Speech by the Minister for Enterprise, Trade and Innovation, Batt O’Keeffe TD, at the private members’ debate in Dáil Éireann

Wednesday, 7 July, 2010

A Cheann Comhairle.

I am delighted to speak in the House this evening and set out for my colleagues the Government’s strategy for maintaining and creating jobs.

I want to assure the Deputies in the House that jobs and industry growth are at the centre of the Government’s economic strategy.

Members of the Opposition must be aware that you cannot decouple economic recovery and job creation from public financial stability and the need for a properly functioning banking system.

If you cannot understand that, then it is a good job you are not in Government.

A Cheann Comhairle, I am acutely aware of the distress the economic downturn is having on individuals, families and businesses.

The negative consequences of that downturn, particularly where jobs are lost, cannot be overstated and our priority has been, and will continue to be, to respond to these problems.

I am committed to supporting enterprise to drive job creation.

In probably the most challenging year for the global economy since the 1930s, this Government’s policies and investments enabled IDA Ireland companies to create 4,500 new jobs and increase exports to €110 billion.

This Government’s policies and investments enabled Enterprise Ireland companies to create over 7,000 new jobs and win new export sales worth €693 million.

Let me put this in perspective.

Internationally, foreign direct investment was down 30pc last year.

In Ireland, it fell by just 4pc.

Internationally, exports fell by more than 20pc.

In Ireland, they fell by less than 3pc.

Services exports actually grew by 2pc.

All of this was achieved in the depths of recession.

Now we have positive indications for the future from the Central Statistics Office.

The quarterly accounts show Ireland moving out of recession, led by a surge in exports which grew by 6.9pc on the last quarter of 2009 with quarter one 2010 the second strongest quarter for exports on record.

Taken together, these results provide concrete evidence that the coordinated measures taken by Government to address competitiveness, the public finances and the banking system are paying off with improved confidence and clear evidence of a return to economic growth.

This Government is facing up to the serious challenges head on and we are taking decisive action to ensure that we return Ireland to economic growth.

The measures we have implemented to date are having a positive impact.

We need to build further on these to consolidate the economic position and create new jobs for those who have been made unemployed.

Our economic growth will be driven by exports of goods and services.

Increased exports will generate jobs directly in the provision of those goods and services.

Importantly, they will also generate indirect jobs throughout the economy in domestic services, retail, construction and other sectors.

Sustainable job creation will have to be driven by the enterprise sector.

That is why the Government is focussing on a ‘whole of enterprise’ strategy as the best route for Ireland to deliver the sustainable economic growth we need over the coming years, support our enterprises to return Ireland to export-led growth and, in turn, drive employment generation for the longer term.

IDA Ireland has already made 48 job creation announcements this year spread around the country and creating almost 3,500 jobs across a range of sectors.

Enterprise Ireland has made a number of job creation announcements this year which will lead to the creation of over 700 jobs around the country.

Yes, there are far too many workers unemployed.

But this does not mean that our economy in terms of jobs is stagnant.

Demand remains weak but there are signs of increase in recruitment activity.

In fact, there are difficulties in filling vacancies in some areas of our economy such as information communications technology, science, engineering, sales and finance.

Although you would not think it from the Opposition motion, it has been estimated that there will be a requirement to recruit up to 96,000 people on average every year up to 2014.

That is on foot of the economic recovery and growth strategy pursued by this Government.

However, contrary to the rhetoric from the Opposition benches, we are not sitting around waiting for the international upturn to simply deliver jobs some time in the future.

The Opposition motion fails to recognise that this Government is implementing the policies and taking the decisions that will allow us to achieve even more ambitious jobs targets for the future.

We are putting in place the resources to enable Ireland to win at least 640 international investment projects over the next five years which are expected to create 105,000 new jobs.

We are putting equal effort into developing Irish enterprises with the specific intention of creating 68,000 new jobs over the next five years.

Beyond direct enterprise support, the wider public capital investment programme for 2010 is expected to support almost 70,000 jobs in the economy.

The latest significant job creation initiative introduced by this Government is the Employer PRSI Incentive Scheme.

The scheme will be a direct stimulus for the real economy by saving employers money and shifting the balance in favour of job creation.

It will support the creation of up to 10,000 jobs.

We have already received over 500 enquiries and 100 applications related to this scheme and this is a further indication that we are getting these policies right.

All of this proves that the charge levelled by the Opposition that we have no jobs creation strategy is utterly untrue and misleading.

It is also misleading to say that we are doing nothing to protect jobs.

In addition to our ambitious job creation strategies, we have implemented effective policies to protect existing jobs.

Schemes such as the Enterprise Stabilisation Fund and Employment Subsidy Scheme were introduced by the Government to help companies address the difficulties arising from the difficult trading conditions as a result of the recession.

These two schemes are enabling companies to sustain 100,000 jobs.

These two schemes were devised and implemented by this Government, Ceann Comhairle - another fact ignored by the Opposition.

We will continue to devise and implement effective policies to adapt to changing needs and global market demands so that we see opportunities coming down the track, plan for them and seize them.

I want to deal with one specific issue raised in the Opposition’s motion this evening.

That is the charge that we have failed to address issues of credit availability for businesses.

The Minister for Finance has already set out the steps that have been taken to ensure that the banks are in a position to lend to viable businesses.

Since I took over the Enterprise portfolio, I have focussed on ensuring that the banks follow through on their obligations to lend.

In my recent meetings with the banks, I made it clear to them what this Government expects from them in return for the support shown to them by the taxpayers of this country.

They were left in no doubt that failure to deliver on their obligations will not be accepted by me or this Government.

In response, they confirmed that they are fully committed to meeting the targets set for them and are ambitious to expand their lending to viable small businesses.

I will be monitoring the situation over the coming months and I will bring the banks in again to meet me if I am not satisfied with the evidence that those commitments are being met.

It is clear to me that there has been a knowledge deficit in the banks when it comes to lending to innovative enterprises particularly in new and emerging sectors.

That is why we have insisted that the banks work with the agencies of my Department to develop the skills they need.

I am also looking at how we can address this and other market failures through mechanisms such as a loan guarantee scheme.

We are dealing with credit availability.

We are implementing policies to both sustain and create jobs. I believe that the Government’s whole economic strategy will enable us to go forward as a more competitive economy with a sustainable and innovative enterprise base.

I reject the claim that we are not putting jobs and growth at the centre of our economic strategy.

That claim is simply not borne out by the facts.

So in that context, a Cheann Comhairle, I wholeheartedly reject the Opposition’s contentions.

Thank you.

ENDS\ETI2251

For further information please contact:

Bernard Mallee, Press Adviser to Minister Batt O'Keeffe, Department of Enterprise, Trade and Innovation, on Tel: +353 1 631 3944, Mobile: +353 87 9173022, Email: bernard.mallee@deti.ie