By way of introduction, I refer to the Taoiseach's comment yesterday arising from the results of the local and European elections that Sinn Féin was the winner of the elections. The Fine Gael Party now has the highest number of Members of the European Parliament. The local election results, when compared with the general election results of two years ago, show a 5% increase in Fine Gael support, with Independents gaining 2% and Sinn Féin 1.5%, while the Fianna Fáil Party lost almost 10%.

The Taoiseach and his Ministers have stated that the Fianna Fáil Party will reflect upon the consequences of the elections, listen to the people and take into account the verdict handed down. Does the Taoiseach not accept that the results of the European and local elections amount to a devastating indictment of his Government? The perception which came across clearly to Opposition parties was that the Government is out of touch, has grown too comfortable, arrogant and removed from the people in office and that its decisions are based on looking after itself and its supporters rather than dealing with the concerns, anger and frustration of ordinary people. In view of the devastating loss to his party and the fact that Deputies from his party are arguing for the Minister of Finance to be got rid of and the purse strings released for more spending, does the Taoiseach not accept that the consequence of yesterday's results amounts to a serious loss of confidence in his Government and in him? What does he propose to do about it?

As I acknowledged yesterday, the Government, at least the main party, Fianna Fáil, did not do well in the elections. I said that very clearly yesterday. Our colleagues, the Progressive Democrats, increased their vote by 1%. I acknowledge Deputy Kenny's party won five seats in the European elections and I have no difficulty in congratulating him on that. I said that in the local elections, from a very low base, his party decreased its vote by 0.6%. That was the figure published on the front page of the national newspapers yesterday. If my party had spent about 15 years in Opposition, I would certainly not consider it a great victory. Fine Gael did better in the European election.

As far as the electorate is concerned, we are two years into this Government and we have lost support of the order of 7% to 9% in the local and European elections.

The Taoiseach is seven years in Government.

The Deputy is not the leader of his party.

The Deputy is 17 years in Opposition.

Perhaps that is the problem.

The Taoiseach is a bit green at the edges.

Deputy Kenny has submitted a question as leader of his party. He is entitled to have it answered.

The Taoiseach should not forget the Independents.

The Deputy did not have to run this time.

As far as our policies are concerned, the Government has been determined over the past two years to stabilise the economy in light of the international recession. It did not affect this country as badly as it could have. There was no dramatic increase in unemployment, and we managed to stabilise ourselves and maintain tax rates while still attracting some foreign direct investment. While it was a difficult two years internationally, we managed our way through that. Public expenditure has been reduced from more than 20% to 6%. It was the right action to get macroeconomic policies right, reduce inflation and ready ourselves for an uplift.

The Government was saving for the next election.

There has been an uplift, as is evident from reports by stockbroking houses. While time will tell whether economic growth will be 4%, 5% or 6%, the economy is expanding well from a low base.

I acknowledge that when economic success does not filter through to people, for example, if they are on a waiting list or a child is not getting what his or her parents believe he or she should from the education system, they feel upset and that we should do more.

We must examine that as a Government, and how we will implement our programme over the next three years in a number of areas. While it is natural that one would like to do better in an election, the economic policies we have followed while not doing silly things for electoral gain are right in the medium to long term.