Dáil Éireann debate -
Wednesday, 10 Mar 1999

Vol. 502 No. 1

Written Answers. - International Financial Services.

John Bruton

Question:

34 Mr. J. Bruton asked the Taoiseach if he will make a statement on the strategy document recently launched by him on the International Financial Services Centre and the role his Department will play in implementing and monitoring the strategy. [6598/99]

The Taoiseach

I launched the Government's strategy for the development of the International Financial Services Industry in Ireland on Monday, 1 March. Copies of the strategy have been laid before the Dáil. The IFSC is now established as a successful and reputable financial centre. More than 6,500 people are employed directly in the centre and in associated back-office projects. The creation of a vibrant financial services industry has also helped to reposition Ireland as a centre for knowledge-based industries.

The IFSC is facing into a period of change. In particular, the corporation tax agreement with the European Commission will fundamentally change the nature of the IFSC as the preferential tax regime will no longer apply with the introduction of an across the board 12.5 per cent rate of corporation tax. The introduction of the euro and advances in technology will also impact on the centre. In the light of these factors, it is necessary for the Government to articulate and implement a new vision for the development of the inter national financial services industry in Ireland, building on the success of the IFSC. The strategy sets out this vision and an implementation plan based on 19 priorities. These priorities include: holding a seminar in June to launch this new vision; promoting the docklands as the hub for the longer-term development of the industry in Ireland – the location of back-office activity elsewhere will also be facilitated where necessary to maintain competitiveness; the docklands authority will implement a development strategy for accommodation and infrastructure for international financial services in the docklands area; IDA Ireland will implement a revised marketing plan for the promotion of the industry; measures will be taken in response to the education and training needs of IFSC companies; taxation issues affecting the industry will be addressed having regard to EU and domestic constraints; company law will be amended to improve the competitive position of the industry; measures are being introduced to eliminate the inappropriate use of IRNR companies; a pro-active approach to ensure Ireland is well-placed to capitalise on opportunities for electronic commerce in financial services and new development opportunities will be pursued, including in the areas of the European pensions market, securitisation and the marine services sector.

The strategy was prepared through the IFSC clearing house group and working groups in my Department. These groups bring together industry representatives with the different Government Departments and agencies involved. While the implementation of individual commitments remains a matter for each responsible Department or agency, a public sector group will be convened and chaired by my Department to co-ordinate and monitor progress. The IFSC clearing house group will submit a progress report on implementation of the strategy to the Government at the end of the year.