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Remarks by Joan Burton to Kennedy Summer School

9 September 2017

Speech by Joan Burton TD
Spokesperson on Finance, Public Expenditure and Reform, and the Arts

Remarks by Joan Burton TD at Kennedy Summer School, New Ross, Saturday 9th September. Irish Politics Session: Budget, Brexit & Better Politics.

JFK was lucky in his choice of speechwriters such as Ted Sorensen so there is wealth of Kennedy oratory available.

I chose this one from an address at Yale University in 1962.

‘The great enemy of truth is very often not the lie--deliberate, contrived and dishonest--but the myth--persistent, persuasive and unrealistic.’

The UK’s Brexit debate is a good case study of a calamitous cocktail of lies and myths.

There were egregious lies about finance for the NHS.

Myths about Europe also had a major impact, perhaps even more decisive than the contrived lies.

The coming Dail session will have BREXIT in the background every day.

 It cannot be avoided.

Brexit has to be factored into the Budget with sufficient flexibility for adjustments to counteract developing damage to different sectors.

Tourism is having a great year the number of UK visitors has fallen. Ryanair is to reduce flights between Ireland and the UK while the serious reduction in the exchange rate for sterling is already causing a lot of disruption and damage.

Economically a two speed Europe seems to be emerging.

EU economies are growing while BREXIT has shackled the UK.

Any recession across the channel will have repercussions here and could blow up all 3 year master plans.

The Budget will be an interesting test of Government capacity to plan ahead.

I take the view that the capital budget has to take pride of place in all calculations with affordable and social housing clearly at the head of the queue.

I found a marked contrast in broadband capacity on a recent holiday in Connemara, some spots with excellent 4G while others had hardly any signal at all.

Climate change adjustments require urgent changes to transport and agricultural policy.

Tax is where another myth creates a policy void.

Ireland is not a high tax country.

What we do have is a tax code that has serious imbalances and a too narrow tax base.

A reforming Finance Minister has an opportunity to think creatively to expand resources for capital spending, debt service reduction and improved services.

I suggest the availability of low interest loans internationally offers a chance to redeem high interest debt and replace it with cheaper loans. I welcome the Government’s decision to redeem the high interest bail out loans and replace some of them, from the IMF and the bilateral loans from Denmark and Sweden and replace them with cheaper loans. When the economy crashed in 2008 Irish interest rates soared to unaffordable levels hence the arrival of the Troika and their punitive bailout. Ireland for some years now has been able to borrow very cheaply and for longer terms. The gross debt remains very large but the lower interest rates leave more money for essential public services

Brexit downgrades London as a dominant financial centre and allows us to join other European countries in promoting a Financial Transactions Tax with a considerable annual yield.

I am surprised that high employment has not generated as much income tax as might be expected. This is likely due to continuing wage stagnation so there ought to be accelerated moves to a living wage as the basic norm.

Every Revenue crackdown on Tax evasion generates a lot more than original estimates.

So it has been in this year’s campaign to detect offshore accounts. These campaigns should be a permanent feature because evasion and avoidance are addictive to those who want NO taxes, not just low taxes.

I want clarity on the property tax situation in 2019. This tax has a solid yield with almost full compliance. There are many ways to remove the fear factor that a huge increase is on the way. For example, the current rate could be adjusted downwards as home valuations increase. There are sensible options while retaining the basic value of the tax.

I’ll leave it there and look forward to the debate.

Thank you