Gerry O'Sullivan
Question:12 Mr. G. O'Sullivan asked the Minister for Industry and Commerce the cost per job sustained for each year from 1985 to 1990, inclusive, expressed in 1985 prices; and if he will make a statement on the matter.
Ceisteanna—Questions Oral Answers. - Job Costs.
Gerry O'Sullivan
Question:19 Mr. G. O'Sullivan asked the Minister for Industry and Commerce the cost grant and estimated fixed asset cost per job approved in each of the years from 1985 to 1990, inclusive, expressed in 1985 prices; and if he will make a statement on the matter.
I propose to take Questions Nos. 12 and 19 together.
The average IDA grant cost per job created and sustained, in constant 1985 prices, for the years 1985 to 1988 is as follows: 1985, £17,079; 1986, £16,720; 1987, £17,460; 1988, £16,100. Full details are contained in the relevant IDA annual reports which are available in the Oireachtas Library. Figures for 1989 and 1990 will be published in due course in the annual reports for those years.
Details of the grant and estimated fixed asset cost per job approved are no longer published on a regular basis, as the cost per job created and sustained is considered a more accurate measure of grant payments against employment performance.
With the imminent abolition of Fóir Teoranta, as announced this evening, and the closure of Sunbeam Limited and other factories throughout the country, would the Minister not agree, taking into account the costs outlined in his reply, that we should put greater emphasis on job preservation as distinct from job creation, taking into account also the restrictions being placed on the IDA in the area of job preservation?
Job preservation is obviously an aspect of industrial policy which is always to the forefront and will, as far as I am concerned, continue to be to the forefront. I would not however, encourage the agencies concerned — nor, I am sure, would they wish to — to seek to preserve jobs at all costs in non-viable operations. I am not talking here about the particular case the Deputy referred to, nor am I making any judgment that that is non-viable, but from time to time there are failures of companies for simple market reasons that show they are no longer viable undertakings, with the changes in technology and with changes in the market-place. It can never be an objective of industrial policy to preserve every existing job no matter what the consequences. There will have to be changes, rationalisation and modernisation and companies will have to follow the market and the technology. Some of those who do not will not survive.
Has the Minister any proposal to amend IDA legislation to give them wider authority in relation to job rescues than they have at present in view of the proposal to abolish Fóir Teoranta?
That is distinctly a question which is worthy of a separate question.
Perhaps the Minister might comment?
I have no such proposals and I do not think they are necessary. The abolition a year or more ago of Fóir Teoranta seems to be regarded as something of great importance today, but it worth remembering that the number of job losses in the past 12 months was the lowest for a very long time and the net job creation as a result was the highest in the eighties.
Would the Minister agree that the cost per job as outlined in his reply gives very bad value to the taxpayer, bearing in mind that these jobs turn out to be of a temporary nature?
I am not at all sure that I would agree with the Deputy on that. I think the taxpayer gets very good value for a great many of the jobs created.
The Minister has indicated that the cost of creating a job in the private sector has consistently been running in the order of about £17,000 during the past four years. Would he not agree that the Government's policy of reducing employment in the public sector, and in particular the cost of reducing employment in the public sector by way of redundancy schemes, adds to the cost of creating new employment, that it is an unwise policy and uneconomic to pursue?
While the short term cost of reducing the level of employment in the public sector may have been high there is no doubt whatever that the Exchequer and the country at large will greatly benefit from the reduced numbers in a country where the public sector was unduly large.