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16th July 2015 | Uncategorised

The Green Party outlines its budget proposals at National Economic Dialogue

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The Party would restore public services and increase capital investment ahead of cutting taxes.

 

Speaking today, Green Party leader Eamon Ryan said: “The Government has got its budget plan badly wrong.  They are at the old trick of promising both tax cuts and spending increases. They have not accounted for the cost of providing for an increasing population and they continue to slash capital spending in way that will harm us in the long run.”

 

“We believe that the budget should work towards a vision, rather than the vision be predetermined by the budget. The Government are taking too narrow a focus on how our economic strategy should be framed. They have already decided that any available revenue will be divided fifty-fifty between tax cuts and spending increases, which undermines this dialogue. “

 

“Our submission takes three approaches in providing for better public services ahead of tax cuts, leveraging greater capital investment in critical infrastructure and promoting local enterprise through reforming the local property tax (replacing it with a site value tax) and a new regional public banking system.”

 

“We also need to start accounting for our store of natural capital in setting the future direction for our country. Our economic stability will be best secured by the steering Ireland in the direction of becoming one of the most environmentally responsible countries in the world.  Such an approach should go hand in hand with a transition to a more equal and stable economy.”

 

 

Summary of main submission points:

 

Expenditure

€ million

Education

350

Public Transport

150

Health

400

Welfare Spending

200

Public Sector Pay

300

Overseas Development Aid

100

 

Total: 1500

 

BETTER PUBLIC SERVICES AHEAD OF TAX CUTS

 

  • The Five year plan presented by the Government envisages an ongoing reduction in public spending as a percentage of GDP.  We agree with the Fiscal Advisory council that the Government has underestimated the demographic pressures on expenditure in key services. 
  • The Green Party would allocate €1.5 billion additional spending in the 2016 budget in support of better education, health, transport, and social welfare services as well as allowing for a rise in public sector pay and a reversal of recent cuts in lone parents allowance and overseas development aid. 

 

ADDITIONAL CAPITAL INVESTMENT IN HOUSING, ENERGY AND WATER SERVICES

 

  • The further reductions in Capital expenditure planned by the Government will undermine the productive capability of the economic as critical bottlenecks in housing, energy, transport and water infrastructure arise. 
  • The cost of long term financing has never been lower and we agree with the representatives of the business community who emphasis the need for investment in such long term assets for the state.
  • Similar ‘off balance sheet’ investments are possible in the provision of water infrastructure and the energy retrofitting of buildings, which can be leveraged  with European investment funds where we can show that the pricing policy adopted allows us meet long term environmental objectives.

 

PROMOTING A NEW LOCAL ENTERPRISE ECONOMY

 

  • The introduction of a new public banking model can assist new small to medium sized businesses, especially in rural Ireland. The Banks would be not for profit professional lending institutions working on a regional basis with a central office providing management information systems. 
  • Deposits raised in a region would be lent out in that region.  Commercial loans which would be larger than those traditionally given by credit unions but smaller than those from Commercial or investment banks.
  • We advocate the introduction of a site value tax system instead of the local property tax where revenues would revert directly to local authorities and involve a reduction in commercial rates which impede local enterprise.

 

The Green Party’s full submission is available on their website, here.