Dáil Éireann - Volume 308 - 17 October, 1978

Ceisteanna—Questions. Oral Answers. - Children's Allowances.

7. Dr. Browne asked the Minister for Finance if it is proposed to tax children's allowances.

8. Mr. M. O'Leary asked the Minister for Finance if he is aware of any decision to tax children's allowances.

Mr. Colley: With the permission of the Ceann Comhairle, I propose to take Questions Nos. 7 and 8 together.

As mentioned in the Government's Green Paper Development for Full [344] Employment, this is one of the options being examined. It is not yet possible to indicate the likely outcome.

Mr. M. O'Leary: Would the Minister agree that if this option is implemented for the purpose of cutting expenditure, the reaction will be most severe again on the lower-income families for whom children's allowances have been the biggest contributory factor to their remaining above the bread line? If these allowances are terminated there will be a severe impact on the living standards of thousands of families.

Mr. Colley: As I have indicated it is not possible yet to indicate the likely outcome of the examination of this option. Therefore, there is no point in trying to anticipate the outcome. I am sure the Deputy is aware that should it be decided to proceed with this option certain steps would be open to families in order that any ill effect that might apply to the lower income families would be counteracted.

Mr. Cluskey: Can the Minister say what are the other options being examined?

Mr. Colley: I would not propose to do so at this stage.

Dr. Browne: Is there a proposal to tax old age pensions?

Mr. Colley: Deputy O'Leary is speculating on something about which there is no decision.

Mr. M. O'Leary: The Deputy started the speculation.

Mr. Colley: There was an option placed before the House and before the public and it is open to anybody who has views on the matter to put those views forward but it is not open to people legitimately to anticipate a decision and to argue as if such a decision had been reached.

Mr. Cluskey: Is it not the position that the options to which the Minister referred in reply to Deputy O'Leary, [345] apart from the question of children's allowances, relate to the abolition of food subsidies, to cutbacks on local authority houses, on expenditure on education and so on? Would the Minister agree that all of the options under consideration by the Government would, if implemented, have serious effects on the lower- and middle-income groups?

Dr. Browne: Is this a loss of the 1973 election kind of thing?

Mr. Colley: I suggest that speculation in regard to the question of taxing children's allowances is one matter but it really is a little early to speculate on the result of the next election.

Mr. Cluskey: Would the Minister care to comment on my remarks?

Mr. Colley: The question relates to children's allowances. I do not propose to follow Deputy Cluskey around whatever areas he considers wise to travel at this stage.

Mr. M. O'Leary: We should like to see the list of options.

Mr. Kelly: Have the Department calculated the amount of revenue that would be raised by the inclusion of children's allowances for taxation purposes?

An Ceann Comhairle: That is a separate question.

Mr. Kelly: Since the matter was referred to in the Green Paper, presumably some calculation has been made.

Mr. Colley: I understand that that figure is available, that it has been available each year for some time past.

Mr. Kelly: What would be the effect this year?

Mr. Colley: I could not say offhand.

Mr. Kelly: Might it be, for instance, about equivalent to the amount of revenue that the Government threw away when they abolished motor taxation for the purpose of buying votes?

[346] Mr. Colley: May we take it from that that Fine Gael are against the abolition of tax on motor cars and, if returned to office, would reimpose such a tax?

(Interruptions.)

Mr. Mitchell: We are for the poor.

Mr. Kelly: I have not discussed this matter with my party but personally I am against the abolition of motor tax. This move by Fianna Fáil was a cheap and grizzly measure designed to buy votes but they will pay for it in the future. They should leave children's allowances and food subsidies alone.

Mr. M. O'Leary: The Minister is adept at drawing a red herring over any issue. Can he say whether the forthcoming White Paper will indicate definitely the Government's position in relation to children's allowances or will the speculation continue?

Mr. Colley: I do not think it would be appropriate at this stage for me to an ticipate the contents of the White Paper. The Deputy will have to await its publication.

Mr. Keating: It all depends on the feed-back.