The Minister for Education, Deputy Mary O'Rourke, is in possession. She has 28 minutes left of the time allotted to her.
National Development Plan, 1989-1993: Motion (Resumed).
I commenced three minutes before the Adjournment yesterday evening. I am very glad indeed to have the opportunity of contributing to this very important debate in this Chamber. In my comments I shall elaborate on the operational programme for which I share responsibility with my colleague, the Minister for Labour.
The programme under the broad heading of development of human resources is concerned with education, training and employment. My comments relate to those aspects coming under my Department and the educational institutions. I shall also highlight the proposals for the development of the midland east region. I need hardly add that I heartily support and welcome these proposals in which I have a special interest, covering as they do my own constituency.
On a general note in relation to regional development, it is true that each region has its own strengths and weaknesses and correspondingly regional specific requirements.
The need to strengthen our education and training efforts, with particular emphasis on the development of business and technological skills, is a strong theme in the plan. Let me illustrate with some references:
1.2.9. ...Investment in education and training can provide a workforce with the modern technological skills to capitalise on the opportunities afforded by improved infrastructure.
2.1.22. If the rate of job creation is to be accelerated significantly, a key requirement is the availability of a workforce equipped with the skills and aptitudes needed by enterprises...
3.2.3. ...enterprises ... will, therefore, require a workforce with mastery of new technology, with sophisticated skills in production and management as well as marketing and language skills. There must, therefore, be a strong emphasis on the education and training of high-level manpower in the technological and commercial fields.
The plan, therefore, embodies a recognition and commitment by Government to develop our "human resources" as a key requirement for economic growth. This commitment is reflected in the support for the sector being sought in three categories: (a) vocational training infrastructure; (b) technology, as part of industry proposals and (c) vocational training. Under category (a) assistance from the Structural Funds is being sought for a programme of investment in our third level institutions over the period 1990-93. This investment, amounting to £93.5 million, has a particular focus, being targeted towards strengthening the capability of the third level sector, to produce trained manpower of the calibre necessary to sustain and accelerate economic development focusing on science, technology and business studies, and to respond effectively in support of industry in technology research and development.
Clearly it is only those priority projects meeting EC criteria in this area which can be accommodated within the operational programme involved in the plan. The overall priorities identified for this purpose are cases where facilities have been shown to be inadequate and need upgrading and rationalisation as well as identified areas of equipment needs.
In the latter category, a four year programme of equipping will be prepared for both the HEA sector and VEC sector institutions. The other category will include a programme to upgrade the regional technical colleges so that they can cope more effectively with greatly increased enrolments.
It will also include priority projects within both the HEA and VEC sectors. Among those for which funds are being sought is, as I announced previously, the regional technical college for Tallaght. This reflects the Government's concern to address the special needs of that area.
Complementing this programme, further support for the third level institutions is proposed under a technology programme within the development proposals for industry. This programme has as an important element, the establishment of the necessary infrastructure to link third level institutions and industry in bridging the technological gap between Ireland and its main competitors in the EC.
The programme targets the provision of applied research facilities in specific technologies in association with third level institutions, as well as support for the upgrading of the technological capacity of firms through graduate placement and support for industry higher education links.
These initiatives and programmes would provide a major boost to the development of the third level sector. For obvious reasons in the context of theNational Development Plan they have as their underlying theme the underpinning of the sector so it can make the maximum contribution to economic growth. The favourable impact of these efforts would be expected to extend to and support growth in all sectors of the economy — industry, agriculture, tourism, financial services, etc.
The programmes will, of course, be reflected in investment at the sub-regional level and, indeed, represent needs identified in the sub-regional programmes. It is intended that the third level sector in all seven sub-regions would receive assistance under the programmes, in varying degrees in accordance with the criteria and priorities.
I will illustrate from the Midlands-East Region. The regional technical colleges in Dundalk and Athlone will be supported under the equipment programme and under the upgrading programme for regional technical colleges. They will also receive support under the technology programme, for example, Athlone RTC, with its special tradition in plastics technology has been targeted for the location of a national polymer technology research centre and funding will be allocated for the development of the centre. Similarly Maynooth College will benefit under the equipment programme. The need for a science building for Maynooth has also been agreed as a priority and it is intended to include it among the projects for EC funding.
Reference to the plan will indicate the importance attached to manpower training. The overall projected expenditure on manpower programmes is £1.9 billion, all of which has been put forward for aid from the Social Fund. Of that amount projected expenditure on training programmes is £1.35 billion. The amount of aid sought is in excess of £1 billion. Projected expenditure on the Department of Education's programme is £879 million or nearly 65 per cent of total expenditure on training.
I briefly referred to this matter last night because I wanted to rebut and refute earlier allegations by an Opposition Deputy that there was no specific mention of education. I found it an extraordinary statement, bearing in mind that the Department of Education's programme as listed in the plan is costed at £879 million, 65 per cent of the total expenditure on training.
Three levels of training have been specified by the Department. Level 1 is the group of training programmes proposed at the senior cycle of second level education. These consist of the vocational preparation and training programme and some additional programmes for which fund aid has not previously been sought mainly in the form of leaving certificate programmes with a strong vocational/technical bias. Level 2 includes the joint programmes with FÁS and CERT, the middle level technician and the middle level retraining programmes. These programmes have been approved for aid in the past.
A third level is being added aimed at higher skill training based on diploma programmes in the VEC colleges and specially geared diploma programmes in the HEA sector. Again, these will be in the areas of science, technology and business studies. These have not been eligible for ESF funding up to now, but I am pleased to say that preliminary approval has been obtained for these level 3 courses in 1989.
The House will note that the matter came up at Question Time yesterday and I was very heartened by the interest shown by some Deputies in the matter. These students will be benefiting at the beginning of the next academic year, that is September-October 1989.
I will be instructing my officials to have early consultations with the relevant agencies within the education system with a view to ensuring that our fund aided training programmes have the greatest possible relevance to the needs of our young people and to the needs of the economy. In this way we will increase the effectiveness of the Structural Funds in pursuit of the objectives clearly set out in the Single European Act, namely, strengthening the economic and social cohesion of the European Community and redressing regional imbalances where they exist in the Community.
Let me illustrate the regional application of these programmes, again by reference to the Midlands-East Region.
The projected expenditure on training and technological education in the Midlands-East Region is £259 million over the period of the plan. This entire amount has been put forward for aid from the Social Fund. The projected amount in aid is £140 million. This represents a substantial subvention to the development programme which has been drawn up for the region. Five main development axes have been identified: (i) agriculture and rural development; (ii) industry and internationally traded services; (iii) marine and inland water resources; (iv) tourism; and (v) forestry.
The service sector will also contribute to growth and employment arising from the generally increased economic activity stimulated by the programme. The services sector is also expected to benefit from increased demand for services in other sub-regions and other EC member states; and the decentralisation of Government Departments and agencies.
Development of the infrastructure, both the physical infrastructure and the education and training infrastructure, were seen as critical to growth in these development areas.
The education system in close collaboration with FAS and CERT will ensure that the training programmes will have the highest degree of relevance to such developments. If I can take Athlone RTC as an example, the present range of ESF-funded activity in the college includes courses leading to such qualifications at certificate level as: business studies; accounting; graphic design; engineering; construction; plastics engineering; office administration etc. As one would expect from an institute serving the midlands region these courses are closely aligned to needs of the region for skilled manpower. Many certificate holders proceed to diploma level studies. In that context I have succeeded in gaining preliminary approval from the Commission for support for this level of study in the education system for the first time. I am confident that this will be confirmed when the Community support framework is agreed with the Commission. The diploma level courses in Athlone RTC lead to qualifications in plastics, engineering, business studies, hotel and catering management and accounting, all qualifications which I am sure the House will agree are relevant to economic activity.
I am happy that a very high percentage of these young people are securing employment on graduation. I would like to see a higher proportion of them securing employment within the region and this is an issue which will be receiving increased attention.
The national plan proposes to increase employment in the tourism industry by 25,000 over the period of the plan. The education system in collaboration with CERT has a major role to play in providing the necessary specialised training which workers in this industry will require. We must be prepared to expand, if necessary, the existing level of our training programmes for the hotel and catering industry so that we can be sure of meeting the present and future needs of the industry for skilled personnel.
My remarks about Athlone RTC apply with equal force to Dundalk RTC. There the certificate programmes include marketing, business studies, food science, computing, engineering, and construction studies and at diploma level, in addition to those at certificate level, administrative technician and furniture technology. As far as Maynooth College is concerned I am in the process of identifying a range of postgraduate programmes which will satisfy the economic criteria applying to aid for objective one regions.
Let me remind the House again that the strategy for the Midlands-East Region under the heading of education and training is aimed at providing both the infrastructure and the education and training instruction required to meet the needs of the development axes.
An important finding for the Midlands-East Region, and indeed one that is replicated for all regions, is that the linkages between schools and colleges and industry need to be strengthened. This is a theme in which I have a special interest. Of special importance in this context is the liaison which has been established between my Department and the Department of Industry and Commerce in providing a strengthened infrastructure for college/industry links, under the technology programme to which I have referred previously.
Already with the support of the Department of Industry and Commerce, through its Office of Science and Technology, and through the Minister Dr. Seán McCarthy, industrial liaison offices have been established in all third-level institutions. Innovation centres are already in operation or are planned for the institutions and there are many ongoing research programmes, funded through the office of Science and Technology and Eolas.
Initiatives in areas such as biotechnology and advanced manufacturing technology which are implemented through a regional university-industry centre are excellent examples.
The legislation currently being prepared for the VEC colleges will stress their role in linking with and supporting industry and will provide a sound basis for their active participation in this area. The draft legislation to designate the NIHEs as universities will have a similar provision.
Overall for the Midlands-East Region, the expenditure proposed amount to a total of more than £1.3 billion. The expenditure is broadly spread. It includes identified needs for an improved physical infrastructure, ground and access transport, water and other services as well as the human resources infrastructure. It includes provision for energy, with particular reference in this region to the development of peat and peat products. The region will share also in the development of the communication network. Tourism was seen as having major potential in the region and its development will be supported. Industry generally and agriculture and rural development are scheduled for substantial support.
The development strategy for the region as for others has the generation of employment as a major theme. While the unemployment rate for the region is at the national level, there are unemployment blackspots in parts of the eastern seaboard, in the peatlands area and in the north and north-west of the sub-region. The particular strengths of the region will be built on to achieve improved employment levels — by tapping the potential for high technology development and providing the infrastructure for knowledge based industrial development; expanding the range of tourism amenities; and expanding the marine and water, peat and forestry related industries. Appropriate training and college industry links will be inherent elements of these initiatives.
It only remains for me to say that I believe the plan is an exciting one. It heralds an era of development in this country. It endeavours to balance national and regional considerations and what I have said about the Midlands-East region will indicate that regional considerations and priorities are being well addressed. Equally, I am happy to say that the role of the education and training sector is fully acknowledged and reflected in the plan. There are many competing claims on the resources proposed in the plan and we will not, therefore be able to include all of the projects and take all of the initiatives we would wish. Having said that, we will certainly achieve a great deal.
In an important debate such as this what one says for the record, particularly in such a precise area as education and training, must be completely accurate. I want to expand a little bit. First I want to applaud the work of my fellow Ministers involved in this, the Minister for Labour who is responsible under the overall heading, and the Minister of State at the Department of Industry and Commerce, Dr. Seán McCarthy. The three Departments worked closely together in formulating our needs in specific areas.
One notes the ripple effect this plan will have in the country as a whole. It is important that the enthusiasm displayed in the preparation at national and sub-regional levels is caught now by the people generally. In this plan lies the future development role for this country. We have an opportunity to seize on it and build on it, and if we do not do so history will judge us harshly.
We have seized upon this job with a sense of mission because it will be good for the country as a whole, for employment and development, and give young people the confidence, the skills and the training to fit them for their future careers, particularly in the areas of science and technology and business studies.
All of the work by the people involved, the politicians, the Government Departments, the civil servants and people at local level has produced a dynamic cohesive plan which will work to the benefit of the country as a whole, and at sub-regional level in the Midlands-East region for which I have particular responsibility, so that it can continue the positive role it has always played in the development of the country.
This plan is supposed to prepare the economy for 1992 and to allow us to compete successfully in a tough market. It states that it will raise productivity, increase incomes and reduce unemployment, all very worthy proposals but what do they mean? To me they mean very little. Looking back on the suggestions put forward by the Government in the past, dismal results have followed. We now have a country in which the roads are riddled with potholes, there are over-grown hedgerows, dirty beaches, up-rooted streets, high unemployment, massive emigration, a total air of depression and very real poverty. We need a plan very urgently to solve our unemployment problems. The passport is not our future, as Fianna Fáil rightly said. Health cuts do hurt the old, the sick and the handicapped but we have the money now to do something about our problems.
The plan envisages the spending of large sums of money on training schemes for young people, all very worthy, but surely the place to start here is in the schools. With the united states of Europe in the offing surely our national schools should commence immediately the teaching of European languages. Our teachers should receive the special training needed in this area. Our universities and vocational schools must be financed to gear up to a new challenge of preparing people for a hi-tech Europe whose own supremacy is under severe threat from the nations of the Far East. The language barrier is probably the greatest barrier we have to full participation in Europe. Whether you are employed by an overseas company or an Irish company with a European dimension, familiarity with European languages is a prerequisite for employment. With the demand for second and third level education by more and more young people, now is the time to look seriously at giving a tax credit to the hard-pressed parents, many of whom do not qualify for State support and who must pay through the nose for the education of their children.
The plan does not give much solace to the Cork region. It admits to one in five unemployed in real terms. The figure, even with emigration, is nearer to three in five. Without the FÁS schemes it would not be far from 50 per cent. Where are the jobs created by the Government in my own area? There is none. The document says we must have a sustainable strategy and restore the growth of manufacturing industry. We have been promised so often in the past few years thousands of jobs here and there. Where are they? The food and horticulture side, according to Bord Glas, was to provide thousands of jobs. I have not seen any of them. We heard the Minister yesterday talk about an up-market advisory service. When he decided to amalgamate ACOT and AFT the move was seen at the time as an effort to rationalise and up-date a vital service to the Irish farmers. Mark Clinton, as Minister, endeavoured to bring this about many years ago but he did not get the support he needed to complete the job. What the present Minister for Agriculture and Food has really done, however, is decimate both organisations, leaving Irish farmers virtually without an advisory service at a most crucial period in Irish agriculture.
The new organisation, Teagasc, which according to the Minister, Deputy O'Kennedy, would lead farmers into the nineties has already lost large numbers of its key personnel. Such well-known people as Dr. Jim O'Grady and Dr. David Robinson have pulled out as have others too numerous to mention. The present Government have slashed the Teagasc budget so drastically that our fine advisory service is now only a shadow of what it was when we were in Government. The Minister rightly admitted that this service is more vital now than ever before. Recently we saw the importance of the testing of various types of sprays but where are the people to test them? They are no longer there. Of course the supremo appointed by Fianna Fáil to carry out the brutal carve-up of Teagasc is none other than master Rea himself, the man who was so critical of us in Government. As a farm leader he was viciously opposed even to modest savings and joined with Fianna Fáil in attacking almost everything we were doing.
Deputy, the Chair would be concerned about reflections made on persons who are outside the House. I suggest that the Minister and the Government are responsible. A reference to individuals or officials should not be adverted to.
How anyone who purports to be on the farmers' side can preside over the chopping up of the farmers' own advisory service beats me. The Minister had the neck to say that the Government are providing a slimmer and a more up-market service to farmers at a time when key personnel are leaving the organisation or are being pushed into other Departments where their skills are wasted. Surely, with a reduction of nearly 700 jobs in Teagasc, the time has come to shout stop.
Yesterday again we heard the Minister talk about the future of the tillage and the grain industry. He made some wonderful pronouncements on what this plan would do for that industry. I can tell you that it will do absolutely nothing. When the Minister stated recently that farmers' incomes were up by 20 per cent he forgot very conveniently the 40,000 tillage men. Grain growers are having a bad time and there are many grain growers in this country. Cereal acreage is dropping dramatically with serious economic consequences for the agricultural industry and indeed for the country as a whole. Without native grain, malting, brewing and distilling could not continue.
In the case of flour and the animal feed milling industry, while large quantities of imported grain are still used, it is very dependent on abundant supplies of native grain. For instance, our pigmeat industry could not survive without massive tonnages of native grain. Also our very vital sugar-beet industry and the processed vegetable industry depend on a viable cereal industry for rotation purposes. The economic importance of grain cannot be overstated. The gross output value of our grain is £1,507 million and the net value is £618 million. The industry employs 23,800 people. The value of the crop to the farmer is £230 million. In 1988 the gross profit margin of spring barley was £82. By 1991 when we are hit with the full blast of EC stabilisers the margin will be reduced to £33.50.
The profitability of milk will be six times greater than grain. It is quite clear, therefore, that the powers that be in the EC, and indeed our own Commissioner, are determined to wipe out the Irish grain grower. This disastrous mistake must be remedied immediately before it is too late. Proper policies must be put in place, aimed at safeguarding the industry, such as national quotas to fulfil national requirements and ensure stability in acreages and an economic price for our growers, indeed the survival of our growers. Imports of grain and cereal substitutes from non-EC countries must be regulated and controlled to protect this endangered Euro industry. I wonder why the plan is silent on what is happening in regard to GATT. That worries me. What will happen after 1992? We have extensive plans to prepare for 1992 but what happens then? We have not heard anything about GATT or what we have had to give to obtain assistance from the EC.
Grain growers are faced with further cuts in 1989 in addition to the 1988 levy of £8. It is unrealistic to expect that another drought in the US will come to the rescue of the Minister. Our grain growers cannot survive another year of levies. It is clear to me that the answer to this problem is the introduction of quotas. Acreage limitation should be introduced now. There must be a link to controls on cereals and cereal substitute imports. Those controls should consist of a package of restrictions involving price, levies, quality and quantity.
Yesterday the Minister mentioned "set aside" but that is not a solution. In my view it will add to an already top heavy bureaucracy. It is simple enough to register grain growers and to set out acreage sold or fed on the farm. In that way grain growers throughout Europe would have an opportunity to prosper and carry out their business in an orderly way. Why should our malting barley industry be subjected to cuts and penalties when we could sell every grain at a profit? That product is very much in demand. Why should our milling wheat be subject to cuts and quotas when we are net importers of wheat? I would like to see a breakdown in regard to those products in the plan instead of a lot of high-falutin proposals. We should get down to the nitty gritty.
The Minister referred to the beef farmers and the wonderful things they had done in regard to intervention but in my view the fate of those farmers is worse than that of the tillage farmers. However, that will not come to light until the autumn. I wonder how many bank managers will be prepared to fund the winter beef farmers later in the year. I do not think many of them will do so.
Beef farmers will lose heavily this year. All the messing that went on in regard to intervention beef will affect beef farmers this winter. We have heard a lot of talk about pollution in recent years and Bills have been presented to the House dealing with pollution control but I wonder how farmers outside the disadvantaged areas can be expected to cope with pollution. Those farmers are paid grants amounting to 20 per cent of the cost of work. It is time we forgot about putting this and that field into the disadvantaged areas scheme. In my view the entire country should be classified as disadvantaged. Such a move would not cost the Exchequer any money but it would put an end to all the hassle we have annually. After two years of not doing anything there is a great flurry of activity in the Cork region with officials walking all over the countryside investigating what areas should be included. We all know in our hearts and souls that those areas should be included. The investigations were carried out when we were in Government and the files were ready to be forwarded to Brussels but Fianna Fáil did not do anything about them. However, with an election in the offing we have had an invasion of officials. We have had two years of idleness by the Government and we were told that people were not available to carry out the survey.
The plans forwarded by the Coalition were returned.
They were not returned; the plans were in the Department.
The Deputy should check the record. Those plans were returned.
I am aware of the record because I prepared the plans. The survey is being carried out at present.
The Minister referred to producer groups as if they had not been heard of before. Those groups are in existence. I started the horticultural producer groups and they have proved successful. They are doing well, thanks to people like Colm Warren and others in the IFA. What has the Minister done about establishing producer groups for the potato industry? I do not think he has done anything. Is the Minister aware that there are producer groups for the beef industry? We have been told that we will be getting a market co-ordinator for potatoes but, in the name of God, what can such an official do in a disorganised market? The Minister is putting the cart before the horse. He should establish a producer group and appoint the market co-ordinator later.
I should like to point out to the Minister that FEOGA grants did not start with the Fianna Fáil Government. The rationalisation of the pig industry did not start with them. It is important that the Minister should bear in mind that the National Coalition obtained FEOGA grants for the pig industry. It is also important to point out that this is not the first occasion that Irish branded beef has been on sale in British supermarkets. That product was available in those outlets four years ago.
The plan is strangely silent about nuclear energy and our participation in a European grid. I have grave reservations about having any hand, act or part in the nuclear industry. After the Chernobyl catastrophe I had to prepare a report on the state of Irish food. I was told that our food was in accordance with EC regulations but what does that mean? Why should Russia be allowed to operate a nuclear plant that is out of date and poses a danger to Europe? Why is it that Russia did not offer as much as a pound note in compensation? Nearer home there are a few doubtful nuclear plants that could be, and may be, causing us problems. The Government should protect our pure food image in Europe. We should ensure that nobody is allowed pollute our food or endanger the lives of our people. It is surprising that there is no reference to that in the plan.
Our place in the food market is at the top of the league and our food is better than that of the rest of Europe. It is in that sector that our future lies but I do not see why we should be the victims of a nuclear plant in some other region. The Government should take action in regard to polluters and make them pay.
What does the plan propose for the poor, the sick and the handicapped? What are we to do about the old folk who are being sent home from well managed welfare homes with no prospect of getting proper care? What will the future be for Mallow Hospital now that we have £9 billion floating around? Will the plan simplify our social welfare system in order to ensure that those who are genuinely sick will get their rights with dignity? Surely, in this day and age, the word of a doctor in regard to the condition of a patient should be accepted. We should not put sick people through a number of appeal boards before we accept that they should be hospitalised. A person deemed to be ill by a doctor should be attended to. Chapter 3 of the plan states:
Industrial development is a critical element of the Government's programme for economic regeneration and employment creation. The evolution in policies is apparent in a number of ways:
—the stronger emphasis on the return to the State...from its investment in industrial development, so that scarce public resources can be more effectively employed;
I go along with those sentiments entirely.
That prompts me to pose the question: how much money is owed to Fóir Teoranta — recently axed by the Government — by companies who can now well afford to repay such money? Does the Minister have a list of such companies? Does he propose to go after these companies to recoup some of the scarce public resources about which he speaks? After all, we would all love to abolish the bank to whom we owe money.
In my area of interest, of food, I still believe we can create many jobs on the whole agri-scene, that we can halt the decline in rural population. Much more could be done by way of helping entrepreneurs involved in specialised cheesemaking and food production, not large industries, perhaps not creating many jobs but which, on a parish-by-parish basis, could be a most important factor on the whole employment scene. For instance, rabbit production in my area was begun without any help from the State and indeed still receives no help from the State. Then there is the matter of processed potatoes of which we still import £40 million worth. Yet, there is not a word about it. Flax production stopped short when I was kicked out of my Ministry. Not one iota was done by the Government by way of continuance of that interesting programme. Fortunately, last year we persuaded Waterford Co-operative to resume trials on flax production. These are now turning out to be highly successful and, with the help of Waterford Co-operative and the Herdman group in the North of Ireland will continue. Then there are health foods, organic food production, another important element.
Recently I was examining the results of something begun when I was a Government member. There is much talk about disease eradication, about tags falling off cattle, of animals with incorrect tagging. It must be realised that the tag at present in use can be opened and closed four times without any trouble and is being done. When I was in Government we went to the trouble of involving a Dutch entrepreneur in devising a tag in respect of which he would build a factory here for its production. That tag has been fully tried and tested but the Minister for Agriculture and Food and his Department are showing no interest in what has been done in that respect.
With all of this money around, the Department of the Environment must become involved in a proper housing programme. In my area people are living in absolutely dangerous conditions. As any town clerk will tell you, the housing lists have gone completely out of bounds. Let us restore the reconstruction grants which did so much to improve the appearance of our towns, villages and country houses. The Minister for the Environment should spend the money on our country roads, the highways and byways because they are absolutely impassable. The Minister spoke yesterday about the flora and fauna. I can assure him that there is plenty of room for them because the hedges are not being cut at all so that the flora and fauna have plenty of places in which to survive and take shelter. I had occasion recently to go to Kerry when around the bend of a byroad I saw a huge crater full of water with a notice above it which read "no rod licence needed here". That must be the ultimate.
Let us clean up our estuaries. It is in this area that funds from the Social Fund would really count. At present local authorities monitor pollution whereas, very often they themselves are the worst polluters. At present Cork harbour needs millions of pounds spent on cleaning it up. Once that has been done then one can develop the shellfish industry. With the awareness of the need for clean air and water we should update our planning laws to ensure that no damage can be done to our environment by any form of pollution.
All industries, especially the pharmaceutical ones, must be monitored. This monitoring or control must be written into law. There is much controversy in my area at present about all of this. The updating of our planning laws would solve many problems in this respect but I stress that all industries, including the pharmaceutical ones, must be monitored by competent, independent people. A system of "no quibble" compensation must be devised in the event of damage to crops or waterways, so that heavier penalties would be imposed in the event of any infringement of the law. Monitoring must be undertaken and controlled by competent independent people, in turn, under the supervision of the people in Johnstown Castle and Moorepark who are internationally recognised as being both competent and independent.
As I said at the outset, the big question that arises is, what will happen in 1993-94 Will we have the farm support so necessary to the small family farm? For example, what will happen to the calf or ewe premium schemes when the harsh east winds of commerce from mainland Europe hit us in 1993 onwards? How will we fare? There are many unanswered questions arising from the contents of this document. One might well ask: what does this deal or plan really add up to? Again, as I said at the outset, there is much good in the so-called £9 billion proposal. We will have a roads infrastructure to transport our food. However, I would be much happier if we began to address many of the smaller, local issues. The plan proposes spending far too much on grandiose by-passes, all very necessary, but I would deem it much more important that money be spent on our highways and byways because we should remember that almost all of our exports derive from the land. If our ordinary country roads are in bad condition, how will we service our farmers? For example, how will farm produce or bulk milk tanks survive on the present shocking condition of our roads? These are the things I should like to see addressed.
Real poverty does exist. As public representatives we receive requests daily from all types of charitable organisations to help the poor. We try to do our best in this respect but it is the job of the State to look after the old, the poor and the handicapped. I would be the first to accept that. We should remember that whether or not we like to admit the fact, a passport does not constitute our future.
I should have liked to have seen more in this plan about how we will address social problems within the context of a united Europe, because, as has been said, we will be the only remaining island in a European context. It is my belief that that could have distinct advantages for us in the future. I anticipate that we may be one of the foremost food suppliers of Europe in ensuing years but only if we take the right steps now. The farmers, as a group, will have to be examined, their whole scene will have to be addressed. It is not sufficient merely to say that farm incomes have risen by 20 per cent. That is equivalent to saying that the dog with its head in the oven and its tail in the icebox has a correct average temperature. We must examine every facet of farming. For example, the tillage people, substantial in number, are in a bad way, as are the beef men. All of these matters can be addressed. Much more could be done with more thought and effort.
The attitude of Commissioner MacSharry is not good enough when he says that we cannot have quotas in grain. Why cannot we have quotas in grain? We have quotas in sugar beet production and dairying. Why should we have the worst of all worlds? We can survive with a price deal in milk but we cannot survive with a price deal in relation to grain. Surely the Minister and the Commissioner know this. They must address this issue quickly. I sincerely hope that, by the time this plan is implemented, much thought will have been given to what has been said, especially by speakers on this side of the House, and that there will be more consultation with local councillors. The big crib councillors have at all their meetings is that they were not consulted and that there was no local input into this plan. They believe this plan was prepared more or less over their heads.
I have not made my remarks in a destructive sense and I hope my criticisms will be accepted in the spirit they were made.
As Minister with responsibility for forestry, I will confine my remarks to the forestry elements in theNational Development Plan.
The development of forestry is of vital importance for Ireland because of the contribution it makes to economic development. Its value as a national investment is that it creates wealth and employment, provides the raw material for a whole industry, diversifies the economic base of rural areas and contributes to the reform of the Common Agricultural Policy and the improvement of farm structure by providing an alternative profitable land use for farmers and other landowners.
The strategic importance of forestry was recognised by the State some 40 years ago when the forest area was less than 2 per cent and a drive to afforest 10,000 hectares a year was initiated, in which the public sector took the lead. The target was first reached in 1960 but was not maintained. By 1985, total planting had dropped to 7,052 hectares, increased afforestation was a priority objective of the present Government and planting was rapidly increased reaching a record level of 11,000 hectares in 1987. In 1988 the rate of planting was increased again to some 15,000 hectares and this included 10,000 hectares which were publicly planted and 5,000 hectares which were privately planted.
In recent years too, the private sector has begun to make a significant contribution to forestry and I find this particularly gratifying. Encouraged by this Government and by EC assisted schemes, in particular the forestry elements of the western package, the private sector achieved record planting of 5,000 hectares in 1988, which was 30 per cent of the overall planting programme. I would invite the House to compare this with the situation that prevailed up to the early eighties when private sector planting averaged only about 250 hectares a year or 2.5 per cent of the target planting programme.
The total effective forest area of Ireland is now about 410,000 hectares. This is some 6 per cent of the land area of the country and represents a remarkable five fold increase on the area under forest 60 years ago. Nevertheless, Ireland still remains the least forested area within the EC which has an average of 24 per cent under forest.
The Irish Government have invested some £1.2 billion in current money terms in forestry since the foundation of the State. Some £520 million has been invested since Ireland joined the Community. European Community grant aid for this programme, however, has been very limited — only some £12 million or 2.4 per cent being recouped from the EC since 1973. Greater use has been made of loans made available from the European Investment Bank. Loans from the bank for Irish forestry investment have totalled more then £150 million.
This Government recognised in theirProgramme for National Recovery the absolute necessity of increasing the level of EC funding for forestry, particularly grant aid. Our efforts in this area have already had an impact and the bulk of the £12 million funding from the EC for forestry was received since this Government took office. In January 1988 the Government announced that we had been granted a total of £8.1 million for a project involving the building of roads in State forests. Increased EC funds were also drawn down in 1987 and 1988 under the forestry elements of the western package programme which is directed towards the promotion of private forestry.
Our broad aim, however, has been to place EC support for forestry on a more solid footing — to ensure that the nation's investment in forestry, public and private, attracted EC support as a right and not contingent to the preparation and negotiation of aid for individual projects. To this end the Minister for Energy, Deputy Michael Smith, and I have been fully involved in the preparation of the national plan. In addition, it was necessary to work closely with EC institutions to press Ireland's case for aid for forestry and to encourage and participate in the development of a Community strategy and action programme for the forestry sector. In the last two years the Minister for Energy, Deputy Smith, held numerous meetings with EC Commissioners and, the House will recall, that the Vice-President of the EC Commission, and then Commissioner for Agriculture, Frans Andriessen, visited Ireland in 1988 and announced his proposals for a forestry action programme.
The preparation of the national plan by this Government and the adoption of the forestry action programme by the EC will enable our objectives of substantial and sustained EC support for Irish forestry to be achieved.
The EC Commission presented its proposals on a Community strategy and action programme for the forestry sector to the Council of Agriculture Ministers on 18 October 1988. The Commission's document outlines the basic facts on the forestry sector in the Community, gives the Commission's view of a long-term Community strategy for forestry and proposes a forestry action programme comprising a set of eight measures for the development of forestry in the Community. As the forestry action programme is of importance for the implementation of the forestry elements of the national plan, I will give a very brief synopsis of the proposals which are of the most interest to Ireland.
The first proposal is to amend the Agricultural Structures Regulation (EEC) No. 797/85. The purpose of this proposal is to encourage the afforestation of agricultural land. The proposal provides for an increase in the level of grant that may be paid to farmers and makes these grants available in future to part-time farmers and to other private individuals. Heretofore, only full-time farmers could avail of these grants. The text also provides for a premium to be paid to farmers who afforest their land and I believe that this premium will be an important incentive to farmers considering afforestation.
The second proposal relates to the implementation of the FEOGA Regulation (EEC) No. 4256/88 as regards a scheme to develop and optimally utilise woodlands in rural areas of the Community. This regulation will provide the channel by which FEOGA guidance funds can be utilized for the development of forestry, both public and private, in rural areas of the Community, including Ireland. Adoption of this regulation will clear the way for EC funds to contribute to the further development of Ireland's public planting programme which, heretofore, has not received meaningful EC aid.
The third and fourth proposals aim to expand the scope of Regulation (EEC) No. 355/77 to cover the cork and forestry products sector. The existing Regulation 355/77 provides aid for the marketing and processing of agricultural products. The remaining proposals relate to the setting up of a standing forestry committee to ensure closer co-operation in the forestry sector between member states, the strengthening of Community action in the protection of forests against fire and atmospheric pollution, and the setting up of a European forestry information and communication system. Very considerable progress has been made at Council discussions on these proposals. I am more than confident that a forestry action programme will be adopted which will enable us to proceed with the investment programme for forestry outlined in the national plan and, in particular, the afforestation and forest road construction programmes.
The national plan sets out clearly that the main objectives for forestry within the plan period will be to double the rate of planting to 30,000 hectares a year and to protect and utilise to the full the economic potential of existing forests.
As can be seen from the plan, we expect the Community to make a substantial contribution of £89 million to the implementation of this programme over the next five years and to contribute also to the development of the timber processing sector. The Community support will be triggered off by the operational programme for the forestry sector. A draft programme has been drawn up and negotiations with the commission are under way to secure this agreement to the programme.
In our discussions with the European Community we will emphasise the benefits of forestry investments for Ireland, our comparative advantage for forestry and the finalised operational programmes will show how the main objectives for forestry will be achieved.
Numerous evaluations of Irish public forestry have been carried out over the last 15 years, namely, a joint Department of Finance and Forest service study of afforestation in 1974; an examination of Forestry Policy by the National Economic and Social Council in 1979; a Forest Service study of afforestation policy published in 1983 and a report by the Review Group on Forestry which was comprised of business men, trade unionists, forestry specialists and civil servants in 1985.
These appraisels have given estimates of up to 4 per cent, net of inflation, for the financial return on the State's investment in public forestry.
The European Investment Bank has also carried out three appraisals of the financial and other benefits of forestry since 1979. While the details of these appraisals are not published the Bank has on each occasion expressed satisfaction with the financial and economic justifications for forestry investments.
The Government expect that with the recently completed reorganisation of public forestry management the efficiency of this sector will be much improved and will result in an increase in the financial return on public forestry.
The most striking evidence of the financial attractiveness of investing in Irish forestry is provided by the involvement in planting of financial institutions, pension funds and individual investors. These investors were responsible for the bulk of the private planting done in 1988. This represents some 69 per cent of the total planting in that particular area.
While the financial rates of return to Irish forestry are satisfactory, the burden of investing in forestry can be high for the investor. This is a result of the time scale involved which can be up to 40 years and sometimes much more, and the fact that the major investment is made at the beginning of the period while the main returns do not become available until the end of the crop rotation. The lengthy time scale also increases the uncertainty regarding cost and revenue projections which must be reflected in the expected rate of return if investment is to continue. Thus European Community aid for tree planting will be of considerable benefit to the drive for afforestation because it will accelerate the transfer of surplus agricultural land to forestry; it will underpin private sector investment and relieve uncertainty involved by the long time scale; and will reduce the burden of carrying heavy investment costs for long periods which is particularly onerous for a Government grappling with the problems created by over-large public sector debt and borrowing requirements.
Taking account only of the financial return to the primary producer of the timber seriously underestimates the direct economic benefits of investing in forestry. Forests provide the raw material to support a whole industry which is of great and immense benefit to the economy.
The value added to new wood in processing is considerable. It has been estimated that £1 of forest produce can become £5.50 in value from a sawmill, £19 in value from a particle board mill and £27 in value from a paper mill. Such levels of added value serve to indicate the extent of the downstream industry that may be based on forestry produce.
In the employment area the Irish forestry and timber products sector provides jobs for up to 13,000 people approximately. Many of these jobs are provided in rural areas where alternative employment is difficult if not impossible to obtain.
The extensive nature of forestry, the bulky nature of wood and the weight loss in processing favour locating wood processing close to the forest in order to reduce the cost of transport. Forestry can, therefore, assist in the dispersal of industry to rural areas aiding balanced development and diversifying the economic base.
There is a ready market for forest produce and no Community imposed constraints on production. Ireland's rapidly growing forest estate will help bridge a chronic national and European Community deficit in timber.
Overall the Community produces some 115 million cubic metres of wood each year. This is only about half of the timber requirements of its 320 million inhabitants. The resulting substantial trade deficit is of the order of £15 billion. The Community's requirements appear modest, however, when compared with those of other countries and particularly in other continents — timber consumption per inhabitant in the Community is only half that in North America.
Consumption of wood and derived products in the Community is increasing and by the year 2000 is expected to be in the region of 325 million cubic metres a year, an increase of some 75 million cubic metres as compared with existing annual aggregate consumption.
By the end of the century the Community's annual timber production is expected to be about 145 million cubic metres — a rise of some 30 million cubic metres. The increase in production in the Community will thus not be enough to cope with the expected increase in consumption.
World production and consumption forecasts indicate that it will become increasingly difficult for the Community to make up its forest products shortfall through imports. The Community is thus faced with the need to develop its own wood production. Ireland's per capita consumption of wood is low by European standards. Nevertheless, Ireland imports some £400 million of timber and timber products each year. Exports amount to IR £140 million approximately a year.
Ireland's annual timber production is increasing rapidly and will double by the year 2000, to some 3 million cubic metres. This output from Irish forests will contribute to reducing the deficit in our trade in timber, through import substitution and exports. In one important sector of the market, for example, sawn softwood. Ireland's degree of self sufficiency increased over the last five years or so from 40 per cent in 1986 to an estimated 60 per cent today.
Forestry offers an alternative productive use for surplus agricultural land — this is very important at present — providing a profitable line of production for farmers and improving land structures. It is estimated that there are more than one million hectares of agricultural land in Ireland which could be far more productively used for forestry. We all know that land bank will increase again over the next number of years because of restrictions from the European Community into traditional agricultural areas.
The forestry element of the western package and the farm forestry and compensatory allowances schemes under the agricultural structures regulations have hightened awareness and generated a new openness towards forestry on the part of farmers. This is leading to a significant breakthrough for forestry at farm level and encouraging farmers to move away from the production fo surplus crops. Continuation of European Community support for these or similar schemes will be very important factors in the further necessary promotion of forestry at farm level.
We have seen that in Ireland forestry has an importance which goes beyond the necessary rationalisation of agricultural structures. It is a major economic activity in itself which will make an important contribution to economic development, particularly as Ireland has striking comparative advantages in forestry in the areas of timber production, plant health and land availability.
The growth rates of Irish forests are the highest in the Community and their yield is above three times the Community average.
The existing State forest crops have an overall average yield class of 13.4, while the average yield class of Sitka spruce crops is 15.9. I should explain at this stage that yield class is a measure of production expressed in cubic metres per hectare per year. The EC average is 4.4, that of the Nordic countries 3.0, of the USSR 1.4, of the US 3.6 and of Canada 1.7. Land now available and being planted has a potential of about 20 in Ireland and even higher rates of production are possible on some mineral soils. This is a very favourable comparison.
One million hectares of agricultural land in Ireland would be far more productively used for forestry. Of this one million hectares at least 500,000 hectares are capable of achieving a yield class of 18 to 24 in forestry. Another 500,000 hectares with an average yield class of about 16, also has a very high production potential by European standards.
In the area of plant health it is internationally recognised that the health status of Irish forests is the highest in Europe and that they are free of the most serious forest pests and diseases that afflict the forests of other European Community and Third Countries.
The high health status of Irish forests is of immense benefit to Ireland and the Community. Irish forests are a relatively disease free source of supply of forest produce such as plants, Christmas trees, bark, foliage etc. for both Ireland and Europe which do not threaten the health of European forests. It is of crucial importance that the benefits and advantages for Ireland and Europe that derive from the high health status of Irish forests be protected. I am glad to say that our Government are taking note of this and are taking the necessary steps. We will be seeking the support of our European Community partners in our efforts to protect the health status of our forests and to control and monitor imports of timber products to that end.
The main objectives of Ireland's forestry programmes are: to increase substantially the areas under forests, that is, to increase by some 30,000 hectares in planting by 1993; to increase the level of self sufficiency in timber products; to protect existing forests from the threats of disease and fire; to utilise to the full the potential of existing forests; to develop to the fullest extent possible the wood processing industries; to improve the marketing of Irish timber; to develop the tourism potential of the forest estate; and to carry out research as required to support forestry programmes.
Increasing substantially the area under forest in Ireland is the major objective of the Irish Government's forestry policy for the following main reasons: the contribution that forestry can make to Irish economic development and notably to rural development and employment; the comparative advantages that Ireland has for forestry; the relative under development of the forestry sector in Ireland where only 6 per cent of the land is wooded compared with a Community average of 24 per cent and the need to contribute to the reform of the CAP and provide alternative use for surplus agricultural land.
These objectives are fully compatable with the Community's aims of reform of the CAP, promoting rural development and reducing the Community's deficit in timber products.
Within the period of the programme the proportion of the sawn softwood market to be met from native production will be increased to 80 per cent from the current level of 60 per cent. In addition, the existing export trade in sawn softwood will be further developed. These actions will reduce the imbalance in the timber trade and reduce imports of timber products from non EC countries.
Ireland's forests are particularly vulnerable to the threat of introduced diseases and pests because of the widespread planting of exotic conifers in even aged stands. The protection of forests against the threat of disease and pests and also from fire will be important policy objectives.
Substantial investment in forest infrastructure, mainly roads, will be required to realise the potential of existing forests. These forest roads will be required mainly to allow the harvesting of the maturing forests. The extra timber coming on stream over the next five years will require an expansion of capacity in the wood processing sector.
There has been rapid growth in the output of Irish forests over the last decade, and we have seen that this growth in output will continue to the year 2000 and beyond. There is a clear need then to develop greater expertise and a market driven approach to developing outlets for Irish timber with a view to penetrating new markets at home and abroad.
The forest estate can provide many amenities and attractions for the tourist industry. The development of these amenities will be planned in conjunction with the Department of Tourism and Transport and Bord Fáilte.
In research, the implementation of an ongoing research programme will be required to support the forest management, planting, industrial development and marketing efforts.
To achieve the objectives identified the following measures will be implemented. The record planting levels achieved in 1988 will be doubled to 30,000 hectares by 1993. This will be achieved through a combination of public and private planting, both essential elements in Ireland's forestry development. The overall planting programmes will provide about 1,600 jobs in 1989 rising to 3,000 jobs by 1993.
The existing estate will be managed efficiently so as to maximise the value of timber being made available for industry. The harvesting and marketing programme will be increased from 1,500,000 cubic metres in 1988 to 2,000,000 by 1993. To facilitate the harvesting of timber about 750 kilometres of forest roads will be constructed mainly in public forests. Relevant amenity programmes for recreational and tourism purposes will be implemented following consultation with the tourism and local authorities where appropriate. The necessary programmes for the establishment and preservation of forests will be undertaken.
In the area of processing and marketing a major study is underway to prepare a "Strategy for the Development of the Timber Industry to the year 2000". This strategy will cover both the pulpwood and sawmill sectors. This aims at encouraging investment in mills which have the capacity to process at least 25,000 cubic metres each year, which meet the highest standards and are capable of developing export markets.
The feasibility of introducing a new pulp mill to utilise the extra supplies of smallwood becoming available is being examined. Assuming this mill came on stream within the period of the plan and I have every confidence that it will, the total investment in expanding the wood processing sector could exceed £150 million by 1993.
In marketing Eolas will promote the image of Irish timber through lectures and seminars and conduct market related research on the physical and mechanical properties of home grown timber; techniques for the drying of home grown timber; the relationships between wood quality, tree genetics and sylvicultural practice to provide guidance to forest management.
In the area of research programmes of sylvicultural research will be implemented in addition to market research mentioned above.
The main operational programmes to be implemented by Ireland will cover tree planting, road construction, harvesting and marketing, amenity development and maintenance and forest preservation. The construction of forest roads takes place just prior to the time of first thinning. There are few private sector crops at this stage of development.
Planting by the private sector will be encouraged through the following schemes: the programme for western development, commonly known as the western package, the farm forestry scheme, the compensatory allowances scheme and the State planting grant scheme.
It is expected that these schemes will be adapted and modified during 1989 to take account of the recent changes in the Structural Funds and, in due course, the adoption of the package of proposals set out in the Commission's communication on a "Community Strategy and Action Programme for the Forestry Sector" which will provide the means by which the Community will promote its new forestry strategy. As already pointed out, this forestry action programme is currently being considered by the EC Agriculture Council.
The following additional measures will be used to promote the expansion of private afforestation: the provision of a technical advisory service on all aspects of afforestation; the provision of attractive tax reliefs; the publication of promotional literature such as illustrated brochures on various aspects of forestry and research leaflets; the holding of seminars and illustrated talks by forestry officials — these are already taking place; the organisation of planting demonstrations and field days; the organisation of forestry modules in training courses for farmers at Teagasc centres and agricultural colleges; the availability of a co-operative forestry facility whereby adjoining farmers can pool their land into blocks for afforestation by a local co-operative and on-going publicity through articles and advertisements in the media and participation in various shows and public events.
In marketing the Department of Energy will work closely with the Industrial Development Authority and Coillte Teoranta to develop downstream industry. Support under EC Regulation 355/77 for the marketing and processing of forest products will be of crucial importance in implementing a balanced and integrated strategy for the development of forestry industries. The market programme will include a major study by the IDA to develop a strategy for the wood processing sector and market research by Eolas on the properties of home grown timber.
The sylviculture research programmes will include investigations in the areas of reforestation, inventory techniques, weed control etc.
Coillte Teoranta will be a major agent in implementing the operational programmes. Coillte will implement directly the planting, road building, harvesting, marketing, forest preservation and amenity programmes as they relate to public forests. The company will also provide field staff for the operation of the planting grant schemes for the private sector and the related advisory service.
The Department of Energy will have responsibility for the following main areas: promoting the development of private forests including the management and payment of grants under the planting schemes; developing a strategy for the development of the forest industries in association with the IDA and Coillte Teoranta; the placing of research contracts relating to sylviculture with Coillte Teoranta and the placing of research contracts relating to marketing with Eolas.
In implementing the forestry plan we will be keenly aware of the major contribution which the judicious development of forestry can make to the environment and in the provision of amenities. The need to maintain a balance in all forestry programmes is recognised.
Schemes adopted for the promotion of planting by the private sector will require that all reasonable steps be taken to avoid adverse effects on the environment. We should take particular note of that.
The legislation establishing Coillte Teoranta specifically provides that the company have due regard to the environmental and amenity consequences of its operations and for consultation concerning forestry development in areas of scientific interest.
I would add that the expanded forestry programme will make a contribution also to maintaining the global balance in the atmosphere and to reducing the deleterious effects of deforestation in other countries and of the burning of fossil fuels for energy purposes.
In conclusion I would hold that the outline I have given on our forestry programme demonstrates the commitment of this Government to forestry development. We have, over the last two years, translated that commitment to effective action on all aspects of forestry development. In the national plan we have taken the necessary steps to ensure the further development of forestry. We will in the operational programmes and in the EC support framework that follow ensure that schemes and policies are implemented to secure the full implementation of the forestry element of the national plan.
I have been waiting here for quite some time, a Leas-Cheann Comhairle.
I can understand that Deputy Bruton might feel that his patience has not been rewarded but if I tell him that to date, in the matter of numbers, his party have had seven speakers as against one for the Labour Party, that has to be borne in mind, too.
That is not my fault.
Nor mine. I am sorry about that.
I have been waiting here.
I understand that Deputy Spring, before his departure — he had been waiting, too — had been advised that he would be the next speaker for the Labour Party.
I had been advised in terms of the timetable of this debate that I was to be allowed to speak at 12 o'clock, as the second Labour Party speaker. Deputy Bruton need not be unduly concerned because I will not speak for too long. I am reluctantly taking part in this debate, if it can be called a debate. We can just look around and see who is in the Chamber, or anywhere else for that matter. Half of the Members of this House are probably not even in the city of Dublin today. I say that just to highlight the farce we are partaking of. This is the third day of a so-called debate on the national plan. What we have had, perhaps because of the way this House has developed over the past number of years, is a succession of Ministers coming in with word-processed scripts. They could have been anybody's scripts, people being told to churn out a script on the national plan, to fill in pages 15 and 16 and off we go.
From the point of view of those of us in Opposition who would like perhaps to make suggestions, the question is, what is the point of making suggestions, or of being critical, or even supportive for that matter? The plan has gone, from what we are led to believe. I wonder was it FAXED to Brussels, which seems to be the trend of the Government in sending out reports nowadays, or was it delivered by hand? It seems quite farcical that we have allowed our system to develop in such a manner that we have three days of so-called debate, a succession of scripts from one side, and people setting out to make points from the Opposition benches, which is the only prospect on offer. It does not really matter because nothing that is said will change anything because the plan has gone to the Brussels. From start to finish this has been a major exercise in public relations by the Government and what we are having here this week would seem to be similar.
Perhaps it is time that all Members looked to the actual procedures within the House. Perhaps we could have had a more constructive discussion here if, either through the committee system or some other system in the Chamber, the Government, the Taoiseach and his Ministers, could have responded to points raised and questions asked, rather than what we have been getting for the last two and half days.
Given the seriousness and the urgency of the matter, it is essential that whatever plan is put forward to Brussels on behalf of this country should have the support of the majority of this House. The ideal would be for every Deputy constructively to try to ensure that the plan would be of maximum benefit to the country. Unfortunately, over the last number of months we have had quite a charade.
Why did the Government authorise the setting up of regional sub-committees and arrange for numerous meetings when it was apparent from the start that no notice would be taken of them? There are many people — public representatives and people in managerial positions — who feel that they have been duped. They were asked to sit at committee meetings in Cork, Kerry, Limerick, Clare and other places and none of the recommendations or comments made has been taken on board. What was the point of those meetings being held, or the committees being established? What is at the root of this is that the Government have little or no respect for the concept of planning. We have had a stream of Ministers and Ministers of State coming in with scripts produced on word processors re-informing us of the goodies that may or may not unfold from this plan.
On the third day of this so-called debate, the other plan has been published inThe Irish Times this morning, details of the plan for the Dublin region which was prepared by the consultants. The local members of Dublin Corporation and Dublin County Council, Members of this House and the community groups who are tired of developing inputs into what was meant to be a democratic process, were all ignored. They were not given even the courtesy of an announcement by their elected Government. They have been presented with a fait accompli. They are told by the media that there would be no rapid rail to the most populous, and in many ways, the most prized section of the city of Dublin and that that decision has already been conveyed to Brussels, along with all the other alleged decisions in this plan. That does not do much for the democratic concept of this House and the way in which this country is being managed.
We, in the Labour Party, called for a national debate on the development of this plan many months ago. The Taoiseach said that there would be a debate, but the understanding was that it would take place when there would be time to make a contribution to the plan. One might question what the contribution could be, but before the plan was completed and sent to Brussels, every Member of this House should have been offered the opportunity to participate in the debate and the local groups who are being denied any part in the preparation of the plan, should also have been considered.
It is not a question of making either the Deputies or the local groups captive audiences to be told that all the decisions had been made and that their views were not of the slightest importance to this autocratic and incompetent Government. We had the show in the Burlington Hotel, very much "Charlie and the Puppets", if I may say so and we had the opportunity of publishing a critique of the flaws in the Government's approach before that happened. We did so in the hope that at some stage the Government might take some notice and that some sanity would prevail. We hoped the Government would go back to the drawing board in relation to many aspects of the plan.
Perhaps whoever is replying to this debate could clarify if anything that has been said or any suggestions made will be considered because the chances are that some reasonable suggestions will have been made by the Opposition parties in this two and a half day debate. Otherwise this is a farcical process. It is not doing this House, the Government, or any individual Member any good. If we are interested in the concept of democracy and in allowing elected representatives and local groups to make a contribution to the development of the country, we would want to look very critically at the mechanisms and processes we have employed in the preparation and the development of this plan.
I criticised the plan before publication. For the record, I said that the regional development plan to be published the following day was a sham and that the Government were doing a considerable disservice to this country in submitting it to Brussels in its present form. I said that their intention was to use the plan as a manifesto of goodies for the European elections in June and that they would not admit until after those elections that the plan will not stand up to scrutiny.
On 22 February last year we issued a public statement warning that the Government had submitted a draft to Europe which sought less than half of the £3 billion in European support which had been spoken of by Ministers. That document was prepared essentially by the Department of Finance and was submitted to the Government on 10 February last. It was accompanied by a warning from the Department of Finance that the plan then prepared might fail to meet the additionality rules laid down by the European Commission. These additionality rules as spelt out by the Department are, first, that the 1988 levels of national expenditure in the structural area must be maintained in 1989; and secondly, that the increase in the Structural Fund commitments in the years 1989-1993 over 1988 levels must all be spent on further structural measures. The Department of Finance's view in February with regard to the first point was that an examination of structural expenditure in 1988 and 1989 indicates that that first rule is being observed. However, we are barely on the right side of this requirement and depending on definitions of structural expenditure, the Commission may not agree that we actually meet the requirement.
With regard to the second requirement, we are meeting the rule but only just. The Commission may, in the course of negotiations on the Community support framework, try to place more burdensome requirements on us in regard to additionality over the years 1989-93. The Government knew in February that the plan they had prepared might not stand up to the scrutiny of the Commission so they changed their plan in order to strengthen its appearance. They had two options in seeking to change the plan: First, they could set out to put forward projects which would meet the Commission's requirements backed up by a policy decision that necessary investment would be undertaken, thereby attracting the fullest possible level of EC support. However that would have involved the Government in spending money and it appears that they are not prepared to spend it. Instead, they have changed the figures to make the plan look more like a national plan. In fact the plan is essentially the same as that which we criticised in February.
The total sum of money sought from the European Regional Development Fund under this plan is just £1.62 billion rather than the £3 billion promised. Most of the rest of the European money involved is current expenditure paid under headings where we already receive EC support, such as the European Social Fund. The figures in the plan have been cosmetically changed by using the following devices: in respect of a number of projects which had previously been costed at £X million, they now have been recosted at £X plus Y million without any change in the nature of the projects involved. As just one example of this, we publish extracts from the February and March plans dealing with airports. It was clear that even though the text of the documents remained largely unchanged, the figures in the March version had been artificially beefed up. Huge amounts of private sector investment are assumed and written into the plan. Under the heading of roads it is assumed that £50 million to £100 million will be invested by the private sector over the period of the plan. The guarantees, tax breaks and incentives necessary to attract this level of investment in roads is not spelled out anywhere. The main heading under which this device is used is industry. Under that heading a total investment of £1.8 billion by the private sector is assumed over the period of the plan. None of the investment is capable of attracting matching funds and it is dishonest to use this figure to pad out the plan. Table 1, attached to the statement, compares proposed expenditure in 1990 as between the February version and the March version of the plan. The table clearly shows the difference the assumption of private sector investment makes to the look of the plan in one year and obviously it makes a huge difference over the five-year period of the plan.
In terms of the overall value of the plan, existing ESF contributions, particularly under the heading of education are assumed to grow at a very considerable rate and are included, even though they have no capital impact. The Government are assuming that they will have EC receipts under this heading of the order of £225 million per annum for the period of the plan. However, the Book of Estimates for 1989 shows that the EC contribution for educational activities at second and third level is less than £50 million and the European social grants to FÁS are expected to be approximately £54 million. I believe that there is still time for a real plan to be put together to meet the European requirements. It must be done by the whole community acting through the public representatives and the many groups, particularly in Dublin who have set out to offer assistance in saving the quality of life in Dublin which is in urgent need of attention.
When we have a further opportunity in the Dáil to question the so-called plan, we will be seeking to have it replaced by one which includes real projects properly costed and funded. The reality is that this plan, albeit a grandiose plan, is not worth one penny if it cannot stand up to the independent and rigorous scrutiny which the EC will apply. Given the reports we read about the Court of Auditors in our newspaper today, one can only assume that the level of inquiry and examination of anything coming from the Government on this country at present will be examined sharply by the European Community. Once again, I call on the Government, even at this late stage, to make the necessary policy decisions so that whatever investment is required will be made so that this country can avail of what is perhaps the most important intervention that is available to us from the European Community. This gives us an opportunity to put our economy on a footing to compete with our partners in Europe.
Minister for Industry and Commerce (Mr. R. Burke) rose.
With your permission, Minister, I am calling on Deputy Birmingham to make a short announcement.
A Leas-Cheann Comhairle, you were not in the Chair yesterday at Question Time when I found myself in some controversy with the Ceann Comhairle. I complained that I had not received sufficient notice to allow me table substitute Priority Questions. I have since been talking to the staff of the Ceann Comhairle's Office and it appears that a letter was sent to my pigeonhole in the afternoon before Question Time. In addition they have drawn my attention to a provision in Standing Orders which would have allowed me to take remedial action in those circumstances. I have been on to the office of the Ceann Comhairle to express my regret and I was anxious also to do so in the House at an early opportunity. I was particularly concerned lest anything I had said might appear to reflect on members of the Ceann Comhairle's staff or indeed of the staff of the Questions Office.
The Chair appreciates the manner in which the Deputy has dealt with this matter.
Having listened to Deputy Spring one could be taken in by some of his comments on his commitment to regional development if one was not aware of his record as Tánaiste in a previous Administration. One must judge his statement in this House against his words and his performance as Tánaiste. He was the Tánaiste of a Government which consistently refused to allow discussion on integrated programmes in any area or their submission to Europe. For example in the Dublin area that administration consistently refused to allow even a submission of an integrated programme and an application for funding for it to Europe. He refused at all times to cater in any way for the needs of the regions. Let us compare this to the mechanism that was established to develop this national plan which is being submitted to Brussels for 1989-93. We had working groups and advisory groups who all helped to develop the programmes that have been submitted in the plan. I was interested to hear Deputy Spring's snide comment on the launch of the plan, "that Charlie and his Ministers were puppets". One could be excused if one were to recall the launch of that infamous documentBuilding on Reality 1985-87 in Iveagh House and I am trying to think of an apt phrase, could one say it was “Garret and his aristocrats”— all of the smoked salmon aristocrats from the Labour Party who were comfortably sitting in a Government which brought this country to its knees. Can we compare that to this Government who have given real hope to our people?
TheNational Development Plan 1989-1993 is a coherent and integrated development programme to increase the productive capacity of the economy over the next five years. It sets out clearly the objectives to be achieved over the next five years in the main sectors of the economy eligible for support from the increased Structural Funds. The overall aim is to strengthen economic and social cohesion between Ireland and the more developed parts of the European Communities in order to increase employment and to raise living standards in this country. The plan achieves a proper balance between measures needed to upgrade essential infrastructure and those required to expand the productive sectors of the economy. Industrial development is a key element of the new plan.
In the case of industry, the Government's approach can be simply put. Over the five year period of the plan we expect that over £3 billion will be spent on industrial development activity eligible for support of up to £1,200 million from both the State and all the Structural Funds. The objective is to create 100,000 gross jobs in industry and internationally traded services during this period in line with the ambitious targets set in theProgramme for National Recovery.
Our aim is to ensure Irish industry can compete effectively in Europe in the nineties. In order to do this we need to achieve a fundamental shift in the way the business sector regards the markets of the European Community. They must no longer be seen simply as export markets but as one single market entity of 320 million people of which Ireland is an inherent part. If we are to benefit from being part of a market which forms the greatest concentration of buying power in the world then we must improve the competitiveness of Irish goods and services. Industrial policy must, therefore, be developed and refined to bring about an improvement in the structures of industry and an upward shift in competitiveness across the full range of business functions.
Policy and support measures will, therefore, concentrate on improving the key business functions of firms rather than supporting capital expenditure items alone. A further relative shift in available EC and State resources to upgrade the management, marketing and technological capability of Irish industry will take place. For small industry, recruitment subsidies instead of capital grants will be increasingly used.
One of the most significant new factors in recent years affecting the scope for economic development in Ireland lies in the sections of the Single European Act dealing with economic and social cohesion. These set out clearly, for the first time, the legal obligation of the European Community to take action aimed at "reducing disparities between the various regions and the backwardness of the less favoured regions" in order to strengthen the economic and social cohesion of the Community. The programme to complete the internal market and all other common policies of the EC must now legally take account of, and contribute to, the achievement of these objectives.
The increased Structural Funds form one particular financial instrument through which the removal of regional barriers is to be achieved. A principal objective of the European Regional Development Fund, for example, is to contribute to the improvement and structural adjustment of regions whose development is lagging behind. Industrial development has a critical role to play in achieving such structural adjustment and in raising employment levels and living standards in all parts of the country. The system of State aids which we use to support industry has recently been reviewed by the European Commission. It announced in December last that there was no objection to that aid system under Articles 92-94 of the EC Treaty. These articles from part of the fundamental rules on competition of the Community. The acceptance of our State-aid system is, therefore, important in the context of the EC programme to complete the internal market and the increased level of support for industrial development purposes that we are now seeking.
For industry, the completion of the internal market will provide new opportunities and challenges. Demand will increase by up to 7 per cent in the medium term according to the EC and hidden trade barriers will be removed. Both these developments will create opportunities for Irish firms. However, the single market approach will also increase competition in all markets and stimulate mergers. These developments pose the challenge.
Achieving a balance of advantage between the opportunities and the challenges of 1992 will depend on the competitiveness of Irish industry across the full range of business functions — production, quality control, technological and product innovation, marketing, distribution and management. In order to help firms achieve the improvements in competitiveness necessary to survive and to prosper in a single, integrated, European market, industrial policy will be reoriented to take account of the changed circumstances. Policy will focus on certain key elements: maintaining a supportive investment environment; maintaining a broad consensus with the social partners on the general approach to industrial policy; achieving a relative shift in State industrial promotion resources from supporting fixed assets to supporting key business functions in management, marketing and technological innovation and in achieving joint ventures and partnerships between Irish firms or between Irish and overseas firms; the objective will be to develop the scale and expertise necessary in firms to take full advantage of the new situation; substituting recruitment incentives for capital grants for the small industry sector in particular; developing a new impetus to improve the marketing performance of Irish firms over the period 1989-1993; placing an increased emphasis (and resources) on achieving a significant upgrading of the technological capacity of Irish firms.
A supportive investment environment is critical for the further development of the industrial sector. Firms which have initiated significant new projects over the past 12 months, have made it clear that without the economic transformation achieved by Government policies over the past two years the investment and employment creation undertaken would not have occurred. The new national plan makes clear the Government's firm purpose to seek a continued improvement in the underlying fundamentals of the economy. In the case of the public finances, for example, further improvements will be sought through: reducing the Exchequer borrowing requirement to about 3 per cent of GNP by 1993 and reducing national debt as a proportion of GNP by some 13 per centage points to about 120 per cent in 1993.
In the case of inflation, the progress achieved in recent years has been remarkable. Last year the average rate of inflation fell to 2.1 per cent over the year — the lowest rate since 1960. The strength of the Irish currency within the EMS was a contributory factor to the improved cost environment for Irish business brought about by this low level of price increase. Lower commodity prices and moderate domestic costs were also of major importance. Low inflation has been good for Irish consumers and for business. It has been a crucial factor in achieving the turn-around in the competitiveness of Irish industry now reflected in booming exports and increasing employment. Through its impact on the cost of inputs, the achievement of moderate wage settlements and lower interest costs, it has lead to the creation of a more certain environment and one more conducive for business investment.
We have brought the rate of inflation in Ireland well below the average that prevails in other EC countries and to less than half of that in the UK — our main trading partner. This achievement was not easily attained. We would be extremely foolish to allow a situation to develop where price increases in this country were again allowed to escalate out of control. The result of such a regression would be to underline hard won investor confidence in the management of our economic affairs and to give an impetus to the upward movement of other cost factors affecting the expansion of the traded goods and services sectors and the creation of employment. We must continue to resist all unjustified price and cost increases, whether on imported products or those within our domestic control.
It is for these reasons that I am glad we were able to come to an agreement with the oil companies yesterday which will ensure that petrol prices at the pumps will not increase at present. I know from my recent visit to Japan and the Far East how important it is from the point of view of attracting overseas investment to this country to maintain the comparative advantage we have gained in Europe in recent years in important economic indicators such as inflation and interest rates. These achievements are proving to be major selling points in attracting new investment to Ireland and I am confident we will secure an increased number of significant new projects with their help.
TheProgramme for National Recovery achieved a unique success in bringing together the main groups representing employers, industry, trade unions and farmers to support a development programme which has done much to bring about economic recovery in Ireland over the past two years. The logic of the approach lies in being able to draw on the knowledge, expertise and experience of the top representatives in different sectors to identify development policies and measures which are pragmatic and workable. Needless confrontation is also avoided. Responsibility for formulating and implementing policies remains with the Government and we intend to maintain this successful approach.
The development programme for industry over the past five years sets out a comprehensive range of measures for industrial development over the period 1989-1993 together with their costs, the objectives which they hope to achieve and the criteria which will apply to ensure their efficiency and cost-effectiveness. It covers the development of small, medium-sized and overseas industry as well as the activities to be undertaken to upgrade the marketing and technological capacity of Irish industry.
In the case of small industry there are over 6,000 firms employing some 55,000 people spread right across the country. They are a critical component of our industrial structure in providing a seedbed of industrial enterprises, an infrastructure to support larger industries. They also help to create an industrial tradition and are an essential component of regional development. The objective is to create 27,000 additional jobs in this sector over the next five years with the aid of four main policy instruments; recruitment incentives; management development grants; specialist consultancy support; and the selective provision of customised small business units and premises which will facilitate the start-up of new projects.
Medium sized Irish owned industry is critical to the future development of the industrial sector generally and to economic growth in the country. As a sector its performance has been poor with employment down by 40 per cent since 1973 reflecting low profitability, falling share of domestic markets and declining levels of investment. It now employs some 80,000 people in 700 firms. The Government's objectives for the sector over 1989-93 are: to increase the investment level; to build-up a number of carefully selected export-led companies from the existing base; to strengthen the management and key business functions of selected firms to upgrade their overall competitiveness; and to help create 28,000 gross jobs in the sector over the five-year period.
Some of the key programmes which will be used are: business partnership — technology transfer to help firms achieve the scale and competitive capability across business functions to take advantage of the increased opportunities which 1992 will bring; the company development programme under which a special consultancy unit will be established to help selected companies to achieve significant expansion and the national linkage programme to tie multinational companies located in Ireland more closely into the economy and to help native Irish firms to become significant suppliers to these companies both at home and abroad.
Overseas investment projects will continue to be important as a source of employment, capital inflow, technology transfer and market opportunity for home-based companies. There are now around 900 overseas firms in Ireland employing some 83,000 people directly. They export over £6 billion worth of goods each year and spend almost £3 billion per year in the Irish economy. The objective is to create 45,000 gross jobs in this sector over the next five years. The level and range of State support for overseas projects will be dictated by a hierarchy of desirable characteristics. These include: the range of business functions controlled from the Irish operation; the level of sustainable job creation; the technology transfer potential; the level of linkages with the Irish economy and the future development potential of the project.
The completion of the internal market presents an immense challenge to Irish industry and this Government are fully committed to helping industry realise its full potential in the post 1992 era. I have already mentioned some of the areas where Government action has succeeded in helping to restore a competitive edge to our industrial sector. Progress in this area can and must be maintained. We must be able to compete with the best in Europe on quality, price and delivery and we must learn to market our goods with a new level of professionalism. The European market is the most sophisticated in the world. Its consumers know precisely what they want from their purchases and it is up to Irish industry to identify the demands of this market and to service them with a professionalism which is second to none. Good marketing is the key to success and without it Irish industry will not only fail to meet the challenge of 1992 but will suffer the erosion of its own domestic market base.
The task of achieving a major improvement in the marketing performance of Irish industry will not be easy. We start from a position of significant disadvantage compared with our European partners. Nearly two-thirds of our exporting firms employ fewer than 50 people and over half did not exist prior to 1975. A good indicator of marketing consciousness is the extent to which firms have a permanent presence in their target markets. For reasons of history, proximity, language and culture the UK has been the major target of Irish firms for many years. Yet, less than 100 Irish manufacturing companies have established a sales or distribution office in Britain. In the rest of Europe, the number of such firms with a locally established presence does not exceed 20. This lack of overseas representation severely limits the capacity of companies to participate fully in international markets. It is a symptom of a fundamental lack of awareness of the importance of good marketing on the part of many of our firms.
From the outset this Government have recognised the need to boost the marketing performance of Irish industry and have taken a number of initiatives to address our deficiencies. The appointment of Deputy Séamus Brennan as Minister for Trade and Marketing was a formal recognition of the importance of marketing. This development was followed by the following specific initiatives: the special training house scheme which was introduced to help export the products of small and medium-sized businesses. The fostering scheme, which was developed in association with the Marketing Institute of Ireland, and aimed at small companies which do not have full time, in-house marketing expertise and which CTT were directed to concentrate their resources on developing the marketing capability of indigenous industry.
The success of these measures coupled with the generally improved environment for industry is clearly evident from our improved trading performance over the past year. 1988 saw a record performance with exports reaching £12.3 billion, up 15 per cent on the previous year. In the process we achieved the highest ever balance of trade surplus of £2.1 billion. In addition, surveys by CTT now reveal that among their client firms the export growth acheived was 23 per cent in 1988 and that this growth was accompanied by an increase in employment of some 4,400 jobs within the firms concerned. CTT have targeted an increase of £450 million from these firms in 1989. This achievement shows what can be done. I want to see us building on this performance and I want many more Irish firms to look abroad for opportunities to sell their goods.
My colleague, the Minister for Trade and Marketing, is currently finalising a national marketing plan which will address the marketing weakness of indigenous industry and identify how Irish firms can be supported in securing an increased share of home and overseas markets. All of these measures are making a very positive contribution to developing the export marketing capacity of Irish industry and the results to date are most encouraging. However, much more can and will be done.
TheNational Development Plan calls for a doubling of our share of the imports of other Community countries from the current 1.2 per cent to 2.4 per cent by the mid-nineties and an increase in the overseas sales of indigenous SMEs from £2.5 billion to £4.5 billion by the mid-nineties. In order to achieve these targets, substantial resources are being allocated to the marketing area. Already in 1989 an additional £2.35 million was provided to CTT to pursue a selective regional development programme in Europe.
CTT will select regions which are showing above average economic performance with a view to identifying suitable opportunities and partnership arrangements for Irish SMEs. These will cover the full range of business development from the sale of the Irish company's existing products through to product development and reciprocal distribution arrangements.
CTT will also initiate a series of "Source Ireland" programmes which will be directed at major industrial and commercial concerns in Europe and will demonstrate the high quality and competitiveness of Irish goods. Both of these programmes will be expanded in subsequent years and will open up new and exciting market opportunities to Irish exporters.
The plan envisages additional expenditure of £43 million on market development programmes in the period to 1993. The essential thrust of this entire effort is to equip Irish industry with the marketing competence to meet the intense competition of the European market and to develop markets of long-term duration based on the quality of our performance. Although I have been concentrating on the impact of the single market for our overseas trade, let us not forget that it will also effect the traditional domestic market. Firms which have confined themselves to the home market will need to establish good marketing practices every bit as much as firms trading overseas.
TheNational Development Plan addresses the position of Irish firms which have not begun to develop the export potential of their products. It is a fact that the majority of Irish manufacturing firms do not sell internationally. As a result they are confined to a home market of only 3.5 million people with per capita incomes of two-thirds of the EC average. Confining themselves to this small domestic scene makes it difficult for these firms to develop the marketing and financial resources to compete fully with their European competitors.
We have an open economy as befits a nation committed to free international trade. If we look at the facts we can see that the value of manufactured imports has risen consistently since 1973 and virtually every sector of the Irish market now suffers a high import penetration rate. In short we have lost market share at home.
The role of the Irish Goods Council is to improve the marketing capacity of firms which concentrate on trade within the country, to help them to compete more effectively and to reverse the overall loss of market share which they have suffered over the past decade or more. The increased resources which the plan envisages for marketing will also extend to the Irish Goods Council's activities. The council estimates that £1.2 billion worth of current imports could be substituted by Irish products.
There is a significant technology gap between the richer and poorer areas of the EC. This gap is both a cause and a result of regional disparities in economic development. The gap is reflected in the relatively low technological capability of Irish industrial firms. The objective is to achieve a significant narrowing in this technological gap between now and 1993.
We are looking at four main programmes: (i) programmes in advanced technology in areas such as biotechnology, micro-electronics, robotics, optoelectronics, power electronics, software, advanced industrial materials; (ii) higher education-industry linkages and innovation programmes which will use the significant technological and knowledge-based resources available in third level educational bodies for industrial development purposes; (iii) the provision of technology services to industry mainly through the activities of Eolas and (iv) the support of campus infrastructure developments which will make essential facilities available on third level campuses to support the development of new industrial projects. It is proposed to double the level of resources allocated to these programmes between 1989-1993.
One of the sectoral objectives set out in the National Development Plan is the provision of comprehensive, up-to-date and competitive telecommunications and postal networks. If we are to achieve the objective of economic and social cohesion set out in the Single European Act, then we must reduce the relatively high costs of the communications services, while enhancing their quality and efficiency.
Despite very considerable investment in telecommunications over the last decade, the level of penetration of telecommunications in Ireland, compared with most member states, remains low and the full range of modern services is still not available nationwide. Our island location on the periphery of Europe, with a low population density and low urbanisation ratio, combine to make the cost of telecommunications development considerably higher than in other member states.
During the period of theNational Development Plan, Telecom Éireann's proposals for capital expenditure will be of the order of £675 million. Of this, £369 million is considered eligible for assistance from the Structural Funds. The projects covered include: telephone switching and transmission systems; digital data services; development of a framework for the provision of an integrated services digital network; improved access to international networks and completion of national coverage for mobile services.
Nearly 80 per cent of Telecom Éireann's investment programme will be spent on the upgrading of the telephone system, including the international network. This investment will provide for additional customer lines to meet anticipated growth of £88 million, additional switching capacity in trunk exchanges of £17 million, replacement of obsolete crossbar exchanges will cost £47 million, improvements to enable new advanced services to be introduced £12 million, upgrading of the transmission system to cater for growth and digitalisation £61 million, and improvements to the local transmission and distribution network £80 million.
The biggest single item in the investment proposed for the development of the international telephone service is the spending of £27 million on the PIAR transatlantic fibre-optic cable. This will give Ireland an alternative direct route to North America by cable. Provision is also made for an earth station to operate with the IBS Intelsat satellite system in North America and the Eutelsat satellite system in Europe.
An investment of £20 million is proposed to complete a big national coverage of the EIRCELL mobile telephone service together with some expenditure on transmission and reception equipment to develop a nationwide one-way paging service.
The investment proposed by Telecom Éireann over the next five years will ensure that high quality, high capacity telecommunications services will be available in Ireland at a price that compares more favourbly with other member states of the European Community.
Prior to An Post being given responsibility for the postal system there had been a serious lack of investment in the service. Under the Postal and Telecommunications Services Act, 1983, provision was made for up to £50 million Exchequer investment in An Post. Because of expenditure constraints, only £4 million was invested from the Exchequer. The emphasis, therefore, by the company to date has had to be on the urgent replacement and refurbishment of dilapidated and dangerous premises, replacement of the motor fleet and provision of more modern computer equipment. Some £33 million has been spent by the company on these items. Except for the £4 million Exchequer funding, this capital expenditure was financed by the company's own resources and borrowing.
Our postal service suffers from a number of handicaps. The operational costs — the bulk of which are staff costs — are high, the post office network densityper capita is the second highest in the Community and the mail volume throughput is also relatively light. Although our postal charges have not been increased since March 1986 they are still high by EC standards and occupy fourth place in the EC league table.
The objective of An Post for the five-year period of the plan is to provide a service which will enhance the capacity of Irish business to compete in the internal market by improving the quality of service and reducing operating costs.
Since its inception in 1984 An Post have been constrained by a lack of funding for mails equipment, the development of modern mail centres and other projects. An Post are the only EC postal administration without automated mails processing systems. The company propose to instal the necessary machinery in Dublin at an estimated cost of £9 million.
It is envisaged that the automation programme, including the introduction of a national post coding system, will be completed in 1992. The proposed automated systems will provide the means for analysis of traffic, with consequent better management of resources and cost savings. They would also have the potential to deliver more consistent throughput rates leading to more reliability and better consumer service.
The postal network is based in the Central Sorting Office in Dublin. This building is used for the functions of national letter sorting, national parcel sorting, local letter delivery, local parcel delivery and other functions. These functions have different requirements in terms of location and An Post have plans to realign the business functions in appropriate locations. This involves creating two new delivery offices, a new national letter sorting centre and a new national parcels sorting centre in Dublin. The cost of these new centres is estimated at £7 million. An Post have already acquired a premises for a new national parcels centre and the company hope to have it operational later this year.
In addition, there are plans for new regional infrastructure developments at an estimated cost of £4.2 million at a number of locations throughout the country. These projects would entail the building of new premises or substantial refurbishment and modification of existing ones. The total expenditure on postal projects included in theNational Development Plan is £20.2 million.
The national plan is a further development of the Government'sProgramme for National Recovery. The ultimate objective is to achieve significant reductions in unemployment and in emigration. Industrial development will make a major contribution to these goals, both through direct employment creation in industrial and international service projects and indirectly in other sectors of the economy. The Government's aim is to help industry achieve the improved competitiveness necessary to take advantage of the single European market. Increased Structural Fund resources will make a major contribution to the achievement of this aim.
With the permission of the House, I propose to give five minutes at the end of my allotted half-hour to Deputy Bernard Allen.
He is going to tell us why he does not go to his meetings.
He is going to answer certain false allegations that were made in this House and to finish the thing.
This document would not pass even the most basic test of an investment programme in a commercial business, however small and unsophisticated that business was. If the Government were a firm applying for an IDA grant on the basis of a plan such as this, they would be turned down flat. No country bank manager would give out money on the basis of a plan such as this. This is because this plan — so described — contains no explicit target rate of return for the billions of pounds worth of projects on which borrowed money is to be spent. A commercial firm would only get money to invest from the IDA or from a bank if they specified clearly how they were going to get the rate of return that was in broad economic terms at least twice the expected rate of interest over the period of repayment.
However, the Government in paragraph 2.2.13 of the plan present a pathetic excuse for their failure to apply the basic test of setting a target rate of return for all this expenditure. They state lamely that the returns cannot be quantified. Why can they not be quantified? Have the Government even tried to quantify the returns and benefits they believe are to come from all this expenditure? If they do not quantify these benefits, how are they going to measure the success or failure of all this expenditure four or five years from now?
Let me give a concrete example. The document says that at the moment transport costs for Irish exporters are twice those incurred by Community countries trading with one another on mainland Europe and, therefore, the Government suggest we should spend a very large sum of money putting this right, getting Irish transport costs down closer to the European level. Why then do the Government fail to say by how much our export costs should be reduced, and will be reduced, by comparison with those of our competitors in Europe as a result of the expenditure of all this money? Why is no target set for achievement as a result of all this spending? How can it be described as a plan if there is no target set?
As I stated, I could not go to my bank manager looking for funds without that sort of basic information, How I was going to make money as a result of the spending I was undertaking with the bank manager's money to pay him back. Yet, this Government have the gall to describe this document as a national plan, a document which dodges that most basic of commercial tests.
Of course this document is not a plan. It is just a five year capital budget with a set of figures for each of the next five years. These figures are accompanied by a text, indeed quite a long text. Most of the text consists of conventional wisdom, clichés if you will, about the economy along with a very small number of new proposals. The document deals solely and exclusively with the capital budget and the hardware side of the economy. It ignores three-quarters of the Government budget which is on current spending and on the software side of the economy. That, together with taxation, social welfare, education, competition policy and housing policy are not dealt with at all in this plan. How a document that has nothing to say about such subjects could be described as a national development plan is beyond me.
The entire document is founded on an error. That error is the belief that our economic situation can be dramatically improved simply by the large-scale spending of money on capital works. All the economic precedents from other countries overseas which have achieved high rates of economic growth indicate that this is not the way the world works in practice. Most of these countries who have succeeded spend money on capital works only after they have already made the money through selling things. We propose to do it the other way around by spending the capital money first and hoping that somehow we will recoup it.
Roads and air corridors go both ways to and from Europe. If we spend a lot of money on the transport infrastructure while still leaving our basic economy uncompetitive, as this plan does, all that the roads and air corridors will do will be to bring in more imports more quickly to our shops, without getting us the extra money to pay for them. The document does little or nothing to improve the competitive position of the supply side of our economy. If the document had been presented in conjunction with a five-year programme of tax reform, social welfare reform and radical long-term proposals on educational and housing policy, we might then be in a position to be confident. But it does not do any of these things.
Much of the investment which is proposed will simply increase the property values of those who happen to own houses near some of the large infrastructural investments, but without increasing production. The benefits will not trickle down to the poor. The arteries of the Irish economy are blocked by poverty traps in the social welfare and tax systems. Giving a blood transfusion to somebody whose arteries are blocked never works in medicine. Similar treatment never works in economics. That is why this plan will not work.
I now refer to the threat to the Common Agricultural Policy which is virtually ignored, apart from a tacit acceptance of it, in this document. One must seriously question whether the amounts of money provided in the plan are sufficient to recoup Ireland for some of the losses it is in danger of suffering over the next few years.
The plan points out that 15 per cent of our workforces and 11 per cent of our production comes from agriculture. We are far more dependent on agriculture than any other EC state, except Portugal and Greece. It is vital to our balance of payments.
I have recently come into possession of a major study on the CAP by the International Monetary Fund. The IMF study shows that the welfare value of the Common Agricultural Policy to Ireland is represented by a gain of 546 million US dollars every year. But it suggests that while we gain that amount the EC as a whole loses 15 billion dollars in welfare because of the operation of the Common Agricultural Policy. The same IMF study also suggests that, in the case of Germany, a dismantling of the Common Agricultural Policy would reduce consumer prices by about 1.75 per cent, increase aggregate employment in Germany by 5.5 per cent and raise gross domestic product by 3.5 per cent. Yet Germany is one of the great supporters of the Common Agricultural Policy — at the moment. It is also the major financier of the CAP. In the light of those benefits to the German economy identified by the IMF, surely the Government must realise that there are major dangers for Ireland and dangers to the Common Agricultural Policy, from which all of the figures indicate that we are the largest proportionate beneficiary in the entire Community.
The CAP is also coming under immense pressure in the current round of GATT negotiations. Against these threats to our life blood in the form of the benefits we receive from the Common Agricultural Policy, which are far greater in financial terms than anything we will get under this plan each year, the plan must be seen as a pitiful response to this huge threat hanging over the entire Irish economy, arising from the current undermining of the CAP, both internationally and internally.
There is in fact evidence in the text of the plan that the Government have implicitly accepted the rundown of the CAP. It is important for everyone to realise that the IMF figures show clearly that this would involve a major net loss to the entire Irish economy, not just to farmers. I do not believe that the Government have any conception of the seriousness of the issue being dealt with here. I certainly do not think this plan represents even the beginnings of a response to this threat.
If Irish agriculture is to overcome the challenge now facing it it must, above all, be flexible. That is why Fine Gael have proposed that much greater effort be put into long-term leasing of land to younger farmers. Leasing is more flexible than outright ownership. Younger farmers are more flexible than older farmers. I ask the Government to accept the proposal before this House in Fine Gael's Economic Development Bill to double over a two-year period the tax relief on leases of land to younger farmers. This and many other things need to be done if Irish agriculture is to overcome the threat which the Government seems so complacently prepared to accept.
Let me now turn to other individual aspects of the plan which are in my view gravely deficient. I refer first to emigration and the brain drain. Taxation and emigration are two things that most worry Irish people. If one listens to people on the "Gay Byrne Hour" or in any public house they are not worrying about the state of our main arterial roads or any of the things addressed in this plan. People are worried most about emigration and the level of taxation, which is causing emigration in part. Yet the plan has virtually nothing to say about either of these matters.
So far as emigration is concerned, the tragedy is that we are losing the best and brightest of our younger generation to foreign countries. We are transferring huge amounts of Irish taxpayers' money to other countries, which has been invested in the education of those people, through the brain drain. The plan does not even mention the brain drain. The talents of our young people are, as the Taoiseach has so often intoned, our greatest national asset. The plan has extensive references to the creation of other forms of assets — physical assets — but completely ignores the issue of the steady haemorrhage of human assets in the form of the brain drain from this country, despite the many clichéd references of the Taoiseach on other occasions but not on this. Something can be done about the brain drain.
I suggest that higher education policy needs to be overhauled. The present grant system for universities should be supplemented by a scheme for tax relief on repayments of loans for higher education. Such tax relief would encourage graduates to stay in Ireland to get the tax relief, while repaying their higher education loan. We should also consider whether people should go straight from school into college. The universities should give credit, for matriculation purposes, to work in Ireland in advance of entry to university. Our universities should be required by law, as Fine Gael proposes in its Economic Development Bill, to spend much more money on second chance education for adults who are already living here, many of whom are long-term unemployed. Many of these need to radically upgrade their human and technological skills if they are to have a chance of finding work here again. That would represent a better expenditure of our money on higher education than educating graduates for direct transatlantic flight to Atlanta or New York.
These measures would help to keep a significant additional number of our most talented people here, generating wealth here and putting something back into the economy which has financed their education rather than generating that wealth for the Secretary of the Treasury in the United States or the Chancellor of the Exchequer in Britain.
I now want to turn to the subject of communications which is mentioned extensively in this plan. Perhaps the best example of the artificial bias in favour of hardware rather than softwear is to be found in the area of communications.
We know that the most important form of communication is the written or spoken word. The plan is full of proposals for spending money on roads, airports and ports. Yet it has almost nothing to say about the ability to speak to people in other European countries in their own language. Before the roads can be used to get goods to the German market, one must first be able to speak to the German buyer in a fashion that he will understand. A plan which does nothing about the ability of Irish people to speak continental languages is not a plan in the context of 1992.
This plan should have contained the following measures:
1. Concrete proposals to introduce the teaching of continental languages in national schools.
2. A specific timetable for the introduction of a major programme for teacher exchange to bring continental teachers into Irish schools to teach and examine students in the teachers' home languages.
3. Making it compulsory that 40 per cent of the marks in all public examinations in languages be for oral competence, the ability to actually speak and understand those languages. At the moment one can pass an examination in French without ever speaking a word of French, this is ridiculous.
I want to turn now to the area of industrial policy. This plan contains virtually no changes in industrial policy. Some new incentives are to be added on top of the existing ones.
The plan draws attention to the weak performance of domestic Irish industry — its low profitability and its poor record in exporting. Yet the focus of industrial policy remains one of spending money on attracting more foreign industry by generous capital grants, and leaving the domestic unprofitable sector to its own devices.
The plan should:
1. Contain a clear commitment to fight to get the EC tightly regulate individual Member State aids to industry. Ireland cannot compete with Germany or Britain in state aids to multinational companies. The present system of competitive grants given by Member States to get industry into one European country rather than another benefits nobody except the international corporations and their customers. Taxpayers are being ripped off in this destructive subsidy race. The EC alone is big enough to stop this wasteful competition. Ireland on its own cannot do it. The Government should have committed themselves to trying to get this destructive race brought to an end.
2. Replace capital grants with credits against PAYE and PRSI costs. Thus instead of getting the money upfront when a machine is put in a firm would only get a grant if it actually employed people.
3. Get rid of 100 per cent training grants which are open to abuse, gross abuse in the Hyster case.
4. Guarantee the continuance of a low rate of corporation tax on manufacturing, say 15 per cent, beyond the end of the century which is only ten years away in return for the progressive removal of some of the current tax allowances on capital and borrowing such as free depreciation and section 84, which are enjoyed by companies. This would increase the tax take in the short term while giving a more assured planning horizon to companies investing here.
5. Encourage extra employment by smaller firms by giving derogation from certain labour laws, such as the full rigours of the Unfair Dismissals Act, to firms with less than 30 employees. The problem of applying these laws to small firms is that an individual dismissal can take a week or more of the owner-manager's time. Big firms can afford this; small firms cannot. It is to avoid getting into that situation that many small firms deliberately do not achieve their full employment protential. Such derogations are granted by our competitors in The Netherlands and Denmark. We should do the same.
Housing policy is one of the largest areas of public and private spending. Huge quantities of our personal and public savings are devoted to bricks and mortar. State aids to housing, in the form of expenditure and tax relief, come to about £500 million every year. That is almost as much as we will get from the EC each year under this plan. Over the period between now and 1992, our housing policies will cost us £2 billion — almost as much as we expect to get from the Structural Funds. This policy is not giving us the results we need.
We have homelessness and lengthening waiting lists for local authority houses alongside grave underutilisation and deterioration of our existing housing. We allow existing houses and our established residential areas to run down while spending public money on building new estates. As a result schools lie empty in some parts of our cities while new ones have to be built in other parts. All of this is because we have a bad housing policy. This can and should be changed.
If we really want to take advantage of 1992, we must use all our resources (including those devoted to housing) more efficiently.
I will make just two personal suggestions in this regard.
1. We should allow all tax payers who have not used up their full entitlement to tax relief on interest on house mortgages, to use the unexpended portion of their relief as against interest on loans obtained to invest in BES shares in manufacturing companies. This would channel more saving into forms that generate recurrent wealth, rather than confining them to house property.
2. We should consider replacing all our forms of assistance to housing with housing credits which could be used by low income families to purchase any form of housing — rented or owner occupied. This would lead to a more socially integrated form of housing than does a system of local authority house building, which segregates people by financial background. Such a system works well in Germany.
The only other point I want to refer to from the remarks I have prepared for this address is as follows: the reason this plan is warped is because of EC rules. The EC rules say that it will only give assistance to capital investment. In my view if the EC want to help underdeveloped countries like Ireland it should be prepared to offer assistance in the same form as is offered by the richer provinces in Germany to the poorer provinces — direct transfer of funds to the budget of the poorer countries allowing them to use them for whatever purpose is most useful to their economy, whether it be debt reduction, tax relief, social welfare improvements, etc. rather than simply requiring us to spend money on capital works, many of which we may not need, simply to qualify for narrowly defined and artificial EC rules.
TheNational Development Plan is a seriously flawed document and a golden opportunity has been lost to revitalise the regions and to counteract the over-development of the Dublin area. It is a sham and a charade and it ignores totally the Hume report and its recommendations. It is designed to keep the grips of central Government on Brussels funds. I have been critical of the formulation of the plan for many months now. One knows that one is hitting very sensitive spots when one is subjected to the personal criticism that I have been subjects to by the Minister of State, Deputy Máire Geoghegan-Quinn, in the House and by the Minister, Deputy Reynolds, in Cork last week in the presence of Commissioner Millan. Allegations were made that I did not care about the formulation of plans and had failed to attend advisory meetings. My view about the advisory bodies is that they were a charade, they had no real input into the formulation of plans and——
That is a cop out.
I have five minutes so do not interrupt me, please.
He is right and the Deputy knows it.
The Deputy had a responsibility to be there.
When I was invited to go to meetings most of the invitations were at very short notice.
The Deputy has suddenly found his voice.
The Deputy should not be interrupted from either side because he has only a few minutes.
They are trying to silence me. They are trying to silence the voice of Cork.
He needs all the time he can get.
Shame on the two Deputies from Cork.
There should be no interruptions.
No interruptions; the Deputy needs all the time he can get.
Most of the invitations to these advisory meetings came at short notice and as Lord Mayor of Cork I had many commitments both at home and abroad during those times. At all of those meetings I either attended myself or a deputy Lord Mayor represented me and I was kept fully briefed and informed of what went on at the meetings, which was very little anyway.
The resources available to those groups would not buy as much as a cup of tea or a pencil for the people who attended those meetings.
Most regrettable was the visit of Commissioner Millan to Cork last week when nobody in Cork, not the county manager, the city manager, the harbour manager, the chairman of the county council nor the Lord Mayor, knew he was coming and for very good reason. The Commissioner was kept away from us because he would have been told what we thought of the plan in the region, that it was a sham. Instead he was frog-marched around in a European election lead-up and met some of the semi-State bodies who told him what the Government wanted him to hear. It was a public relations exercise for the Government.
The Lord Mayor has so discredited himself that he knew it was not worth meeting him.
The national plan was to be an abrogation of the seven regional plans and was submitted before the final draft of most of the regional plans was ready. To this day the authors of, for example, the regional plan in my area have not even seen the final document.
That is why it is part and parcel——
Now they are trying to silence me again with bullyboy tactics. I have five questions to put. Will the regional plans be published? Will even the authors of the plans see the final draft copies of the regional plans? Will the working parties meet again to monitor the implementation of the plans? Who will implement the plans? I would like answers to those questions. I would like to know if the regional development agencies, as suggested in the Hume report, will be set up to monitor and implement the plans as moneys become available or if the Government will dole out these moneys with a nod and a wink just as they abused the lottery funds. These questions must be issues in the forthcoming European elections.
As I have said, the astonishing fact that has just come to light is that the Government may have no intention of submitting any of the regional plans to Brussels as part of the national plan for structural aid. That is another alarming development that will have serious consequences for us here. No less dramatic too is the startling revelation painfully extracted that the regional group will have no say in monitoring the implementation of plans in their respective areas. It is not too late for the Government at this stage to put the position right. They can allow the regional plans to be submitted to Brussels by the regions and they can go ahead with the setting up of the regional development agencies as recommended in the Hume report. If they do this even at this late stage, matters can be put right. I would also like to say that we in the Cork region, in case our position has been misrepresented in this House, met over a number of week-ends as a local authority for full day sessions and developed a plan for submission to the main working party in our region.
The Deputy's time has expired.
In conclusion, I would like to say that we in Cork are extremely disappointed at the manner in which this plan has been prepared. The three local authorities in the south-west region, at a historic meeting in Cork in January, expressed their views that the plan was a sham and a charade——
A waffle session.
The Deputy is a member of the authority.
The Deputy is seeking further cheap publicity.
The three local authorities were unanimous in their rejection of the manner in which the plan was being formulated.
At the outset I would like to tell my colleagues, and especially Deputy John Bruton before he leaves the Chamber, what the people are saying.
If I wanted to know that I would have no need to consult with the Minister.
You have all the answers now. What did you do when you were in Government? To Deputy Allen I would say that actions speak louder than words.
TheNational Development Plan represents a new and promising partnership between Ireland and the European Community in which Irish and Community resources are being combined to produce a comprehensive integrated national plan covering every region of the country and into which every sector of economic activity is linked. It is designed to build on the successes achieved under the Programme for National Recovery by setting the framework for our economic and social progress over the next five years.
One of the unique and most appealing features of the plan is that it sets out a planned programme of expenditure in each of seven subnational regions. This is a very important point and one I would like to emphasise strongly. In keeping with European Community Regulations, Ireland is designated as a single region for the purposes of the Structural Funds. However, in recognition of the differing needs and requirements of individual areas of the country the Government divided the country into seven subregions. In each subregion we established an advisory group and working group to prepare plans identifying the needs and priorities of their subregion. These working groups and advisory groups were structured to provide broadly based representation and contact across all sections of social and economic activity.
When will we see the plans?
All the main bodies concerned with development were represented on these groups including local authorities, State agencies, the Industrial Development Authority, FÁS, regional tourism organisations, Udarás na Gaeltachta, Teagasc and Government Departments. How many more do some of the Member of this House require to have on these advisory bodies? Elected members of local authorities, as well as representatives of industrial and farming organisation, trade unions and chambers of commerce, were represented on the advisory groups.
This is the first time that regional consultation of this nature has ever been undertaken by Government in the formulation of overall economic and social policy and there is no doubt that the views and plans put forward at subregional level have greatly influenced the overall thrust of the national plan and the allocation of resources.
The plan has been warmly praised and welcomed by a wide range of interests in all spheres of social, economic and business activity. Of course, we have heard criticisms of the plan but these are emanating from individuals who are addicted to being negative. This is not a negative plan. It is positive. It is a plan for growth, a plan for the future.
The primary objective of our economic policy is to achieve growth. As the completion of the single internal market of the European Community moves nearer, we have to pay increasing attention to the disadvantages we face as a peripheral region of Europe. Sustained progress of our peripheral and open economy depends ultimately on the successful exploitation of our comparative advantage. It depends on the extent to which we can expand the capacity of our internationally exposed sectors and it also depends on strengthening the competitiveness of our economy on all fronts. TheNational Development Plan has been drawn up to tackle the problems associated with our deficiencies in economic infrastructure, our shortage of productive capital, our underdeveloped natural resources and our peripheral location. It is a comprehensive developmental plan which charts a realistic and positive course for the social and economic development of the country.
The development plans for the areas for which I have specific responsibility — tourism and transport — are indicative of the radical and positive approach which we are taking to provide the conditions necessary for economic growth.
The plan provides for major capital investment in the Irish tourism product, concentrating on all weather facilities and other amenities which maximise the tourism potential offered by the country's unique natural environment and cultural heritage. This investment will be backed up by a new specially designed marketing scheme to capitalise on the new amenities provided as a result of this investment. Eligibility and levels of assistance under the proposed investment scheme have yet to be agreed with the European Commission. The level of expenditure under this proposed tourism programme is set to exceed £300 million, of which the Regional Fund is expected to contribute £160 million. The balance will be made up by Exchequer funding of £10 million and private sector funding of £130 million.
The national plan identifies the three main problems in Irish tourism which led to a loss of market share in our international markets over the decade to 1986. These are lack of competitiveness, particularly due to access costs; low level and ineffective use of marketing resources and deficiencies in the Irish tourism product in terms of range, standards and facilities as compared with competitor countries. Access problems have been reduced substantially in the last two years and plans to resolve remaining access difficulties where they exist are included under the transport element of the plan.
The marketing of Irish tourism has been improved in line with the recommendations of international consultants. There has been a reduction in the concentration of resources on national destination advertising. In so far as resources permit, marketing is now more concentrated on individual market segments identified as having real potential for increased tourist traffic to Ireland and linked specifically to product availability.
However, the main thrust of the tourism development programme over the next five years is to develop the sector through the provision of suitable tourism facilities and amenities for which there is international appeal. Because of constraints which budgetary imbalances impose on the Government's ability to finance this, investment policy will be primarily directed towards supplanting Government expenditure by private sector investment in the provision of the necessary amenities. I have no doubt that the private sector will respond to this challenge. Indeed, I am aware from Bord Fáilte that they have received a very large number of development proposals, many of which are innovative and exciting. All of these projects must, of course, be examined to see if they are viable and if they will meet the necessary eligibility criteria. I am confident that a large number will be successful. The Exchequer contribution to the programme will be through the development and enhancement of cultural and heritage attractions in State ownership and the inland waterways.
The proposals for transport outlined in the national plan are radical and ambitious and they have been deliberately designed to address the two most fundamental problems facing Ireland in the transport sector in the context of the completion of the internal market, (i) our peripheral location and (ii) high transport costs.
Ireland suffers from major transport disadvantages and structural weaknesses by comparison with other EC countries due to the general poor quality of our internal transport network and our peripheral island location with a consequent heavy reliance on access transport services, both air and sea.
Transport costs for Irish exporters are up to twice those incurred by competitors in Community countries trading with one another on the European mainland. The cost disadvantages of the Irish transport sector represent a major burden for the Irish economy and a significant obstacle to its future economic growth.
Transport has, therefore, been targeted by the Government in theNational Development Plan as an area for priority treatment and expenditure proposals involving innovative and far reaching levels of investment have been formulated to address the structural weaknesses in the transport sector. The programme for transport envisages total expenditure of over £440 million over the next five years in the following action areas: the development of air and sea corridors and services, £200 million; investments in State and regional airports, £120 million; development of certain commercial sea ports and renewal of the strategic fleet, £77 million and investments in bus and rail infrastructure, £45 million.
Detailed investment plans for each of these areas have also been formulated with the overriding objective of ensuring that Ireland is fully integrated into the mainland European transport network. The proposed investments are essential for the future investment of the Irish economy in the context of the completion of the internal market and the investment plans have been carefully tailored to specifically address our peripherality problems and the cost disadvantages associated with our location.
The Government are confident that the EC Commission will recognise the acute and unique problems faced by Ireland in this regard and will strongly support our determined drive to improve the access and internal transport networks throughout the economy.
I should like to take this opportunity to home in on particular elements of the national plan which relate specifically to the South-West Region. At the outset I should like to place on record the valuable and important contribution which the advisory group and the working group in the South-West Region played in identifying the priority needs and requirements for development of the Cork and south Kerry region.
After the outburst of the previous speaker criticising all that has been done by those groups, I consider it necessary to put that statement on record. The last speaker engaged in cheap political gimmickry. The groups set about the task of identifying the strengths of the region on which to build and capitalise for the future. They isolated the weaknesses and impediments to growth and have put forward proposals to deal with these problems. I am heartened to know that the advisory and working groups took on board the valuable work which had already been carried out at local level in identifying the development needs of the region. I refer in particular to the Cork Land Use and Transportation Study (LUTS) published in 1978 and the South-West Regional Strategy Study published in October 1988, both of which were commissioned by the South-West Regional Developmental Organisation and were available to the committees.
Despite many utterings to the contrary from some quarters I would like to assure all concerned that the input from the working group and the advisory group has had a major bearing on the content and direction of the national plan and in ensuring that the sub-region's allocation of funds under the plan is adequate and specifically directed at the areas of greatest need and with the greatest development and growth potential as identified by the groups.
The south-west sub region comprises County Cork, Cork city and south Kerry. This region covers almost one sixth of the land area of the State and has over oneeighth of the population, including the greater Cork area which, with a quarter of a million inhabitants, is the second largest conurbation in the State.
As indicated in the national plan the south-west, in common with the rest of the country, suffers from serious structural problems which are aggravated by infrastructural deficiencies. The major symptom of these problems is a grave scarcity of viable jobs. The problem in this area can well be appreciated when one bears in mind that in the period 1961 to 1987 the net increase in manufacturing jobs in the area was 2,000 only.
This apparently small net increase in jobs of course must be looked at in context. In the Cork area alone we have suffered the closure of major labour intensive traditional industries along with many supporting industries which depended on them. Indeed, were it not for strenuous Government efforts to encourage both the development of native enterprises and the location of mobile international businesses in the area, the situation would have been considerably worse. The success in this area was due in no small part to the effort and resilience of the Cork people and the overall attractiveness of the area to international industrialists and businessmen, and that, despite the negative image being portrayed by people who should know better, particularly Members of this House representing that area.
There has also been a very significant decline in employment in agriculture in the area which has fallen by 32,000 jobs since 1961. This is all the more striking given that the area, particularly in north and east Cork, has some of the best agricultural land in the country with a well developed farm structure and nationally significant food processing industries centred on the towns of Mallow, Mitchelstown, Midleton and Rathluirc.
It is clear that the greatest need of the south-west sub region is to increase sustainable employment. Therefore the overall objective of the development plan for the area must be to achieve a net increase in the number of viable jobs. In order to do this we must create the conditions necessary for economic growth and social development in the area. More specifically it is necessary: to strengthen the productive base of the economy; to improve and upgrade key elements of the region's infrastructure and to develop the human, technological, marketing and financial resources of the region.
In seeking to strengthen the productive base of the economy the programme will focus on: the restoration of growth momentum to an internationally competitive manufacturing sector; the development of internationally traded services, particularly the region's significant tourism potential and the augmentation of these two main elements by efforts to stabilise the remaining rural population.
The measures related to direct investment will be supported by the creation of an economic and social environment which is cost competitive and supportive of business. Such an environment would overcome the main constraints by providing: good access to and from the south-west by road, sea, air and rail to markets both within Ireland and abroad; high quality telecommunications; adequate regional and county roads; sanitary services to meet domestic and industrial requirements and to prevent pollution; technology and marketing support matched to the requirements of local business and a skilled and adaptable labour force.
As well as addressing the weaknesses in the area we must focus strongly on the strengths of the sub region and utilise them to their maximum potential. In the greater Cork area, for instance, our strategy for development will seek to exploit and further develop the assets and advantages which the area enjoys, for example good international access points through Cork Airport and Cork port; a good third level educational base provided by University College, Cork and the Cork Regional Technical College. The advantages which these establishments offer to industry include the availability of a well educated and computer literate workforce, excellent research and development back-up and the unique expertise of UCC in dairy food sciences and as the National Centre for Food Biotechnology; the location in Cork of the National Microelectronics Research Centre; the proven success of Cork as a location for international companies engaged in pharmaceutical, electronics and technology based industries and the availability of prime industrial development locations such as Kilbarry, Ringaskiddy and the Cork Business and Technology Park.
The areas I have mentioned in relation to the attractiveness of the Cork city area are just examples. There are many others which have been identified for development. Similarly, the assets and advantages of the other areas of the sub region have also been identified as axes for development such as: the concentration of oil and gas exploration off the south coast, the opportunities presented by the existing Kinsale gas field and the recent announcement by Marathon of a new gas find; the extensive coastline of the region which can form the basis for expanded sea fishing and aquaculture industries; Farranfore Regional Airport which will shortly be capable of handling international air traffic; the potential for further development of the food processing sector afforded by the region's strong dairying, beef and pig producing traditions; and the areas predominance and attractiveness as Ireland's premier tourist region with its unparallelled beauty and scenery and its wealth of rivers, lakes, mountains and many other attractions.
The expenditure and investment proposals for the south-west sub region set out in the national plan involved expenditure of over £1,253 million in the period 1989 to 1993. These are radical, ambitious plans and involve investments in all the vital areas of economic development including transport covering both internal and access transport, telecommunications, energy, industry, tourism, agriculture and rural development, human resources, education and training.
These investments are designed to build on the successes which have been achieved through the policies contained in theProgramme for National Recovery and ensure that the South-West Region is well placed to benefit from the opportunities which will be presented by the completion of the single internal market in 1992.
I should like now to comment on some particular elements of the investment proposals for the south-west relating directly to my areas of responsibility as Minister of State at the Department of Tourism and Transport. Given the peripheral location of the South-West Region both in an international and national context there is a clear need to ensure that the transport infrastructure in the area is substantially developed. In order to achieve this provision has been made in the national plan for expenditure of over £210 million on improving the transport infrastructure in the south-west. This expenditure includes investment of over £144 million on national and non-national roads and over £64 million on the improvement of access transport both by sea and by air.
On the access transport side the investment proposals envisage expenditure of approximately £17 million on the upgrading and extension of facilities at Cork Airport, expenditure of over £10 million on the upgrading of facilities at Cork port and expenditure of £34 million on the development of air freight services from Cork Airport to the Continent.
Cork Airport, which for many years seemed doomed as a perennial loss maker, has at last shown its true worth. As a direct consequence of the steps taken by the Government to liberalise the air transport sector and to dramatically increase tourist numbers there has been a huge boom in passenger traffic through that airport. Passenger throughput at the airport has increased from 342,000 in 1985 to 542,000 in 1988 and is confidently expected to be close to 800,000 in 1993. Among the main investments which have been undertaken in the last two years are the runway extension and the first phase of extension of the terminal building at a combined cost of almost £6 million. These developments contrast sharply with the poor performance of the airport and the minimal investment in that airport since it was opened 26-odd years ago. Further substantial investment in facilities is planned over the next five years including further extension and modernisation of the terminal building, extension and upgrading of runways, taxiways, aprons and other airside facilities and modernisation and upgrading of navigational aids and equipment. The cost of these investments will be of the minimum order of £17 million.
In addition, it is proposed to develop Cork Airport as a centre for air freight services to Continental Europe. Provision has been made for expenditure of the order of £34 million on this aspect over the period of the plan. I wonder what Deputy Allen and other speakers think is wrong with that sort of proposal for the region and airport. What in the name of goodness are they talking about? The development of air corridors to the Continent is considered essential because of the vital importance of the European markets in Ireland's export drive. The proposal for specially dedicated commercially viable air freight corridors is a response to specific demands from industry and the acquisition of large size freighter aircraft operating on a round the clock intensive basis to major European distribution centres is envisaged.
The south-west is Ireland's premier tourist region and the revenue generated by tourism is vitally important to the economy of the area. In fact, tourism revenue is the main source of non-agricultural income in many parts of the region. Being labour intensive it is also an extremely important source of much needed employment sustaining about 7 per cent of total employment in the area.
Ambitious growth targets for tourism were set by the Government in theProgramme for National Recovery and we are well on line to meet these targets. The objective for tourism for the South-West Region which are set out in the national plan follow these ambitious targets and provide for: the doubling of overseas tourist numbers from an estimated 800,000 in 1988 to 1.6 million in 1993; the doubling of revenues generated from overseas visitors from an estimated £115 million in 1988; and the provision by the industry of at least 1,000 additional jobs a year up to 1993.
This region is, of course, ideally suited to tourism — its diverse physical environment is a major asset comprising some of the most spectacular and scenic areas in the country. To date this vital national physical resource has thankfully remained unpolluted. The region has strong heritage and cultural traditions and is ideally suited to the development of outdoor and specialist activities to meet the needs of the fastest growing elements of the international tourist market. These activities, such as angling, golf, watersports, hill climbing and cycling, to mention a few, are all natural products for the region and have been identified for development. In addition, the provision of all-weather facilities which will help to extend the traditionally short season are important. I note that the development of these areas of tourism has been recommended by the south west regional working group and I am very happy to be in a position to support them.
The National Development Plan is a positive response to Ireland's social and economic deficiencies and its implementation will put the county on course to reap the benefits which will accrue from the full integration of the European Community. It contains the planned expenditure in each of the seven sub regions. It responds to the identified needs and objectives of each sub region in a way that assures the people in every part of the country that they will share in the development which is planned.
I am confident that the plan will be accepted and adopted by the European Commission. The plan has been the subject of close consultations with the Commission at all stages. I had the pleasure of accompanying the Commissioner for Regional Policy, Mr. Bruce Millan, on his recent visit to Cork. Mr. Millan who is the Commissioner directly concerned with responsibility for the plan showed a keen interest in the measures which are being pursued by the Government to improve our economic position and he was very impressed with the advanced state of our technological development. I have no doubt, from my experience at that meeting with Mr. Millan, that he and his fellow Commissioners will see this plan being fully in line with the objectives of the Structural Funds.
At the outset of my contribution I want to label this plan as another version of the fairy tales of Ireland. Given the propensity of Fianna Fáil supporters to believe in fairies, moving statues and the like, while that may be all right for them it is not good enough for the rest of the unfortunate people in this country, particularly those in my region.
Over the past six years I have been very consistent in my condemnation of the Government of the day, both the Coalition and the present Government, for their failure to recognise the desperate need and the sorry plight of the Border region. In fact, I led the band of criticism against the Coalition Government and I was joined in that task by other Deputies from the Border region but now that the roles have been reversed they have gone to ground. However, I am still consistent in my condemnation of the Government, and I have to be consistent on behalf of my constituents, but I wonder what has become of the "sheep" among the Fianna Fáil Deputies from the Border region who have not even raised a bleat in respect of the desperate plight of the people in that region.
Over the past 20 years my native town of Dundalk has virtually bled to death. We have seen a steady haemorrgage of industries in that region and sadly now we are seeing the unacceptable face of emigration. Traditionally emigration was highest in the west of Ireland but now the emphasis has swung to the north-eastern area. I understand that emigration from the Dundalk and County Louth region is the highest in the country at present. In addition to that we have the highest unemployment level in the country. There is a totally unacceptable figure of 32 per cent unemployment in Dundalk while the national average is 18 per cent. In 1981 the unemployment figure in Dundalk was 2,100 but in March this year over 4,000 were unemployed there. This is coupled with the highest emigration rate in the country. If the unfortunate people from my region had waited for better times what would the unemployment figure in the region be?
The failure of all Governments to recognise the plight of the people in the Border area is inexplicable, unacceptable and totally disillusioning to me as a Dáil Deputy. The profile of the Border area is very low and despite the fact that 1984 the European Economic and Social Council clearly identified the Border area as being among the most deprived in Europe absolutely nothing has happened in that area. Can you blame me, a Leas-Cheann Comhairle, for being cynical about this collection of beautiful words, rhetoric, pious platitudes and objectives?
One of the objectives of the National Development Plan is the encouragement of local initiatives in developing joint tourism projects. I have to describe the objective as the height of bull. I do not believe it and neither do the unfortunate, long suffering people of my region. They are very courageous, patient and resilient people who have turned helplessly to one Government after another for help over the past 20 years but to no avail. They have received absolutely no recognition; there is no point in saying anything other than the truth. The European Economic and Social Council identified it and both the previous Government, of which I was a backbencher, and the present Government have done sweet Fanny Adams to help the people of my region. I feel cold anger and am cynical about all party political processes.
I am calling on the Government now to recognise the desperate plight of my region. In fact, in a previous contribution in this House I suggested that economically the people of my region would be better off on the other side of the Border. I cannot accept the neglect of County Louth. I cannot and will never accept it. The statistics are there. I did not invent them, the people of County Louth did not invent them. We have been treated as second-class citizens and with scant regard by both Governments in the time I have been here in the Dáil. In fact, I believe the two Governments should have been charged with criminal neglect of County Louth.
I want to refer in the short time I have to the decision by the Government to relegate County Louth as a Border county for inclusion as a midland county. I think this decision is inexplicable and could only be explained by a psychiatrist. To include County Louth, the foremost Border county in Ireland as a midland county defies logic and explanation; a county which has figured in the headlines of the world over the past 20 years. It is crying out for remedial help, the need for which has been identified by the EC and, incredibly, this uncaring Fianna Fáil Government have consigned it to the midlands. When some one comes up with a reasonable explanation for that decision I want to be the first to hear it, not the second.
In the likely absence of an explanation to that decision I want to ask the Government for God's sake to give some help to County Louth. That county has been starved of funds and deliberately consigned as a backwater because of a tacit acceptance or belief in Government circles, and indeed shared by civil servants, that while the Ulster troubles remain County Louth is expendable. I have to refute that. I cannot and will not accept it. In addition to the economic difficulties arising because of the differing rates of VAT across the Border, our area has also had another problem which it has borne on behalf of the Irish nation, that is we have paid the price for the Ulster troubles. No other town in Ireland has suffered as badly as the town of Dundalk because of the criminal excesses of the IRA. I call on that band of renegades and criminals for God's sake and for Ireland's sake to stop their campaign of shame in the Six Counties. Many of the problems they have created have spilled over into the south of Ireland. My town has been branded as a town that has harboured these people and, while I cannot in conscience deny that allegation totally, I think it has been overstated in the past and we have suffered a grave credibility problem internationally.
The Government must recognise these factors and must do something to alleviate the suffering in County Louth and, indeed, right along the Border areas. The only thing I can see which would help at this late stage is the creation of a Border development plan or a Border survival plan, a definite, cohesive plan for an area that everybody in this country must accept has suffered more than any other region in this State.
In the early seventies an enterprise zone was created by the British government to help the city centre traders in Belfast survive the indiscriminate nowarning bombings. That was successful and today the centre of Belfast is buoyant economically. We need some type of an enterprise zone to be created along the Border with lower VAT and tax incentives, a reduction in rates for the business traders who have survived and grants to attract new type industries, for example, high-tech industries and computer industries to compensate for the steady loss of manufacturing industries, such as the turn-of-the-century industries, the textile and footwear firms which have virtually ground to a halt in that region. Unless we get a cohesive plan, economic activity in the Border region will cease. It is as bad as that. It is very late in the day for medicine to be applied but unless it is applied the whole economic structure of the Border area will go under.
Among the projects I would like to mention is the number one priority in Dundalk town, that of the completion of phases three and four of the inner relief by-pass. We have completed phases one and two. The vital stage is the building of a bridge across the Castletown River. A commitment was given by the outgoing Taoiseach when he visited Dundalk towards the end of his reign. While I accepted the fact that it was dropped in the first year from the building programme by the Government, I think that as the Government enter their third year the time has come to recognise the absolute necessity of building that bridge. Everybody of every political persuasion in Dundalk — Fianna Fáil, Fine Gael, Labour etc. acknowledge the need for that bridge. I appeal to the Government to announce very quickly the start of the work on phase three.
I also deplore the passing over of Dundalk as a venue for the regional sports centre. Six sports centres have been created around Ireland, some of them in very small towns by comparison with Dundalk — a town with a population of 30,000 people. I find it incomprehensible that Dundalk was passed over — an ideal location — because of its location and proximity to the Border. It was an ideal opportunity for cross-Border co-operation in sporting events. Surely, cross-Border competition is one of the roads to peace. It was disappointing to find that Dundalk was yet again passed over when this was an ideal opportunity to establish the town as a sports centre.
I should like to refer to the state of the roads in my native county. I want to state specifically the condition of the Newry road. It is certainly not a good advertisement to people from the North of Ireland who come in very large numbers to this part of the country. The Border post of Carrickcarnan is an absolute disgrace to the Government and the Office of Public Works because there is a crater at the Border area which has widened as the months go by. At an area which is a gateway to Southern Ireland it is very disillusioning to see the condition of the road and the Border post. I would ask the Minister to ensure that some work is initiated at Carrickcarnan to improve the image of this country.
In relation to 1992, has anything definite been worked out to accommodate the 150 customs officials who live in Dundalk making a useful contribution to the Dundalk economy and providing a service for the nation? What will happen to them? Will they be consigned to the scrap heap or will some meaningful occupation be provided for them?
Another area I want to address is the shameful downgrading of Louth Hospital, which has been in the shadow of the famous Lourdes Hospital. While I am grateful that we have the Lourdes Hospital in my county I deplore the downgrading of the Louth Hospital, Recently there was a threat to its very existence. The children's ward in that Hospital has actually closed. The hospital has been starved of funds by the North-Eastern Health Board. I appeal to the Minister to recognise that a town of 30,000 people, a town with the highest rate of unemployment in the country, cannot be left without a hospital. The Minister should recognise that the Louth Hospital has done a great job over the years and he should give some type of commitment to the Louth Hospital so that it can continue to function and will be upgraded in the future.
I want to briefly put in a word for a man who recently has been much maligned in this House, a man who provided 2,500 jobs in the economy. I am referring to Mr. Larry Goodman. This man and his organisation has been very badly treated by members of the Labour Party. While it is ture that irregularities existed in one small outlet of this organisation there are other companies, beef companies, which are being investigated, but that has not been mentioned in this House. Mr. Goodman, who has made a vital contribution to our economy, has been badly treated and I would ask——
Deputy McGahon appreciates that while that name has been mentioned in the House before, it is not a practice here either to praise or criticise any individual.
I thank the Leas-Cheann Comhairle for his indulgence and I want to share the rest of my time with Deputy Cooney.
The House agrees to Deputy Cooney having the remaining 11 to 12 minutes.
Because of the time constraint I will have to synopsise what I want to say. It is a great pity that there was not a national consensus behind this plan. Why I say there was not, is that the political representatives of more than half the people, that is all the Opposition parties in this House, were excluded from its formulation and were ignored on its announcement. That is a great pity because the plan discloses problems of such magnitude that it would require an enthusiastic consensus to solve them, in addition to ideas that might have been available from this side of the House which could have been used with regard to the bones of the plan and the methodology used in the planning procedure.
The size of the problem is mentioned in page 12 of the plan at chapter 1 where it says:
Taking a 25-year horizon, per capital output would have to grow at an annual rate of 1.8 percentage points in excess of the EC average. With a positive growth differential of 1 per centage point per annum, it would take Ireland over 40 years to attain the average level of GP per head of the Community.
That shows the size of the problem to be tackled if we are to cure our unemployment problem in a reasonable time. We have to achieve a growth rate that would be several percentage points higher than the EC average. We have to look at the plan and see if there is anything in it that will bring this rapid recovery and put it in place. Unfortunately, I cannot see the specific points of the plan that would achieve this.
The plan is aspirational and indicative. It is like a sketch of a house but it is totally devoid of working drawings as to how to get to the finished product. This is one of the great and valid criticisms that has been made by many interests and not just political people, with regard to the plan. Regrettably we do not know where the assistance is going to come from, the timescale for it in particular sectors or how much of a budget will be provided out of the billions of pounds we are talking about. There is no indication of where the £2 billion that is posted as coming from the private sector is to come from, nor of the timescale, and we do not know which areas of the private sector the Government have in mind to produce these vast sums. If these funds do not go into the plan, then we are not providing the matching finance and we will not get the full £3 billion that is available under the enhanced Structural Fund. It is available but not certain unless we match our spending here. The plan is silent on so many things. It is aspirational. It outlines objetives and ambitions that we all share but there are no nuts and bolts as to how to reach those objectives or achieve those ambitions.
The development measures projected for industry are commendable in themselves, but there is no detail as to how they will be achieved. It is merely a repeat of the kind of statement we have been getting in plans for a long number of years. The plan promises support for joint ventures between Irish and foreign firms. Have those firms been identified here or in the European Community? A statement like that means nothing without supporting information.
The plan promises support for the promotion of industrial linkages. What is meant by that? The plan means nothing without details. It promises support for the provision and refurbishment of factory space on a selective basis. Where will the selectivity take place? That is the sort of detail that is absent from the plan. The absence of such detail makes the plan very disappointing and certainly frustrating in so far as the regions are concerned. At the end of the plan there is a number of pages given to each of the new sub-regions. One of the regions in which I am particularly interested is the midlands — Midlands-East. Deputy McGahon has told us all the things that are needed in County Louth and I must share his disappointment at the lack of specifics for that county because it has particular problems. I would also plead with the Minister to let us know why County Louth was put in with Midlands-East, a region that includes Longford and Kildare with which it has nothing in common. It should, as Deputy McGahon said, be a Border region.
Let us take, for example, County Wexford. That is part of the new planning region of the south-east. There is nothing whatever in the few pages on the southeastern region to tell us what is proposed in Wexford or any of the other counties in that region. Wexford needs to have its ports of Rosslare and New Ross improved. They are mentioned, I will grant you that, but there is no indication of how much money is set aside for improvements in Rosslare and no money targeted for improving access to New Ross. The thing is pointless without the people down there knowing how much money is available to be spent on what specific project over what time scale. How can there be enthusiasm for this plan without those details? Perhaps they are available but, if so, they should have been published in conjunction with the plan.
The plan is totally silent on the Government's ideas for extending the disadvantaged areas and agricultural sector. It talks about extending the area but Fine Gael have called for a campaign to have the entire county classed as disadvantaged. That has not been taken up by the Government and they have not defined what areas, short of the total county, they would like to see included. That again is a disappointment.
One of the things that Kilkenny urgently needs is improvement of the road structure from it to the ports of Waterford, New Ross and Rosslare which serve it. Kilkenny has no manufacturing base of any significance. It has good service industries and is a viable tourist centre because of the investment in Kilkenny city and the efforts of the Kilkenny people themselves in that regard. To put a manufacturing base to Kilkenny, one would have expected that this plan would have identified this as an area lacking such a base and indicated in pounds, shillings and pence what was needed, the type of industry that would be suitable and how they would go after those industries to locate there. Complementary to that, they would have made provision for proper road linkage out of Kilkenny to the servicing ports. Carlow also is an inland town. It suffers from the lack of a good road system out of it to the ports in the south-east serving it, principally Rosslare. Carlow does have a good manufacturing sector, but it suffers. Its capacity to compete is damaged by virtue of not having a good road system.
Tourism gets much attention in the plan, in generalities. Carlow, for example, has the River Barrow. Up to some years ago that river was used by the Emerald Star Line but the lack of facilities forced the withdrawal of that line from the river. If tourism is an area for expansion, one would have expected to see specifics of how the potentially attractive tourist amenities of an area should be enhanced. The River Barrow also has potential for fishing, although I mention the word with some hesitation in the presence of the present Minister. That requires clean water and the Barrow requires to be kept free from pollution. The industries which are polluting it require assistance if there is a lot of expense in cleaning up the operations.
On the question of tourism also, Kildare — an unlikely area for tourism — has tremendous potential. It has the largest area of cutaway bog in the country, bog that is finished. These vast tracts are available for development. An imaginative plan has been devised in Kildare for flooding of a very large area and having a huge aquatic sports centre within easy distance of metropolitan Dublin — tremendous potential. There is nothing whatever in the plan to show that this idea has been considered or accepted. Will there be investment in it? That is a prime area for activity. The Barrow also serves Kildare and there are the canals. We are talking about establishing specialist niches in the tourist area.
Water based holidays is an obvious specialist niche holiday to develop in Ireland. There is nothing whatever to show that consideration has been given to all these things. That is why I say that the plan is a disappointment because of its lack of specifics. It is 123 pages of desirable aspirations, of generalities and economic clichés and jargon that we have seen in plans from all Governments for as long as I have been in this House. You will find exactly the same objectives and aspirations, but they are only programmes, not plans. In the absence of the nuts and bolts — of, by analogy, the working drawings — I am afraid that it does not mean what it should mean. This is a once off chance for the Irish people to take advantage of the extra funds available to lift us up to European level. I sincerely hope that we are not going to miss that chance.
TheNational Development Plan is a strategic blueprint for the development of the economy over the medium term. It covers all sectors and all regions in a practical and integrated way. It identifies in a comprehensive fashion those key areas of the economy which need to be developed with State and European Community assistance if our growth potential is to be realised.
The plan embraces all the major economic responsibilities of the Department of the Marine. It covers the sea fishing industry, fish processing, aquaculture and fishery harbours. It contains a major programme of development for commercial ports and shipping. Under the tourism aspect, there will be every opportunity for the development of viable angling projects.
The plan is an integrated framework for the development of the national economy. The programmes under the responsibility of the Department of the Marine are closely linked with the wider programmes for the economy as a whole. In the preparation of these programmes there was close co-operation between my Department and the Departments of Tourism and Transport and Agriculture and Food. There will be similar ongoing co-operation between these Departments and the various agencies concerned, in the implementation of the programmes under the plan. In the preparation of the programmes under the aegis of the Department of the Marine detailed consultations took place at regional level over many months. This involved a major commitment not only at official level but by the State and the local agencies concerned. I would like to take this opportunity to express my appreciation of the tremendous efforts which all these people have made.
The whole thrust of this plan is to improve the competitiveness of the economy and to strengthen its productive capacity. Thus the plan concentrates on the major infrastructural needs of the economy as well as on the key productive sectors. The plan does not and could not embrace directly all facets of State activity. Priorities in this area must be set. The resources involved, while significant, are not unlimited given the many pressing needs which must be faced. Nevertheless, the plan provides the framework within which all aspects of planning and development can be addressed.
The revised Structural Funds will have a significant impact on six of the areas covered by the Department of the Marine. These are commercial ports, shipping, fishery harbours, fish processing, angling, and water sports recreation. It should be remembered, however, that these sectors cannot be considered as complete in themselves. Rather they are part of much wider programmes in the transport, food processing and tourism areas generally. This in one sense will be the real key to the success of the plan, integrating local and regional areas of responsibility and different aspects which have been previously dealt with individually by various Government Departments under one coordinated structural integration planning process which we have never done before. This will be unique in the development of our economy and certainly, in my view, it is long overdue.
Ireland was a late entrant to the sea fishing industry. Because of this we are at a much earlier and much less developed stage than the other maritime states of the Community. There is still considerable scope for further development and job creation in all the parts of the industry, production, processing and marketing. Irish production of seafish is almost a quarter of a million tonnes annually. About 14,000 persons are employed in the industry and in its ancillary services. The seafish industry is important to the national economy — it is valued at nearly 1 per cent of our GNP. It contributes in a special way to the wealth of coastal and island communities where other opportunities for income generation are limited.
In 1988 the Government adopted a development strategy for the seafish industry. The overall aim of the strategy is to fully exploit the potential of the sea fishing industry both at sea and ashore to enable it to make its full contribution to the economy of the coastal regions and the country as a whole. The strategy sets a target for the creation of 4,400 new full time and part time jobs in the seafish, aquaculture, processing and ancillary industries by 1991.
To achieve this employment target we will tackle major structural weaknesses in the fishing fleet; protect and enhance fish stocks; promote investment in highrisk aquaculture developments; strengthen marketing skills; and ensure that the supporting infrastructure, particularly fishery harbours, is adequate.
The development strategy sets the targets. The development plan will underpin the infrastructure which is required to achieve these targets.
The aquaculture industry has been growing rapidly in recent years. It has expanded in the past decade from a very small base to a major industry. It has the potential for substantial additional growth. The industry contributes significantly to employment and incomes in areas where there are few alternative sources of employment.
Despite recent advances the aquaculture industry remains in need of support. Though aquaculture is profitable the risks and necessary investments are very high. Encouragement in the form of grant aid is very necessary. This will become more important in the future when the industry expands into more exposed sites and higher cost technology must be used.
Total investment in the sea fisheries and aquaculture programmes could be up to £150 million over the period 1989-1993. Significant additional resources have already been provided from our own resources in the 1989 budget. These resources will be complemented by receipts from the Community under existing facilities together with substantial new funds which will become available from the Social Fund.
About 25 firms dominate the fish processing industry in Ireland although there are over 100 firms involved in the industry. These firms are engaged in processing mackerel, herring, whitefish, salmon and shellfish. Much of the output of the sector is exported but many of the firms are small compared with their international competitors. They have limited resources to undertake an expanded export market effort. A number of factors limit the development of the fish processing industry mainly the limited availability of the raw material due to quotas and to seasonality and the overdependence on pelagic varieties. We have to set new objectives.
Our objective in the fish processing programme is to bring about the optimum utilisation of raw material so as to best satisfy market demand and at the same time create maximum value added exports and employment in Ireland. Our main targets are: to increase the level of our exports of processed fish; to increase the proportion of these exports which have high value-added; and to create 600 full time and 400 part time new jobs in the processing sector. To achieve these targets we will,inter alia, implement an expanded programme of sustained exploratory fishing for whitefish and other underutilised species.
We believe there is enormous potential provided we make the necessary investment in research and undertake the work that needs to be done in co-operation with our partners in the European Communities. We have taken measures and shortly a Bill to establish our own marine research institute will come before the House and this will enable us in a practical way to give effect to some of the developments I mentioned.
We will encourage investment in whitefish, farmed fish and shelled fish processing which has enormous potential for development.
The development will be carried out carefully and will be well balanced to ensure that there is no risk of pollution or damage to the environment. This is outlined in the Fisheries Development Plan which I referred to a few moments ago.
Let us not forget the cities, there are canals and rivers that can be developed and they are relevant to your proposals.
Recently I took note of a very valuable speech made by the Deputy some months back. We are very glad to note his interest and I have directed his comments to the Central Fisheries Authority. I am aware there are a number of key locations, especially in the north city area, and in particular a reservoir which is relatively derelict at present, but which has in my opinion enormous potential for development. It would make a magnificent amenity and fisheries and it is right in the heart of the northern part of the city. I am more than willing to discuss this with the Deputy or indeed any Deputy who has an interest in it. As I have said, I have directed the Central Fisheries Authority to the desirability of developing the canal fisheries in Dublin. Indeed during the recent maintenance work carried out on the canal they had to remove some fish stock and these were found to be in very sound condition. It is up to Deputies, as Deputy Mitchell has done, to get involved in the organisation and development of these because we have the ability to develop these resources. Unless somebody like the Deputy and the organisations involved in development within the city become involved in this type of work, the potential will not be exploited. This plan opens up opportunities like this to enhance the tourism prospects of the city and to create a very attractive and valuable amenity.
That is a very good reply but perhaps the Minister would look at the Grand Canal dock site?
I certainly will. The Central Fisheries Authority are more than aware of its potential. However they need support to enable this work to be done and we are endeavouring to do this in the Department. Hopefully we will get more co-operation from local interests. We will not run away from our responsibilities in that regard.
Ireland is situated on the periphery of the European Communities. Because of this we have difficulties accessing the main European markets — difficulties not faced by any other member state of the Community. When the channel tunnel is completed even the UK will be joined to mainland Europe. Ireland will be the only member state without a land link to the remainder of the Community. For Ireland, therefore, investment in sea links is equivalent to investment by mainland Community countries in cross-Border road and rail links to other member states.
We have a huge task ahead of us and we cannot delay it. The importance of ports and harbours to the Irish economy becomes obvious when we consider the amount of our total trade which is handled by seaports. At present over 80 per cent of our total merchandise trade passes through ports.
Our principal port is Dublin which handles almost half of our trade. It caters for all forms of port business. Other major commercial ports are Rosslare and Dún Laoghaire, where there is specialisation in Roll on-Roll off, Waterford, which specialises in Lift on-Lift off, Cork and Shannon.
Port facilities must be suitably modernised so as to enable faster turnabout of ships. Computerised documentation processing must be used to cut down delays. Quays, docks, and jetties must be in good order. Handling equipment must be modern, efficient and properly maintained. Ireland suffers from major direct cost disadvantagesvis-à-vis other EC countries due to our peripheral location and consequent heavy reliance on sea transport. Transport costs for Irish exporters to Europe are approximately twice those incurred by Community countries trading with one another on the European mainland.
Computerisation of documentation merits more attention and is becoming more important. In the area of ports and shipping the main focus of attention has been on the physical facilities necessary to ensure that goods can move quickly and economically between Irish companies and their customers abroad. There is, however, more to trade than capital assets themselves. Exporters and importers recently criticised the delays which occur due to customs and other procedures and it is important that all these procedures associated with trade — the very lifeline of our existence — are reviewed to ensure that no constraints remain which would impede development in this area. There were difficulties associated with the lack of uniformity in customs documentation of EC member states but they were very much reduced by the introduction of the single administrative document.
The increasing sophistication, however, of information technology gives more opportunities to the clients to assess the relative cost of importing or exporting their goods to different ports here and abroad. The era of paperless trading is now upon us and I am aware that considerable developments are taking place in member states, including the United Kingdom, in the application of technology to trade and customs procedures. It is a system known as the FCP 80 — the Felixstowe Cargo Processing for the eighties — and it has become recognised as a comprehensive system. It is managed and marketed by Maritime Cargo Processing Company which have a direct input and which have been operating since about 1984. There are now 200 or 300 companies involved in generating a lot of extra activities in that area. They have modernised the whole system of documentation in a way which enhances the possibility of delivering goods and services speedily and more efficiently.
Most of the systems now allow for electronic data communication and the paperless trading to which I referred between the organising agencies involved in this area, shipping and forwarding agents, shipping lines, stevedores, customs and excise and port authorities. We must examine this very carefully because we are not keeping pace with developments in the European Community, apart from the physical infrastructural difficulties to which we should pay more attention if we are to face up to the challenges in this whole area.
The primary objective of Irish ports policy is to provide infrastructure and modern handling equipment at ports for exports and imports to ensure that our ports will provide an efficient and cost effective service and have the capacity to turn vessels around in a matter of hours. There must be sufficient port capacity of appropriate quality strategically located in relation to its users. Only if this is so can we hope to reduce the costs of internal transport. Because of the distribution and character of Irish ports, policy should be directed mainly towards development projects for the ports which are essential to the efficient and economic movement of goods.
Policy should be directed also towards preservation works for ports where the absence of such works would result in the closure of a port which, while near to other ports, performs a unique service related to industrial or commercial activity in its hinterland. Many of these ports are in unemployment black spots. Their closure would add to the unemployment of the areas and decrease the chances of attracting further industry to these places.
As well as developing the main central network of ports which is essential for the development of our trade, we must not neglect very important ports, such as Drogheda, which are very significant in relation to the economic development of these regions. It is time also that we looked at the question of port zones instead of individual ports in the development of our long term ports policy to ensure that the crucial elements in the transport infrastructure of ports are efficient in the handling of goods and cost efficient in operation. Ideally each port should generate sufficient income to pay for replacement and enhancement of its facilities in order to provide a service attractive to its customers. Its costs should be the minimum consistent with providing an efficient handling system. Ports should be financially self-supporting. I would envisage that State grants should be made and requests for EC assistance supported where improvements are essential to meet well defined commercial needs and where the ports' own resources are insufficient to finance the development.
Irish industry must respond to the challenges which will accompany more intensive competition following the completion of the internal market. We must achieve faster transit times for freight to Britain and to mainland Europe. This is critical for our economic development. There is an urgent need to concentrate freight traffic for different destinations at specified ports. In particular in the context of 1992, Dublin port — which because of its location is ideally suited — should be established as the main port for intensive freight services to and from Britain. Major investments are already planned at the port over the next five years. If appropriate transport infrastructure is provided in the hinterland of the main west coast ports in Britain this would further improve the competitiveness of Irish exports to mainland Europe via the landbridge link.
A similar policy of concentration of resources on cost efficient access ports is necessary for exports to mainland Europe if the economy is to be in a position to capitalise on the opportunities being presented by the completion of the internal market. The competitive situation which Irish exporters will face from other countries, especially the UK, will be intense.
Dublin, Waterford and Cork between them handle almost all of our lift on/lift off traffic. Much of the growth in Irish foreign trade over the next ten years or so will be in this container trade. Unless facilities are provided to handle this growth Irish trade will be severely hampered and Government strategy will be jeopardised. Only one container crane was purchased in the State during the eighties. Seven of the 11 cranes in operation are over 14 years old. Many of these cranes are slow and cumbersome. There is an urgent need for new equipment to handle container traffic.
A major constraint on the development of meat production, particularly pigmeat, in Ireland is the cost of imported ingredients for animal feed. Shipping direct to Ireland from the country of origin could cut the cost of importing animal feed ingredients and other commodities by up to £5 per tonne. To achieve this direct shipping and consequent cost saving we must provide adequate deepwater facilities, together with the most modern handling equipment for large bulk carriers, at our ports and in particular at Dublin, Cork and the Shannon Estuary.
To tackle the particular problems of our major ports, which I have just outlined, proposals have been prepared by the Government in the context of the revision of the Structural Funds for the development of these ports. In deciding what support should be given and to which ports, a number of criteria have been taken into account. These include the need for efficient ports and for a frequent and speedy service to and from ports; the fact that the price, quality and service offered by land and ocean carriers are of vital importance in the choice of ports for imports and exports; the fact that the quality of the approach roads to ports and of loading facilities and other facilities at ports are vital for efficient operations and the fact that Dublin, Waterford, Cork, Dún Laoghaire, Shannon and Rosslare between them cater for nearly all our port external trade.
Priority in expenditure will be given to improving loading facilities and the range of ancillary services at our principal ports. Expenditure will be concentrated particularly on Dublin, Rosslare, Waterford, Cork and Shannon ports. It will involve the provision of appropriate berthing facilities and investment in bulk cranes, lift-on/lift-off equipment and terminal buildings.
Essential preservation and reconstruction work will be undertaken at other ports such as Drogheda and Dundalk so that such ports can retain their existing capacity and employment and satisfy regional needs. Improvements will be carried out in the Shannon Estuary so that it will be in a position to cater for heavy industry should an upsurge of activity or of trans-shipment occur in that area in the future. We now have a deepwater jetty at Moneypoint which has enormous potential for further development of trans-shipment. At present the deep-water jetty at Moneypoint is being used in the trans-shipment of coal and has been established as an area of enormous scope for further development in trans-shipment with the present investment in infrastructure. Taking advantage of such opportunities can only be to the benefit of the economy in that region.
It is estimated that the total cost of the proposed investments in commercial ports will be about £72 million over the five years of the development plan. This investment will ensure that the commercial ports are developed on a basis which will maximise their contribution to the integrated development of the economy and the provision of essential transport support services for industry.
The eighties have been a traumatic decade so far as shipping is concerned. Few countries have escaped the effects of the worst depression shipping has seen in over 50 years. However, over the past year and a half it has become apparent that the industry has weathered the storm and demand for shipping services, new building activity and charter rates is once again increasing. As I mentioned, over 80 per cent of our total trade, valued at more than £12 billion per annum, is seaborne. This underlines the importance of shipping services to the economy. As our exports go from strength to strength the demand for such services increases and the importance of fast reliable access to world markets becomes ever more critical.
Irish shipping policy has always been to promote full commercial freedom of shipping with ships of all nations free to trade without restrictions to and from Irish ports. Trade has not been reserved for Irish flag ships and Irish operators are not protected from international competition. While it is certainly desirable that the Irish-owned fleet should be maintained at an adequate strategic level, in the world of international shipping it is equally important that our domestic shipping services operate in a truly competitive manner and offer good value to their customers. The main objective of Irish shipping policy over the period of the development plan is to provide a fast, reliable, direct and secure service. This service will be fully integrated with the mainland European transport arteries and will complement the port development I have already outlined.
Major investments in specially dedicated sea access services are essential for the future development of our economy in the context of the completion of the internal market. Action must be taken to improve transit times and reduce access costs to Europe. The conventional Irish shipping fleet has become considerably reduced in size during the past few years. It currently stands at less than two thirds of the estimated minimum strategic requirement to ensure a competitive transport market and to face emergencies. It is vital that we direct our efforts to expanding this fleet.
Our medium term policy objective is to close this strategic gap through encouraging private investment stimulated by direct grant assistance. To this end a grant scheme was introduced to finance eligible ship acquisitions. A variety of different types of shipping projects are being investigated and the plan contains provision for expenditure of up to £65 million over the five years.
I would like very quickly to skip through some of the other aspects. I have already referred to the fisheries development plan and the necessity to carry out the various developments outlined in that plan. It is also essential in the development of the fishing industry that we develop our fishery harbours. We must preserve some of the piers which would otherwise deteriorate rapidly and develop other piers where congestion or a new emerging need or potential for new landings exist and, above all else, we most provide the necessary support services, such as ice plants, auction halls, boat lifts, fuel and water supplies. It is vitally important that we do this as well as improving the road network.
At present, work is underway at Rossaveal, Dingle, Killybegs, Greencastle, Kilmore Quay, Clogherhead, Burtonport, Castletownbere, Darby's Point and Dunmore East. Major improvements are also being carried out at some of the smaller ports and landing places, many of which have been neglected during the past 25 to 30 years. We will devote investment of about £19 million to fisheries harbours over the period of the development plan. This investment has been designed to improve the effectiveness of the fleet, and reduce operating costs through providing modern facilities and better access through relief of congestion.
The final point I wish to make is that in the area of marine recreation and angling, tourism has been identified as a key sector for development under the plan. Ireland should have a natural advantage in the provision of activity and special interest holidays including, in particular, angling, sailing and other marine recreational activities. The development and marketing of such activities will form a key element of the tourism operational programme. Suitable marina and angling projects will be eligible for consideration under this programme. There will be co-operation between my Department and the Department of Tourism and Transport in the implementation of this element of the plan.
I am very anxious to encourage the development of marinas so that they can contribute fully to the tourism and leisure facilities in Ireland. My Department will facilitate private investment in marinas and encourage suitable development plans. A number of very attractive proposals have been received and are being investigated. There is a very attractive proposal to develop a marina up to international standard on the lower Shannon. It is expected that this project will get underway very soon with the result that the lower Shannon area will be opened up. Facilities will be put in place in this marina equal to anything available anywhere on the Continent. These in their own way will present significant opportunities for economic prosperity.
This plan presents us with a unique opportunity to undertake the major infrastructural works which all of us agree are necessary and essential. No one in this House believes that this is going to be easy. Each of us recognises that to get the very best results under the development plan, a lot of hard work and effort will be necessary and a lot of documentation and paperwork will have to be completed to ensure that we obtain maximum benefit. This plan provides the instrument with which to get this work underway. I commend the plan to the House.
Before commenting on what is specifically contained in this plan I would like to say at the outset that any plan which does not take into account the proposal to complete the Channel tunnel in May 1993 is a very unwise one. Shortly after the completion of the internal market, that tunnel will be open on a specific day. I think it is due to open on 13 or 15 May 1993. This will lead to very specific and complicated problems for us. In fact, the Anglo-French tunnel may well sink Ireland's plans for 1992. The whole objective is to bring about greater cohesion in the European Community. In particular, those countries on the periphery of the Community, remote from the 40 per cent golden core, are meant to have better access to the centre. Already the transport cost of Irish exports at 9 per cent of total cost is twice the European average, and this is before the completion of the Anglo-French tunnel.
We often hear complaints from our colleagues in Europe, in particular our German colleagues, who say Ireland does not play its role fully committed, for instance, to the defence of Europe. The Germans have made a great success of Marshall Aid, and fair play to them. I think they will not begrudge this small nation if we make equal success of the proposed doubling of the Structural Funds, but Ireland can play its full role in the Community only when we are economically united with and given the same opportunities as the rest of the Community. At present Irishmen and women are paid only 58 per cent of the EC average. Union, economic union, political union, means equality, and if they expect all these other burdens of responsibility to be taken by this small nation to seek to participate in the benefits of that enlarged Community.
In the republic GDPper capita is only 40 per cent of that of the five richest EC regions. If full political and economic union is to come about, these disparities must be levelled out. Ireland is the UK's sixth most important market. As the island behind the island we are likely to remain a good market for the UK because of our remoteness, our continued remoteness, from mainland Europe, but the 60 per cent of Irish exports now going to the UK will come under severe pressure from May 1993 onwards when the Channel tunnel is completed, bringing the overland travel time between Paris and Birmingham down to five and a quarter hours while the travel time between Dublin and Birmingham will remain a little over nine hours.
Probably many people smile and scratch their heads when they think of the possibility of some sort of tunnel connection between Ireland and Britain, but I am not one of them. I think it is time this proposal was examined. We will find our traditional markets are going to be under the most severe attack. The Community is the biggest economic bloc in the world now with almost 320 million people. We, as a nation of 3.5 million people, can either attack that other market of 317 million or we can sit back while they attack us and not only that, while they attack our markets in Britain by their new access to Britain through the Channel tunnel. It is dangerous for us not to try to plan or see to what extent the objective of an Anglo-Irish tunnel, a tunnel between Ireland and Britain is achievable.
Two measures which need to be examined are not addressed in the development plan. One is the possibility of a tunnel connection between Ireland and Britain which should be scientifically examined and costed. Secondly, much more immediately, the 50 km or so of British roads which are of strategic importance to Ireland, particularly those from Holyhead eastwards, should be promoted jointly by the Irish and British Governments for upgrading. In this way Ireland could use British roads as a substitute land bridge to Europe. If we cannot at least get our own bridge or tunnel connection to Britain, it is vital for us as a secondary objective that those British roads eastwards from Holyhead in particular are upgraded. It is even more important to us than to the British Government, so that we can use Britain as a land bridge to Europe, and when that tunnel becomes available between England and France at least we will be able to try to use that to counteract the attack that will be made on our traditional markets in the UK. If the British Government do not take the initiative we should do so and ask the British Government to come with us jointly to promote that development of the roads. Strategically this is of vital importance to us.
Since neither of these matters has been given adequate consideration, the newly created Anglo-Irish parliamentary group due to be appointed in the summer should be empowered to carry out a thorough examination of both these suggestions and to report with great urgency to the Dáil and the House of Commons.
The Cecchini report estimated that up to five million jobs would be created and up to £153 billion sterling would be saved per year by the completion of the Single Market and the removal of remaining EC internal trade barriers. Ireland will soon be the only EC country without an overland connection to the Community. A tunnel would possibly cost a once-off expenditure of £7 billion to be shared by the Republic, the three and a half UK regions and the EC. As a percentage of the amount to be saved as expressed by Cecchini this is not an insurmountable sum, though a precise costing has not been done. On completion of the Channel tunnel 1,400 highly skilled Irishmen will be without jobs. A trained workforce with expensive plant and machinery already written off against tax will be available. Surely it is not too much to suggest that the ideas mentioned of a tunnel and a land bridge through Britain at the very least be thoroughly costed.
I see in this plan which has been presented to the House a great shortcoming because it does not address that question. We can improve all the byroads we like. We can improve all the small ports and harbours we wish, but if we do not protect our markets, particularly our vital markets, we will have no use for those ports or those internal roadways because the barriers when they come down mean not only can we attack the Community, they can attack us. It is like a fellow taking a penalty. If you happen to be in goal you will look at it differently from the fellow who is taking the penalty. He thinks it is going to be very difficult to get the ball in while the fellow in the goalmouth thinks it will be very hard to save it. It is a bit like a glass which is half empty or half full. Nobody is going to come to our aid unless we ourselves examine in detail, not just on an island basis but on a Community basis, what are our strategic considerations, and access to the Community is the central and most vital consideration in this regard.
With regard to this plan, I note the report is signed by nobody in particular, not by the Taoiseach or the Minister for Finance. There is no foreword to the report to the effect that this is a Government plan which has been prepared with assistance from the following consultant and has been scientifically calculated. No consultant's report has been appended. No consultants have been able to sign this report. I am not surprised. How could anybody sign this report? It is a political report, not a plan, and it has been submitted to the EC in its most vague terms for political advantage only. The Dublin region represents almost a third of the population of the Republic. The working group in that region have not yet completed their report and will not even complete the report for another month. Yet the report is supposed to be based on the democratically developed input of the seven regions, of which Dublin is one. It is crazy to suggest that this report has been democratically developed and that all the necessary scientific information has been included since the Dublin region working group have not yet completed their report. I am not surprised that nobody has signed this report.
The living conditions of people in flat complexes in my constituency and in the constituency of Deputy Garret FitzGerald, as well as constituencies on the north side from Ballymun to the inner city, are appalling. The local authorities in charge of those flat complexes have certain statutory duties in regard to health standards in various commercial bodies throughout the city but the health standards in their own flat complexes are appalling. Nobody in this House would like to live in those conditions. What are we proposing to do? Having left people in these flat complexes, we propose to isolate them by building motorways around them and cutting them off from their traditional hinterland, particularly in places like the Liberties. What sort of planning proposals are these? Two thousand tenants of Dublin Corporation do not even have a bathroom one year after the so-called millennium. It is very poor planning which considers that the only solution to Dublin's problems is to build motorways through the city centre, which very few people want.
I regret very much that to date the Government have not taken up Fine Gael's suggestion of creating a national forum. Fine Gael have suggested that this could consist of a select committee of the House, including leaders of the various parties, jointly with representatives of the social partners, farming, business, unions and youth bodies, to prepare for 1992. There were massive preparations for Ireland's entry to the Community in 1973 involving trade unions, politicians, business people and farmers, working together across party lines. No such preparation is being made for 1992. The Single European Market is the greatest innovation since we entered the Community. The forum proposed by Fine Gael is an essential way forward. When the Minister for Finance asked for assistance in this regard I made him a formal offer on radio yesterday on behalf of my party to participate in such a forum so that when the Government change we do not take the Government's clothes and they do not come to the Opposition benches and take our clothes.
This report suggests that almost £3 million will be provided by the private sector. God only knows where that figure was taken from. There is a far better chance of the private sector putting up that sort of money if they know that the plans being put forward by the Government are supported by the Opposition and will not change when that Government change. That is vitally important in these unsure political times as we approach 1992.
With the permission of the House I should like to share my time with Deputy Garret FitzGerald.
Is that satisfactory? Agreed.
I will make a few concluding remarks. The Minister for the Marine mentioned tourism and tourist attractions generally. In the development of waterways as a tourist attraction, the Liffey, the Grand Canal, the Royal Canal, the Dodder and the Poddle should not be forgotten. In particular, the Dodder, Grand Canal, Liffey waterway at the Grand Canal dock site could be Dublin's prime tourism attraction. I am impinging on Dr. FitzGerald's territory since this is in his constituency but I have written a policy document covering this site. It is a matter which should be given consideration.
I regret very much the undemocratic nature of this report in so far as it was prepared without an input by elected representatives, without the Dáil having seen the report before it went to Europe. I hope some of the suggestions I have put forward will be considered by the Government.
The document before us which is described as a National Development Plan is largely a nonsense. It has one useful element in that it does something not previously done. It breaks down the public capital programme regionally. I initiated this proposal in 1986 but found, astonishingly, that even our existing programme was not broken down in that way and that considerable research was required to find out where we were spending the money. I am glad that the process I initiated has been carried to a conclusion and it is useful to see the pattern of our capital programme broken down in this way. As a national development plan it is a nonsense. It lacks any of the specificity or economic content that such a plan could be expected to have. It reads like a document prepared by numerate administrative civil servants based on an input by engineers but shows little sign of anything which could reasonably be described as planning in the ordinary sense of the word.
If the European Commission accept this plan as a basis for doubling Structural Funds to Ireland, all I can say is good luck to the Government — they will have got away with it. The plan fails in any way to meet the concept of additionality fundamental to the whole process of convergence and the doubling of the Structural Funds which I negotiated in Luxembourg in 1985. The Government have made it clear that they propose to lower the level of public investment. That could be described as substractionality but hardly as additionality.
If the idea is that the doubling of funds is to be justified by an increased input from the private sector, this is totally speculative. There are no concrete proposals for private investment upon which this concept would be based. If we examine the proposals in the many tables attached to the document, we find that three-fifths of the regional fund money sought from the Commission and all of the social fund money is sought in respect of projects in which there is no private investment. The only investment on the Irish side consists of reduced public investment. That is not in any sense additionality. The EC money is sought largely in relation to projects which do not involve additional investment.
What is the relationship between this phoney document and the real plan for Dublin published in summary form inThe Irish Times this morning? This is a development programme for the greater Dublin area and no doubt there are similar documents for other parts of the country. At least one hopes there are. This plan is a genuine one. It has a solid economic basis. It is specific in its proposals as to where money is to be spent and it is well thought out. I would not necessarily agree with everything in it. There are always areas of possible disagreement in the details and I might have slightly different views, but overall it is a very good plan indeed. What relationship is there between this and the Government's so-called plan submitted to Brussels? None whatever that I can see. I am open to conviction and persuasion on this but let me give some figures and invite the Minister replying to the debate to explain the discrepancies.
In the Government's so-called plan the provision for transport, other than national roads, for the Dublin region is £239 million. In this document, the genuine plan for Dublin, it is £173 million. It is not a huge discrepancy and could perhaps be explained away. I do not rest my case much on that. The Government's provision for sanitary and other local services is £53.64 million. In the actual plan the provision is £225.69 million, 4.5 times as much. The provision for sanitary services alone in this respect is far beyond the £53 million figure indicated. In the actual plan the figures in respect of waste water disposal, water services and solid waste management add up to £130 million plus. For the whole of sanitary and other local services in the Government's plan submitted to Brussels it is £53.64 million. Obviously the Government are widly wide of the mark as to the needs in this regard. Wherever the figure came from it bears no relationship to reality.
Here again I recognise there could be good reasons for the discrepancy but the greater Dublin plan in respect of industry limited particular parts of industrial investment to £77 million; the Government have put in £73 million. That may be explicable in terms of the fact that the planners for the Dublin area are only concerned with very specific infrastructural investment in relation to industry whereas the Government figure on that is much larger.
Then we come to tourism. The Government submission for tourism to the Dublin region where it expects to double tourism over the period of the plan is for £60 million. The actual planned figure in this document is £125 million and the justification for that is set out in great detail. It appears the Government, for reasons best known to themselves, have submitted to Brussels a series of figures drawn from God knows where which bear no relationship to and, in fact, are totally divergent from the genuine needs of the Dublin area as submitted in the plan prepared by the consultants. I do not know how they are supposed to rectify that, whether they are going to go to Brussels and say that the figures were all wrong and that these are the real figures, and what effect that would have on our case in Brussels, or do they intend to ignore this report, the only genuine plan, and carry on with the phoney figures which have no back-up in terms of actual projects?
This is the biggest single mess I have seen in terms of presentation of material by Government that I can remember. I look forward to, but do not expect to get, some explanation, justification or even reference to this discrepancy between the actual plans for the Dublin area and the figure submitted by breaking down national figures notionally, and obviously incorrectly, by the Government.
There are a couple of points I would like to make in regard to the Dublin area. The Dublin plan now available and published byThe Irish Times has some merit. It challenges the engineers' passion for urban roads at the expense of the life of the city. It says that the damage done by the destruction of the environment to make way for the grandiose inner tangent is probably now so great that it may be too late to retrieve anything, which is what the engineers probably hoped would be the case. Having gone so far in knocking down buildings which are irretrievable at this stage the plan supports the Clanbrassil Street dual carriageway. Because of the proposed Tallaght busway it is suggested that the inner tangent must go ahead at this stage. So much has been knocked down that if we do not go ahead with it we are going to leave chaos behind. The damage has been done and is irretrievable. The plan does, however, suggest strongly that there is no compelling case for the outer tangent since the engineers have not yet had their way in knocking down the parts of Dublin concerned. They are still there and the plan suggests, wisely, that the arguments are not compelling, to use their carefully chosen language. It would involve major property destruction. I hope the Government will now make it clear that this particular project, affecting the area of the Liberties, is dead.
The consultants give very strong support for traffic law enforcement. They say that the introduction of road pricing should be taken seriously. They make the point that before anything else is done in terms of building or knocking down we should get the benefits of traffic law enforcement that we have not got. They estimate a significant increase in traffic flow if existing laws were enforced. This includes the need for a special traffic police. I understand the reasons the Garda Síochána have hitherto resisted the idea of any separate policing for this purpose.
Realistically, with the pressures upon the Garda Síochána whose strength has been so reduced under this Government although crime has not declined proportionately, it is simply not practical for the Garda Síochána to carry out their work of criminal law enforcement while, at the same time, dealing with traffic laws. A separate body is required for that purpose. That has to be faced up to and the consultants are right in that. When that is done we will see significant improvements in traffic flow without knocking anything else down or building any more roads. I am not saying this should not be done because additional roadworks are, of course, required. It would be absurd to spend more capital sums before spending the quite small sums needed to enforce the existing law and improve the traffic flow.
On road pricing they made reference to this without pressing it because political considerations may prevent it being adopted. I hope they will not. I have been making the case for this for the past 20 years because parking controls alone will not effect the necessary adjustment between public and private transport. The only way that can be done is by the private motorist being charged at peak hours a price for using road space commensurate with the actual cost of that road space in economic terms. The reason public transport has declined in Dublin is because the private sector is subsidised to an enormous extent. Road space is given free to private motorists, usually one person in a car. At a time when that road space has enormous value, they get it free. With that enormous subsidy from the community naturally the facility is over-used. If champagne were free it would be overdrunk. If a valuable product is made free people will use it and abuse it to the point of the most gross economic distortion. That has happened in our city. Public transport has declined because even with subsidies it is far dearer than highly subsidised private sector transport with its free road space which is immensely costly and immensely valuable.
I hope the Government will take their courage in their hands on this issue and if they do I hope the Opposition will support them in tackling the problems of traffic in Dublin intelligently as has been done in Singapore. I do not think we will have to have a Government as dictatorial as that in Singapore to introduce road pricing. A democracy will tolerate the introduction of a system of controlling traffic based on the pricing system which applies to the supply and demand of most goods that are sold to the public.
There are several points to which I wish to make reference in the minute or so remaining. There is a reference to what is called the port access route which is another name for the eastern by-pass. They make a strong case for this in traffic terms but they make two points which are very valid: first, that it would be important that the introduction of such a new motorway would not lead to increased traffic flowing into the city centre. The purpose is to give access to the port and to provide for the 30 per cent of the total flow of traffic flowing into Dublin city that is crossing the city from one side to the other. If, however, it were built in such a way as to provide easy access to the city it would increase the amount of private transport coming in. That should be prevented and public transport should be given priority.
The second point — and this is absolutely crucial from the environmental point of view — is that the valid objections to the building of this motorway can and should be overcome by using cut and cover tunnelling methods. The idea of building a motorway across Sandymount Strand is repellant, certainly to most people in Sandymount and people who have any concern for our city; but there is no reason other than cost — and there are now additional resources available — that such a road cannot be built by cut and cover method across the strand. The sand and the sea would come back over it and when the work has been done the strand would be preserved and the traffic would flow through. Of course the costs of tunnelling are somewhat greater but, as the report points out, in this instance it would be well justified because of the beneficial environmental effects. The fact is this road, a very important road from the traffic point of view, has not been built because of the valid environmental objections. If one wants it built, and the case is strong, then one must be prepared to pay the additional cost for a road going through such a sensitive area.
There is another point I want to make. I support strongly the proposal for a £17 million investment in the Grand Canal dock area. This dock is an immensely valuable area for potential development. It could be extraordinarily attractive, like Saint Catherine's Dock in London, or the docks in Salem in Massachusetts. With restaurants and facilities around the place, boating in a marina, museums and housing of an appropriate kind around, the area would be extraordinarily attractive, and it does need some public investment to build up the area. Plans have been prepared by local people as to how the area might be used. These plans are totally harmonious with the commercial possibilities, and I understand there is some initiative being taken by some public enterprises which have land in the area to secure an orderly and constructive development of the kind that will make full use of the potentiality of that area.
I strongly support the proposals for the Dundrum busway. The Harcourt line is there. I do not know what is holding up its development. It and the Dundrum by-pass could be built together. Our Government did in fact provide the money for the Dundrum by-pass but this Government, in their curious way on coming into office, cancelled all kinds of plans that we had prepared, and two years later reintroduced them and will, no doubt, claim credit for them. The people of Dundrum will not be misled by this. That by-pass, which cost £6 million, and the busway should be one of the higher priority projects because, as the consultants point out, the economic return on that will be very considerable indeed if adequately linked into the city traffic system in the Harcourt Street area. These are proposals which relate to the area I represent and have considerable merit in their own right. The document the Government have produced bears no relation, as far as Dublin is concerned, to the needs of the area. The figures in it are totally out of line with requirements. I urge the Government to scrap these nonsensical proposals and substitute the plan which they have asked the consultants to produce and which seems by and large an excellent one for the Dublin area.
The national plan which we are discussing is an unprecedented document in the annals of Ireland's public finances and in the economic life of this nation. It is, as has been suggested by the Minister of State for European Affairs, a major document. It is the largest budget ever mobilised to modernise our economy, to accelerate economic growth, to provide increased job opportunities and contribute to narrowing the gap between our living standards and those of the richer European nations. The most frequently peddled untruth which has been propagated about this plan is that there has not been enough consultation as to its contents. I wish to deal with that and with the impact of the plan on sub region 7.
As the Taoiseach has pointed out in an excellent contribution, in preparing the plan the Government carried out an unprecedented level of consultation at both national and local level. At national level the Central Review Committee of theProgramme for National Recovery was consulted, as was a wide spectrum of business, financial and vocational interests. To make the plan as responsible as possible to the needs and requirements of different areas of the country a completely new system of consultation with local interests was put in place. I worked for long enough in the Department of Finance and Deputy FitzGerald was involved for long enough in Government to know that this is a unique breakthrough and a unique occurrence and politically there should be the generosity to recognise that that is the case. This was rightly seen by the Taoiseach as an important and a significant innovation.
For years as a civil servant I felt that various plans were prepared by different administrations on entirely the wrong approach. Planning was from the top down. It was, as Deputy FitzGerald recognised in his contribution, entirely on a national basis and no effort was made to break down either the proposals or the budgets on a sub-regional basis, which is the only way to plan. This plan is different in that for the first time planning has been undertaken on a sub-regional basis. Equally important is the fact that the plan has a sectoral focus. In this plan the most important elements in planning, sectoral planning and sub-regional planning, are for the first time brought together. It is disingenuous in the extreme to suggest that the plan has been plucked out of the air.
If you look at the proposals for sub-region 7 you can see that the various sub-regions have made very major inputs. The fact that the people in Dublin were slow in making their input should not have been allowed to deter the Government in progressing in sending this matter to Brussels. I would make the point that earlier this year, indeed up to the last month or so, the major criticism that came from the Opposition parties and in particular from Fine Gael was that the Government stood the chance of submitting the plan too late. They cannot have it both ways.
In the preparation of this plan there was meaningful and appropriate consultations and this is evident in the plan. This was achieved through the working groups and the advisory groups. The shallowness of the criticisms that have been issued are reflected in the antics of one Deputy who addressed the issue in this House, Deputy Bernard Allen. Deputy Allen is after all the Lord Mayor of Ireland's second city. He was presented with a privileged opportunity to engage in the rebuilding of his region's economy and in the momentous task of national regeneration but he did not respond. He absented himself from the effort and then belittled the efforts of those who did involve themselves in the great work of producing the plan for his region by being critical in the extreme. Deputy Bernard Allen is a representative of all that his party stands for, hollow rhetoric and a failure to deliver in equal measure.
The fact that consultation took place in the formulation of the plan is well illustrated when one examines the composition of the working groups and the advisory groups. In the case of sub-region 7, the region in which Wicklow is included, the working group consisted of the county managers of the seven counties plus representatives from all the State bodies and the Government Departments concerned. That is unique in planning in this country. The advisory group consisted of the chairmen of the eight county councils plus the chairmen of Bray Urban District Council, Arklow Urban District Council, Dundalk Urban District Council, Athlone Urban District Council and the Lord Mayor of Drogheda. The social partners were also represented in the advisory groups with representatives being drawn from the ICTU, the Irish Transport and General Workers' Union, the FWUI, the Irish Farmers' Association, the CII, the ICMSA, the ICA, Macra na Feirme, the ICOS, the FUE and chambers of commerce. How in the name of goodness can any reasonable person suggest that that is not unique and that it is not consultation? The allegation of a lack of consultation does not stand any serious scrutiny.
Turning to the plan itself and the impact on one particular region, sub-region 7, it is clear that the aspirations of the people who formulated the work programme of the working group and the advisory group have been incorporated in the plan. The diverse character of the region, which is commented on throughout the operational programme which is being prepared by the working group and the advisory group, is recognised in the plan. The measures proposed in section 4 of the operational programme are incorporated in detail in the plan as has been submitted by Government. What is proposed in the plan for this region is a £1.3 billion boost. That is the most significant thing that has ever happened in so far as the economic, social and political life of the eight counties in question is concerned.
Recognising that eastern seaboard towns such as Bray and Arklow and towns further north in County Louth have been badly hit by unemployment and that there has been a decline in traditional industry, the plan proposes an injection of £414 million during the period that it is to run. There is to be a further £122 million input for agriculture and rural development. It is wrong for any serious politician to suggest, as was suggested here last night by spokespersons from various parties, that these figures are a pittance. They are not; they are significant contributions to the growth and development of the counties in question. The plan provides £288 million for road building in the region. Much of that will go to building up Euro route 1, to increasing access transport in and out of Dublin Port, to improving the transport further south into Rosslare and to making access transport available, in particular along the eastern seaboard into all the parts of the sub-region that have been so adversely affected by unemployment. That will make a major contribution to the economic life of Counties Wicklow, Louth and Wexford.
The likely impact of the plan can be judged well if you look at a county such as Wicklow. In many ways the county I have the privilege to represent is a microcosm of Ireland. The upgrading of access roads into Wicklow will provide the county with the last vital element on which industrial expansion and job creation can be developed. The Government have recently granted Wicklow designation and for that all parties represented in the county are extremely grateful. We have been pressing for the additional benefits of the western package and no doubt the Government have listened to the case being put forward there.
In the county council in Wicklow we have recently added to the economic advantages of Wicklow as an industrial designation by agreeing that the county manager will have the power to extend rates reliefs to new industrial developments. We undoubtedly have the workforce, young, well-trained people, and we also have the tradition of industry in that county. We have excellent communications. Indeed the north-eastern part of County Wicklow, because of the Government's wise decision to designate the whole county, is unique in that in terms of proximity to the major port we have unique industrial advantages.
The upgrading of the N11, the by-pass at Shankill and the developments of the Arklow by-pass, all of which are envisaged in this plan, provided the icing on the cake in so far as the wooing of industry to Wicklow is concerned. Those of us who have been concerned, as I have been, for many years with problems of access, particularly into north-east Wicklow, can see in this plan the light at the end of a long tunnel. The injection of £122 million in rural development is equally appropriate and equally important to a county like Wicklow. Wicklow with its tradition of rural enterprise and in particular with its focus on forestry has much to gain from the programme and a great deal to gain from this plan. It should be stated that all parties represented on the local authorities have been generous enough to recognise that this is the case.
Would that their colleagues at national level would be equally generous.
A more vital investment proposal is the projected expenditure of £259 million over the period of the plan in sub-region 7 in the important development of human resources. The importance of this element in the proposals for the life of the counties of the mid-eastern region was dealt with by the Minister for Education in the course of her contribution this morning. The importance, however, of those proposals deserves re-emphasis in my contribution.
I should like to point out to the Deputy that the order of the House requires that I call on the Minister for Finance at 3.30 p.m.
I will bring my contribution to a close. The plan should be the occasion for the expression of national self-confidence. It should be seen as the launching pad for a major boost to our nation's confidence. Its launch should be seen and portrayed as the turning point in the affairs of the nation, as a Rubicon which Ireland has now passed over, as the first step out of an economic wilderness. To my mind it is a beacon, a plan which offers us and affords us unique opportunities. It certainly deserves the praise of all Members and, for that reason, in this short contribution it is my pleasure to commend the plan to the House.
The Deputy should remember what happened to some of the armies that crossed the Rubicon.
The doubling of the Structural Funds and the potential benefits of completion of the single market for the overall perforance of the European economy can, between them, create the best opportunity for sustained high economic growth we have had since the sixties. The increase in the funds puts us in the position of being able to undertake a major programme of investment in our infrastructure and our productive apparatus, without putting at risk either budgetary stability or our external balance. The new phase of economic integration now under way can release a wave of dynamism in European business. If this happens, then output, demand and investment in the European Community are set to grow over the next few years at a rate on a par with the best achieved in recent times. If we can increase our share of this expanded market and capture our due proportion of the enlarged investment, we in Ireland can look forward to a period of buoyant growth in output and employment.
What we must not overlook, of course, is that these developments represent an opportunity for, rather than a guarantee of, progress. It is up to ourselves to turn this opportunity into real economic and social gains. Only if we order our own affairs sensibly, and follow the appropriate course in our policies and our behaviour, will the potential benefits materialise. If we let the opportunity slip, we will have ourselves to blame. This fact will not be lost on our European partners, whose goodwill is essential to our longer term progress towards economic and social cohesion.
Making a prediction for the prospective rate of economic growth runs the risk of counting chickens before they are hatched, indeed before some of the eggs have yet been laid. Moreover, as the plan indicates, the impact of the Single Market both on the economic prospect of the Community at large and even more so on the weaker regions is a major inponderable. Any forecast of how the economy could develop over the coming few years must be conditional.
We have sought from the Community, through the medium of the National Development Plan, a particular level of financial support. The Government will be pressing for the full amount specified in the plan. The programmes set out in the plan will give a major stimulus to economic growth, both in terms of the activity involved and their impact on our longer term growth potential. With a favourable international economic environment, and the successful adaptation of the Irish economy to the conditions of the internal market, we could anticipate an average growth rate over the period to the mid-1990s of up to 3½ per cent. Strict adherence to the domestic economic policy strategy outlined in the plan is, of course, an essential element of the necessary adaptation. However, should the overall pace of growth in the Community accord with some of the more optimistic predictions, a growth rate exceeding 3½ per cent would be in prospect. The sensible approach in these matters is to base one's plans on a prudent assessment. We must remain mindful of the serious continuing imbalances in the world economy at large, and the risks they entail.
I want to emphasise today that this prospective progress could pass us by. We must take full advantage of the improved domestic environment, the increased level of Structural Funds becoming available to us from the EC, and the anticipated extra growth which 1992 and the single market can release in Europe. Unless, together, we set about exploiting these opportunities, this prospective progress will pass us by.
Our goal is simple and clear-cut. As a nation, we want to achieve substantial employment growth. We want to afford the young an opportunity to stay in Ireland rather than take the emigrant ship or plane. We want to renew hope among the unemployed, the hope that they can regain the dignity of work, and escape the grind of joblessness. We want that employment, when it comes about, to be high quality, and capable of supporting a fulfilling way of life.
I believe all would agree with this broad aim but our actions must match our words. If Ireland is to advance and prosper within the new Europe, if our people are to fully share in its progress, we must all be prepared to face some key realities. Employment growth depends on our ability to produce, and sell, more and more goods and services in the face of intensifying international competition. In turn, our capacity to produce and sell an increasing level of output in the future depends on our success in raising investor confidence in Ireland as the base from which to attack the full breadth of European markets.
The keys to maintaining, and improving, investor confidence are clear. First, we must maintain financial stability, in particular in terms of the exchange value of the Irish pound and of interest rates. The Government set out their commitment to maintenance of the exchange value of the Irish pound within the EMS in theProgramme for National Recovery. That commitment is reaffirmed in the National Development Plan. Secondly, we must follow responsible fiscal policies which demonstrate our capacity to manage our own affairs prudently and well.
TheNational Development Plan follows through on the progress already made on this front. Our intention is to achieve a further reduction of the Government's borrowing to 3 per cent of GNP in 1993. This course will require continuing strict discipline on public expenditure. It will, however, also begin to reduce the burden of debt and debt service overhanging the economy. A declining debt burden is essential. I will return to this subject later. Thirdly, we must ensure that domestic cost trends strengthen rather than weaken our competitiveness, and demonstrate our growing ability to outsell the competition both at home and abroad.
We all have a role to play in this respect. Restraint is called for from all who influence price and competitiveness trends. It is not a matter of wage developments at home alone — though wage costs loom large in the competitiveness equation.
Government must restrain their demand for tax resources. As indicated in theNational Development Plan, the further easing of personal taxation will be an important objective of policy, even though it must be pursued within the overriding requirement to reduce borrowing. Business must also take the longer term view. In the same way that a rising burden of taxation can generate inflationary pressures, so also can a shortsighted rush to squeeze extra profits out of economic progress. The growth prospect which I have outlined also demands continuing moderation of wage trends. That moderation must extend right across the economy — it is not a requisite only for the elements of industry and services which trade internationally. Costs in all parts of the economy impinge on export prospects.
Finally, we must make the soundest possible use of EC assistance becoming available to us in increasing amounts. These funds must be made to contribute to the real development of the economy. They cannot be looked upon as a short term windfall, to be used to bolster up living standards, now, beyond the levels we have earned through our own efforts. No, their fundamental purpose is to support developments which will enable us, in the new Europe, to grow and prosper through, and beyond, "1992" and the Single Market. The projects which these funds support must contribute to enduring and sustainable growth. The fundamental criterion for determining on what we should spend these funds has to be the value of candidate projects in underpinning real, and sustainable, advance. This is the criterion which underlay the preparation of theNational Development Plan. It is also the key concept which we will have in mind in the discussions in Brussels which lie ahead. Adherence to this principle offers the best hope that Structural Fund-aided projects will help to stimulate a sustained economic expansion. That is what is most needed, both to cut into unemployment and to begin to increase per capita incomes towards those obtaining in the Community.
Some may say we have had enough of "restraint" but the hard facts remain. We are not yet out of the woods as far as the Government finances are concerned. This year about another £1 billion will be added to our already excessive national debt. This year, we will have to use over £2 billion of taxpayers' money simply to pay the interest falling due on that debt. We cannot realistically aspire to European levels of taxation unless and until we start bringing our debt down relative to our national income. This will only happen when continued sound management by the Government, matched by realism in the demands placed on it, brings our overall expenditure into closer alignment with tax and other resources.
From the domestic viewpoint, the reduction in interest levels already achieved has brought direct benefits to all, consumer and businessman alike. I do not believe that anyone in this House would seriously argue for a reversal of this welcome improvement. To secure the position we have attained it is vital to follow the course of fiscal policy set out in theNational Development Plan, to “pursue further reduction (in Exchequer borrowing) over the medium term”.
Apart from maintaining the downward pressure on interest rates, to which this should contribute, the intended course of fiscal policy should reduce the burden of debt in real terms by one-tenth over the plan period. A fraction like one-tenth conveys no solid idea of the real value of this development, or the turn-around it would represent. Let us put it into plain words. Interest costs this year approximate £40 per week per person at work. A saving of one-tenth of that means £4 per week less of every worker's income going to debt service.
We have not yet achieved a level of investment capable of yielding growth in employment adequate to meet the needs of our labour force. There has been a marked recovery, but we must see to it that the pace of investment is further stepped up; hence the need for a sound fiscal and financial climate, and for a national philosophy which places competitiveness requirements high on our agenda.
We are far from reaching European levels of productivity across the broad span of industry. While major progress has been made, we still have far to go.
In summary, we must not lose our sense of proportion because of the recent economic advance.
We must remain realistic about the future, and not be carried away even by the prospect of major EC assistance. The core requirement now is that we act with longer-term interests firmly in view.
By maintaining a policy of prudence and restraint we will contribute to a continuing favourable interest-rate climate; we will keep inflation low, facilitate a strengthening of investment trends, and, above all, lay the groundwork for expansion and employment growth.
It is remarkable that some Opposition Deputies continue to claim that there was inadequate consultation in the preparation of this plan when the truth of the matter is that there was a level of consultation with economic, social and local interests which was unprecedented in the preparation of a national development plan in this country.
The economic and social interests were consulted at national level through the Central Review Committee of theProgramme for National Recovery.
In addition, we set up special arrangements to ensure that the regions would be able to identify their needs and priorities for development. In each of the seven sub-regions into which we divided the country, we establishedad hoc advisory and working groups. The advisory groups comprised all the main representative bodies with an interest in development — the CII, CIF, Chambers of Commerce, ICTU, IFA, ICMSA, ICOS and Macra na Feirme as well as the county councils, county borough corporation, borough corporations and larger urban district councils who were represented by their chairpersons. The working groups included the managers of all county councils and county borough corporations, representatives of the relevant Government Departments and representatives of the appropriate State bodies.
These groups held extensive series of meetings and, between them, received several thousand submissions from representative groups, community associations, State agencies, private sector firms and private individuals. The submissions received by the groups were taken into account in a general way in the preparation of the sub-regional assessments and, contrary to suggestions made during the course of this debate, all of the submissions have been, or are being, referred to the relevant Government Departments and State agencies for further detailed evaluation.
Consultants participated in the work of the groups in most of the sub-regions. I would like to refute the suggestion made by Deputy Ruairí Quinn that the EC Commission have refused to meet the cost of these consultancy studies. This is simply not the case. The full cost of these studies will be met by the Commission under the technical assistance provisions of the regulations. Deputy Quinn's suggestion in this case is as fanciful as his colourful but totally unfounded descriptions of alleged inter-departmental conflicts. In this context also I would like to state that it is not the case that the consultants engaged in the Dublin region were instructed not to consider the extension of the DART system. All options, including the extension of the DART, were considered by the consultants. The allegation that the consultants were told to alter their report to fit in with the plan is totally unfounded.
The Government received detailed and comprehensive assessments from the groups in each sub-region on their development needs and the development strategies which they had identified. The work of these groups was an extremely important input into the preparation of the plan and the formulation of the programmes which will be associated with it. It will inform the detailed implementation of the programmes in each of the sub-regions.
The plan contains summary material based on the assessments received from the sub-regional groups. In addition, for the first time in a national development plan, the expenditure envisaged for each of the seven sub-regions is indicated in the plan. Contrary to what has been suggested by Deputies Alan Dukes and Ruairí Quinn, the initiative in deciding to include these sub-regional sectors in the plan was taken by the Government. We informed the EC Commission of our intentions in this regard and they welcomed the innovative approach we were adopting. At Government level there was no obligation on us to consult in any shape or form. We took the initiative ourselves. I want everybody to be clear about that.
The operational programmes will, for administrative purposes, be sectoral rather than geographically-based. Government Departments and State bodies, at both national and sub-national levels, and local authorities, will have roles to play in the implementation of the programmes. There are already in existence at local level long-standing and well-tested administrative arrangements for co-ordination on an on-going basis between the various agencies involved. These will continue to apply for the co-ordination of activities and expenditure under the programmes in order to ensure an integrated coherent approach to the implementation of the development measures planned for each area.
There have been suggestions that we should establish additional administrative structures at national and regional level in connection with the implementation of the plan and programmes. It has been the consistent policy of this Government to streamline the public service, eliminating duplication and overlaps, including in some instances winding up State organisations. We have no intention of creating unnecessary additional bureaucratic layers now under thisNational Development Plan. The existing arrangements are efficient, cost-effective and provide the best mechanism to ensure that the measures in the plan and programmes are put into effect on the ground.
Therefore, when some Deputies talk about new regional structures and regional development boards or whatever they fail to realise what they are really saying. They refer to Europe and the regional structures existing there, but, in areas like France or southern Italy, it must be realised we are talking about regions with populations of 10 million or 11 million people. There is no region of 3.5 million with a sovereign government or head of state. They should realise that they are not comparing like with like, are not facing up to reality or ascertaining how we can get the best value for money from the manner in which we spend it or in how we supervise and co-ordinate its expenditure.
TheNational Development Plan was regarded as a matter of the highest priority by the Government and for this reason the preparation of the plan was directed and controlled at all stages by the special high-level Committee of Ministers and Secretaries, chaired by the Taoiseach and meeting normally on a weekly basis. From the outset, we rejected any notion of merely assembling an amalgam of schemes and projects selected on the basis that they would be likely to qualify for Structural Fund assistance. That would have been a wholly inadequate response to the opportunity and the challenge presented by the new situation. The Government were determined that the plan should address in a fundamental way the country's developmental needs and achieve the national and European Community objective of greater economic and social cohesion.
The plan was based on a thorough asessment at national and regional level of the major deficiencies in our economy and infrastructure, the factors which tended to impede or hinder economic and social progress and the particular national assets which could be most fruitfully exploited. In this way it was possible to devise the strategy and identify the development measures which would best promote economic and social development so as to increase economic growth, increase employment levels and improve living standards and social equity, while protecting and enhancing the psychical environment.
The result is a coherent strategic development plan geared to maximise economic and social development in a way that is balanced, both sectorally and geographically. Here I refer to other criticisms from the Opposition benches which amazed me. Deputies wondered why housing development and health were not included in the plan. That shows a complete lack of understanding of what the Structural Fund is all about. The Structural Fund does not apply to housing or health and I do not know whether the Deputies are politically naive or were trying to mislead the public into thinking that certain areas were left out. These areas do not qualify for Structural Fund assistance and the Deputies should know that.
The development measures in the plan fall into two broad but closely interrelated categories. There are measures designed to achieve improved competitiveness and efficiency by tackling the problems arising from our physical peripherality within the Community, inadequate infrastructure and low population density. In addition, there are measures directly targeted at enhancing the productive capacity of our economy in all the key sectors of manufacturing and service industry, tourism, agriculture, fishing and forestry. The measures involved have been described in detail by my colleagues in the course of this debate.
There have been some allegations that the Government, in the plan, are failing to meet their obligation to ensure that spending on structural measures increases by at least as much as the amount of additional aid received from the Community funds. These allegations are totally unfounded. Again, whether because of a lack of understanding of additionality or for whatever reasons, various attempts have been made to mislead the public in this regard.
From the earliest stages in the preparation of the plan, the Government rejected out of hand any idea of using Structural Fund money to reduce the public borrowing requirement. On the other hand, we have still a considerable way to go in easing the burden of the great national debt which still hangs over us.
The pages are interchangeable; the Minister should not worry about getting lost.
I will not get lost, the Deputy should not worry about it. The approach we adopted, in keeping with the requirement set out in the regulation on the co-ordination of the funds, was to ensure that the baseline of expenditure on structural measures would be maintained in real terms, and that the additional resources resulting from the increase in the funds would all be devoted to increased structural expenditure. In this respect, we are fully meeting our obligations under additionality.
It has been suggested also that the plan is too heavily biased towards physical capital investment. I do not accept this criticism. This plan includes very substantial provisions for training and recruitment as well as measures to enhance the marketing and technological capacity of our industries. Together, the investments in physical and human capital set out in the plan provide an environment of stability which should give greater confidence to businesses contemplating investment.
As we go through the next stages of negotiating the Community support framework with the EC Commission and securing approval for the operational programmes through which the plan will be implemented, the opportunities will become much clearer, but, of course, in the Single Market, the opportunities are there for all comers. Prospective suppliers in the rest of the Community will also see these opportunities and be prepared to take them up. Irish firms will, therefore, have to ensure that they are as competitive as the rest. By the same token, if they can keep a competitive edge, there is no reason why they should not also seize the opportunities which present themselves in the other member states which are taking part in this process.
In a wider sense, of course, the environment which this plan creates will be beneficial to much more than the individuals and firms directly affected by the spending proposals which it contains. It sets the whole economy on a course for stable growth and, if we have enough faith in ourselves, we can achieve and better our targets.
I believe that faith is well-founded. We have come through an undeniably difficult period of adjustment. That we have achieved the outstanding results we have achieved is a tribute to the sense of responsibility and maturity of the social partners. There has been a striking awareness of the need for individual restraint in the common interest and in the interest of the coming generations whose future we hold in trust. In the course of the preparation of this plan, and in the consultations which were conducted at both national and regional level, there was a great sense of common purpose. If the benefits of the sacrifices of recent years are to be reaped, we must maintain that sense of common purpose to take us through the further stages of winding down the national debt to manageable proportions. The Government, for their part, will do their utmost to maintain the national economic consensus and ensure that, as the benefits materialise, they will be distributed equitably and in a way which sets our society on a course of justice and prosperity extending into the closing decade of this century and beyond.
Is the amendment agreed?
- Abbott, Henry.
- Ahern, Bertie.
- Ahern, Dermot.
- Ahern, Michael.
- Andrews, David.
- Aylward, Liam.
- Barrett, Michael.
- Brady, Gerard.
- Brady, Vincent.
- Brennan, Matthew.
- Browne, John.
- Burke, Ray.
- Byrne, Hugh.
- Conaghan, Hugh.
- Connolly, Ger.
- Coughlan, Mary T.
- Cowen, Brian.
- Daly, Brendan.
- Davern, Noel.
- Dempsey, Noel.
- Dennehy, John.
- de Valera, Síle.
- Ellis, John.
- Fahey, Frank.
- Fitzgerald, Liam.
- Fitzpatrick, Dermott.
- Flood, Chris.
- Flynn, Pádraig.
- Foley, Denis.
- Gallagher, Denis.
- Gallagher, Pat the Cope.
- Geoghegan-Quinn, Máire.
- Haughey, Charles J.
- Hilliard, Colm Michael.
- Hyland, Liam.
- Jacob, Joe.
- Kirk, Séamus.
- Kitt, Michael P.
- Kitt, Tom.
- Lawlor, Liam.
- Leonard, Jimmy.
- Leyden, Terry.
- Lyons, Denis.
- McCarthy, Seán.
- McCreevy, Charlie.
- Mooney, Mary.
- Morley, P.J.
- Moynihan, Donal.
- Nolan, M.J.
- O'Dea, William Gerard.
- O'Donoghue, John.
- O'Hanlon, Rory.
- O'Keeffe, Batt.
- O'Keeffe, Jim.
- O'Leary, John.
- O'Rourke, Mary.
- Power, Paddy.
- Reynolds, Albert.
- Roche, Dick.
- Smith, Michael.
- Stafford, John.
- Swift, Brian.
- Treacy, Noel.
- Tunney, Jim.
- Wallace, Dan.
- Walsh, Joe.
- Walsh, Seán.
- Wilson, John P.
- Wright, G.V.
- Bell, Michael.
- De Rossa, Proinsias.
- Desmond, Barry.
- Gregory, Tony.
- Higgins, Michael D.
- Howlin, Brendan.
- Kavanagh, Liam.
- McCartan, Pat.
- O'Sullivan, Toddy.
- Pattison, Séamus.
- Quinn, Ruairí.
- Sherlock, Joe.
- Spring, Dick.
- Stagg, Emmet.
- Taylor, Mervyn.