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6 December 2007 Edition

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ECONOMY: Sinn Féin's Budget proposals for Brian Cowen

Finance Minister Brian Cowen

Finance Minister Brian Cowen

Sustaining and sharing prosperity

IT’S crunch time for the Fianna Fáil-led coalition as Finance Minister Brian Cowen presents his 2008 Budget (as An Phoblacht goes to press), with tax revenues falling, election promises coming home to roost and economic growth slowing down considerably.
For a number of months, Minister Cowen has been working hard on conditioning the public for a tight budget. The deceit on which the election was won is clear for all to see as tax-cutting proposals which were never viable have to be abandoned in the face of a €1.75 billion shortfall in tax revenues.
Sinn Féin set out its priorities for the Budget last week and in doing so it is the only one of the Leinster House parties to clearly set out an alternative course of action for the Finance Minister on Budget Day.  The party’s core priorities include sustaining economic prosperity, improving quality and capacity within public services, achieving value for money for tax-payers and advancing the all-Ireland economy.
This week we carry edited extracts of the Sinn Féin Budget submission

Introduction
Sinn Féin’s commitment is to the creation of a prosperous and equal economy and the elimination of poverty and inequality.
A prosperous economy requires communications and transport infrastructure, high-quality accessible public services, strong social protections and a highly-skilled and educated workforce. It requires the Government to maintain healthy public finances.
Sinn Féin was the only party which argued in the run-up to the election that, with the slow-down in economic growth, the Government could not afford to cut taxes and maintain, let alone improve, public services and provide essential infrastructure.
Ireland as a whole continues to suffer from significant infrastructure deficits and lags behind other states in terms of R&D (Research and Development) capacity within enterprise while the level of engagement of workers in up-skilling and re-training remains too low.

Public finance
If public finances are not kept in a healthy state, the Government will not be in a position to ensure that everyone’s basic needs and rights to housing, health and education are met.
Nor will it be in a position deliver infrastructure to ensure that our cities, towns, villages and businesses are served by modern transport and telecommunications infrastructure.
The purchasing power of the Irish family has been seriously eroded in the lifetime of the previous government with a series of stealth taxes, including double-digit increases for electricity, gas and health insurance as well as soaring home heating oil, petrol and associated transport costs.
When you add in nine increases in mortgage payments over an 18-month period, it is clear that there has been a visible decline in the disposable incomes of working families.

Proposals on taxation
a)    Keep those on or below the average industrial wage within the standard rate tax band. The minimum wage should be set at 60 per cent of the average industrial wage, and all those on it should be kept out of the tax net.
b)    Retain the current rates for standard rate tax band (20 per cent) and the higher rate tax band (41 per cent).
c)    Proceed with the removal of the PRSI ceiling.
d)    Do not introduce proposed cuts in employee and self-employed PRSI.
e)    Increase restrictions on the use of specified tax reliefs (such as stallion fees, greyhound stud fees, and multi-storey car-parks) by high-income individuals.
f)    Standard rate all discretionary tax expenditures and include a review of these within the remit of the Commission on

Taxation.
g)    Increase mortgage interest tax relief.
h)    Aggressively pursue tax evasion and invest adequate resources for tax collection and enforcement.
i)    Close all remaining legal loopholes that have allowed the super-rich to pay no tax whatsoever, thus increasing the tax burden on everyone else.
j)    Remove tax exemptions except where the economic and social value outweighs the cost (e.g. R&D).
k)    Negotiate for tax harmonisation across the island.
l)    Introduce a 50 per cent tax on oil and gas profits and 10 per cent royalties on sales in line with standard practise in countries like Norway which have greatly benefited from such revenues.


Tackling wastage of public money
a)    ‘Value for money’ assessments should be conducted in a transparent way through the Public Accounts Committee.
b)    Review consultancy spending with an accompanying commitment to create new mechanisms to include the frontline public service workers in meaningful discussions about how those services are run.
c)    Reverse the decision to accept pay increases for the Taoiseach and ministers as recommended in Report No 42 of the Review Body on Higher Remuneration in the Public Sector. There should be no wage increases for members of the Government or Oireachtas for the duration of this Dáil.
d)    Empower the Comptroller and Auditor General to examine all existing PPP projects for cost over-runs, revenue foregone and wastage against long-term cost and profit projections.


Key public service budgetary demands

Health
a)    Deliver into the hospital system the additional 3,000 hospital beds required.
b)    Increase the threshold for the medical card to €250 per week for 2008 as proposed by Combat Poverty.
c)    Extend the cervical cancer-screening programme across the state in 2008.
d)    Reverse privatisation of healthcare by immediately ending tax breaks for private hospitals and the ‘co-location’ land gift scheme and investing all health funding in the public system.

Housing
a)    Construct 12,000 social housing units in 2008.
b)    Amend the Planning and Development Act (2002) to require that all new developments allocate 30 per cent to social and affordable housing, with at least 10 per cent social and at least 10 per cent affordable housing.

Education
Provide the resources to reduce all class sizes for children under 9 years of age to a maximum of 20 pupils.

Drugs
Provide the resources to implement the recommendations of the Report of the Working Group on Drugs Rehabilitation published in May of this year.

Childcare
a)    Introduce a universal pre-school session of 3.5 hours per day, five days a week for all children in the year before they go to school.
b)    Suspend the Childcare Subvention Scheme and extend the Equal Opportunities Scheme by six months pending reform of the Subvention Scheme entailing detailed consultation with Childcare providers using the Scheme around the state.

Disability
Introduce a ‘Cost of Disability Payment’ of €40 per week for people with disabilities regardless of whether they are in work or not.

Social Welfare
a)    Increase of €20 for all personal rates, including job-seeker’s benefit and state pension.
b)    Double the Living Alone Allowance to €15.40.
c)    Provide those on social welfare payments and families eligible for FIS with either a weekly fuel allowance payment of €25 or the equivalent in an allowance for units of electricity and gas and extend the fuel allowance from the beginning of September to the end of April
d)    Restore child benefit to children of asylum seekers and those awaiting a residency decision.
e)    Provide the funding to enable all 875 schools identified as disadvantaged under the Delivering Equality of Opportunity in Schools (DEIS) action plan to provide both nutritional breakfasts and lunches to students five days a week.

Jobs and Training
Sinn Féin is calling for:
a)    A targeted and funded strategy to pre-emptively up-skill workers vulnerable to future jobs-losses.
b)    An all-Ireland R&D strategy co-ordinated through the enterprise development agencies, central and local government, business, trade unions and educational institutions.
c)    A specific ‘Redundancy to Entrepreneurship’ scheme to assist workers who have become redundant to establish their own businesses.
d)    A major review of the performance of IDA and Enterprise Ireland and an examination and expansion of the role of FÁS. 
e)    A grant package for small and medium businesses to help them become more environmental (e.g. recycling, water re-use and energy conservation).


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