A Fairer Way to Recovery - Fianna Fáil Proposals for Budget 2013

A FAIRER WAY TO RECOVERY

FIAnnA FáIl PROPOsAls FOR BUDGET 2013

slÍ TÉARnAIMH nÍOs COTHROIME

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BUDGET 2013 – A FAIRER WAY TO RECOVERY

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Table of Contents

Proposals for Budget 2013

EXECUTIVE SUMMARY 2

1. Economic overview 7

2. Determining the necessary budget adjustment 9

3. Delivering jobs and growth 10

4. A fair adjustment of the taxation burden 16

5. Helping families in negative equity 20

6. Investing in our future 21

7. Reducing expenditure, protecting services 22

8. Ensuring fairness in public expenditure 28

9. Bank pay and pensions 30

10. Providing flexible pension options 31

Appendix 1: Summary of adjustment 32 Appendix 2: Taxation Measures 33 Appendix 3: Expenditure savings 34


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Executive Summary The principles underpinning our budget proposals are: Education, Disability and Mental Health services must be ring fenced from

any cuts in expenditure. We will reverse the cuts to home help support hours.

Job creation and retention must be supported by not adding to the burden of costs for business.

Those with higher incomes and wealth should bear a greater proportion of the burden of adjustment.

The tax base should be broadened in a way that promotes the long term health interests of society.

More demanding targets for reductions in the public sector pay bill are required with a strict deadline for their achievement.

Greater investment is needed in Exchequer capital projects than proposed by government.

A change in the definition of principal private residence is required to help struggling individuals and families who need to move home.

A residential property tax at this time would be both socially and economically unfair.

To help first time buyers we will extend on a restricted basis mortgage interest relief for a further 12 months.

To support high skilled quality jobs in the domestic economy and encourage home insulation, we propose reversing the cuts in home energy grants announced last year.


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Achoimre Tá slí níos cothroime ag Fianna Fáil i dtreo an téarnaimh.

Siad seo a leanas na prionsabail atá mar bhonn ar ár moltaí Cosnóimid Oideachas, Seirbhísí Míchumais agus Meabhairshláinte ó

chiorraithe. Déanfaimid malartú ar chiorraithe sna huaireanta cabhrach baile.

Tacú le cruthú post le polasaíthe nach gcuireann le hualach na ngnóthaí Ní mór dóibh siúd atá maoin agus ioncaim móra acu glacadh le hualach

na gceartuithe de réir a n-achmhainní. Caithfear an bonn cánach a leathnú ar mhaithe lenár sochaí go fad-

téarmach. Aidhmeanna níos troime maidir le laghdú an phá-bhille sa tSeirbhís

Phoiblí le spriocdháta docht. Níos mó infheistíochta i gclár caipitiúil an rialtais. Athrú a dhéanamh ar mhíniú an téarma “áit chónaithe phríomháideach”

chun chabhrú le clanna ar ghá leo bogadh tí. Bheadh cáin tí cónaithe leatromach ag an am seo. Ar mhaithe le ceannaitheoirí céaduaire, leanfaimid le faoiseamh cánach

úis ar bhonn caol ar feadh 12 mhí. Ar mhaithe le fostaíocht oilte intíre agus le insliú tí a spreagadh,

déanfaimid malartú ar na ciorraithe a chuireadh i bhfeidhm anuraidh ar an deontas fuinneamh tí.


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Our key proposals are:

Taxation

• We believe that high earners over €100,000 are in a position to pay a greater amount of tax and we propose an increase in the Universal Social Charge of 3% to achieve this. It is important to note that this increase will only apply to the portion of income above €100,000.

• Pension tax relief is a significant cost to the State and is unsustainable in its

current form. The level of relief should be restricted to 30% and the earning cap reduced to €70,000. To balance the impact on the incentive to save for retirement, a deferred tax credit should be provided to mitigate the change to marginal rate relief.

• Reducing resources for enforcement activity by the Revenue has been

completely counter-productive. Increased enforcement activity, including Revenue audits targeting high risk areas, will improve the tax take.

• Mortgage Interest Relief for First Time buyers should extended for a further 12

months.

• The duty on agricultural diesel should be equalised with other motor fuels. A rebate system for approved users should be introduced. This will combat the loss of revenue from fuel laundering and the consequent environmental damage.

Helping the Negative Equity Generation

• We propose a range of measures to assist families in negative equity including legislation to allow people to keep their tracker mortgages if they move house and a revision to the rules governing the definition of principal private residence for income tax purposes.

Stimulus Measures

• We are proposing an investment stimulus of at least €4.2 billion over 3 years. The government’s pension fund levy should end in 2013 and be replaced with a mandatory investment by private pension funds of 1% per annum for 3 years in the Strategic Investment Fund. This would be an investment of €700 million per annum and would be supplemented with an equivalent annual investment from the NPRF. We will shortly publish legislation to bring this about.


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• The cuts announced to home insulation grants in December 2011 were economically and environmentally unwise. We propose reversing them and streamlining the operation of the scheme.

• The economy is suffering from very weak overall levels of consumer spending and a significant growth in the black economy. To tackle this we suggest that a tax credit of up to €2,500 be made available for approved home improvement works subject to engaging a registered, tax compliant contractor. We believe this measure will be revenue enhancing for the State.

Support for Business and Employment

• The government should avoid heaping additional costs on business by transferring payment for sick pay to employers. The current rate of employers’ PRSI should be maintained.

• An appeals mechanism based on economic circumstances is required to limit the burden of commercial rates.

• More rigorous measurement of actual drawdown of credit relative to the

targets set for the banking sector under the terms of the recapitalisation should be initiated.

• We also suggest an increase of up to 10,000 in the number of places across

local employment schemes, including the Tús scheme. This can cover a wide range of ventures including community centres, child care, meals on wheels, community enterprise, city, town and village maintenance and renewal.

Expenditure

• The proposed €550m cut to the capital budget is too deep and will damage the output potential of the economy in future years while causing further job losses in a labour intensive sector of the economy in the short term. Our proposals will result in €150m extra exchequer capital spending above the level proposed by government.

• We believe that overall Social Protection expenditure can be reduced without cutting payment rates. We urge the government not to touch child benefit.

• The government has failed to make any inroads in reducing public sector pay.

The entire reduction to date has been as a result of previously announced measures. A target of an extra €350m in savings needs to be set and achieved for 2013. Discussions between government, management and trade


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unions should commence immediately. The focus of the incremental adjustment should be on non-core pay areas of allowances, overtime, certain premium payments, targeted redundancy at management and administration grade, additional working hours, changes to work practices as well as increments for public servants.

• In addition to pay savings, Departmental managers should be instructed to

target much more ambitious non-pay savings by focusing on procurement, shared services, out-sourcing and administration.


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1 Economic Overview

A number of key reports and economic statistics have been delivered in recent months. Taken together they indicate that the Irish economy can best be described as “bouncing along the bottom”, a far cry from predictions from the Minister for Finance that it could “take off like a rocket”.

The complacency of the government’s approach can be seen from the manner in which the report of the Fiscal Council was discarded without a meaningful reply.

The mantra is repeated that we are meeting all our targets under the programme when in fact we continue to miss a number of key targets. A confused message is being delivered to our EU partners who are questioning why we need a reduction in our bank debt if we are performing as well as we claim.

Among the issues highlighted by recent reports are:

• Compared to 2011 the government are now projecting lower growth rates for 2013, lower job creation, higher unemployment, lower real wage growth and higher public debt, Stability Programme Update April 2012 and Medium Term Fiscal Statement November 2012.

• There are still significant risks to Ireland's economic outlook. GDP will grow by just 1.4% in 2013 IMF report

• A bank debt deal is needed for debt sustainability: “Material investments in Irish banks by the ESM could transform the public debt outlook, cut the bank–sovereign link, and cement a needed win for Europe,” IMF report.

• Banks are still not supplying the needs of households and SMEs. IMF report.

• There is still "little appreciation" of just how bad the country's finances are and that further cuts in health, education and welfare are "inevitable”, ESRI report.

• Unemployment will remain high at 14.8% this year while the unemployment rate will only fall slightly to 14.6% next year. (This compares to 14.3% and 13.6% in the government’s Stability Programme update). ESRI report.

• There is a 40% chance that the debt to GDP ratio will fail to stabilise by 2015 under the current policy framework. Fiscal Council.

• GDP was flat for the second quarter. The economy avoided slipping back into recession by just €3m. Quarterly National Accounts.


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• In the last 12 months the number of people at work has fallen by 33,400. 1,200 jobs are being lost per week in 2012. Quarterly National Household Survey.

• Tax revenue is falling, in July, August and October it was below 2011 levels and significantly below target, Exchequer returns.

A co-ordinated European response is required

The Eurozone has entered a double-dip recession after recording a 0.1% contraction in the third quarter of 2012. Countries such as Austria and the Netherlands, which had previously weathered the storm well, saw their economies shrink in the third quarter.

Many parts of the Eurozone are suffering from slow growth, very high unemployment and falling living standards. Indications are that the downturn is intensifying with a strong chance that both Germany and France will see negative growth in the final three months of the year.

The Eurozone countries that have stabilised their debt ratios should avoid further austerity measures. Germany, which has achieved a balanced budget, could allow its budget deficit to temporarily rise to around 3% while keeping its Debt / GDP ratio constant. Similarly other countries such as Belgium, Netherlands, Finland and Austria could avoid further expenditure cuts and tax increases without worsening their debt / GDP burden.

Failure to take co-ordinated action of this kind risks the Eurozone economy descending into a deflationary spiral which will be damaging to all countries.

A deal on Ireland’s bank debt is urgently needed

The warning by Fiscal Advisory Council that there is a 40% chance that Ireland’s Debt / GDP ratio will not stabilise by 2015 highlights the urgent need to conclude a deal on Ireland’s bank debt.

The Taoiseach recently acknowledged that “the European position was imposed on us” indicating that he too believes that Ireland has a strong moral case for a reduction in the bank debt.

Ireland has undergone the most severe adjustments in its fiscal position with almost €25bn of measures introduced proving both our capability and commitment to reforms.

It is in Europe’s interests that Ireland turns out to be a success story. If the German Chancellor and French President are true to their word regarding “examining the situation of the Irish financial sector with the view of further improving the sustainability of the well-performing adjustment programme”, they would facilitate a swift resolution of this issue.


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2 Determining the Necessary Budget Adjustment The 2012 deficit is now expected to be 8.3% of GDP. While this is within the ECOFIN limit of 8.6% the Medium Term Statement notes that “the nominal level of the deficit at €13.5 billion is approximately €350 million worse than estimated at the time of the Stability Programme Update, due primarily to the higher voted current expenditure."

The deficit target for 2013 remains unchanged at 7.5% of GDP. The current estimate of the 2013 Exchequer deficit is €15.2 billion assuming the promissory note payment is made. This represents a huge addition to the national debt. Ultimately, the Fiscal Treaty commits Ireland to a balanced budget and it is imperative that we continue to bring down the deficit in a managed way while maintaining frontline services.

We concur with the need for an adjustment of €3.5bn but we propose a different composition in terms of the split between tax and expenditure. In addition within the expenditure programme we propose a smaller cut in the capital budget. We believe that such a composition of the adjustment will both socially fair and economically prudent.

The composition of our proposed consolidation is outlined below:

Total Consolidation 2013 €bn

Expenditure Current Capital New expenditure commitments Net expenditure adjustment Tax Net New Measures Carry Forward from 2012 Additional tax audits Adjustment for full year effect in 203 Interest savings Total adjustment

1.43 0.40 1.83 (0.09) 1.74

1.36 0.22 0.10

(0.12) 1.56

0.20

3.50


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3 Delivering Jobs and Growth The government’s Jobs Initiative has failed to make any inroads into the unemployment crisis.

Since the start of 2012, there has been a fall of 24,000 people at work. In terms of full-time employment, the trend is even worse with 34,000 fewer people employed than at the end of 2011 and the fall in the second quarter of 2012 was the highest since 2010.

One quarter of the workforce are not working to the extent to which they would like.

The core principles which underpin our proposals to create jobs are:

• There should be no change to our corporation tax regime.

• The government must avoid adding unnecessary costs to business particularly in labour intensive sectors.

• Ireland’s position as a world centre for high-technology enterprise should be maintained by investing in training and research.

• Our competitive advantages in the agri-food sector should be fully exploited.

• Targeted education and training solutions should are required to support

employment opportunities for people experiencing unemployment.

• Capital investment in employment-intensive projects is essential to boost the competitiveness of the economy.

Supporting Enterprise

We propose the following measures to encourage enterprise and job creation:

• Allow businesses to appeal an assessment for commercial rates on the basis that the ratepayer’s economic circumstances have changed. A number of factors should be set out for guidance purposes for local authorities in determining the amount by which to reduce rates in the event of deteriorating economic circumstances. A simplified form of appeal should be allowed to the Valuation Office.

• Enhance the Employment and Investment Scheme (EIS) to make it more

attractive. Allowing full tax relief when the investment is made in a start-up company would facilitate raising capital for SMEs.


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• Investigate the potential for providing access to vacant or underutilised public property for entrepreneurs or business start-ups to use as incubation centres.

• City and County Enterprise boards should be retained under the aegis of Enterprise Ireland and should be strengthened by providing business incubation units in each board and by the provision of a one stop shop helpdesk for business start-ups. Legal, human resources, patents, accountancy and funding advice would be available. Each Enterprise Board should be linked with a third level institution. We propose to increase their funding by €10m.

• Impose rigorous efficiency targets on the ESB, Bord Gáis and Eirgrid.

• A National Energy Efficiency Action Plan should be undertaken to achieve a

national energy saving of 20% by 2020 including measures to assist SMEs to lower electricity costs.

Employee Sick Pay

While the government appoints a Minister for Small Business and applauds itself for being supportive of SMEs, the Minister for Social Protection Joan Burton is seeking to put the cost of sick pay on to businesses.

This will lead to higher employment costs for the 200,000 small businesses in this country that employ more than 655,000 people.

In key sectors such as retail and hospitality, employee costs account for 60% of overall costs.

This threat hanging over businesses is already affecting employment and many businesses are saying that they are holding off on recruiting until they know whether this is included in Budget 2013.

The government should recognise the reality for smaller companies that they do not enjoy the flexibility available to larger employers.

The Minister for Social Protection is seeking to use spurious comparisons to support her arguments. For example in Northern Ireland, while employers do make the initial sick pay payment, they are able to offset this against their PAYE tax bill later. In addition, it has less of an immediate cash flow implication as the payment is just £81.60 for 28 weeks there compared to €188 a week for 2 years here.

The Minister needs to end this uncertainty now and rule out any changes to the arrangements for employee sick pay.


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Credit Availability for Business

Businesses up and down the country are finding it more and more difficult to access loans or proper credit facilities to enable them to protect existing jobs and create new ones. The absence of credit is costing jobs and closing businesses.

According to the Credit Review Office, credit targets are being met. However, its calculations are based on credit approvals, rather than actual credit drawdowns, and take account of the restructuring of existing loans, as opposed to the provision of new credit facilities. This urgently needs to be changed.

The Central Bank found that in the Eurozone, only Greece refused more loans to small businesses than Ireland. Businesses in Ireland are twice as likely to have a loan application rejected as elsewhere in the euro area.

In their manifesto, Fine Gael promised to “direct the new Credit review Office to publish a delivery audit of the commitments by AIB and Bank of Ireland to make available a total of €12 billion in additional lending to small and medium enterprises in 2010 and 2011” . This has not been acted upon.

The government should adopt proposals made by our Spokesperson on Small Business John McGuinness who has called for greater lending powers to be given to credit unions and greater use of the County Enterprise Boards in respect of microfinance.

Tackling Youth Unemployment

The unemployment crisis has hit young people hardest. With over 1 in 4 young people unemployed, the sheer scale of the problem is being masked by the numbers of people emigrating and the significant numbers of young people entering or staying in education.

Our young people want to work and all they want is to be given the chance.

In May we launched a comprehensive document to tackle youth unemployment. The measures we propose are:

• Immediately cut courses in education and training that are no longer relevant to labour market needs and transfer those resources into areas of need.

• Reform our education, welfare and employments services and introduce education and training vouchers on a pilot basis, similar to the UK model.

• Extend the scope of apprenticeships to a much wider range of occupations.

• Require all young people who are not in education, employment or training 6 months after qualifying for jobseekers allowance to engage in a strengthened CE (or equivalent) scheme as opposed to cutting their benefits further.


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• Up-skill 100,000 job seekers with ICT skills over the next four years.

• Establish a programme providing 1,000 internships in the Irish Financial Services Centre.

• Reform, strengthen and expand the JobBridge Programme by 5,000 places specifically targeting those aged under 25.

Energy Retrofitting

In Budget 2012, grants for internal and external wall insulation as well as attic were slashed as well as the grants for heating controls and boiler upgrades. According to SEAI's 2010 Annual Report, over 5,000 jobs were supported through the domestic home grant programmes. However, the expertise that has been built up has been put at risk by the changes to the scheme.

This was extremely short sighted and will cost jobs and make it extremely difficult for Ireland to meet its retrofit and energy reduction targets

By developing and preserving a highly skilled workforce in this area, we can also tap into a growing export market for energy efficient goods and services.

To this end we support:

• Reversing the cut in grants introduced last year.

• “Green Loans” on favourable terms administered through the credit union sector.

• The roll out of a ‘Pay as You Save’ scheme. This could be extended to

commercial premises as well.

Science, Technology and Research

Research and Development is central to a modern successful economy.

We have an excellent base from which to make further progress. Two thirds of Ireland’s R&D is in the private sector, creating new product and service innovations that will drive exports, growth, and jobs. Productive, high calibre research, undertaken by highly skilled research teams working closely with industry partners must continue to be a priority.

In addition we propose:

• Currently the R&D credit is a function of increases in expenditure using 2003 as the base year of comparison. The incremental approach needs to be reviewed in light of the pressure on company budgets. In order to encourage investment in the sector, all R&D expenditure should for a two year period be eligible for a tax credit, subject to EU competition approval.


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• The outsourcing cap on R&D expenditure should be reviewed. The scheme

currently limits the outsourcing of R&D from business to research institutes to just 5%. This greatly limits the degree to which enterprise can collaborate with universities and third level institutes on R&D activity and is inconsistent with other government policy aimed at fostering linkages between these two sectors.

• In order to encourage the widest possible uptake of the R&D tax credit,

Revenue and Enterprise Ireland should actively target the Irish SME sector with user friendly information guides on how the relief works.

The Agri-Food Sector

The agri-food sector is a great success story for the Irish economy. Quite simply, the quality of our food and food ingredients offering is unsurpassed anywhere in the world and we must market this asset at every opportunity.

As well as providing a livelihood for an estimated 120,000 farmers and their families, the sector currently exports almost €8 billion annually in food and beverage products, representing 50% of indigenous manufacturing exports. It employs over 45,000 people in over 800 companies throughout the country.

The Irish agri-food sector can be at the forefront in our export-led economic recovery, with the potential to create thousands of new jobs.

• The government needs to fully implement the key recommendations of Food Harvest 2020 for the future development of the agri-food, fisheries and forestry sector. This has the potential to create at least 4,000 jobs.

• The abolition of milk quotas in 2015 is an opportunity to greatly expand the

output from this sector. Currently farmers can claim a capital expenditure on the construction of farm buildings and certain other works. The cost is written off over 7 years. Reducing this to 3 years to take advantage of the current opportunity will potentially yield economic returns in to the future.

• The Irish seafood sector is worth €700 million and employs 11,000 people.

The government must protect and enhance the sector in the current review of the Common Fisheries Policy. Achieving agreement on sustainable yields and removing unnecessary technical restrictions on Irish fishing practices is key to ensuring the vibrant future of the Irish Fishing industry.

Arts and Culture

The positive contribution that a thriving arts and cultural sector makes is valuable to Irish society as a whole. We also appreciate the economic potential of the arts and


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creative industries and their role in supporting enterprise and innovation in the economy.

• The government should extend Section 481 Film Investment relief to 2016 to maintain Ireland’s attractiveness as a location for film production in an increasingly competitive international environment.

• A range of funding mechanisms should be examined for the capital

development plans for the National Gallery of Ireland, the National Concert Hall, the Abbey Theatre, the National Museum at Collins Barracks and other major cultural centres.


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4 A Fair Adjustment of the Taxation Burden Taxation policy has a key role to play in supporting economic activity within the State. Policy should be designed in a way that underpins growth and all revenue raising measures should be benchmarked against alternative proposals in terms of their impact on employment and economic activity.

Residential Property Tax

The Troika have repeatedly made clear that specific budget decisions are a matter for the government of the day, taking account of prevailing economic conditions, subject to the requirement to meet the overall fiscal requirements of the agreement. Therefore it is within the remit of the government to decide whether on balance now is the appropriate time to introduce a full value property tax or whether alternative taxation measures should be introduced to meet the targets set out for 2013.

450,000 people live in homes where difficulties in meeting the monthly mortgage payment are being experienced. Hitting these household at this time with an additional charge which takes no account of ability to pay would risk driving them deeper into financial difficulties.

Over 50% of residential mortgages are in negative equity, including the majority of those taken out since 2000. Imposing a recurring tax on an asset which has a negative net worth in circumstances where people have no option to dispose of the asset is fundamentally unfair.

The recovery in housing transactions is vital to the recovery of the economy. The introduction of a property tax is likely to further delay any recovery in the housing market further damaging the domestic economy.

Between 2002 and 2009 nearly €5.5bn was paid by purchasers of residential property in the form of Stamp Duty. In addition the sale of new residential housing has generated over €14bn in VAT receipts for the Exchequer since 2002.

If a residential property tax is to be introduced fairly, a normalisation of the housing market, including measures to deal with the mortgage arrears crisis, is an essential prerequisite. In addition comprehensive logistical planning is required to avoid a re-run of the fiasco surrounding the Household charge. Neither of these conditions are likely to be in place for several years.

Fianna Fáil’s conclusion is that now is not the right time to introduce a property tax. It risks damaging an already weak domestic economy. It would fall disproportionately hard on families already struggling to meet mortgage payments.

High Income Earners

111,000 income tax cases had earnings over €100,000 in 2011. This represents the top 5% of earners. They paid an average effective tax rate of 25.7%. Increasing the


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Universal Social Charge by 3% for earnings above this amount would raise €200,000 and increase the effective tax rate paid by this group by 1% to 26.7%.

It is important to emphasise that the additional tax would only be paid on the portion of earnings above €100,000 and where a married / civil partnership couple choose to be jointly assessed it would not apply to them if they both individually earn less than €100,000. We believe this represents a fair adjustment of the income tax burden.

Tax Relief for Pension Contributions

An optimal pension policy should allow individuals to spread the income they earn (and the tax paid) over their entire lifetime rather than just their working life.

A number of measures have been implemented in recent years to limit the accumulation of excessive pension pots. In this budget we propose that the government reduce the annual earnings limit (along with age-related percentage limits) for maximum tax relievable contributions for pension purposes from €115,000 to €70,000 and reduce the rate of relief to 30%. We propose that the loss to the employee in respect of the reduction of marginal rate relief would be mitigated by means of a deferred tax credit. In order to give certainty to employees, there should be a commitment to make a final definitive change to the rules governing pension contributions.

We believe that this strikes a balance between the need to encourage employees to make provision for their future income needs without unduly depriving the State of income tax revenue at the current time.

Levy on alcohol sales in Off Licence premises

Ireland is currently seeing an increase in alcohol consumption within the home. One of the reasons often cited for this trend is the significant price differentiation of alcohol products between on-trade and off-trade establishments. Not only has this discrepancy affected social behaviour by discouraging people from consuming at public houses, but it has also been cited as a contributing factor to the rise in binge drinking and underage drinking.

There is an opportunity to establish a greater degree of fairness within the alcohol sales market and to raise revenue for the State by introducing a levy directed towards off-trade establishments. This would also be beneficial to society as a whole since the regulation of alcohol taxes is one of the most common ways to combat alcohol related problems, especially within European societies. The cost to the health care system of alcohol related illnesses is approximately €1.2bn out of a total estimated cost to society of €3.7bn.

We therefore propose that a levy of 10% on alcohol sales in off licences be introduced which will raise a minimum of €100m in a full year. We also believe that the licensing system in the off trade needs to be restructured to take account of the


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volume of sales / square footage of the retailer. It is illogical that a large multiple is currently the same (€500) for a beer license as a small independent retailer.

We also propose to outlaw the practice of below cost selling of alcohol which will eliminate the loss of VAT to the State from such practices. According to industry estimates, this will raise €20m

Tax on High Salt and Sugar Content Products

61% of Irish adults are overweight or obese and 20% of children likewise. Considerable evidence exists that the consumption of high sugar content drinks and sweets / cakes contribute to obesity which in turn raises the risk of heart disease, diabetes and other ailments. A ‘junk food’ tax could take the form of an excise duty surcharge on certain food products as categorised by the National Food Safety Authority based on levels of salt, sugar and added sugars.

According to a recent study from Marie Murray and Micheál Collins of the Nevin Economic Research Institute a separate tax for sugar and salt taxing could generate €95m and €13m respectively. For individual consumers it would mean 3 cent on a chocolate bar and 5 cent on a two-litre bottle of cola.

Illegal Sale of Diesel

Ireland currently faces a significant problem with the illegal sale of diesel with figures suggesting that 12% of all diesel in Ireland is sold illegally. The illegal laundering of diesel is damaging to the public finances, public safety, and to the environment. With the rise in fuel costs only encouraging such activity, it is imperative that measures be taken to address the matter.

The duty rates between agricultural fuels and motor fuels should be equalised with a reclaim system for agricultural fuel users. This would save the exchequer approximately €160m, according to a report prepared by Deloitte for the Irish Road Haulage Association. We believe an initial first year saving of €100m can be achieved.

In addition a 10c rebate for licensed road hauliers similar to the system that operates in Belgium and Spain has the potential to boost exchequer revenue by encouraging domestic hauliers to purchase fuel in the State rather than when overseas.

Capital Gains Tax

Low rates of capital gains tax may be desirable in encouraging entrepreneurship. However, the extent to which income can be converted to capital gains there is a potential significant loss of revenue to the State from a significant variation between capital gains tax and income tax rates. We propose an increase in the capital gains tax rate to 35% which will yield €80m.


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Taxing the tobacco industry

Research from the Irish Heart Foundation and Irish Cancer Society has shown that in the decade to 2010, the tobacco sector’s revenue from a pack of cigarettes has increased from €1 to €1.84. Essentially the industry has used the opportunity afforded by increases in tax on tobacco to increase their own profits.

We endorse the proposals from the Irish Heart Foundation and Irish Cancer Society that tobacco prices should be controlled in the same way as other sectors such as energy prices and taxi fares. With such a change the proportion of the retail price of tobacco that would go to the exchequer would increase.

This can raise a minimum of €100m in the first year, increasing to €150m in subsequent years.

In addition more effective targeting of cigarette smuggling and additional spending on prevention measures is required.

Revenue tax audits

Data submitted by Revenue to the Oireachtas Finance Committee shows that the number of tax audits carried out has fallen from 13,400 in 2009 to approximately 9,800 in 2012. The yield from tax audits declined by €200m. During this time the number of audit case workers has fallen by 143.

This is clearly a false economy. Revenue’s own report estimates that:

• Redeploying 30 staff would collect €225m of debt. • Increasing audit resources by 125 staff could yield an additional €100m per

annum. • Recruiting 40 ICT specialists to replace external resources would save €4m

per annum.

We believe the necessary additional resources must be made available urgently. At a conservative estimate this should yield an additional €100m in 2013.

Mortgage Interest Relief

A recovery in the volume of housing transactions is essential to growth in the economy as it typically associated with a range of other activities including increased retails sales. Tentative signs of a recovery in the market are currently been seen but this may be due to the imminent end to mortgage interest relief for first time buyers. In order to avoid choking off this recovery, we believe mortgage interest relief for first time buyers should be extended, subject to an annual maximum of €2,000, for an additional 12 months. The cost of this is approximately €20m.


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5 Helping Families in Negative Equity People in Ireland in their 30s and 40s hold nearly 90% of the negative equity in the country. This is a huge millstone round their necks. If they want to move to a more suitable home because of a growing family or take up better employment opportunities, they are restricted from doing so because they cannot sell their home as a result of the overhang of negative equity.

If someone does choose to move out and rent their home, they will face a number of additional costs including, income tax, universal social charge, Non Principle Private Residence tax, fees to the Private Residential Tenancies Board and from 2013 PRSI will be levied on rental income.

In practice, thousands of reluctant landlords have to subsidise the mortgage on their previous home. Others are making the unwise choice of not declaring their rental income and storing up huge problems for themselves for the future.

We propose a simple change to the income tax code which would allow people who bought their house between 2000 and 2009, who have now moved out and are themselves renting another house, to offset this payment against the rental income for a period of 3 years. We estimate this will cost €20m in the first year.

In addition, we are proposing a number of other measures to specifically assist this group.

These measures include:

• Negotiate with banks to allow people to keep their tracker mortgages if they move house. If this is not successful, legislation should be introduced to ensure it occurs.

• Allow early access to pension savings in certain circumstances in a manner along the lines of the kiwi saver or a loan from defined contribution accounts (similar to US 401k).


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6 Investing in our Future The Infrastructure and Capital Investment Framework (2012-2016) envisages a 60% reduction in Exchequer capital investment in 2014 from its peak in 2008, with the allocation in 2014 of €3.25 billion representing less than 2% of GDP. We believe this represents too deep a cut in capital expenditure.

As of the end of October the government had underspent the 2012 capital budget by €336m. We know from Department of Finance and NAMA projections that €1bn of capital spend equates to 10,000-17,500 new jobs in the economy. So €336m would equate to 3,000-5,000 new jobs. The government is depriving the domestic economy of much needed spending.

We propose a capital spend of €3.4bn for 2012 which is €150m greater than proposed by the government. The incremental expenditure should be focused primarily on labour intensive projects.

Strategic Investment Fund

In September 2011, the government announced the establishment of a Strategic Investment Fund. While the merit of maximising non exchequer capital investment is universally recognised, the government’s plans lack ambition and are likely to be of limited impact as currently devised.

We propose a much larger Fund based on a mandatory total investment of 1% per annum for the next 3 years and a matching investment by the National Pension Reserve Fund from its discretionary portfolio. This gives a potential €4.2bn for investment on a commercial basis in infrastructure opportunities and would be separate from the Public Capital Programme. The size of the fund could be further enhanced by making investment in it available to regular savers in a manner similar to the National Solidarity Bond as well as additional market funding where available. This programme will not impact on the General government Deficit.

The government’s Pension Fund Levy and the related VAT changes were an attempt to tackle the jobs crisis. To date, there is no clear evidence that the levy has produced any tangible benefit.

The long term nature of pension funds, both public and private, makes them uniquely suitable for investment in infrastructure assets that offer stable, predictable cash flows. Investment in the proposed Strategic Investment Fund offers pension funds the opportunity to partner with the State in the development of projects that will offer a commercial return, secured on a portfolio of real assets while also providing a significant stimulus to economic activity which would be beneficial to all sectors of society.


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7 Reducing Expenditure, Protecting Services Implementation of the Croke Park Agreement

Source: Croke Park Implementation Body Report June 2012

Ultimately the success or otherwise of the Croke Park agreement will be measured by a simple criterion – how much money will be saved from the exchequer pay bill while maximising delivery of public services.

The vast majority of savings achieved to date have been from measures introduced by the previous government. The pay and pensions bill fell by €1.8bn between 2008 and 2011.

Recently Minister Brian Hayes claimed:

“A totality of €2 billion has been taken out of the public sector pay and pension bill as a result of the measures since 2008 and the measures that Brendan Howlin is introducing now.”

In reality the government have not introduced any significant measures to control the public sector pay bill.

Minister Howlin’s claim that he regarded the Croke Park Agreement as “an extraordinary tool for change” and that most of his EU colleagues would give their right arm to have such an agreement rings hollow given the failure of the government to make progress since the last budget.

We believe that certain allowances are clearly part of core pay and subject to the terms of the Croke park agreement. The constant description of all allowances as “perks” in certain section of the media is misleading and does not adequately reflect the range of reasons they were put in place.

The review that the government has initiated covers only payments of up to €1,500 and it is inexplicable that it has taken the government so long to consider them. The government intends to take an inordinate length of time to conclude this process.

We recognise the current system is unnecessarily cumbersome and inefficient and is in need of being streamlined. This will inevitably result in the reduction or elimination of some allowances with others being subsumed in to core pay. This process needs to be done quickly and in an open transparent manner.

2009 2010 2011 2012 2013 2014 2015Combined Pay and Pensions Bill 19,235 17,723 17,448 17,483 17,063 16,888 16,788 Change from Previous year 696-‐ 1,512-‐ 275-‐ 35 420-‐ 175-‐ 100-‐ % Change on Previous year -‐3.5% -‐7.9% -‐1.6% 0.2% -‐2.4% -‐1.0% -‐0.6%


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It is unsustainable that the entire focus of incremental public sector pay savings should be on new entrants.

We believe the pay and pensions bill is not falling fast enough and an additional €350m needs to be achieved in 2013.

However, should agreement with the unions not be reached by March 1st 2013 the government will have to consider a range of measures to achieve this additional level of savings including:

• A reduction in the sick leave, including uncertified sick leave bill of €50m • An average cut of 5% in actual allowances to save €75m • Deferral of increments for 2013 to save €170m, with no increments payable

above €100,000 salary grade. • Accelerated targeted redundancy in administrative and management grade

numbers to save €30m • Additional working hours and a change to work practices

Interest Bill on National Debt

The interest bill on the national debt is expected to be €9.3bn in 2013. The average interest rate on the State's debt is projected at 4.9%.

The NTMA currently has cash on hand of c€20bn. According to the Minister for Finance the funds are “held in the Exchequer account at the Central Bank where they earn the Euro Overnight Index Average as set by the European Banking Federation on a daily basis.” This is currently 0.07%

In addition bond yields in Irish government debt have come down significantly. 5 year bond yields are at 3.5%, while 9 year yields are at 4.7%. In the past the NTMA were extremely successful in exploiting opportunities such as this to bring down the annual interest bill. We believe it should be possible to reduce the overall bill by approximately 2% through buybacks of State debt and a more judicious use of the existing cash buffer. This estimate does not include the savings in the interest bill that would arise from a reduction in the bank debt.

Social Protection Control Measures

The existence of fraud within the social protection system diverts resources from those in most need of assistance while undermining public confidence in the system as a whole. Fraud should not be tolerated at any level and the government must prioritise efforts to reduce and where possible eliminate illegal claims.

Technological advances and more detailed case examination can assist significantly in detecting and eliminating fraudulent claims. The Comptroller and Auditor General’s report for 2011 notes that data matching needs to be more timely and include more information to increase its effectiveness. Attention should also be given to more clearly communicating to claimants their rights and responsibilities and the


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consequences of fraudulent activity. Consideration should be given to graduated penalties for successive fraudulent claims and removing the restriction on the recovery of debt from current social protection entitlements and other State payments.

It is also important to note that as large a proportion of social protection funding is lost through administrative and customer error as fraud. Complexity within the system can give rise to genuine error amongst customers and staff. Merging and simplifying the range of schemes administered by the Department would assist in mitigating such losses without reducing entitlements.

Health

The Health Care service is very much to the forefront of the implementation of the Croke Park agreement and will benefit significantly from the delivery of targets both in respect of pay and non-pay savings.

Measures to achieve savings must fully take account of the need to protect patient care. The government must not make similar mistakes to the one it made in 2012 when it decided to reduce home care support hours.

The state drug bill continues to be a source of considerable concern. Over prescribing would appear to be a significant problem and the Department of Health need to engage with general practioners to make savings in this area. In addition measures agreed with the pharmaceutical manufacturers in respect of branded and generic drugs need to be rigorously implemented to ensure the maximum savings are achieved.

Talks to achieve savings in relation to pay for Hospital Consultants have been shambolic. The Minister for Health needs to take firm control of the talks and ensure savings are delivered in 2013.

Non Pay Savings under Croke Park

Fianna Fáil believes that more should be done to expedite and maximise the savings that can be achieved from shared services and procurement across the public sector. In the last Implementation Body report on the Croke Park Agreement there was over €386 million savings made in the non-pay roll area. There are still significant opportunities for savings through joint procurement and commissioning across all local authorities and public bodies. The State should aim to save a minimum of €350m in 2013.

Labour Force Activation Measures

Labour Force activation measures have improved but can still be enhanced considerably.


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Private sector recruitment firms should be used to assist in finding employment opportunities for long term unemployment claimants. The incentive structure should be structured such that payment to the agency should be made following a successful six month placement.

To further improve the flexibility of the social protection system, claimants should be allowed to freeze their payments for a set period of time to allow them to take up short term employment opportunities. It should be possible for individuals to view their full social protection record online as they can currently do with tax credits and Revenue correspondence.

We also suggest an increase of up to 10,000 in the number of places across local employment schemes, including the Tús scheme. This can cover a wide range of ventures including community centres, rural recreation, child care, the warmer homes scheme, community enterprise, city, town and village maintenance and renewal.

The ultimate goal should be to provide all people in receipt of jobseeker’s payments an opportunity to carry out valuable in the community.

A combined saving of €200m can be achieved from control and activation measures.

Rental Schemes

The Rent Supplement and Rental Accommodation Scheme are vital State supports for those in need of both short term and long term housing support. At present, there are over 95,000 claimants in receipt of Rent Supplement and over 30,000 benefiting from the Rental Accommodation Scheme. The State needs to be both conscious of the direct cost of Rent Supplement and the indirect cost it may pose in terms of distorting the private rental market resulting in increasing costs for low income working families.

We propose an increase of €4 per week in the contribution for individuals (€8 couples) under the Rent Supplement Scheme and an acceleration of the rate of transfer of claimants to the Rental Accommodation Scheme. This will save €25m. Landlords not registered with the Private Residential Tenancy Board and landlords who are not tax compliant should be excluded from the scheme.

Household Benefits Package

We support the principle of maintaining the universality of the package for older citizens and on a targeted basis for other welfare recipients.

The government should aim to reduce the cost of the delivery of the package in negotiation with the electricity, gas and telephone companies. As the single biggest customer for each of these entities, the State should be in a position to achieve a significant discount on the cost it incurs while maintaining the current level of benefit. The subsidy to broadcasters should also be reduced.


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Off the Road Facility

The 2011 Comptroller and Auditor General’s report found that over 7% of vehicles travelling on the M50 on sampled dates did not have current motor tax. When vehicles where the tax had expired within one month of the date of travel are excluded the apparent rate of evasion was about 5%.

An evasion rate of 5% would equate to an under collection of motor tax in the region of €50 million per annum, and represents an evasion rate seven times greater that that estimated in the UK.

To combat this, the “off the road” facility in relation to the taxing of motor vehicles should be abolished subject to a very limited number of exceptions. This should result in savings of at €40m if the evasion rate falls to 1%.

Rationalisation of State Boards and Agencies

Fine Gael’s "Reinventing government" promised the abolition of over 145 state bodies and companies including the dismantling of the HSE and FAS.

In 2011 Minister for Public Expenditure Brendan Howlin announced a plan that would see 48 agencies or conglomerates abolished or merged by the end of 2013.

Although given the go-ahead, the rationalisation of many of these agencies has not yet been implemented, in some cases due to failure to bring forward the necessary legislation. Only one third of the 48 State agencies earmarked for abolition or merger in 2012 will have completed the process by the end of the year. In addition of the 46 planned for 2013 it appears only 24 will now go ahead on time.

The process needs to be urgently re-invigorated with a target of an additional €20m in savings in 2013.

Local Government

The report on local government efficiencies published in June 2010 identified potential savings of up to €511m. The Minister for the Environment should instruct each of the City and County Managers to bring forward proposals to provide an update as to savings that are being achieved in this respect. A minimum of €50m of savings in 2013 should be achieved from this.

Horse and Greyhound Fund

In 2011 €57 million was made available from the exchequer to the horse and greyhound fund established under the Horse and Greyhound Racing Act. In total €727m has been paid in to the Fund since in 2002. This led to an effective state subvention of €265m over the period, once betting duty is factored in. In 2012 the State subvention amounts to €29m. Notwithstanding the significant contribution both sports make to the economy the scale of the subvention is unsustainable and we propose a €10m reduction for 2013.


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State Claims Agency

The State Claims Agency has responsibility for management of personal injury and property damage claims against the State. The total paid out in respect of all clinical claims in 2011 amounted to €97.5 million.

At end 2011 the State Claims Agency had 5,306 claims under management. The estimated liability against all active claims was €991 million, (Clinical claims €860million, employer liability, public liability and property damage €131 million).

Currently if someone receives an award following a medical negligence claim the payment is made in the form of a once off lump sum. At the time of the award a decision must be made based on assumptions which include life expectancy of the plaintiff, costs of future medical care, risk of further deterioration and the rate of return from investing the lump sum.

The Working Group on Medical Negligence and Periodic Costs concluded that system should be replaced with one of periodic payments. This combined with a reduction in legal fees has the potential to provide the State with a minimum cash flow saving of €25m in 2013.

Public Sector Pension Deduction

As a solidarity measure, the Public Sector Pension Reduction for retired senior civil servants, public servants and politicians should be increased. This would only impact pensions greater than €75,000. We propose the amount of a pension between €75,000 and €100,000 be reduced by 25% and any excess over €100,000 be reduced by 30%.


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8 Ensuring Fairness in Public Expenditure We believe there is a need for a number of public expenditure initiatives to address certain needs:

Reverse cuts to third Level grants €10m

In light of the significant hardship caused to students this year following the botched implementation of the new online system for administering student grants and the significant hardship that this continues to causes thousands of students, we believe that last year’s 3% cut to student maintenance grants must be reversed. The impact of the removal of maintenance grants for postgraduate students also needs to be urgently assessed.

Restore career guidance teachers from September €5m

Last December Minister Quinn removed the ex-quota allocation for guidance provision. We said at the time that this would lead to the dismantling of the entire service. Since September this year, it has become clear that schools are struggling to maintain a counselling service, are offering an emergency service only and are unable to cope with mental health problems. We would like to see a gradual reinstatement of guidance provision.

Reverse cut to home help hours €10m

We absolutely reject HSE spending cuts to home help hours as a result of Minister Reilly and the HSE’s mismanagement of the health budget for 2012. The Programme for government committed to additional funding each year for the delivery of more home help and other professional community care services. It is a critical support to older people in facilitating their early discharge from, and in preventing inappropriate admission to, acute hospitals.

Lift the ban on Garda recruitment €5m

Following a three year recruitment suspension the current climate demands a review of Garda numbers. Worrying trends in rural crime, burglaries across the commuter belt and a rise in gangland violence underline the need for an end to the moratorium on Garda Recruitment. Re-opening Templemore will enable greater flexibility and movement in the force to respond to criminal threats and ensure that Garda stations across rural Ireland remain open.

Reverse cuts to rural DEIS schools €2m

Earlier this year Minister for Education Ruairi Quinn admitted that it had been a mistake to target DEIS for significant cuts yet following a review he decided to only partially reverse those posts in DEIS band 1 and DEIS band 2 urban primary


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schools. This review did not look at rural DEIS schools and we believe this was unfair.

Increase the number of school resource hours €5m

The government must commit to prioritising funding for special education. This must include protecting the number of Special Needs Assistants in our schools along with reinstating the cuts implemented to resource teaching hours. The government must ensure there are no further cuts to resource teaching hours which have already been cut by 5% in June 2012 and 10% in June 2011.

Free GP care for new born children €10m

The government’s proposal for free GP care have been consistently delayed. The cost of healthcare for infants can be a major worry for families. As an immediate measure we propose the introduction of free GP care for all new born children from the beginning of 2013.

Labour market proposal of Social Justice Ireland €15m

We fully endorse the introduction of a new employment programme modelled on the Part Time Job Opportunities Programme that was successfully piloted in the mid-1990s. We believe this would create in the region of 12,000 jobs in the public, community and voluntary sector for unemployed people. Participants would have their social welfare payments switched to their new employer and also receive a small top-up payment.

Together with the additional placed under Tus and Jobridge, funding for Country Enterprise Boards and home insulation grants, the total additional expenditure measures we propose are €90m


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9 Bank Pay and Pensions There is widespread public concern on the subject of bank pay and pensions.

The government must address the fact that over 1,700 bankers in institutions with explicit state support are currently earning basic salaries over €100,000. Over 180 of these executives are on basic salaries in excess of €200,000.

There is no justification for such a large number of bank employees earning salaries of this order. Ordinary staff in the banks are living in fear that their job will be gone while the top executives continue to enjoy Celtic Tiger era mercs and perks.

The banks cannot operate in a vacuum and in the context of the upcoming budgetary decisions it needs to recognise it wider social obligations.

Consultant firm Mercer have been hired to look at pay at all levels in the banks. We believe that that this review must result in more realistic levels of executive pay across the banks that continue to owe the State and its citizens for their very existence. However, the lack of urgency would appear to indicate that the review is nothing more than a smokescreen and allows the Minister give the appearance that something is being done. If the Government does not act immediately when the report is published we will introduce legislation to impose a significant reduction in senior bank pay levels.

Pensions

AIB plugged a deficit in its pension scheme in August by transferring €1.1bn of loan assets to its pension fund. The company has since confirmed that some of this transfer is helping to pay the pensions of former senior executives.

Given the failure of the Banks occurred under the stewardship of these Executives and the State support, we believe that these pensions need to be reduced. We have published legislation to achieve this and will seek support for it in the Dáil.

Between €100,000 and €150,000 20%

Between €100,000 and €150,000 30%

Above €200,000 40%


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10 Providing Flexible Pension Options An aspect of pension provision that often discourages pension take up is their perceived inflexible nature.

At present in Ireland, there is an estimated €72bn invested in Irish pension funds. The majority of assets are managed on behalf of Defined Benefit Schemes (approximately €48bn) with the remaining €24bn managed on behalf of Defined Contribution schemes (including additional voluntary contributions). Most Defined Benefit schemes are now closed with members being transferred to Defined Contribution schemes.

Many people in society face severe financial difficulties as a result of the economic crisis. In some cases, these individuals have significant pension assets accumulated which they are prevented from accessing until retirement under the terms of the Pensions Act 1990.

We propose an amendment that would allow for early access by individuals to up to 20% of their pension schemes taxable at their marginal tax rate. For practical purposes, we suggest this would apply initially only to Defined Contribution Schemes. The conditions under which people would have access should be strictly defined and would include:

• Redundancy • First Time buyer home purchase • Critical illness • Dealing with debt problems

An OECD report stated that whilst care is required to ensure that people do not unduly threaten their retirement incomes, early access to pension savings should be considered as a policy option by governments to reduce the effect of cyclicality in the economy.

An alternative that could be considered is allowing tax free withdrawals subject to a requirement to pay back the amount in full within a specified period. This would be similar to 401(k) accounts in the USA where loans are tax free but have to be paid back with interest and generally within five years to avoid a penalty payment. If the loan is taken as a down payment for a home, it may be repaid over 15 years. New Zealand also offers early access to pension savings through its Kiwi Saver model.


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Appendix One: Summary of adjustment

Taxation € million

New Tax measures (Appendix Two) 1,405

Revenue from increased tax enforcement activity 100

Carry Forward from 2012 220

Adjustment for non-full year impact of new measures in 2013 -125

Change to non-principal private residence definition -20

Extend Mortgage interest relief for First Time Buyers -20

Net tax adjustment 1,560

Expenditure € million

Capital (Section Six “Investing in our Future”) 400

Additional public sector pay savings (Section Seven “Reducing Expenditure, Eliminating Waste)

350

Non pay savings under Croke Park agreement 350

Social Protection (Appendix Three) 280

Health (Appendix Three) 265

Implementation of report of review group on local authority efficiency 50

Abolition of off the road facility for motor tax 40

Justice (Appendix Three) 20

State Claims Agency 25

Rationalisation of State agencies and boards 20

Reduction in State professional and consultancy fees 20

Reduction in subvention to Horse and Greyhound Fund 10

New spending commitments -90

Net spending adjustments 1740

Saving on National Debt interest bill 200

Total adjustment 3,500


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Appendix Two: Taxation Measures

Taxation measures € million

Reduce earnings cap for pension contributions from €115,000 to €70,000 and restrict rate of relief to 30% 330

Increase Universal Social Charge by 3% for PAYE and self-employed workers above €100,000 200

10% levy on off licence alcohol sales 120

Tax on high salt and sugar content foods 100

Redesign motor tax system including rate increases 100

Adopt proposals of Irish Cancer Society and Irish Heart Foundation to increase prices and regulate the tobacco industry 100

Abolish Green diesel exemption and replace with a fuel rebate to reduce revenue loss from illicit trade 100

Raise standard DIRT tax from 30% to 35% 100

Raise capital gains tax from 30% to 35% 80

Raise capital acquisitions tax from 30% to 35% 45

Increase excise duty on a bottle of wine by €0.75 per bottle 45

Restructure NPPR tax to focus on high value homes 35

Outlaw below cost selling of alcohol 20

Implement the outstanding commission on taxation recommendations on tax reliefs 20

Tighten rules in relation to tax exiles 10

Total 1405


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Appendix Three: Expenditure Savings

Social Protection € million Increase the minimum contribution for rent supplement by €4 weekly, €8 for couples 25

Free Travel: reduce payment to operators by 7% 5

Put the free electricity and gas schemes out to tender, minimum 10% saving to be absorbed by utilities 20

Cut by 15% the payment by Department of Social Protection in respect of free TV licence (to be absorbed by broadcasters) 10

Put the free telephone rental scheme out to tender, (cost in 2011 €119m) / negotiate a reduction with eircom (current rate €22.22 per month, total cost of scheme in 2011, €120m)

20

Additional control and activation measures 200

Health € million Improve the efficiency of designated private beds in public hospitals 25

Reduce the bill for hospital consultant pay from reformed work practices 50

Increase prescription charges for medical card holders to €1.50 50

End practice of private patients of consultants being accommodated in public beds free of charge 10

Obtain reimbursement of hospital charges related to treatments provided in Irish hospitals under European Union schemes 10

Derive greater efficiencies from €1.8bn drug budget including inappropriate prescribing 100

Reduce Agency staff costs 20

Justice € million Reduction in Legal aid fees 10

Streamline case management within the Courts Service, including greater use of video conferencing between prisons and Courts 10

Documents

A Fairer Way to Recovery - Fianna Fáil Proposals for Budget 2013