaries increased in the same period. In the same few years  the average tax paid by farmers actually decreased by £72 or 9.3 per cent.
Farmers now pay less than one fifth of the average tax bill of a PAYE worker. Despite this, the Taoiseach apparently thinks that farmers are overtaxed as he told the recent Fianna Fáil agricultural conference in Kilkenny that the “future should bring an easing of the tax burden, which could only be of benefit to the farming community”. The Fianna Fáil-Labour recipe for tax equity is load the burden on the sick and the unemployed, give more tax concessions to wealthy farmers.
Despite our considerable economic difficulties, the single biggest problem facing our people remains the conflict in Northern Ireland; the biggest challenge facing democratic politicians is the search for a lasting solution. The Government must be aware of the widespread disappointment that the initial promise of the Downing Street Declaration is being trampled into the ground by the continuing violence of both the IRA and the loyalist paramilitaries. Certainly the expectations were pitched too high. The extravagant claims of “peace in a week” and “peace by Christmas” were not just foolish and misplaced, but irresponsible in the extreme.
Together with these claims, other less public claims were being made within the Nationalist community in Northern Ireland. The belief was encouraged — and not just by Sinn Féin/IRA — that the Hume-Adams agreement provided the basis for the United Ireland to be arrived at on the Hong Kong model. The belief was further encouraged that Hume-Adams enjoyed the support of the Irish Government and that it was only a matter of time before the Nationalist objective would be realised. The prospect of a United Ireland in our lifetime was held up as a real, if not immediate, prospect. Understandably Hume-Adams alarmed Unionists. It raised fears and uncertainties which the Loyalist paramilitaries were quick to exploit and which some Unionist politicians were eager to confirm for reasons of self preservation.
The Downing Street Declaration,  meanwhile, failed to satisfy many Nationalists. The leader of the SDLP formally welcomed it, but he did not actively support it in the way that Sinn Féin/IRA actively opposed it. Mr. Hume made many television appearances assuring us of Mr. Adams's good intentions. Mr. Adams led the campaign on the ground to undermine the declaration. Together they continued to put forward Hume-Adams as the real answer to the Irish question.
The trend towards clarification, or translation of the declaration into the language of Hume-Adams confirms an impression of two forms of political communication running together in a maddening babble. It becomes increasingly difficult, not only for those outside the political elite but even within it to distinguish sense from nonsense. This is a profoundly destablising condition.
The declaration is a masterpiece of ambiguity — though considered ambiguity — in acknowledging complex realities and trying to build constructively and, as far as possible, consensually upon them. The problem with Mr. Adams and Mr. Hume is that they see these ambiguities of the declaration in terms of the old unfinished business.
For them the pure logic of the declaration's (green) language is still entangled in a contingent empirical detail — the principle of majority consent in Northern Ireland. The calls for “immigration” for a new “atmosphere”, for “realising the potential”, “moving the process forward”, and so on, represent attempts to circumvent that detail, to foster the triumph of destiny over practicality. They are calls to pretend that things are other than what they are.
 The failure of the two Governments to follow up on the unique momentum for political progress created by the Downing Street Declaration has brought further uncertainty and instability to Northern Ireland. The sectarian murder gangs have been only too willing to exploit this atmosphere — as we saw in the past two weeks on the Shankill Road and in Loughinisland.
The Taoiseach and the British Prime Minister were entitled to the praise they received for their successful negotiation of the declaration. The warmth of the reception the Taoiseach received from all parties in this House on his return from London last December was virtually unprecedented. However, I do not believe either of them merit much praise for their handling of the situation since then.
Given that the Taoiseach and Mr. Major put so much effort into the preparation of the Downing Street Declaration, it is all the more surprising that they should be prepared to put the whole project at risk by failing to follow through. In the six months since the declaration was signed there has been little evidence of any urgency in the approach of either Government. Months have been lost awaiting a response from Sinn Féin-IRA, yet there is little evidence — even at this stage — that a cessation of violence will be forthcoming. All of the time the body count mounts and fear is entrenched.
I was always apprehensive that the intensive efforts which the Government has put into attempting to entice Sinn Féin-IRA into the political process would result in further alienation of Unionist opinion. I am afraid that my fears were well grounded. Mr. Adams lavishes praise on virtually every speech the Taoiseach makes. He talks cosily of the Dublin Government being well aware of the timeframe for consideration by Sinn Féin-IRA of the Downing Street Declaration. The Taoiseach condemns individual atrocities by the IRA but fails to utter a word of criticism of the political equivocation of Sinn Féin.
The net result of all this has been to  create among even moderate Unionists the impression that the Government and Sinn Féin are political allies, working hand in glove in pursuit of a common political agenda. This is exactly the impression Mr. Adams wishes to create.
The problem has been compounded by a carelessness or looseness with words on the part of the Taoiseach when it comes to Northern Ireland. It was a serious error of judgment for the Taoiseach, within 48 hours of the Loughinisland massacre to use his visit to the United States to launch a demand for a form of cross Border authority with executive powers. It was inevitable that his interview would be seen as a demand for a form of joint authority over Northern Ireland — a demand which, I believe, is totally unworkable.
Rather than pursuing unachievable objectives and workable solutions the Taoiseach and the Prime Minister should use the declaration as the framework for the development of political structures within Northern Ireland which would be capable of winning broad cross community support. The matter is one of absolute urgency. The latest disclosure that the framework document on which the two Governments were working may not be ready until after the summer is a further setback. With people being murdered almost on a daily basis these sort of delays are simply unacceptable.
The situation cannot be allowed to deteriorate any further. The paramilitaries must not be allowed to set the agenda, or to exercise a veto of violence on political progress. The primacy of democratic politics must be asserted, and democratic politicians must be obliged to face up to their responsibilities. The first of these is to build on the achievements of the Declaration by giving practical expression to its democratic sentiments to which all parties, except the terrorists, subscribe.
Finally I would like to comment on the special Sinn Féin delegate conference at which, it is claimed, a formal decision will be made on the Downing Street Declaration. Once more Sinn Féin-IRA is  taking the Irish people for fools. The dogs in the street know that this conference is a farce, staged for the benefit of publicity, and will merely rubber stamp a decision taken by the IRA. The decision is widely known, the IRA does not accept the Declaration, but will neither formally accept or reject it.
Likewise, the IRA has no intention of renouncing violence. It is holding out for a refashioned declaration that more closely resembles the Hume-Adams agreement. The IRA will continue killing to get its way, and Sinn Féin's pretentions to democracy must be seen in this light.
This Government must now make it clear to the IRA, and to those guarantors of Sinn Féin's good intentions, that IRA violence will not be tolerated and that there is no political dividend for murder and that neither Loyalist nor Nationalist gangs will be allowed to veto progress or set the agenda.
Minister for Finance (Mr. B. Ahern): This adjournment debate on the 1994 Estimates provides an excellent opportunity to take stock — to review the emerging economic and budget position in 1994 and to look at the prospects for next year and the medium-term.
Ireland is currently among the best economic performers in the industrialised world with strong growth, rising employment, low inflation, a substantial balance of payments surplus and a level of interest rates which is the lowest since the late 1970's. This performance, which has resulted from the consistent pursuit of sensible policies, reflects strong exports and improved competitiveness based on a wide degree of consensus on economic and social policy. Yet, high unemployment continues to be the major economic and social problem.
It is against this background of significant economic progress, coupled with the continuing challenge of unemployment, that I want to look at three issues. I would like first to set out Ireland's key national economic objectives; second, to summarise the progress made in achieving these goals in recent  years; and, third, to discuss the prospects for the future.
Our main economic objective is to achieve the maximum possible sustainable increase in the number of people at work. A secondary, but still important, goal is to realise the fastest possible sustainable rate of improvement per capita living standards.
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