Dáil Éireann - Volume 460 - 24 January, 1996
Financial Resolutions, 1996. - Financial Resolution No. 7: General (Resumed).
Debate resumed on the following motion:
That it is expedient to amend the law relating to customs and inland revenue (including excise) and to make further provision in connection with finance.
—(Minister of State at the Department of the Taoiseach, Deputy J. Higgins).
Minister for Arts, Culture and the Gaeltacht (Mr. M. Higgins) Minister for Arts, Culture and the Gaeltacht (Mr. M. Higgins)
Minister for Arts, Culture and the Gaeltacht (Mr. M. Higgins): Is mór agam an deis seo a fháil chun labhairt sa díospóireacht seo faoi Cháinaisnéis 1996. Ar ndóigh, is í seo an dara cháinaisnéis atá curtha i láthair ag Aire Airgeadais de chuid Pháirtí an Lucht Oibre. Ó cuireadh ceann an bliana seo caite i láthair, níl amhras ach go bhfuil éacht  bainte amach i ndáil leis an mbainistíocht atá á déanamh ar eacnamaíocht na tíre seo agus ba mhaith liom comhghairdeas a dhéanamh le mo chomhleacaí, an tAire Airgeadais, an Teachta Ruairí Quinn, dá réir. Faoin gceannasaíocht atá tugtha aige, tá an ráta fáis eacnamaíochta níos airde sa tír seo anois ná in aon tír eile san Eoraip.
Féachtar chuige i gCáinaisnéis 1996 go leanfamid ar aghaidh ar an mbóthar sin. Ach chomh maith leis sin, táimid ag féachaint chuige go mbeidh torthaí an fhoráis atá romhainn i mbliana le roinnt ar theaghlaigh, ar lucht PAYE agus go háirthe orthu siúd nach bhfuil ag obair.
Ar ndóigh, bhí scéalta suntasacha sa cháinaisnéis féin agus sna Meastacháin a foilsíodh roimh Nollaig do réimsí áirithe a thagann faoi choimirce mo Roinne-se agus ag an bpointe seo ba mhaith liom tagairt a dhéanamh do roinnt acu sin.
I wish to refer to the extension of section 35 film relief, about which there has been much comment. Deputies will be aware that yesterday's budget signalled the decision to extend the section 35 tax relief for film production to 1999. At a time when all tax incentives have been the subject of the most rigorous scrutiny by Government in the context of containing both direct and indirect public expenditure, the decision to extend section 35 to 1999 represents a clear endorsement by Government of my conviction that the integrated range of strategies to promote the Irish film and television production industry which I introduced in 1993, and which was supported by the Government of which I was a member in that year; should be kept in place for a further period.
In addressing the future or otherwise of section 35, I was faced with the reality that the Finance Act, 1993 provided that the measure would terminate on 31 March 1996 for corporate investors and on 5 April next for individual investors. The House should be under no illusion that the extension of section 35 was in any way an automatic option for the Government. In order to inform the Government's thinking on future options for this measure, I was pleased  to agree with my colleague, the Minister for Finance, that a detailed review of section 35 was called for in order to evaluate the effectiveness of the scheme in securing my objectives for the Irish film industry. This review was carried out by Indecon economic consultants and I wish to express my warm appreciation of the quality and professionalism of the consultants' work in the short time period which I assigned to them last October to undertake their task.
The Indecon report points to the dramatic increase in film production in Ireland since 1993 as a consequence of the section 35 tax regime. Their best estimates analysis, however, suggests that the annual cost of the section 35 incentives exceeded the quantified benefits to the Exchequer by a range of between £6.1 million and £8.8 million. This conclusion is in contrast with the earlier IBEC economic database analysis which suggested that for 1993 and 1994, a net benefit accrued to the Exchequer from section 35. Indecon's overall conclusion was that, on economic criteria, it would be hard to justify continuing the incentives in their present form.
Indecon's recommendations were designed to address three core objectives by an amendment of the section 35 regime. These were to: maximise the return to the Exchequer in terms of expenditure on Irish employment, goods and services; reduce the overall cost of the measure to the Exchequer in terms of tax foregone about which we can argue another day; and increase the investment pool to make use of section 35.
The Indecon recommendations formed the basis for extensive discussions which took place between the consultants, officials of my Department, and officials of the Department of Finance and the Revenue Commissioners in subsequent weeks. They also informed my contacts with the Minister for Finance on this subject. I am pleased to inform the House that the Indecon recommendations provided the focus for the final package agreed for the next three  years between me and the Minister for Finance, and subsequently the Government.
It was the clarity of the Indecon analysis which led us all to conclude that refocusing section 35 was warranted and I acknowledge Indecon's role in facilitating a satisfactory conclusion to our discussions with the Minister for Finance which offers the prospect of continued high levels of film and television production in the State in the years ahead.
The new measures introduced in yesterday's budget include: full retention of section 35 relief in respect of 60 per cent of the cost of production of projects under £4 million, targeting projects which, in the light of experience, offer better levels of Irish employment and spend on Irish goods and services; and retention of an important incentive to continue to attract higher-budget films to Ireland, also offering significant employment potential; the opportunity for the upskilling of our labour force; significant spend on Irish goods and services; and the raising of the profile of the Irish film industry and of Ireland in the international arena; in these cases, 50 per cent of the cost of production of the film can be raised from section 35 investments up to a ceiling of £7.5 million.
The budget also facilitated reducing the cost to the Exchequer by restricting the tax relief on individual and company investments to 80 per cent from 100 per cent, by reducing the amount that can be raised for film budgets over £4 million from 60 per cent to 50 per cent by increasing the investor pool by means of a facility to allow individual and corporate investors to dispose of their shares at the end of one year instead of every three years as was the case hitherto and by increasing the limit to which a company or a corporate group may invest from £1.05 million to £2 million.
Finally, the section 35 tax relief will now be triggered after the date of commencement of principal photography, addressing problems which arose where  section 35 funds were being raised before film projects were available.
Since I secured a radical amendment of the section 35 tax regime in the 1993 and 1994 Finance Acts, there has been an unprecedented increase in the level of film and television production in the State. People are right to say that section 35 came into existence under the Finance Act, 1987, and it coincided with the decision to cease funding for the Irish Film Board. In the six year period 1987-93, £11.5 million was raised under section 35. In stark contrast, £55.5 million has been raised under the scheme in the two years and nine months since it was radically overhauled in 1993, and this significant shift in funding for production has been clearly translated into production gains. Eighteen feature films and 11 television productions were made in 1994, while in 1995 I certified no less than 33 feature films and 16 TV productions, some of which will not be completed or even commenced until this year.
The increased level of production in the State has led to tangible increases in employment in the industry. Although the labour force surveys do not facilitate the extrapolation of precise employment data for the industry, the IBEC economic database records the factual position in respect of all films supported by section 35 and-or Bord Scannán na hÉireann in 1993 and 1994.
This indicated that 4,191 persons, or 480 full time job equivalents, were directly employed in these projects in 1993. For 1994, the figures were significantly different, indicating that 12,784, or 1,115 full time equivalents, were employed in that year. When employment figures are taken for both the direct and indirect impact of the State incentives in 1994, it is estimated that some 1,228 full time job equivalents were secured in the industry in 1993 and 1,957 in 1994 — representing an increase of 59 per cent.
I am confident the amendments announced in yesterday's budget have struck the right balance and will ensure  sustained levels of film and television production. The measures retain the core elements of the previous scheme in that they are designed to promote indigenous and non-indigenous production in recognition that non-indigenous production — apart from significant employment and value added for our workforce — is an important vehicle to upskill our workforce by providing them access to larger scale projects which the current scale of the industry here would not normally provide.
At the same time, our focus on indigenous production reflects my conviction that film is by far the most powerful vehicle for cultural expression and it is essential that the Irish imagination and Irish stories be portrayed through this vehicle and to the widest possible international audience.
Deputy de Valera has taken a keen interest in this scheme. When speaking yesterday on a financial motion she referred to the difficulties blockbuster films might encounter in Ireland given the amendment to the scheme. Looking back over the almost 70 projects which I certified since becoming the certifying authority, one animation project and two feature films would have been affected. I pointed to the advantages which these blockbusters gave us in phase I.
Everything I have introduced in film should be seen in an integrated way. The most important measure taken was the refunding of the Irish Film Board, for which provision has been made until 1999. I have made provision for the training initiative which will shortly get under way. The independent commission of RTE has resulted in £12.5 million or 20 per cent of production and the independent sector has been involved in Teilifís na Gaeilge. These hang together with Bord Scannán giving the lead as the core element of the future indigenous sector.
The amendments to section 35 which I have outlined represent the key elements of the Government's future strategy in this regard. In the context of the Finance Bill, however, I intend to  give further consideration to other issues, including some raised by the INDECON analysis, such as the definition of a “qualifying film” and the question of providing an off-seasonal incentive to maximise film production throughout the year. Deputies correctly raised this problem of “peaking” — a concentration of production during a few months in the summer, which I am trying to address. I am also trying to avoid “overheating” of our labour resources due to too many projects taking place within a confined period of months.
To the extent that INDECON points to such issues as cost uncompetitiveness as a factor which reduced the benefits of section 35 — and specifically highlights the costs associated with intermediaries and financial and legal advisers as well as labour market entry restrictions and inflexibility in labour market practices — I look to all sides of the industry to come together to decide how best these issues can be addressed.
The retention of section 35 sends out a powerful message to the industry that the integrated range of strategies which I have introduced to ensure its sustained development are assured up to 1999 at least. This should enable the industry to plan its future with a degree of certainty not known before, and I would expect that demonstrable progress can now be made to achieve my objective of establishing a self-sustaining level of film and television production in the State. Such an outcome will greatly enhance our national culture and artistic expression while also contributing significantly to the economic and social progress of the State. In deciding to retain section 35, the Government is entitled to expect that these goals can be achieved over time in a spirit of partnership with the industry. As I was making my case to the Department of Finance, I read some comments in the public media regarding section 35. It would be hard to conclude other than that there was an element of begrudgery in it as if we could not, for example, handle a success, which it undoubtedly was. The time has come to put to rest  old prejudices that film does not neatly fit into manufacturing, nor is it a service like international financial services. What it is, of course, is an exciting and new form of employment through cultural expressions, and it is very good for this country for all of these reasons.
Deputies will also be aware that I have warmly welcomed the extension of the business expansion scheme to include the music industry and to cover investment in the production, marketing and promotion of new artists' studio recordings and associated videos.
This is a very significant and worthwhile initiative. I have always contended that the cultural industries can make an enormous contribution to creating employment and assisting our overall economic development. It is a crucial moment for our self-confidence when we realise this is a source of new kinds of jobs built on the imagination of the Irish people. It was for this reason that I established a special task force, FORTE, to examine the needs and the potential of the music industry and to establish how co-ordinated, focused action by the State sector — in partnership with the industry itself — might help its further development. FORTE's final report will be published shortly, but in advance of this publication I requested an interim report dealing with issues of taxation. It was this interim report, backed up by a separate analysis carried out by an IBEC group, which provided me with the arguments and the rationale which I brought to Government when arguing for this type of BES relief. The extension of the BES scheme to music demonstrates that the arguments made have been accepted and augurs well not just for music but for the future development of all our cultural heritage industries. There can be no doubt that, in what has been described as the post industrial world, it is to those industries that we must look for much of our future development.
It must be emphasised that the industries in the cultural heritage sector need the same supports and resources as any other industry or source of job creation.
 They need management and marketing skills, continuous investment and product development. In some ways the music industry has been a victim of its own success. The focus of our attention has been on our major international artists such as U2, the Cranberries, the Chieftains, etc. leading to the perception that the industry is doing well enough on its own — “if its not broken, don't fix it” might sum up this type of thinking. It is too important for that.
FORTE and other groups have been able to isolate those segments of the music industry which need support and investment, in particular the development of new artists and bands. Let us make no mistake, this is the very life blood of the industry. Ireland is recognised as being a rich pool of creative talent. However, unless the investment is made and support given to new artists, we risk squandering that resource. I am not prepared to see that happen, nor is this Government. We have listened to the rational, convincing arguments of the music industry and we have responded with alacrity and imagination.
I very much look forward to the positive response of Irish investors and the Irish music industry to this new initiative.
Maidir le Údarás na Gaeltachta, ar ndóigh, tá béim ar leith leagtha ag an gcáinaisnéis ar chruthú fostaíochta agus is ar Údarás na Gaeltachta atá an cúram sonrach sin leagtha laistigh de theorainneacha na Gaeltachta. Tá soláthar de bhreis agus £20 milliún á chur ar fáil don eagraíocht i 1996 le haghaidh forbairt na Gaeltachta. Is soláthar caipitil é £17.6 milliún den tsuim sin. Úsáidfear £11 milliún den tsuim sin chun deontais a íoc le tionscail Ghaeltachta d'fhonn an fhostaíocht sa Ghaeltacht a chaomhnú agus a mhéadú. Is ionann é sin agus méadú de bhreis ar 2 faoin gcéad i gcomparáid le bunsoláthar na bliana 1995. Tá suim £6.6 milliún á tabhairt don Údarás i 1996 chun clár tógála na  heagraíochta a airgeadú agus chun scaireanna a ghlacadh i gcuideachtaí, etc. Is méadú de 5.6 faoin gcéad é sin i gcomparáid le bunsoláthar na bliana seo caite. Caithfear an fuílleach de £2.5 milliún go príomha ar chostais riaracháin na heagraíochta agus ar chur chun cinn na Gaeilge. Is soláthar maith airgid é sin cibé slat tomhais a úsáidtear agus is léiriú é ar an tábhacht a chuireann an Rialtas i bhforbairt na Gaeltachta agus i gcur chun cinn na Gaeilge. Beidh mé ag súil leis go gcaithfear an soláthar go coigilteach tíosach ar thograí fiúntacha a roghnófar trí dhianchritéir roghnaíochta.
Tuigim ón eagraíocht go raibh torthaí fostaíochta an-sásúla acu arís i 1995 agus go bhfógrófar iad sin go luath. Tá an iomaíocht thionsclaíoch ag éirí níos géire i gcónaí agus tá dualgas ar, agus ról ag, Udarás na Gaeltachta cabhrú le cuideachtaí Gaeltachta chun iad féin a chur in oiriúint do na fadhbhanna a chothaíonn sé sin dóibh. Tá béim níos mó ag an Údarás anois ar thacaíocht a thabhairt do chomhlachtaí chun a gcumas iomaíochta agus éifeachtúlachta a fheabhsú. Tá coimhlint mhór ann ó thíortha a bhfuil geilleagair íseal-chostais acu agus ní foláir do ghnóthais Ghaeltachta díriú ar riachtanais bhunúsacha ar nós na gceann seo a leanas le go mbeifear iomaíoch sa mhargadh: teicneolaíocht a uasghrádú; scileanna foirne agus bainistíochta a fheabhsú; agus tairgí ardchaighdeánacha a chur ar fáil.
Tá céadatán ard de na poist nua a cruthaíodh le roinnt bhlianta anuas i dtionscail Ghaeltachta á ghiniúint ag gnóthais sheanbhunaithe. Is comhartha mhór dóchais é sin agus táim cinnte go leanfaidh an tÚdarás lena gcuid iarrachtaí leanúnacha chun comhlachtaí faoina scáth — cinn sheanbhunaithe agus cinn nua — a fhorbairt agus a neartú oiread agus is féidir.
Le bunú Theilifís na Gaeilge tá gealladh ar leith ag baint leis an earnáil léiriúcháin neamhspleách chun deiseanna fostaíochta breise a chruthú. Beidh an tÚdarás ag tacú leis an earnáil sin chun an tairbhe is fearr is féidir, ó thaobh cruthú fostaíochta de, a bhaint amach don Ghaeltacht. Beidh mé ag tagairt do Theilifís na Gaeilge arís ar ball.
 Maidir leis na Scéimeanna Feabhsúcháin sa Ghaeltacht, ar ndóigh, bíonn obair fhiúntach ar mhaithe le forbairt na Gaeltachta agus cur chun cinn na Gaeilge ar siúl freisin le cúnamh na ndeontas a thugann mo Roinnse féin le haghaidh Scéimeanna Feabhsúcháin sa Ghaeltacht. Is suim de £3.35 milliún a bheidh ar fáil i mbliana le haghaidh muiroibreacha, forbairt chomharchumann, hallaí agus Coláistí Gaeilge agus saoráidí ilghnéitheacha ar nós páirceanna imeartha, cúirteanna leadóige agus mar sin de. Usáidfear cuid den tsoláthar sin chun an mhórscéim mhuiroibreacha ar Inis Meáin-Inis Oírr a chríochnú i mbliana.
Is eol do Theachtaí, ní foláir, gur fógraíodh inné nach mbeidh ar chumas mo Roinn-se cúnamh a chur ar fáil faoin sean-scéim chun bóithre sa Ghaeltacht a fheabhsú. Cé go bhfuil méadú i mbliana sa soláthar atá déanta sna Meastacháin do na Scéimeanna Feabhsúcháin sa Ghaeltacht, is amhlaidh go ndearnadh cinneadh an t-airgead a chaitheamh ar oibreacha a bhfeictear a bhfuil tosaíocht níos mó ag baint leo ná Scéim na mBóithre Áise — go háirithe ar mhuiroibreacha Gaeltachta atá á bpleanáil i láthair na huaire. Dá thoradh sin, tá cainteanna ar siúl idir m'oifigigh féin agus oifigigh na Roinne Comhshaoil chun freastal níos fearr agus níos éifeachtaí a dhéanamh ar na riachtanais i gceist. Beidh cainteanna againn chomh maith le hÚdarás na Gaeltachta, eagrais phobail agus na comharchumainn.
Ní miste a rá, ar ndóigh, nach mbíodh ach suim theoranta airgid ag mo Roinnse le caitheamh ar bhóithre, rud a chiallaigh nach raibh ar a cumas ach freastal ar líon beag den iliomad iarratas a fuarthas gach bliain — thart ar 80 bóthar as 800 iarratas a fuarthas anuraidh, cur i gcás. Caithfidh go bhfuil slí níos éifeachtaí chun an riachtanas a shásamh.
Faoi mar a dúirt me, is suim £3.350 milliún atá sna Meastacháin le haghaidh 1996. Táthar ag pleanáil go gcaithfear timpeall £2.35 milliún de sin ar mhuiroibreacha agus tá soláthar de £0.55 milliún ann chun deontais reachtála a íoc le comharchumainn Ghaeltachta, i  gcomhréir leis na méaduithe suntasacha a cheadaigh mé dóibh anuraidh.
Is ar éigean is gá dom a rá go mbeidh mo Roinnse ag leanacht ar aghaidh ag tabhairt tacaíocht láidir do go leor scéimeanna tábhachtacha eile a théann chun tairbhe labhairt na Gaeilge agus muintir na Gaeltachta.
Ó thaobh Scéim an bhFoghlaimeoirí Gaeilge, d'fhreastal beagnach 23,000 foghlaimeoirí ar na Coláistí Gaeilge sa Ghaeltacht i 1995 agus d'fhan siad ar iostas i 740 teach Gaeltachta. Is cuid antábhachtach d'eacnamaíocht na Gaeltachta iad na Coláistí Samhraidh Gaeilge agus meastar go mbeidh thart ar an líon céanna foghlaimeoirí i gceist arís i mbliana.
I gcás scéim labhairt na Gaeilge, meastar go n-íocfar deontas faoin scéim le thart ar 3,200 teaghlaigh Ghaeltachta i mbliana. Tá an scéim nua seo tar éis cur le húsáid na Gaeilge i roinnt mhaith teaghlaigh ó cuireadh tús leí cúpla bliain ó shin.
Maidir le deontas do thithíocht sa Ghaeltacht, ba mhaith liom an deis seo a thógáil chun a rá nach bhfuil deireadh curtha le deontais feabhsúcháin tithe sa Ghaeltacht — tá na deontais sin ar fáil i gcónaí agus tá soláthar maith airgid déanta lena n-aghaidh i mbliana. Tá athrú sa scéim, áfach, sa mhéid nach gcuirfear oibreacha áirithe neamh-shubstaintiúla san áireamh feasta le haghaidh deontais. Ina lán cásanna, áfach, ní dhéanfaidh sé seo difríocht ar bith, mar go mbeidh go leor oibre i gceist chun an tuasdheontas feabhsucháin a thuilleamh ar aon chuma. Tá deontas feabhsúcháin ar fáil i gcónaí d'oibreacha substaintiúla ar bhunchreatlach tithe agus do shaoráidí sláintíochta cosúil le huisce, séarachais agus seomraí folctha.
Deputies will be aware that the 1996 Estimates have signalled, yet again, a significant increase in the allocation for An Chomhairle Ealaíon, the Arts Council. The Estimates figure of £18.5 million has been reduced marginally in yesterday's budget by £100,000 as a contribution to the additional funding being allocated to the long-term unemployed.
 The council's revised allocation — now £18.4 million for 1996 — represents an increase of 13 per cent over 1995. This represents an increase of just over 81 per cent on the council's allocation for 1992, the year immediately prior to my initial appointment as Minister for Arts, Culture and the Gaeltacht.
I acknowledge the contribution historically of all my predecessors with responsibility in this area, but facts are facts and the figure I inherited when I became Minister for Arts, Culture and the Gaeltacht was approximately £10 million. The difference between £10 million and £18.4 is approximately 81 per cent.
Deputies will also be aware of my strong endorsement of the Arts Plan 1995-97 which was published by An Chomhairle Ealaíon in February last. I am pleased to inform the House that Government approval of the strategic objectives of the plan was signalled in November last and that I was charged with the task of entering into discussions with the Minister for Finance about the future funding of the plan.
In the light of these discussions, I agreed with the Minister for Finance that the funding targets set out in the plan could be realistically phased in over the five year period 1995-99, rather than the initial three years as proposed. I am pleased to inform the House that, at their first meeting for 1996 last week, An Chomhairle Ealaíon welcomed the level of funding secured by me for 1996 and decided to reschedule the plan to cover the five years 1995-99. This was a prudent decision in the light of the historically high increases I have secured for An Chomhairle since 1993, and I am confident that the additional timeframe now proposed can secure the funding targets by 1999. It was, of course, a document produced after considerable consultation and the further consultation in this rolling plan will be facilitated for the Arts Council by the extended time.
As regards the cultural development  incentive scheme, about which I am frequently asked, the Government's commitment to funding for the contemporary arts is not confined to the annual allocation of An Comhairle Ealaíon, significant though it is for 1996. The £18.4 million allocation for An Chomhairle this year includes a capital allocation of £1 million designed to assist modest capital works, mainly on existing infrastructure requiring repair or upgrading.
In addition to these funds, however, I have additional Exchequer and European Union funds at my disposal under the Operational Programme for Tourism 1994-1999 to promote the development of an arts and cultural infrastructure in the State, notably in the regions. These funds will be disbursed under my cultural development incentives scheme which I announced last year and which, with matching funding from other sources such as local authorities, will enable me to facilitate the development of an arts, cultural infrastructure to the value of some £26 million from now until the end of 1999.
I am pleased to inform the House that an advisory committee which I have appointed to undertake an evaluation of the applications under the scheme and make recommendations to me thereon has commenced its deliberations on the 170 applications I have received to date. I hope to be in a position to announce some decisions on these applications within the next two months or so.
In concluding this item, I should inform the House that the £26 million in capital infrastructure which I hope to be able to generate under the cultural development incentives scheme is additional to the some £5.7 million which I have already committed to flagship projects in the regions such as the Galway Municipal Theatre, the Longford Theatre, the Hawskwell Theatre in Sligo, the Hunt Museum in Limerick and the Crawford Municipal Gallery in Cork. They are in a separate group.
From March to August 1996 the planning that has gone on for the past three years both here and in France to  develop the major celebration of contemporary Irish art and culture, “L'Imaginaire Irlandais”, will bear fruit across France. I secured Government commitment to provide up to £1.5 million towards the project, the idea for which originated during President Mary Robinson's State visit to France in 1992. At the end of 1995 over £500,000 had been spent on preparations and the balance of the funds for the project are provided in this year's Estimate for my Department.
I am happy to record that the French Government agreed to make available a cash contribution of up to £500,000 to co-fund jointly agreed elements of the programme of events in France and that access is being provided to suitable venues in France for various facets of the project. The project represents the fruits of continuing and long established contacts between arts groups, individuals and State agencies in the cultural arena throughout the island of Ireland. The emphasis will be not just on next year but on enduring contacts.
The development of the programme, under the general guidance of organising committees in both countries, is in the hands of the full time commissioner appointed by me for the project, Ms Doireann Ní Bhriain, and her opposite number in France, Mr. Michel Ricard, of the Department of International Affairs in the French Ministry of Culture. The overall programme is being designed and developed in close collaboration with the project's French partners. Both sides are confident that, following the manifestation, there will be a greater awareness among French people of the people of this country as dynamic, innovative and looking with confidence to the future. Irish creative artists will have entered the bloodstream of French cultural life and there will be long-term cultural and economic benefits for the people of both countries.
On the national cultural institutions I must emphasise that I am equally concerned for them. I have allocated significant increases to this purpose to the national cultural institutions since  assuming office. The amounts of the normal grants-in-aid allocated to these institutions have increased by 46 per cent between 1992 and 1995. If funding for specific new or one-off projects is included, the grant assistance provided increased by 62 per cent over the same period. In relation to the National Gallery, which has a separate Vote, increases of the order of 66 per cent have been allocated in the same period. I want to pay tribute to these institutions and thank their staff for all they have done.
I am pleased to say that work is progressing well on a number of specific projects, some of which began during the time of the last Government. I refer in particular to the clock tower in preparation for the relocation of the Chester Beatty Library to Dublin Castle. The first phase of the redevelopment at Collins Barracks for part of the National Museum collections continues apace with, it is hoped, the opening to take place in 1997. That is a major development for the city and the museum. In this regard, I am finalising my examination of the report of the interim board of the museum and hope to implement as many of its recommendations as resources permit. I am also pleased to note the exciting developments which have been progressing at the National Gallery in recent years, including the completion of the refurbishment of the 1968 wing and the planned development of the vacant site on Clare Street over the next few years.
The National Library too will see the completion in the Temple Bar district in 1996 of its new dedicated photographic archive which will share its premises with the Photography Department of the Dublin Institute of Technology. At last the library will be able to store, preserve and make available to the public copies of some hundreds of previously unseen prints and photographic plates.
I would like to take this opportunity to welcome the new measures in this year's budget for facilitating the development of the collections in the national cultural institutions. Provision  was made last year for a special tax relief for donations to national collections. A major gift under the scheme was to the National Gallery of Ireland of the archives of the artist Jack B. Yeats, including his many wonderful notebooks and sketch books. The National Museum of Ireland also received a gift of a large historical group painting entitled “HQ staff of the Irish Republican Army” by the artist Leo Whelan. I would like to express publicly, in the time given to me by Deputy de Valera, the great appreciation due to the donors for their co-operation. Last year's provision of £0.5 million for this relief has been increased this year to £0.75 million.
Ba mhaith liom cúpla focal a rá ag an bpointe seo faoi Theilifís na Gaeilge. Thug cinneadh an Rialtais den 7 Nollaig 1993 údarás dom treoir a thabhairt do RTE dul faoi na hoibreacha capitil riachtanacha i ndáil le Teilifís na Gaeilge agus freagracht a ghlacadh don tseirbhís nua, go dtí go mbeadh struchtúr reachtúil ar leith bunaithe di.
Tá RTÉ, faoi stiúir mo Roinne-se, ag gabháil faoi láthair don obair tógála is gá d'fhonn an bunstruchtúr do Theilifís na Gaeilge a chríochnú. Tuigim ó RTÉ go raibh caiteachas caipitil £7.6 milliún den chostas measta iomlán de £16.1 milliún déanta acu faoi dheireadh 1995. Cuireadh deontas-i-gcabhair de £3.6 milliún ar fáil do RTÉ ó Vóta mo Roinne-se i 1995 agus cuirfear suim bhreise de £12.2 milliún ar fáil i mbliana i ndáil leis na hoibreachta caipitil. Tuigim ó RTÉ freisin go bhfuil na hoibreacha caipitil ag dul ar aghaidh i gcomhréir leis an sceideal agus go bhfuiltear fós ag súil leis go mbeidh an tseirbhís nua ar an aer faoi Dheireadh Fómhair 1996.
Maidir le costas reatha na seirbhíse, cuireadh suim iomlán de £3 milliún ar fáil do RTÉ ó Vóta mo Roinne-se i 1994 agus 1995 agus beidh soláthar de £10 milliún ar fáil don chuspóir céanna i 1996. Tá an obair ag dul ar aghaidh go maith, faoi choimirce Chomhairle Theilifís na Gaeilge, i ndáil leis an bpróiséas  chun cláir a choimisiúnú agus a charnadh sula dtosaíonn an chraoltóireacht ar ball.
I am pleased to have obtained an increase of £400,000 in 1996 or 22 per cent over the amount provided in 1995 for the Heritage Council. I had support from Members of all sides of the enactment of the Heritage Act, 1995. I am pleased to see the enthusiasm, energy, vision and independence which the members of the new council have already displayed in the first six months of their period in office. The council has a wide and challenging brief and I wish it well. The heritage services in the Office of Public Works are in the course of transfer to my Department. The provision for these services at £42 million approximately represents an increase of £1 million on the 1995 provision.
Last Monday I had the pleasure of launching a report by consultants Cairns on the future development of the Royal Canal. There is a significant amount of development and work.
Is í seo an saghas cáinaisnéise atá riachtanach dúinn i láthair na huaire — cur chuige atá cothrom agus cúramach, agus a bhfuil a chuid tosaíochtaí leagtha amach go soiléir, go háirithe dóibh sin atá dífhostaithe ar bhonn fad-théarmach. Is cur chuige den chineál seo atá ag teastáil don tír agus níl amhras ach go bhfuilimid ag freagairt dó sin mar is cuí.
Miss de Valera Miss de Valera
Miss de Valera: There is great unease that we are increasingly moving from what was originally proposed in the Arts Plan. With great fanfare and hype, the Minister for Arts, Culture and the Gaeltacht announced the Arts Plan which had a price tag of £26 million to be spent from 1995-97. Today's edition of The Irish Times states:
This is, however, a shortfall of more than £3 million on the figure agreed as necessary to implement the Arts Council's Three Year Plan 1995-1997, the strategic objectives of which were adopted by Government in November. This makes an aggregate shortfall of £6 million, including last year's figures. After the Book of Estimates was published, the Minister for Arts, Culture and the Gaeltacht Mr.  Higgins suggested to the Arts Council that the plan should run over five years instead of three, and this was accepted by the council.
At Question Time before Christmas I asked the Minister if he intended to extend the time proposed for the Arts Council Plan and the words the Minister used on that occasion in the Official Report were “certainly not”. I was most surprised to see, just a short time later, that it was agreed there should be an extension to five years. These changes in regard to the Arts Plan have lead to the undermining of confidence in the arts world with regard to funding and the implementation of the Arts Plan. The Minister said through an adviser that the cut in the Arts Council grant of £100,000 is regrettable.
I welcome the BES schemes for the music industry in the budget. The industry has huge potential and I encourage the Minister to take on board the many suggestions in the IBEC submission on the music industry. However, I would like the Minister to clarify the precise definition of new artists and whether under this definition, new artists only will be eligible to apply.
I welcome the extension of section 35 relief for a further three years for investment in the film industry. In view of the increase in film production since 1993, which is directly attributable to this relief, I am pleased it is being retained. In particular, I welcome also the reduction in the holding period required for capital gains tax purposes from three years to one year and the increase in the investment limit for corporate investors to £2 million per annum. I have some concerns, however, about the changes in the budget for the film industry. The proposal to reduce the amount of expenditure on larger films which would qualify for relief will, in effect, undermine the film industry here and make it difficult, if not impossible, for the growing indigenous Irish film industry. These large productions are necessary to create an infrastructure on which indigenous productions can build. Rather than bringing in new proposals which would retard the growth of the film infrastructure, we would be  helping to accelerate it. Section 35 relief has been of net benefit to the country and we are aware of the benefit it brings in terms of tourism and expenditure in local communities. After the demise of “Divine Rapture”, I called on the Minister to ensure that film producers should be required to present a bond which will guarantee all moneys due to Irish workers and suppliers. At that time I suggested also that he should consider new measures to encourage the establishment of a truly Irish film industry, with Irish scriptwriters, producers and directors. Unfortunately the Minister did not address these issues in the budget.
The Minister has reduced by 20 per cent the tax benefit for personal investors in qualifying films. Let me give a brief example. This means that someone who previously would have invested £25,000 in a film and obtained £12,000 tax relief will now obtain tax relief of only £9,600. The reduction of £2,400 in tax relief will significantly reduce the potential return on investment in film. In many marginal projects this may mean that the return received will be below a required commercial return and may discourage investment. The Minister has not only reduced the tax benefit by 20 per cent but has also reduced the timing during which this tax relief will be available. We are told that tax relief will now only be available from the date of commencement of principal photography. In the normal course of events this would be unlikely to commence in the tax year in which the taxpayer makes his investment. Taking into account the cost of borrowing money, this further reduces the return available to section 35 investors. Why is the Minister amending section 35 to this extent, given that it has worked successfully and has been largely self financing due to the direct and indirect tax revenues raised from expenditure on Irish goods and services? Why is the Minister gambling with the relief which has been most successful to date at little or no cost to the Exchequer?
Problems arose with the relief in the past. However, these were not the fault of section 35 investors or the operation  of the section itself but due in some cases to the management or promoters of a particular film. I previously called on the Minister to grant certification only when full funding was in place for films. However, the Minister has hit at funds which gathered section 35 investment to ensure finance was in place for potential film projects by not allowing investments from such funds to gain tax relief until photography has commenced. It is a classic chicken and egg situation. On the one hand the Minister will not allow tax relief until principal photography has commenced while, on the other, principal photography is unlikely to commence until funding is in place. Does the Minister realise that investors in small productions may not be willing to invest in a tax year if any delay in the timing of their tax relief is anticipated?
I wish to deal with the Minister's amendment to the tax relief for donations of heritage items of national importance. While I welcome the relief and its implications for retaining heritage items for the benefit of the nation, is this the most efficient or effective method of obtaining such items? Unlike film relief to which I referred, no significant spin off or additional employment is generated through this provision. In effect, tax liabilities worth £750,000 are cancelled in exchange for the State receiving heritage items. Would it be more effective to grant this money to individual bodies and allow them to increase their budgets by purchasing such items?
Due to the means by which this relief is constructed, it is up to taxpayers to approach the relevant institutions rather than the other way around. The selection committee for these gifts must review a large number of items, some of which may not have any cultural merit. Would this time not be better spent by these institutions going after particular items they wish to obtain with a budget of £750,000 rather than relying on taxpayers to come to them? Under this alternative, heritage items the national institutions wish to obtain could be purchased in a far more efficient manner. I  ask the Minister to consider this proposal.
The Minister referred in a positive manner to the peak periods in film making and the question of seasonality. I agree with his view and I made that point last night. I am glad we are at one on this issue because more jobs in the Irish film industry would be generated in trying to spread the load over the full 12 months rather than the usual May to September period. I am glad matters have progressed in that manner.
The Minister referred in particular to the National Library in terms of cultural institutions. I am sure he is aware that Dr. Pat Donlon is unhappy with a number of aspects pertaining to the National Library. She was most brave to come out publicly on those issues but it is a pity that somebody with her responsibilities feels she has no other choice but to make the matter public. I congratulate her for doing so but it should not have been necessary. The Minister and his Department should have addressed that need. Even at this late stage, I hope the National Library, which is a major cultural institution, will be recognised and given any financial assistance it requires for its day to day work. It is a fundamental element of our cultural institutions. Other cultural projects should be promoted but the major cultural institutions cannot be forgotten. They also require assistance and support, not just with flowery speeches but with hard core funding. I appreciate it is difficult to obtain funding at times but I ask the Minister to do his utmost to find the finance to deal with that particular problem.
A Bill dealing with cultural institutions is awaiting the attention of the House. I hope it will be debated as soon as possible because the museum and other institutions must be considered in terms of how they can be best assisted and promoted. Since the beginning of the State, these institutions have provided a tremendous service in the areas of culture and heritage.
I am sure the Minister is aware of Fianna Fáil's position on Teilifís na Gaeilge, which we supported from the beginning. The promotion of Teilifís na  Gaeilge was a Fianna Fáil initiative and we are happy to support the Government proposals. However, I was disappointed to note the Minister's approach to the funding of the station and I am sure it was a surprise to RTE to discover that it had to set aside further moneys for it.
Mr. M. Higgins Mr. M. Higgins
Mr. M. Higgins: That is not so. It only involves one hour.
Miss de Valera Miss de Valera
Miss de Valera: Teilifís na Gaeilge warrants firm funding of its own and I am sure the Minister accepts and acknowledges that point. I hope he will promote that aspect.
Mr. M. Higgins Mr. M. Higgins
Mr. M. Higgins: The only cost to RTÉ is one hour.
Miss de Valera Miss de Valera
Miss de Valera: I understand that point but the House wants the immediate initiation of Teilifís na Gaeilge and this can only be done through firm funding. I hope the Minister believes the station is of sufficient importance to the country and its culture that it should have its own funding mechanism rather than relying on other forms of finance.
Other provisions in the budget do not come within my remit but as a public representative I wish to comment on them. This Government inherited a very strong economy with high growth and low interest and inflation rates, but, by its actions, it has thrown away these benefits. This budget can be seen as a lost opportunity to set out a responsible, strategic approach to our finances rather than taking the easy and short-term option of overspending.
Much pain was inflicted in trying to get the economy back in shape and now the Government increased the national debt by £1 billion in 1995. This budget could have been a watershed for the economy but instead it tinkered with the system as this is the only approach which can be agreed on by the warring parties in Government.
During the week we saw an unseemly squabble between Fine Gael, Labour and Democratic Left, all jostling for position. It was nothing less than a public demonstration of the deep divisions  and tensions in the Government. Coalition Governments, by their nature, are composed of more than one party and there will be tensions between them. Sometimes these can prove to be positive but in this case there are three parties with differing philosophies and approaches to the economy. We saw the three parties doing their utmost to show that they had a particular view on how the budget should progress and seeking credit for the budgetary measures. If the matter were not so serious it would be amusing for any student of politics.
Democratic Left won the fight, not only in what was proposed in the budget but in terms of PR. In the absence of an economic plan it is strange that economic policy is dictated by a party that holds less than 3 per cent of the national vote. While that may go down extremely well with members and supporters of Democratic Left I wonder how the members and supporters of Fine Gael and Labour view it.
What the nation should have expected in this budget was an honest look at and reform of the taxation system. Business should have been encouraged to employ more people and thus reduce unemployment. The Government should have encouraged wealth creation while at the same time implementing measures for the low paid and unemployed. Many in low paid jobs struggle to keep afloat and have great financial difficulty living from day to day. As we know it does not pay many in low paid jobs to go out to work. Much was made of policies to encourage the unemployed but I cannot see any great incentive for either the low paid or the unemployed in them. We might have very nice policy documents and well expressed and thought out views from those in Government but it is not forthcoming when it has an opportunity to implement economic measures which would have a positive effect on the low paid and unemployed. It has paid lipservice to those on low incomes and the unemployed. For example, for a single person with full rate PRSI contributions the net gain, based on the Minister's figures, is £89 per year if the person's income is between £5,000 and £10,000.
 That is £1.71 per week. For a married couple with four children and one earner earning £20,000 per annum, taking the increased child benefit into account, the benefit will be £185 per annum or £3.56 per week to be shared between the six members of the family. This Government will claim to be interested in upholding the values of the family. For a married couple with one earner and no children earning between £12,000 and £20,000 the uplift in take-home pay is £86 per annum or £1.65 per week. It would be encouraging if none of them smoked or drove a car as if they did they would be net losers.
This Government has no commitment to the agricultural community which makes up 40 per cent of gross national output. The increase in the VAT refund will not offset rising prices for food-stuffs, fertilisers, fuel and electricity. The REPS scheme proves the Government is not serious about the issues. In 1996 less than half the funds necessary to fund the scheme have been made available. What will the Minister do about the tens of thousands of farmers who will not be in the scheme? What does he intend to do about farm investment? What are his plans for the 12,000 to 14,000 dairy farmers whom Teagasc say will go to the wall in the next five years? To date, out of 5,000 applications for grants under the dairy hygiene scheme, 225 have been paid. The control of farmyard pollution scheme has been closed to new applicants since last June.
The only reference to crime in the budget is a proposal to help provide a burglar alarm for the elderly. While I have no objection to this in principle it underlines the fact that the Government has abjectly failed to provide a safe environment for society, particularly the elderly. Crime is on the increase in rural Ireland. Is this the only response the Government is capable of making? I come from a rural community in County Clare and there is great fear and anxiety especially among the elderly living in isolated places. In County Clare there were less than ten cases of elderly people being attacked in their homes  but the fact that it occurs in the county or the surrounding regions is a cause of great fear and makes prisoners of our elderly. Surely they should be able to rely on the Government to implement laws to protect them and others in society.
Minister for Equality and Law Reform (Mr. Taylor) Mervyn Taylor
Minister for Equality and Law Reform (Mr. Taylor): I wish to share time with the Minister for Enterprise and Employment, Deputy Bruton.
I congratulate my colleague the Minister for Finance on an innovative and well thought-out budget. The Minister has succeeded in bringing in a budget which will create more than 30,000 jobs this year and will greatly help many of those among the long-term unemployed who until now have had little hope of re-entering the jobs market. At the same time the Minister has succeeded in ensuring that Ireland's economic strategy is well within the Maastricht guidelines, which will ensure that we are well placed for participation in the single European currency in three years' time.
This is an innovative budget, it rewards those at work, it promotes enterprise, it strengthens social solidarity and it underlines the importance of creating the right economic circumstances for all of us to gain from interest rate cuts in the future. One national newspaper this morning described this as a “go to work budget”. I agree with that analysis. However, it is also a budget with a social conscience as is evidenced by the increases in carers' allowances, child benefit, living alone allowances, family income supplement thresholds and health allowances. What is remarkable is that my colleague the Minister for Finance has managed to do so much while still ensuring that Government spending will not exceed little more than £12 billion this year. Extra spending is being met out of savings. This is a budget from which everyone will benefit to some extent.
As Minister with responsibility for equality and for women's issues I am very pleased to see a number of specific proposals which will have the effect of helping large numbers of women. Increases in the carer's allowance and in  child benefit are important and are very welcome. The measures to help the long-term unemployed will provide considerable assistance to a vulnerable and marginalised section of Irish society.
Estimates for my Department for the year to come certainly provide us with ample evidence of the ongoing commitment of this Government to equal opportunities policies and to support for family life. The moneys provided in 1996 for family support services will enable the organisations concerned to continue their respective programmes of expansion and development, made possible by the additional funding which I have made available to them in recent years.
Funding of the services of the Legal Aid Board, which provides access to justice to people who otherwise could not afford it, is being increased again in 1996, to £6.5 million. This represents an increase of almost 5 per cent over the 1995 figure. The funding now is almost double the 1993 allocation of £3.2 million. The level of funding over the past couple of years has facilitated a significant expansion of the service, involving the employment of significantly more solicitors and support staff and an increase to 26 in the number of full time law centres as against 16 in 1993. As a consequence, the waiting lists in law centres have been drastically reduced and in many cases eliminated.
The State Family Mediation Service which helps couples who have decided to separate to do so on an amicable basis, has been allocated £300,000 this year. Its expenditure last year was £260,000. The amount allocated this year will enable it to continue with its expansion programme. This will include a scheme for the use of private mediators in providing mediation on behalf of the Family Mediation Service. That arrangement when put in place will help to make mediation widely available.
The organisations which provide voluntary marriage counselling services to couples have a long and distinguished track record. In recent years, by providing them with grant aid, my Department has played a significant role in actively  encouraging voluntary organisations in this area to develop and expand their services. In 1994, and again in 1995, my Department expended £750,000 in support of these services. Large sums were invested in upgrading premises and facilities and in providing advanced training for counsellors and supervisors.
Similarly, substantial sums of money were invested in recruiting and training new counsellors to ensure that the groups could cater for all of those who wished to avail of their services. I also intend to extend the grant aid programme to include voluntary organisations who provide counselling services to children who are in need of counselling because of marriage breakdown. The allocation to voluntary counselling organisations is being increased this year to £900,000 to reflect the extra demands being made on the marriage counselling services and the need to provide for children's counselling.
New employment equality legislation is also among the priority proposals with which I am concerned at present. My intention is that new legislation will prohibit discrimination, not only on the grounds of sex or marital status, but on a wider range of grounds including parental status, sexual orientation, religion, age, disability, race, colour, nationality or national or ethnic origins, including membership of the travelling community. Work on a Bill is well advanced in my Department and I hope to be in a position to publish it before Easter. The enactment of this new legislation will necessitate the restructuring of the Employment Equality Agency to reflect its wider responsibilities.
In the course of this year, I hope to publish the Equal Status Bill which will deal with discrimination on a range of grounds in non-employment areas. When this Bill is published, it will be fully debated in these Houses and I will seriously consider any amendments put forward by Members or suggested by outside interests. Meanwhile, the representations which have already been made to me in this matter will be fully borne in mind in finalising the Bill. I stress that the legislation will offer no  protection to anti-social elements, it will deal only with discrimination on specified grounds. It is similar to legislation which has worked well in many other countries such as Britain, the US, Canada, New Zealand and Australia.
In July last I received the very comprehensive report of the Task Force on the Travelling Community which dealt with key issues of concern to travellers such as accommodation, access to health services, education and training opportunities, discrimination and relationships between travellers and settled people. The Government has established an interdepartmental working group of officials to consider its implementation, including, in particular, the costs involved. We will determine what action is called for on the recommendations in the task force report as soon as the report of the working group has been considered.
This year also I expect the finalisation of the report of the Commission on the Status of People with Disabilities. This report is expected to recommend the most far-reaching proposals to end the marginalisation of Irish people with disabilities since the foundation of the State. The report will probably require action from all Government Departments and State agencies. I look forward to receiving it and beginning work on the implementation of its recommendations within a matter of months.
One of the most significant events of 1995 for my Department was participation in the Fourth World Conference on Women. At the conference, agreement was reached, with some reservations, on a Declaration and Platform for Action which, if implemented, will represent major progress towards equality between women and men worldwide. I will shortly put structures in place to oversee implementation of the platform in Ireland and in this context, I will ensure appropriate involvement of non-governmental organisations.
The 1996 budget is one of which this Government can be proud. It maintains the necessary financial discipline  required to remain within the Maastricht guidelines and it will significantly help in the creation of employment. It will reduce the level of income tax by widening the standard rate tax level and increasing personal allowances. It will reduce the burden of PRSI on employers. It contains specific measures designed to promote enterprise. It provides for an innovative plan of action for the long-term unemployed. Opposition parties and economic commentators have had difficulty in constructively criticising this budget. This is because an objective observer cannot fail to see its merits. I have no doubt it will usher in a new era of opportunity for all of us in the year to come.
Minister for Enterprise and Employment (Mr. R. Bruton) Richard Bruton
Minister for Enterprise and Employment (Mr. R. Bruton): I wish to take up the theme developed by the Minister for Equality and Law Reform. There is no doubt that Opposition Deputies have been confounded by the quality of this budget. Their only complaint relates to suggestions of division within Government, which are wide of the mark. In their hearts they know this is an excellent budget, well put together, which maintains an excellent economic performance. In the last two budgets there is a very strong theme of fiscal responsibility. We are creating a very stable fiscal environment, which is in sharp contrast with other budgets.
It is interesting to note the record of Fianna Fáil and the Progressive Democrats, who appear to be latter day saints in conversion to fiscal rectitude and tax reform, which is quite the opposite. When they left Government they had presided over a period of excessive, accelerating growth in public spending, then standing at 7 per cent per annum. Since then we have succeeded in restraining that rate of growth. This Government introduced a budget yesterday showing real public spending growing at 2.5 per cent, almost one-third the rate Fianna Fáil and Progressive Democrats had bequeathed.
It is very significant that we are achieving stability in fiscal terms. In the programme for Government the three  parties agreed targets for public spending and borrowing which established a good framework for economic development. We are beginning to see the fruits of that fiscal stability. This year, for example, the current budget deficit will be close to nil, 0.2 per cent of GNP. We also anticipate that the general Government deficit as a proportion of national income will fall again by 5 percentage points to 81 per cent. This means we are achieving Maastricht criteria and continuing to reduce our debt.
We are reinforcing that approach to our public finances by committing ourselves to a multi-annual approach to fiscal issues, a very positive development, thus reinforcing the notion of stability and planning so important to business. We are also seeing the fruits of that stable fiscal environment which is having a very positive effect on our economy.
Last year we saw a record increase of 4 per cent in employment — 49,000 additional people at work. That is as much achieved in one year as had been achieved in almost 30 years between 1960 and 1989, clearly demonstrating that Government policies in this area are working. It is important to stress that we are reaping the rewards of solid Government policies. We have seen that clearly in my Department in the performance of our industrial agencies. Last year was the best on record of the Industrial Development Authority, with a net increase of 6,500 jobs. In addition Forbairt had one of the most outstanding performances yet on the part of the indigenous sector which over a number of years had been witnessing declining employment. Last year we saw a net growth of employment on the part of indigenous companies in excess of 2,000 and the same was true of SFADCo.
I do not for one moment suggest that we should be complacent about this performance. I am at present taking steps to ensure our approach is carefully reviewed, that we are attuned to take advantage of the opportunities and challenges opening up to us.
In the context of those challenges the pro-employment budget introduced yesterday will reinforce our ability to seize  that potential. Employers' PRSI has been cut by £51 million in a full year. Over the past two budgets the threshold for employers' contributions at the low rate of 9 per cent has been increased from £9,000 to £13,000 and the rate actually reduced to 8.5 per cent. That is very significant progress, meaning that henceforth two-thirds, or 655,000, of all jobs in our economy will be subject to the low rate. This effort is targeted at the creation and protection of employment and is crucial to many of our industries which have had to face very stiff competition, particularly resulting from currency changes.
We have also improved the benefits of working through very significant reform of employees' PRSI, having reinforced a strategic shift in the structure of employees' PRSI by introducing an allowance last year of £50, rising this year to £80 per week, which will ensure that people who go back to work again. This will open up new opportunities for lower paid and all areas of employment.
The poverty trap was an issue this Government recognised as presenting a serious difficulty. We have made very significant progress, reinforced again this year by improved child benefit, improved family income supplement, reinforced further by making the child dependent allowance retainable by those who take up work for 13 weeks while allowing them retain their medical card for three years. It is worth giving a small example of how that improvement has had a very practical impact in the case of, say, a married couple with three children who would receive just over £142 on social welfare. If one spouse goes out to work at £180 a week the couple will pay no income tax, no levies, their only contribution by way of tax being the £5.50 PRSI contribution. In addition they will receive a top-up family income supplement of £33. To sum up, they will be better off by £65 than if they were on welfare and can retain their medical card for three years, a very significant change for lower earners. This means we are able to demonstrate real net gains of those taking up employment, a major problem we have had to overcome and on which we have  made significant progress in the last two budgets. Clearly there is further to go on this route but it can clearly be seen that we have made very significant strides.
Child benefit, one of the most significant instruments used by this Government to improve incentives to work throughout our economy, has been increased in just two years by 45 per cent, from £20 to £29. The action of Government speaks louder than words and we are demonstrably dealing with the poverty traps.
Another area of major concern to all who have studied our economy in recent times has been the need to reduce unemployment. We conducted a survey within my Department of the take-up of employment created by IDA and Forbairt. It is encouraging to note that approximately 40 per cent of those jobs go to people who are unemployed, which means we are making a real impact on reducing unemployment. However, what is not so encouraging is that the same cannot be said of those who are long-term unemployed, many of these new job opportunities passing them by. We have done some research which shows that the probability of somebody who has been two or three years out of work finding employment within 12 months is extremely low, of the order of 20 per cent or less than one-third of the opportunity of a person who has only recently lost employment.
It is clear we have to target the long-term unemployed. We must also target young school leavers without formal qualifications who are experiencing very high rates of up to 70 per cent unemployment. This budget has introduced an innovative package to tackle both those problems. As the House will know, the recruitment subsidy of £80 per week is targeted specifically at the long-term unemployed who have been out of work for three years. This will give employers a very significant incentive to bring such people back into the workforce.
There are also many other schemes targeted at 18 and 19 year olds who leave school without qualification. We  are introducing a significant new initiative, a progression programme for them. This will mean there will be a youth progression programme avialable to those in danger of drifting into long-term unemployment. After six months of unemployment they will be required to register with FÁS or the LES and will have a programme tailored to their individual needs, including job counselling and placement, training, work trials — another new initiative — youth employment option and subsidised training in employment, otherwise known as the job training scheme. Young people will be expected to participate actively in this initiative or have their continued eligibility for welfare support reassessed under existing social welfare provisions, with a possible disqualification of up to nine weeks.
This has not been framed in a negative way. It is a very positive, proactive programme, opening up opportunities for young people who could all too easily remain on the live register, drift into long-term unemployment and see their chances slip away. It is very important that we get people committed to this endeavour, which is what this programme is designed to do.
We are introducing many other initiatives, such as the work trials programme in which some 5,000 people are participating. In addition, we have totally revamped the community employment scheme to ensure it is targeted at achieving progression for those who are particularly mobile, giving long-term work experience to those who are not so mobile, who need greater employment experience. All of that is reinforced by the pilot job option scheme.
There is a very significant underpinning of enterprise, particularly small businesses. We have introduced a 30 per cent corporate tax rate on the first £50,000 profits of small non-manufacturing companies. In addition, we have ensured that the transfer of family businesses or family farms will not be hit with huge capital acquisitions tax burdens at that crucial time when one generation hands on to the next.
Dáil Éireann 460 Financial Resolutions, 1996. Financial Resolution No. 7: General (Resumed).