Tuesday, 22 November 2011
Dáil Éireann Debate
Deputy Sean Sherlock: On job creation, this Department must deal with the reality of the capital funding available to it. On 10 November the Government published its infrastructural and capital investment medium-term Exchequer framework for the period 2012 to 2016. Overall, capital investment totalling €17 billion has been allocated across Departments. In one way or another, all of this €17 billion ultimately has a focus on job creation. The Government’s role is to create the conditions within which it will maximise the impact of this capital allocation and support the private sector in the creation of jobs. Within the medium-term framework the State’s support to enterprise and innovation has been protected and prioritised and clear targets for job creation have been set. When averaged over the lifetime of the framework, the job creation targets for Enterprise Ireland and IDA Ireland are set to approximately 22,659 per annum.
The capital allocation for programmes funded by the Department is to be increased in 2012 to €514 million, an increase of €6 million on the 2011 allocation, and supports to industry will be maintained in excess of pre-recession levels when total capital expenditure was at its highest. This represents a strong commitment in this Department to the development of enterprise and provides the development agencies with sufficient resources to target aggressively the projects and investments that will drive economic renewal. In setting out this level of capital investment in the productive economy the Government has been cognisant of issues, including maximising the achievement of value for money and the sustainability of job creation measures.
While the notion of spending an additional €3.1 billion per annum on job creation might sound attractive, what the economy needs is structural change. The Government must ensure the enterprise development supports and agencies are fit for purpose and well positioned to help Ireland to move out of the current downturn by creating sustainable jobs and continuing to grow exports in traditional key markets, as well as targeting high growth markets such as the BRIC countries for both exports and inward investment. The Government has made inroads in bringing about these changes, as well as restoring confidence across enterprise, investors and consumers. For example, work is advanced within the Department on determining the extent of the restructuring of the county enterprise boards; IDA Ireland has restructured in order that more of its staff are in client-facing jobs, while Enterprise Ireland has made operational a new potential exporters division which will target companies with export potential. These are just a few examples of the changes being brought about.
Deputy Peadar Tóibín: While many words were used, the question was not answered. It would have been answered in four syllables, namely, 30,000, the number of jobs that would be created if an additional €3.1 billion per annum was available. For example, the Government could reinstate the sum of €750 million it took out and could make Ireland’s broadband services the best in the world with the expenditure in one year of €3.1 billion. Obviously, the reason I mention the sum of €3.1 billion is that it is the cost of the Anglo Irish Bank promissory note. One could provide 900 MW of offshore wind energy to power up to 1 million homes. In a five-year period, with that amount of money, one could retrofit 1.4 million houses in the State. This includes every single house in the State, would save each household €1,400 per year and the scheme would pay for itself within seven years.
Deputy Peadar Tóibín: I do not know whether the Leas-Cheann Comhairle saw the RTE television programme, “Arrivals”, last night. It provides an example of the generation that has been lost to the country owing to the choices being made by the Government to divert funds from capital expenditure to Anglo Irish Bank, etc.
Deputy Sean Sherlock: I take the Deputy’s point which is made in good faith. However, in respect of the Government’s capital allocation, there has been a 4% increase in Enterprise Ireland’s capital budget for 2012. I will rush through the figures because I am conscious of the time constraints, but there has been a 10% increase in the number of high potential start-up companies, a 20% increase in the number of innovation partnerships and expenditure of €18 million on the innovation fund. The key point is that the Government is trying to set down the foundations or the bedrock on which one can sustain jobs over a longer period. If one considers Sinn Féin’s proposals for capital expenditure, they entail borrowing something like €1.7 billion from the European Investment Bank. It is talking out of both sides of its mouth in this regard — there is a bit of the Tadhg an dá thaobh about it — because, on the one hand, it states it would not pay back moneys to the European institutions from which Ireland has borrowed money while, on the other, it would have no problem in borrowing approximately €1.7 billion from the European Investment Bank. This does not stack up.
Deputy Peadar Tóibín: My party believes in paying back sovereign debt. It is paying private debt with which we do not agree. Moreover, the European Investment Bank has been tasked with giving funds to states such as Ireland and the amount of money outlined in Sinn Féin’s pre-budget submission is allowed for, given the level of the State’s GDP.
I have a single question pertaining to the funds taken from Tara Mines pensioners by the Government on foot of the last jobs initiative. The Tara Mines pensioners who were to be found outside the gates of Leinster House today will see a reduction of 10% in their pensions in the next four years. That is a substantial sum which represents nearly a one month’s pension payment which is to be taken out of their pockets as a result of the so-called jobs initiative taken a number of months ago. While there has been much to and froing between the miners and the Minister for Finance on this issue — I believe the Minister wrote to the Minister for Jobs, Enterprise and Innovation in this regard — there has been nothing but platitudes. As for the Minister for Finance’s statement, in reality it should be either the company or the pension agency organisation which deals with this matter and there should be oversight by Revenue. However, nothing is happening and the pensioners will still have their pensions reduced by 10% on 1 January as a result of the decision made by the Government.
Deputy Sean Sherlock: In fairness to the pensioners who were outside the gates of Leinster House today, if I interpreted the vox pop correctly, the strong message also extended to the amount of money being taken in administration fees.
Deputy Sean Sherlock: I respectfully ask the Deputy to allow me to answer the question. The pensioners were as adamant in their opposition to that aspect. Let us take another look and look at the issue from the perspective of the communication passed between Departments. However, with all due respect, as the question tabled by the Deputy pertains to capital expenditure of €3.1 billion, he will forgive me if I do not have an exact answer for him on the issue of the pension fund mentioned.
66. Deputy Seán Crowe asked the Minister for Jobs; Enterprise and Innovation when he will launch a jobs strategy; the way such a strategy will differ from the jobs budget launched last summer; and if he will also be developing a retail strategy for the State. [35956/11]
Deputy Richard Bruton: I am preparing a jobs strategy for the Government that will set out a series of clear, actionable measures to support the creation and retention of jobs. The strategy will focus on areas such as improving competitiveness and intensifying competition in the sheltered sectors, assisting indigenous business to grow, supporting indigenous start-ups, attracting inward entrepreneurial start-ups, developing and deepening the impact of foreign direct investment, exploiting opportunities in new and emerging sectors and supporting employment initiatives within the community.
In preparing the strategy I have consulted a wide range of stakeholders from the public, private and community sectors to obtain their views on actions to support employment creation. I have received more than 600 individual ideas through this process. My Department and Forfás, in consultation with officials in other Departments, have been analysing the proposals to identify those which are likely to have the greatest impact on job creation and retention.
The jobs initiative announced last May represented a series of early actions on the part of the Government to restore confidence in the economy, stimulate demand and assist those seeking to work. The jobs strategy, by contrast, will present a medium to long-term vision of where Ireland can maximise employment opportunities in areas where it has traditional strengths such as tourism and agrifoods, as well as in new and emerging sectors such as cloud computing, health and the life sciences, silvertech and the green economy. Some of the actions in the jobs strategy will be delivered in the short term and have an immediate impact, while others will be delivered in a longer timeframe.
The objective is to publish the jobs strategy early in the new year. The actions contained in it will assist all enterprises across all sectors to protect and create jobs. It also will include specific actions for key sectors, including the retail sector.
Deputy Peadar Tóibín: Here we are, roughly eight months into the new Administration, and the situation is that 440,000 people are unemployed and 70,000 are emigrating annually. It is important that the lives of the individuals who are forced out of this country are understood, which was very well demonstrated in the RTE programme “Arrivals” last night. This situation is the result of the lack of focus on jobs. We discussed the crisis with regard to upward-only rents, energy costs, the credit freeze, the increases in VAT and, now, the Government’s determination to lift the cap on hypermarkets, which are all anti-business policies.
One of the aspects I would like to have included in the jobs strategy is the breakdown of large State contracts. It is not true that the Government does not create jobs. The Government creates jobs, and there is close to a 1:3 multiplier effect for every euro invested in capital projects by the State. To give an example, a new contract is being developed for the maintenance and construction of the Bord Gáis grid throughout the State. It has come to my knowledge that instead of the normal procedure where the Government had contracts for a number of small businesses which worked on the grid, a new super-contract with one supplier is being created which will have a value of approximately €1 billion over almost ten years. It is likely this will push the contract outside of Ireland and make many small Irish suppliers in this area unemployed.
Deputy Richard Bruton: I do not know whether a question was asked. Public procurement is certainly an area where we will look to ascertain what initiatives can be developed to ensure SMEs get a greater share of opportunity from public contracts. I know the Deputy in his question to the Minister of State, Deputy Seán Sherlock, referred to the potential impact of €3.1 billion in creating 30,000 jobs. To put that in context, we are estimating the €2.3 billion we have been assigned for the capital programme over the next four years will create 110,000 jobs through the enterprise agencies. In this difficult time, it is important to put our money into sustainable jobs in exporting businesses that can be sustained for the long term. We would all love to have more money to build projects but what we really need is enterprises to sustain employment for the long term.
Deputy Richard Boyd Barrett: As I have a later question that will not be reached, I will try to connect it to this question on the issue of retaining jobs as well as creating them. Given they handed him a letter, the Minister will be familiar with the Connolly Shoes workers in Dun Laoghaire who were sacked, having been 17 months on strike, and who have now been found by the Employment Appeals Tribunal to have been unfairly dismissed. One of the longest serving employees, Mr. John Mulpeter, after 38 years service has been sacked unfairly and will walk away with only €1,600 because the legislation allows employers to do this to people — it allows them to essentially concoct excuses to sack workers so they do not have to pay them off properly in terms of redundancy and pensions. Legislation needs to be urgently brought in to prevent unscrupulous employers from sacking workers to avoid paying them moneys they are owed and their proper entitlements.
Deputy Willie O’Dea: Does the Minister agree that the new planning guidelines announced by his colleague, the Minister, Deputy Phil Hogan, will have a devastating impact on retail businesses in town centres throughout the country and will not create any new jobs?
Deputy Peadar Tóibín: I mentioned the Bord Gáis contract because it is an example of a contract that will edge out small suppliers and one on which the Cabinet can have an effect. Will the Minister seek to change the policy direction in which that Bord Gáis contract is developed?
Deputy Richard Bruton: I cannot comment on a Bord Gáis contract that is not issued under my Department, in which I have had no direct role and about which I do not know the legal status. However, it will be an ambition of Government to seek to create opportunities for small business. The thresholds for contracts are sometimes set just too high for small businesses to have a chance to compete and we will seek to make changes in that area.
The issue raised by Deputy Boyd Barrett is the subject of a later question and I cannot answer on the particular circumstances of the individual to whom he referred. If the Deputy wants to submit a question, I can answer that. My understanding is, as the Deputy said, that the labour relations machinery has found in favour of the workers in this case and enforcement is being pursued.
As I understand it, the Minister has announced modifications in the retail planning guidelines which are designed to improve competitiveness and to have value available. The truth is that Irish people pay something like 20% more for retail grocery products compared to other countries in the eurozone. This is a small measure but it is carefully designed to protect town centres and there is a keen awareness by the Minister that the heart of towns have to be protected. This is a well-calculated measure by the Minister which strikes the balance that needs to be struck.
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