Budget (7th December 2006)
Our country has seen incredible progress over the last decade. The historic evil of mass unemployment has finally been overcome. Where once we were known throughout the world for emigration, now we are known for innovation. But we can take nothing for granted. We must provide more and better services for this generation and work to build an even brighter future for the generations to come.
The core of this week's Budget reflects a balance between protecting a successful economy and using the fruits of success to help those in need. We reject the tired ideologies of those of the right and left who believe there is a conflict between a strong economy and a strong society.
I am proud of our commitment to reducing taxes in order to allow people take home more of the money they earn. I am also proud of the fact that we have implemented an unprecedented series of increases in support for children and pensioners. But we want improvements to pensioners, health and education which can be sustained well into the future and that's why we are determined to invest in areas like infrastructure and research which will decide if we are to be a success not just today, but in the years ahead.
I have been in politics for almost thirty years. In all of this time, I have both listened to and helped shape a lot of budgets. In harder times, some were stringent. This is the most balanced budget I have seen in a lifetime in politics.
This Budget is about giving everyone a chance to succeed. It is a Budget which signals the determination of the Government to reach out especially to the less well-off and underpriveleged of our society.
The Budget - to say a number of things about it - is responsible and sustainable. It will see Ireland enjoying a budget surplus equivalent to 1.2% of GDP next year. It is affordable for the long-term, puts money aside to deal with external shocks could affect the economy over the years ahead particularly in bad times.
It promotes enterprise by reducing the regulatory burden on small businesses, it gives growing businesses greater access to capital for investing by substantially increasing the limits on BES investment. It encourages innovation through increased R&D incentives. This will help Ireland business cope and thrive in an increasingly competitive marketplace.
It rewards work by increasing credits, widening bands, cutting rates. Once again, our commitment to keep the minimum wage rate out of the tax net will be met by 2007. The increase in the standard rate band means that more than 80% of taxpayers will have an effective tax rate of 20% or less. The strength of the economy also is allowing us to reduce the top rate of tax by 1%. All workers, most particularly those on low and middle incomes, will keep more of their earnings next year.
And of course it helps those on low incomes with the largest welfare package in the history of the State. The commitment to raise the contributory pension to €200 will be meet and exceeded with an increase of €16 to €209 delivered. Non-contributory pensioners will also share in this historic achievement with their weekly pensions being increased by €18 to €200 per week. The lowest rate of full social welfare payment will be increased by €20 per week.
It supports young families and first time buyers by doubling the mortgage interest relief for the first seven years of a mortgage. This will help in a great way for those who have the problems and stresses of taking out new mortgages. Any change in stamp duty at this time would only inflate the market and push prices further out of reach for young families. We are also increasing child benefit by €10 per month. This means that a family with two children under the age of 6 will receive €5,780 next year.
It also helps the rural economy and also environmentally friendly issues in this budget.
So thanks to the hard work of the Irish people responding to the policies of Government and working with us, our economy is now one of the strongest in the world. Budget 2007 uses the economic success as a platform on which we will build a fairer and stronger Ireland, together.
Ends
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