It is 40 days since the House last met. In that time the Government and the Taoiseach have wandered through an economic desert bereft of ideas, decisions, direction and, dare I say it, the courage to govern. In that period we were told that it was necessary to cut €2 billion from public spending. The Government went on holidays, sent papers to, and held meetings with, the social partners and borrowed €55 million a day to keep the nation going. The Government's indecision has damaged our international standing and made us the butt of international jokes while the cost of money spirals to a dangerous level; people are frightened out of their wits at the loss of, and inability to protect, jobs, and because the Government is offering neither leadership nor direction on its plan, strategy or the decisions it intends to take to move the economy forward with the confidence and trust to which people can respond.

The time for talk is over and it is time for decisions. When does the Taoiseach intend to announce his decisions on public finances, job protection, and restoring the confidence and trust that will give people some semblance of a direction to follow and a structure to discuss?

I reject the Deputy's contentions. The Government does have direction and has taken decisions as a result of the end of year Exchequer returns which saw a deterioration in the public finances beyond those provided for in the budget. The Government decided to submit a five year stabilisation plan to the European Commission which requires savings of €2 billion this year, €4 billion for the following two years, €3.5 billion the year after that and €3 billion in year five, until 2013. It has made a commitment to the Commission to reduce the general Government deficit to less than 3% as required under the Stability and Growth Pact at that time.

I undertook before Christmas to use January to work with social partners to ensure that people fully understand the scale of the problem, that this will require a national effort, that people must buy into the requirements of the situation to meet the real political, economic and social challenges facing the country. That is being finalised this week and weekend. I said I would do that because I believe it is the way forward. It involves providing leadership, to ensure that we are all committed to achieving those savings of €2 billion. The Government has been working to identify these savings. Unlike the Deputy, we have stated clearly that all areas of expenditure must come into play in achieving those savings of €2 billion and that the ability to identify in terms of pay or pay-related, pension and non-pay issues is the best means by which we can minimise the impact on those who require services which is funded by the non-pay side of the budget. Those are the types of approach we have made and discussions we have held. The discussions continue and progress is being made. We will know by the end of the week whether we can come to an agreement on a framework for a pact that will bring stabilisation, that will be based on social solidarity, and that will allow us to take the opportunity for reform that this recession provides for us.

As Taoiseach, I am acutely aware that people are losing their jobs and that more will lose jobs. I am acutely aware of the fact that this open economy is not immune from the international developments which have taken place. I am acutely aware of the Government's responsibility to bring forward a macro-economic plan on our public finances that meets with our obligations as members of the eurozone, and to bring forward at the same time micro-initiatives on all the issues the Deputy mentioned to deal with the savings of €2 billion that must be identified. We are prepared to do this. We are actively engaged in it and we are finalising it at the moment.

The proposals put forward by the Deputy and his party during the Dáil recess would be totally inadequate and would go in the opposite direction. The proposals put forward, such as a freeze in the increments for public pay and a contribution made by those earning over €100,000, would bring forward a maximum of about €330 million if it was provided for in full. He also spoke about the need to increase capital spending by €1 billion, all of which would make us worse off by €700 million.

We are going in the other direction. We are looking at all areas of current and capital expenditure. We have identified the €20 billion that is needed for pay and pension costs, the €20 billion in social welfare and social security costs, and the €15 billion in non-pay costs on the current side. We are identifying all areas of expenditure and engaging with the social partners in order to solve this problem and provide the €2 billion in savings in a way that will minimise its impact on ordinary working people and those people who require the delivery of State services.

The Taoiseach tempts me to get involved in the narrow confines of party politics. He is the person who brought in the budget last October that attacked the vulnerable, the voiceless and the defenceless. He is the person who put thousands of the elderly on the streets when he tried to take away their medical cards. He is the person who attempted to take away the allowance for intellectually challenged young people at home. He is the person whose Minister for Social and Family Affairs stated recently that the carer's allowance should be halved.

I did not say that.

He is the person whose Government has attacked the vulnerable and the defenceless time and again. When I proposed six years ago that if the Government was going to pay for benchmarking, the very least it should do is look at the possibilities of public service reform and the cost of that. Benchmarking is now costing €2 billion per annum. I was here in the 1980s when tax rates were 60%, interest rates were 20% and inflation was 16%, and all Fianna Fáil did from these benches was scoff and not give any credit or assistance in the national interest to the Government of the day.

That was the end of the Fine Gael Party and Labour Party coalition.

We were the first party to put forward the view that it was necessary to freeze the national pay deal. We put forward the view that there should be a recapitalisation programme for the banks. If the Taoiseach is interested in constructive suggestions, then I will give him some. His members have been talking out of the side of their mouths about national consensus and a national Government. We have an interest in the way this country moves. We have an interest in protecting the country and in seeing that confidence is restored to our economy. I have some suggestions that do not represent all the answers to the Government's problems, but if the Taoiseach is looking for consensus, will he support a reversal of the outrageous VAT increase that has cost jobs all over the country and led to an outflow to Northern Ireland? Is he prepared to abolish PRSI for employers who take on new employees in 2009? Is he prepared to give a tax exemption for companies that involve themselves in research and new product development? Is he prepared to freeze Government charges and rates, so that some confidence will be restored to small businesses and small enterprises?

I do not make these suggestions purely from a partisan party point of view, but as constructive suggestions in the interest of retaining and creating jobs. If the Taoiseach wants consensus and support, I have just given him four suggestions today. I will return to the banks at another time. These suggestions would help the Government to put some semblance of economic sanity to the floundering it has been at for the last six weeks.

On the one hand, the Deputy asks me whether I will take on his suggestions, and I will take any constructive suggestions because this is a national effort. However, I will not take the criticism that the Government is floundering around what it wants to do. The Government is determined——

Where is the effort?

The Deputy can make his remarks and snigger later. The Government is determined to pull everyone behind this national effort. It will not be done without engaging with those who have a stake in this society. I remind people that when we faced a difficult situation in 1987, we pulled together even though not everyone agreed that was the approach. I believe in this approach.

Can the Taoiseach tell us what the approach is?

I will answer the question put by the Deputy's leader. When he becomes leader, he can ask the questions. I believe in this approach as a problem solving approach. The first and immediate objective, as set out by the Government, in terms of its obligations internally and in terms of maximising internal confidence, bringing internal confidence to our own country and ensuring that there is external confidence in how we run our affairs——

Going forward.

——is to bring forward savings of €2 billion in the immediate term. We will do that. We will do it on the basis of the social partnership approach in which we are engaged. We will use the course of this month to achieve that common approach. I believe that progress is being made. I cannot say tonight that we have agreement on those issues, but I believe that the process of engagement is the best method by which we can bring the country behind us to face up to the real situation out there at the moment.

In making that case, it is often portrayed as an attempt by the Government to abdicate its responsibility. That is far from the case. It is the Government's responsibility, in the interests of a successful implementation of such a consolidation programme, to have people behind us and to speak to those people who represent legitimate stakeholders in society, such as employers, employees, trade unions, farmers and the voluntary pillar——-

We tell them first of all that the Government will discharge its responsibility and will do so in as inclusive a way as is possible for us to do so.

Why does the Taoiseach not do that in here?

I make no apologies to anyone for doing that. When the Government makes its decisions in the coming days, we will report to this House the decisions we have taken. We can debate them here if we so wish. I have no problem with democratic accountability, but as long as I am running this Government, I will run it as I see fit and as I believe, based on my philosophy.

The Taoiseach's philosophy got us where we are now.

If Deputy Kenny has another way of suggesting how to run the country, that is a matter for him and I respect him for it. However, I will run the country on the basis of how I see it.

The Taoiseach should put a motion before the House.

The Taoiseach's philosophy has got us where we are.

This is a huge challenge facing the country. We will discharge our responsibilities and we are going about that in the right way. As we proceed with these measures, we will gain and maximise the support for the actions that we must take.

The Taoiseach should put a motion before the House tomorrow, and we can debate it.

The Deputy should stop lecturing us all. People are losing their jobs.