The Government's plans to phase out the Universal Social Charge over the next five years has been described as "reckless" by Sinn Féin's finance spokesperson Pearse Doherty.

In the Summer Economic Statement yesterday, the Government committed to reforming the income tax system for taxpayers earning up to €70,000 annually.

Speaking on RTÉ's Morning Ireland, Mr Doherty said that abolishing the USC would mean a loss of €5.4bn in tax receipts every year.

He said the country needed capital investment and if the Government abandoned its plans to cut USC for this year, it would mean extra funds that could be invested in housing.

He added that Sinn Féin would take low earners out of the USC but those earning over €28,500 should remain in it.

Hospital trolley and housing crises will continue unless the Government changed course on plans to reduce taxes, he said.

He said the best way to protect Ireland against any future shocks to the economy is to invest in proper third-level education, infrastructure and broadband. 

Minister for Public Expenditure and Reform Paschal Donohoe said the Government has focused on reforming the tax base and gradually reducing USC.

Doing so, he said, would enable the Government to create more jobs, which allows for the creation of better public services.

Speaking on the same programme, Mr Donohoe said for every €1 invested in tax reform, an additional €2 will be invested in public services.

The Government will begin investing €1bn a year in the rainy day fund in 2019, he said.

He added that it was important to make sure Ireland has the capacity to face any future external shocks.

Mr Doherty, however, said that he had to ask how bad does it need to get before the resources available are used to help those in need. 

He said in reality it was a fund for budget overruns, supplementary budgets and if it was a real rainy day fund, it would be allocated to the National Pension Reserve Fund.

Speaking on Today with Sean O'Rourke, Minister for Finance Michael Noonan said those earning more than €70,000 will have a 'solidarity levy' imposed once the USC is removed.

Otherwise, he said, the gains for higher earners would be extravagant and that it was Government's intention for everyone to gain, but to do so proportionally.