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Finance Minister not up to the job – Ó Caoláin

6 February, 2008

Speaking during today's Dáil debate Sinn Féin TD and Dáil leader Caoimhghín Ó Caoláin described the Bill as lacking innovation and noted that it does not indicate that the Minister for Finance is up to the challenge presented by the current economic circumstances.

Deputy Ó Caoláin said:

"There have a number of significant worrying developments since the Budget was announced at the start of December. The Central Bank has predicted that the downturn in construction will cost 23,000 building jobs this year. The exchequer surplus was a mere €630 million in January, down from €1.7 billion in January 2007. The number of people claiming unemployment benefit rose in January at the fastest pace since 1980. The International Monetary Fund (IMF) has warned that a recession in the US would inflict significant damage on the Irish economy,

"As economic growth forecasts are revised downwards the challenge for the Minister for Finance and for the Government is to ensure that the revenue is there to provide for public services and that neccessary interventions are made to stem job losses while creating alternative employment. This can be done if the will is there at Government level to do it.

""The Government slept walked into this situation. While others were recognising the serious vulnerabilities in the Irish economy this Government and this Minister were insisting that everything was going fine. They deemed those who raised legitimate concerns about the state of the economy to be merchants of doom.

"The provisions in this Bill will not be enough to address the extent to which this state continues to lag behind other EU states in terms of research and development capacity within enterprise.

"The Government failure to plan for the future of the economy will have serious consequences for the exchequer. Tax revenue across a range of taxes are down while the burden on social insurance fund is set to rise as a consequence of an increased numbers of redundancies and a growing level of unemployment.

"It is time the Minister for Finance outlined what action the Government is to take to put the economy back on a solid foundation and ensure we regain competitiveness - this bill should have set the tone for the Government's approach.

"There are measures in this Bill that are to be welcomed. Sinn Féin welcomes the new measures to tax the profits of exploration companies exploiting our natural resources though these do not go far enough. We are also concerned by the fact that this tax will not apply to exploration licences granted before 2007?

"Sinn Féin welcomes the overdue reduction in the rate of VAT on non-oral contraceptives, from 21% to 13.5%. We also welcome the fact that those on the average industrial wage are being kept within the standard tax band and that unsustainable tax cutting proposals have not been implemented.

"There are a number of things that we would have hoped would be included in this bill. It should have focused on eliminating unfair tax advantages for the wealthy, reviewing VAT charges which hit low income families hardest and increasing the restrictions on the use of specified tax relief's for high income individuals. Sinn Féin would have liked to see the Government commitment to the abolition of the regressive Employee PRSI ceiling implemented.

"While this bill contains measures to promote energy efficient technology amongst businesses we would have liked to see the inclusion of an innovative scheme to assist low incomes households to insulate their homes and to install sustainable heating alternatives.

"There are other elements of this bill that will have to be teased out at committee and report stage - including the manner in which the changes in VRT are being introduced. We will deal with this and other issues at committee stage." ENDS

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