Vol. 478 No. 1
11 Mr. Callely asked the Minister for Enterprise and Employment the current IDA or Government policy for job creation outside the Dublin region; the basis on which such policy was considered; his views on the need to encourage job creation in the Dublin area; the effect which current IDA or Government policy may have on Dublin; and if he will make a statement on the matter. [10510/97]
217 Mr. Callely asked the Minister for Enterprise and Employment the recent IDA and Government policy on job creation outside the Dublin area; the disadvantageous effect, if any, this will have on the Dublin area; and if he will make a statement on the matter. [10533/97]
I propose to take Questions Nos. 11 and 217 together.
As indicated in the statement issued on my visit to Galway early last month in the context of the announcement for Boston Scientific Corporation, IDA Ireland has been asked to press ahead with the implementation of a new regional policy for employment growth in location outside of the larger urban centres. However, I should emphasise that this policy stems entirely from the statutory obligation IDA has under the Industrial Development Act, 1986, to foster the national objective of regional industrial development.
The new IDA Ireland policy is as follows: financial incentives will now be biased in favour of smaller regional locations, with higher grant levels, as appropriate, in each individual case; with the involvement of private sector investors, stimulating and supporting a major programme of modern advance factory construction at key locations and, working in partnership with local authorities, to have available quality serviced sites at priority locations for new industrial investment. In addition, the IDA will devote additional resources at senior executive level to oversee this new focus.
This announcement was made against a background where Dublin has been fortunate to secure a large proportion of inward investment over the last number of years. The record growth for 1996 reported by IDA Ireland in terms of its national performance is substantially due to the exceptional capability of the eastern region to attract such a high proportion of mobile investment.This region now incorporates one of the major high technology business environments in Europe.
In 1996 the net growth in jobs in companies supported by the industrial development agencies in Dublin was 6,014, an improvement on the 1995 performance of 4,789 and dramatically ahead of the 1994 figure of 1,140. According to the annual series of CSO labour force surveys average annual employment growth in Dublin during the period April 1994-April 1996, at 19,300 per years, was four times that of the previous two years, while the average annual rate of jobs growth in the Dublin region during the same period at 5.2 per cent was well ahead of the job growth rate nationally, 4.4 per cent, over the same period.
The recent announcement of enhanced IDA incentives is not in any way intended to, nor will it, disadvantage Dublin or any other major population centre in Ireland in attracting new inward investment. It is an attempt to improve the attractiveness of some of the major regional location which have not directly benefited from the success of the IDA's efforts in recent years.
Specific incentives will have the greatest effect with smaller investors whose needs can be fully realised in a smaller community rather than in major population centres. In any one year IDA Ireland would interact with a number of smaller entities without the absolute requirements of a large sub-supply base or need for immediate access to, for example, a third level institution or an international airport. It makes total sense from the perspective of such clients to locate within a community of appropriate scale and capability to suit its needs.
The impact and resultant benefit to a regional community of such an investment is equally positive.The recent announcement was an attempt to highlight and promote the inclusive industrial policy of the Government. Our emphasis is to ensure that firms locate in areas which cater for their range of requirements and in the process facilitate balanced industrial and employment growth across the country.
While the Minister's announcement was welcomed by people in areas outside Dublin it incensed Dublin Deputies from all parties. I am sure he has learnt the lesson that announcements do not always have the effect one wishes. I would welcome a restatement of the provisions of the 1950s IDA legislation. There are huge pockets in large urban centres which have not benefited from the Celtic tiger syndrome.
The Minister said the IDA grant system will be biased in favour of smaller regional locations, with higher grants, as appropriate, paid in individual cases. What guidelines will be used in determining the level of grant payable?
I assure the Deputy that the guidelines will be flexible. The IDA does not publish negotiating guidelines. It would not be in the interests of the IDA or the country to publish these guidelines as they contain material which may be used by our competitors in the race to attract mobile investment. Not only is there a bias in terms of the grant level but more resources have been allocated to pursuing such investment. In recent times there has been some growth in the number of mobile engineering projects which are suitable to regional locations. In addition to creating the environment in local regions to attract inward investment, we are also successfully focusing on mobile investment suitable to those regions. By adopting this two-pronged approach I am confident we can deliver results. We have seen results in counties Leitrim, Cavan and Monaghan and other locations in recent months.
