I had the good fortune by chance this morning to hear Nell McCafferty speaking about this debate on radio. In the course of her remarks, which, as ever, were both entertaining and astringent, she asked whether, if I [876] intended to speak in the debate, I would spend my time defending the record of my Governments against attacks from the other side of the House or address the subject of morality and politics. I will not spend much time on the first issue. A procession of Fianna Fil Ministers and backbenchers have sought to detract attention from the real issue before us in this debate by trotting out their favourite myths about the Governments I led, myths that are half truths at best, some of them, however, departing so far from any semblance of the truth as to deserve an epithet that I am not permitted to employ by you, Sir, in this House.
The simple and incontrovertible facts are that when I came into Government in June 1981 I found that the volume of public spending had been increased by almost half in the previous four years, the public pay bill had arisen by 35 per cent in the single year 1980, inflation was in excess of 20 per cent, the external trade deficit was at the horrifying level of 16.5 per cent of GNP and the Exchequer borrowing level facing us for the year ahead, had we not tackled it instantly and vigorously, would have amounted to 21.5 per cent of GNP.
When I left office less than six years later, and despite the appalling damage done in the interval by the extravagant and dishonest MacSharry budget of March 1982, the growth in the volume of public spending had been reduced to 0.5 per cent, the public pay increase was down to 5.5 per cent, inflation was down to 3.9 per cent, there was a surplus of 4.5 per cent in our external trade and the Exchequer borrowing level that Fine Gael presented to the country in the 1987 election had been halved from 21.5 per cent in 1981 to 10.75 per cent. That was the budget which Fianna Fil adopted almost unchanged.
Moreover the conditions for an expansion of our economy had been so well established that before Fianna Fil were able to take any action of their own which, in fairness, they did effectively by cutting spending in the 1988 budget, the economy was growing at a rate that yielded an [877] increase of 4.8 per cent in 1987. That is quite enough economics.
I will turn now to the question of morality and politics. The key issue we have to face is the kind of relationship that should exist between politics and business and whether the relationship that has actually prevailed in the last couple of years has conformed to the needs of a healthy, democratic society in Ireland.
Because centralised planning does not work, because the market system is essential for economic success and therefore for social progress, and because only a certain range of activities can appropriately or successfully be undertaken by the State itself - and in saying that I do not for one moment diminish the importance and value of the public enterprise activities in question - the modern world has to face the issue of the role of politics in what is necessarily a largely capitalist economic system. Some might like matters to be otherwise, but the reality, which I, like many others who would prefer a more egalitarian society, have had to face, is that in this matter we have no choice.
Moreover, given the fact that we are an intergral part of an intensely competitive world, we in Ireland have no choice but to accept and fall broadly in line with neighbouring countries in certain key respects, for example, in relation to tax rates. While I regard as totally unsatisfactory our current marginal tax rate of 56 per cent for a worker at or under the aveage industrial wage - and I deplore the priority given by both parties in the present Government to lowering tax rates for the benefit of their better off supporters instead of raising tax bands to relieve PAYE workers of this excessive tax rate - I see nothing whatever wrong with a top tax rate of 65 per cent for really wealthy people. But when the top rate in neighbouring Britain falls to 40 per cent, we in Ireland have no choice, if we are to retain entrepreneurs and enterprise in this country, but to go a long way towards the British figure, however much we may wish it could be otherwise. That is why the Labour Party have now realistically [878] accepted a top tax rate of 50 per cent in Ireland.
We cannot afford to ignore this question of incentives. While it is true that in an emergency a whole nation can be got to work together in a common cause without seeking individual reward, and while it is also true that there are still many people - though fewer, I fear, than in the past - who are happy to work for their country in the Civil Service or in running State enterprises without seeking any personal gain beyond their salaries, the fact is that a very large number of people who have entrepreneurial capacity want to see a relationship of some kind between the fruits of their efforts and the financial reward they receive - whether by way of bonuses, shares or otherwise.
They seek this not just for themselves but because they have the ambition to leave to their children by way of inheritance a claim on current resources in future years. It is very difficult to provide a moral justification for transmuting a current claim on 1991 resources by X arising from his work in this year into a claim by X's son or daughter on resources produced in, say, 2010. Indeed, so far in my life I have yet to find anyone who has been able to explain the moral basis of such a postponed claim on resources. We may, however, also doubt the real benefit to members of a future generation of being provided with a substantial claim on current resources in their lifetime because of a parent's past achievement, for such inheritance, as we call it, can, if substantial, sometimes be a disincentive to effort and even a source of moral deterioration among those who acquire it.
But the fact remains that the capitalist system, including most specifically this power to transfer a claim on resources to a future generation by way of inheritance, works by providing what is clearly a strong incentive to entrepreneurs to achieve a continual growth in total resources, and such a growth in resources provides the only solid and secure means of improving, through transfers effected by politicians, improved social conditions [879] for the population as a whole. Those who will not face that fact are living in cloud cuckoo land.
Those who accept and support for practical reasons this economic system have an absolute duty to ensure that the accumulation of resources in fewer and fewer hands, to which it tends to lead, is brought and kept under control. That means that those in charge of political affairs must be willing and able to distance themselves from the system sufficiently to carry out their duty of securing a redistribution of resources and a structuring of society that will secure equality of opportunity to the maximum extent possible within what is an inherently morally problematic, capitalist structure.
If politicians get too close to the enterprise sector and become too emotionally or financially involved with it, they will not be able to perform this, their morally compelling duty to society. Let us never forget that the achievement of social justice is the only true objective of politics. The advancement of economic growth is and can only be a means towards that end and not an end in itself, as it has been elevated not merely here but in other countries like Britain in the past decade.
The relationship between politics and business is thus bound to be an uneasy one. On the one hand, if politicians are too unfamiliar with business and its legitimate needs they may perhaps unintentionally undermine the climate necessary for genuine enterprise. They may, indeed, have to pay some attention to balancing a certain inherent insensitivity to the world of enterprise on the part of the civil servants who advise them - who themselves are and should remain very properly distanced from this world of enterprise - but the opposite danger is the commoner one, the danger that politicians may not keep themselves sufficiently distanced from business. Where that happens great damage can be done both to politics and to business.
It is clear to almost everyone that this precisely has happened in this country in the past few years. The MRBI poll published a few days ago demonstrates [880] in the most emphatic way public sentiment on this point. Curiously this aspect of the poll has attracted little attention. It shows that 74 per cent of those asked if there had been a drop in standards in Irish politics replied in the affirmative and when those who gave this answer were further asked to what extent they thought the leadership of the Taoiseach, Deputy Haughey, and his Government had been responsible for a drop in standards, no fewer than 89 per cent replied that in varying degrees they were so responsible; and the replies to a similar question about a drop in business standards yielded an almost identical answer about the responsibility of this Government and their leader.
A Taoiseach and a Government who are thus judged by two-thirds of our people to have been responsible, either wholly or in some measure, for a decline in standards in both politics and business should be replaced to give Members an opportunity to purge themselves of whatever has led them to this position.
These events have raised other issues. Given the appalling damage done to the public view of politicians' relationships with business, it is clear to me that the system under which political parties at present finance general elections in particular by means of contributions raised from private individuals and from business is no longer appropriate. In the past this arrangement has stood the country in good stead. Certainly so far as my party are concerned, under my predecessor - who warned me always to be on the qui vive for and to return instantly any contribution that might seem to have any kind of strings attached - and under myself and my two successors, the public interest has been protected against any influence being exercised over our decisions on issues that might affect such contributors. But the issue is no longer whether justice is being done to the public interest but whether is it being seen to be done.
It is now clear that to restore public confidence in politicians and politics, Members of the Houses of the Oireachtas must in future, like members of local [881] authorities, declare their interest and that members of Governments - and, in the light of recent events, unhappily, perhaps, also their spouses and children - be required to furnish details of their assets, liabilities and income when in office and for some years thereafter to, I would suggest and our party suggested last November, an ethics commission comprising such figures as the Ombudsman, the Comptroller and Auditor General and a High Court Judge. There should be a provision that this commission would have a duty to investigate any allegations of non-disclosure or incomplete disclosure and when a Minister is found to have failed in his or her duty of disclosure, to publicise the result of such inquiry with a penalty of loss of office for any intentional or conscious breach of this obligation.
As someone who has served in the office of Taoiseach, I want formally to ask the Minister for Finance, who will be concluding this debate, whether this Government are prepared forthwith to implement such a structure and to provide finance from public sources for political parties in order to eliminate the need for them to seek and to accept support from private sources. I expect him to respond unequivocally to these questions.

