The Government "has no desire to dictate personal choices to any group of citizens and least of all to the family", the Taoiseach said yesterday in the Dail.

He acknowledged that the Cabinet would have to be attentive to the "balance" between spouses who worked outside the home and those who stayed at home for their children or to care for dependants.

And he promised that "the Government will take steps over the remainder of its term to ensure the necessary balance in the implementation of Government policy. We will be listening carefully to proposals put forward in the negotiations on a successor Partnership 2000."

Speaking during a debate about the Budget controversy surrounding single-income families, Mr Ahern said he would be meeting the social partners again shortly "to explain the Government's view on how to achieve balance in giving effect to the NESC vision and to listen to their views".

He said that if it "transpires that the essential balance requires more years to be worked through at the realistic pace I referred to earlier, then the Government will be prepared to work with the social partners to achieve that balance."

"There has to be a sense of fairness, vis-a-vis not just carers in the home but the low-paid and other disadvantaged categories of the population," Mr Ahern said. It was the Government's responsibility to ensure "over the next period that resources are equitably distributed".

The Taoiseach stressed that "our objective is, as far as possible, to provide a level playing field, in terms of fundamental fairness, equality of opportunity and personal freedom of choice".

He insisted, however, that the Budget was one of the most ambitious, with a strong emphasis on social inclusion and that apart from some heavy smokers "everyone gains".

Mr Ahern said that because "it is one Budget, it has not been possible to identify clearly or fully the balance that is essential in particular for carers who work at home and to underpin our ongoing commitment to those who are least well off".

He said the State had to respond to social change. "If we accept that people should pay tax in their own right, especially above a certain income level," then it was for "further discussion what level of relief is appropriate to take account of any individual or couple's domestic of family circumstances, and what supportive measures are necessary to support such a change, particularly when it goes further down the road".

The most controversial part of the Budget had been the plan to reduce drastically the number of people paying tax at the higher rate to 20 per cent or less, by doubling the band over three years and individualising it, he said.

Defending the Budget measures, he said that 125,000 people were being taken out of the top tax rate in the coming year.

"It goes a long way towards acknowledging the additional costs of childcare in families, when both parents work outside the home," he said.

He added that the present tax system clearly discouraged the married woman in particular from a return to work outside the home, by in most cases imposing more than 50 per cent deductions on her pay.

"If you add to that in many instances the cost of childcare and other costs, it may simply not be worth her while. What we can do to help those at work is severely constrained if the bands have to be doubled, regardless of circumstance."

He pointed out that the concept of "individualisation" of tax bands was contained in the ESRI's booklet last October on budget options.

He said that the Combat Poverty Agency had supported individualisation and restriction of the transferability of bands but urged a series of accompanying measures.

In a rebuff to Fine Gael, the Taoiseach said that while they had been loudest in their opposition to the change, they proposed something with a similar effect in their recent economic policy document, and so "the furore created by the Fine Gael leader is arrant bluster and hypocrisy".

"Fine Gael is overtly trying to push married women at home out into the workforce, whereas the Budget simply sought to remove the positive discouragement to workforce participation contained in our present tax system."