Every week I hear, as I know we all do, from constituents in my constituency in Dublin Bay South about the immense difficulties they face in finding a home and getting support with housing. I hear from renters who are looking at unaffordable rents - rents are as high as €4,000 per month for a house in my area - and renters who are facing eviction and cannot find another affordable home to rent. I hear from young couples and individuals who cannot afford, or even aspire to afford, to buy their own homes. This immense cost of housing is clearly contributing vastly to the cost-of-living crisis being faced across the country. Yet, at the weekend, the Minister for Finance warned that there are limits to what the Government will do to ease the cost-of-living crisis.

The pandemic has shown us that State intervention is the art of the possible and State investment and public intervention on housing and the cost-of-living crisis should now be a priority. It is very disappointing to see the lack of action in this regard from the Government. It is no wonder that President Michael D. Higgins has described the housing situation as a housing "disaster". It is no wonder the President is referring to failures in Government policy. It is deeply concerning in this context to see kite-flying from members of the Government about tax cuts being the priority, rather than the priority of spending on housing, childcare and public services such as schools and hospitals and on addressing what the Irish Congress of Trade Unions has rightly called the "social wage" measures.

Yesterday in the Seanad, we saw a disappointing indication from Government Senators who qualified their ambition for affordable public services with proposals on tax cuts. That is not what is needed. What we in the Labour Party have called for is a pay rise across public and private sectors to enable working families and individuals to see actual increases in their take-home pay and to see reductions in the costs they are facing in housing, childcare and health and proper Government investment in supports for people that will address the cost-of-living crisis and deliver housing to address the housing disaster we face.

Pay increases are needed for the public and private sectors. I welcome the public sector pay talks that are ongoing. Being conscious that under the current pay agreement, workers are due to receive a 1% pay increase in October, with inflation now standing at 8%, this amounts to an effective pay cut for hardworking people. I know that is understood and it is why the pay talks are under way. I urge the Minister and Government members to take a generous approach to these talks, resist the conservative instinct not to be ambitious and not to trust people to spend wisely and take up the challenge and opportunity to see real investment in social wage measures, in childcare to ensure an equal early start for every child and in education and healthcare to reduce the enormous costs that are coming out of people's pay packets every week.

I thank Deputy Bacik for raising those two matters. On the negotiations that are under way on public pay, it is precisely because the Government recognises and values so much the contribution that nurses, doctors, teachers and civil servants make to society and the economy that these public pay discussions are under way. We believe an agreement on the future of public pay for the country is a just and needed recognition of the efforts of those who play such an important role, particularly during the pandemic.

On the Deputy's point on taxation, the views of the Government, including in the programme for Government, are very clear. The Deputy made the point that if an increase in real pay happens, she wants that pay to feed through into take-home pay improving at the same rate. That is the view of the Government in relation to indexation. The point the Government is making is that if there is an increase in overall wages to respond to the great cost-of-living challenge we face, we simply want to ensure that as much as possible of that increase in overall wages feeds back into people's purses and wallets as opposed to being absorbed into unintentionally higher levels of taxation. That is what we are looking to do.

I would have thought there could be some common ground on this issue between the Deputy and me. If she is making the point that she wants to see real pay increase, what the Government is doing is putting forward, as recognised in the programme for Government, a personal taxation strategy that is looking to do the same - no more and no less. It is something that will be valued and needed at a time in which the cost of living is such a challenge and so many are under such pressure.

In stating that there are limits to what a Government can do, I am simply making the point that the cost of borrowing is changing. It is increasing. It is quite remarkable how little this ever features in Opposition critiques and statements regarding what the Government will do. At the start of this year, the interest rate on Irish Government debt was just above 0%. Today, it is nearly 2.5%. It is a change that is taking place around us, the consequences of which Ireland, the economy and the Government are well able to manage. However, to indicate to the Oireachtas and the people of Ireland that there are no constraints on action the Government can take would plainly be dishonest and even dangerous. Even within the constraints that are there, the Government's response in housing and the need to deliver more homes is an investment of €4 billion and the thousands of homes being directly built by the Government via local authorities all over the country. This is leading to higher numbers of planning approvals, commencements and homes being built.

I thank the Minister. The Labour Party certainly believes in constructive and responsible opposition but we are a party of the left. We believe in the need to ensure investment in public services for all. We do not believe in tax cuts for some at the expense of public services for all. That is our concern. Our concern is that during the pandemic we saw, rightly, the State stepping up to deliver investment. We need to see that level of ambition now in addressing the housing crisis and cost-of-living crisis.

We have welcomed some Government measures but we have also been critical, rightly, when they do not go far enough. For example, the Government's Sick Leave Bill 2021 will leave low-paid workers out of pocket and its flexible work legislation essentially offers employers a right to refuse flexible work options. While we welcomed the Government's proposals on the living wage, they do not go as far as the Labour Party's Bill. Our concern is that people have no more to give.

I express solidarity with the striking Bausch + Lomb workers in Waterford. One striking worker there stated that this winter they will be forced to leave the heat off and put on an extra jumper. They are seeking a pay rise to tide them and their families over. The Government is simply not ambitious enough to deliver the real solutions that are needed to address the cost-of-living crisis for those workers and others.

We recognise the intention of the Deputy in providing more constructive opposition and the different tone of it. At the same time, and with respect to Deputy Bacik, it is simply not open to the Government to be able to maintain the levels of expenditure, borrowing and intervention we had during the era of Covid. That was a unique period in our public and economic health, one that is thankfully coming to an end as the disease is put behind us. Even though it is present, it is not posing the fundamental challenge to society and the economy that it did in recent years.

I return to the point I made.

If Deputy Bacik was looking for real wage growth for workers who need wage growth, surely she would support a personal tax approach that simply looks to move income tax credits and bonds in line with wage growth in our economy. That is what we are looking to do. If workers, particularly those on low to middle incomes, get the wage increase they deserve and will need given the rising cost of living we are now facing, they should not see too much of it absorbed in higher levels of taxation as they earn more. I think there may be more common ground between the Deputy and me on that point than maybe the Deputy would admit.

It is the level of ambition.