Quarterly National Household Survey: Statements.

Minister for Enterprise, Trade and Employment (Mr. Martin)

I welcome the opportunity to address the House on the quarterly national household survey results. It is important sometimes to reflect on our achievements and to pause for a moment to understand what is happening in our economy. The figures published by the Central Statistics Office last month tell a compelling story of transformation.

I pose an important question to the House. What does an increase of 400,000 in jobs since 1997 tell us? It tells me that we have put in place the right enterprise policies to build a strong economy. Through lower taxes we have given individuals more choice over how to spend their incomes and we have nurtured a culture of enterprise where people with new ideas are not stymied at every turn. In a decade, our very approach to risk takers has changed. No longer is the only option for entrepreneurs to emigrate to innovate. Ireland has been transformed from a country where many young people had to leave to find jobs to one where young people from across the globe are contributing to our economy. We have implemented broad economic polices that have changed the business environment. This is not just our own analysis. After eight consistent years of managed growth and prosperity, the International Monetary Fund is still able to commend Ireland's "continued impressive economic performance, the result of sound economic policies."

Mr. Howlin

It did not begin eight years ago.

Mr. Martin

The figures from the latest quarterly national household survey are marked proof of the effectiveness of Government policies in the areas of employment and the labour market. Our recent economic success has been remarkable. The so-called "jobless growth" of the early 1990s has long since been replaced by consistent employment creation. Employment increased by 93,000 in the 12 months to August 2005, bringing the total at work to 1,929,000. This is the highest annual growth rate in five years and is an increase of 31% or 461,000 since 1997. Women have particularly benefited from the massive growth in employment during this period. The number of women in the workforce has increased by 39% since 1997 as against the 26% increase in male workers. More needs to be done if we are to continue to attract women into the workforce. In addition the figures show a strong regional performance, with employment in the Border, midlands and west region increasing by almost 6%, giving employment to an additional 26,000 people. Moreover, we have seen employment increase in most sectors of the economy, with financial and business services showing strong growth.

This strong employment growth has been based on a strong and vibrant economy. With favourable economic growth forecast to continue, the indications are that employment growth will be maintained in 2005 and into 2006. Employment is forecast to grow by around 2.9% in 2005 and by 2% in 2006. Unemployment continues to be maintained at a low level at 4.2% and is forecast to remain at around this level into next year. Our unemployment rate is currently less than half the EU average of 8.6%. Our current rate compares to an unemployment rate of 10.4% in 1997. The numbers unemployed have decreased by 50% in this period, from 171,200 to 85,600. Long-term unemployment has dropped from 90,000 to 27,000, a decrease of almost 70%. It now stands at 1.4%, which is about one third of the EU average.

The consensus approach under social partnership, involving employers, employees and Government, has been a major contributor to Ireland's economic success. This has been backed by a well-balanced suite of employment rights legislation, which, together with measures designed to stimulate employment, provide an appropriate framework for the purpose of achieving an efficient and competitive business environment. In addition to employment growth, the partnership agreements have been effective in securing improved economic performance and, above all, raising living standards. In the ten years to 1987 inflation was running at an average of 12% whereas the current rate is just 3%. Moreover, the pay terms of the two most recent national agreements have given workers pay increases of almost 30%.

Ireland will continue to implement policies that lead to higher levels of employment. We will strive to reach and if possible exceed the EU employment rate targets for 2010 of 70% for overall employment, 60% for female employment and 50% for employment of older workers. As pointed out by the enterprise strategy group, the policies adopted to date have proved very successful. However, if we are to move forward in the context of a knowledge based, innovation driven economy, a new set of challenges awaits us which require a different approach. In the labour market context this means we need to maintain a strong focus on education and training, including lifelong learning, to ensure the development of a high skilled, adaptable workforce. We need to ensure an adequate supply of labour to meet the needs of the economy and to sustain economic growth. Labour will be supplied through a number of sources: the underlying population increase; increased participation by the unemployed and those outside the labour force; and economic migration.

Education and training have been central to our economic success. Similarly, our future prosperity will depend on workers acquiring the knowledge, skills and competencies required to compete in an increasingly global economy. The enterprise strategy group's recommendations made it clear that lifelong learning will be key, as the nature of the workplace requires that workers be ever more flexible and adaptable. More than in the past, people will need to upskill and reskill throughout their working lives. This can only be achieved by introducing new approaches and putting in place the necessary delivery structures. The One Step Up initiative, which I announced recently and have substantially resourced, is an important element in this process. This initiative will promote life-long learning and upskilling of our workforce by providing easy access to a range of training and learning initiatives, including both tutor-led training and e-learning. It will also assist employees to obtain a recognised qualifications within the national framework of qualifications.

In ensuring an adequate supply of labour to increase the numbers at work in the context of the decreasing numbers of young people coming into the labour market, there will always be a need to mobilise labour supply from other sources. This will mean encouraging increased participation in the domestic labour market. It will also mean adjusting economic migration policy in Ireland to address identified labour shortages and skills needs.

Migration, combined with the natural increase in the population, has resulted in an increase in the population by 87,000 to more than 4 million in April 2005, the highest it has been in nearly 150 years. This is truly a historic milestone. This is a very positive trend for Ireland in view of our labour and skills shortages. The high level of immigration in the past year, with over a third coming from the ten new member states, is a result of our non-restrictive policy to those from these countries who wish to work in Ireland. There is no doubt that for most of our skills shortages, appropriate EEA workers are available.

The total population today is the highest since the census of 1861. The historic nature of this population increase should not be lost sight of. Demographers agree that if there had been no emigration since 1841, the population of the Republic would be in the region of 20 million instead of 4.13 million today. It is interesting to note that Pádraig Pearse believed the country could support a population of 30 million. These figures may be fanciful to us today and we would have an entirely different economy but, nonetheless, we have turned a corner in terms of the history of population growth in this country.

The Employment Permits Bill 2005, which I introduced in the Dáil last week, includes provision for a more managed economic migration policy, including a continual assessment of skill and labour needs in future. Research carried out by the expert group on future skills needs will continue to inform Government policy in this field. The focus of this policy will be to facilitate efficiently and effectively the entry into Ireland of people with skills we need but which we cannot source from within Ireland or the European Economic Area. The high growth in employment indicates how well the economy is doing and how important it is that we can absorb increases in the labour force both on the domestic front and from overseas.

In the space of fewer than 15 years, we have built a very different economy that has the inherent capacity to sustain growth rates that are the envy of some and a sought after example for others. At the root of this exceptional employment performance is a deeply embedded commitment to pursue policies across Government that boost our competitiveness. This is underpinned by recognising that we must constantly change, adapt and reform if we are to stay ahead.

I am realistic enough to know that keeping, let alone expanding, our share of world trade and investment will not be easy. Our competitors are no more than a mouse click away. Competitiveness is as easily lost as it has been hard won. While we are no longer a low cost economy, the recent annual report from the National Competitiveness Council recognises that we retain some fairly impressive and significant national strengths.

For example, we have achieved remarkable rates of economic growth over the past decade and we have recorded one of the best economic performances in the world. From 1997 to 2004, Irish gross domestic product grew by an average of more than 7.5% compared with an average of just over 2% in the European Union 15. Under the sustainable growth heading, Ireland's living standards, as measured by GDP per capita, the National Competitiveness Council calculates we come first out of 15 countries, and for gross national product per capita, we are sixth out of 16 economies at which it looked. GNP per capita has almost doubled since 1997.

However, it is not all about arcane economic numbers. Real progress has been achieved in improving living standards and this is reflected in Ireland's strong performance in the United Nations human development index that is a good indicator of general quality of life. Here we came fifth out of 15 comparable countries. In addition to the decline in unemployment and long-term unemployment in particular, the ESRI has shown that over the period 1994 to 2001, life chances improved significantly. This trend is directly related to declining unemployment and reduced levels of dependence on social welfare in a period of economic boom.

Maintaining our competitiveness is of huge importance for Ireland because we are one of the most open economies in the world. In terms of trade performance, we came second out of 16 nations in the National Competitiveness Council's league table, with much of this driven by our strengths in the foreign investment sector. We have one of the most favourable taxation regimes in Europe and have put in place enterprise policies that support all investors. This makes Ireland a secure and profitable location from which to do business globally. The combined effect of these policy strands has ensured that Ireland has consistently been an attractive location for foreign direct investment for a considerable period and we have successfully won more global and EU foreign direct investment than our size would naturally suggest.

Our commitment to developing a modern high technology and competitive economy is winning where it counts, that is, in the marketplace. The export performance of the high technology sector is powered by the skill and ingenuity of a productive and competitive workforce. Chemical, pharmaceutical, medical devices, electronic and electronic commerce sectors would not consistently choose Ireland as an investment location if we did not provide solid competitive advantages. We all know that global competition for prestige and high value mobile investment is intense, yet global businesses continually choose to invest here because we are competitive for these high end industries. Hard nosed investment decisions are not made in favour of uncompetitive and lowly rated economies.

Not only is foreign direct investment critical to maintaining economic vitality, how we manage the transition to a different portfolio of foreign investors is a key challenge that we meet. Manufacturing is still the engine driving our economy and represents by far the greater part of the exports of €68 billion and local economy expenditure of €15 billion by overseas companies in Ireland each year. However, the type of manufacturing investment being secured for Ireland has changed. Many western-type economies are seeing a gradual loss of low level, labour intensive operations to lower cost countries, but innovative economies like Ireland continue to attract advanced manufacturing operations that are at the cutting edge of technology, where high productivity output is heavily reliant on the skills and capability of a highly educated and agile workforce. These investments may not have the headline grabbing head count of previous years but their massive capital investment per employee shows that we are serious contenders when it comes to winning sophisticated, technology driven, mobile investment. We will continue to encourage manufacturing. It provides the test bed for innovation and ingenuity. Developing new products, creating new processes and achieving greater productivity is an integral part of manufacturing today.

Helping us further along the road of transformation, the enterprise strategy group's analysis of our enterprise performance made a very strong case. It showed us how and where we need to be creative in policy thought and deed. I spoke about the One Step Up initiative and the upskilling of the workforce and population. This is one part of our response to the enterprise strategy group.

A second key plank in our response to the O'Driscoll report has been the new Enterprise Ireland strategy to help transform indigenous enterprise. The vision set out in the strategy is the support and creation of a dynamic indigenous firms sector engaged in high value added activities. Enterprise Ireland's clients will become more intensely market focused and innovative, providing new and proprietary products at premium prices. The strategy has a heavy emphasis on research and innovation, exports, competitiveness and entrepreneurship to deliver greater numbers of new high growth companies with strong potential to win increasingly profitable contracts in global markets. It aims to help Irish companies grow into self-sustaining enterprises of sufficient scale to compete internationally.

Driving the competitiveness agenda and keeping us ahead of the curve was very much at the heart of the enterprise strategy group's recommendations. We have a broad and diversified enterprise base that has expanded with the help of constructive economic and business policies and we have one of the best possible international locations from which to do business. I want to keep it this way and I am determined we maintain this competitive advantage.

Sustaining the momentum for change and reform demands a close dialogue with business. I recently announced the business members of the enterprise advisory group who will advise Government on the implementation of the enterprise strategy group recommendations and on enterprise policy generally.

Globalisation provides huge opportunities for companies with international ambitions but it is also presenting unprecedented competitive pressures. I fully agree with the enterprise strategy group's report when it describes the new emphasis we should place on building strong indigenous small and medium-sized enterprises. Through Enterprise Ireland we are designing a new approach to helping SMEs but I do not believe changing our support schemes is sufficient. Ten years ago, the growth issues for small companies were very different and a small firms task force presented radical and important reforms that helped small companies mature and capitalise on economic expansion. Today SMEs face very different but no less difficult problems about growth and expansion in a world transformed by freer trade and massive competition.

We have made a very clear commitment to the need for a substantial step change in research and development, building on the outstanding success we have had since 1998 in that area. We need to change step again to bring Ireland into the next decade. In recent weeks, there has been much comment about the establishment of a variety of groups. It is effective that Ireland Inc. has looked strategically in consulting with people and has developed strategic frameworks for policy formulation. People criticise, in a shallow way, the establishment of strategic groups to look ten years ahead. It is a dangerous debate that is without substance. If we adopt that approach, we will do so at our peril.

Mr. Hogan

I was curious about why this item was put on today's agenda but now I know. The Minister for Enterprise, Trade and Employment felt he would not have sufficient time next week at the Fianna Fáil Ard-Fheis in Killarney to say all he did today. We are getting a preview of his ard-fheis speech.

Mr. Howlin

A very dry one at that.

Mr. Hogan

He will get more time at the ard-fheis.

The Central Statistics Office reports the population has breached the 4 million mark, standing at 4.13 million people. However, there is much comment as to the true population level. Once upon a time, in his previous portfolio, the Minister got into difficulty with sums over medical cards and the numbers of people over 70 years of age. It turned out to be a much different figure than was originally estimated. We are not exactly sure of the true level of migration into the country or population growth, as it varies from one particular study to the other.

Following the Famine of the 1840s, and the almost relentless flight of people from the land, we can look to inward migration as a sign that Ireland has finally come of age. Hard and painful economic reforms, arising from the bad old days of the 1980s were needed. Much progress has been made in the economy by successive governments in ensuring economic growth, development and employment opportunities for our people. We are richer, more confident, outward looking and self-assured.

However, a series of key challenges remain that we are simply not facing. We have enough reports at this stage to implement, particularly the enterprise strategy group's report, Ahead of the Curve. I was critical that another layer of business people was needed to implement recommendations already made through the existing——

Mr. Martin

Those are the recommendations in the report.

Mr. Hogan

There were many recommendations in the excellent report by Mr. O'Driscoll and his team. However, we do not need to see another implementation body but action. The Minister is now beginning to take some action.

According to the Forfás expert group on future skills needs, the list of professions facing a skills shortage is mind-boggling. It includes bricklayers, plasterers, carpenters, floorers, painters and decorators, accountants, actuaries, financial analysts, investment and risk analysts, fund managers, engineers, welders, computer analysts, chemical engineers, doctors, dentists, dieticians, social workers, credit controllers and warehousemen. These professions have been identified as suffering skills shortages by Forfás, an agency that advises the Minister. FÁS has also identified these shortages, another organisation advising the Minister.

As the economy grows, so too will the need for policies that will fill these gaps and create the necessary supply of workers for the future economic development of the State. Many reports have been published on skills needs because we have failed to plan ahead for these shortages. With economic growth in the last 15 years at an average of 7%, it was and is incumbent on the government of the day to plan ahead in infrastructure, competitiveness and skills requirements. We are now playing catch-up and the Minister recently took an initiative on up-skilling.

A situation where only some categories of the population are up-skilled is not needed. If that happens, there will be an unemployable group of people at the bottom due to educational drop-out levels in the lower socio-economic groups. The education system has a role to play. We do not want to see people dropping out of education, particularly at second level, to the extent they are now. This is a worrying trend that requires joined-up thinking in Government policy. Education will play a major role again, as it did in the 1960s, in driving the enterprise agenda.

There are 137,000 migrant workers working in Ireland, 7% of the workforce. Between 2000 to 2005, over 100,000 persons from outside the EEA came to Ireland for employment purposes. This is in addition to the substantial numbers of EEA nationals, with estimates of over 90,000 having applied for PPS numbers since 1 May 2004. The legislative infrastructure to maintain this situation does not exist, although the new Bill on employment permits will go some way in addressing this problem.

The Immigration Council of Ireland has pointed out that a two tier system of migrant workers has developed and is being perpetuated. On the one hand, there are those on work visas, generally in better jobs, with their families by their side, better paid and valued by the State. On the other, there are individuals, with no families, lower paid and not here in their own right, but rather in the gift of their employers. The legislation the Minister recently published goes some way towards addressing this.

There is some confusion about the Minister's proposed green card system, however, particularly as we are used to the US system. That green card system gives the individual the right to search for work, apply for residency and aspire to citizenship. The recently published legislation has not gone that far. I remind the Minister that Forfás stated:

While the EU and EEA counties will provide a substantial proportion of Ireland's low skill requirements, continued non-EEA immigration will be needed to meet some of Ireland's high skill demands over the next number of years.

Ireland is new to inward migration. We have the almost unique opportunity to avoid the pitfalls of the US and the UK where an enormous underclass of immigrants and their children has developed. The plight of the Irish emigrant in the UK is one we do not want to see happening here. In these countries, an entire generation has grown up knowing nothing but social deprivation and poverty. The link is made to the fact they are of foreign parents and their situation is often linked to the colour of their skin or their religion. As a result, an almost ingrained distrust of state institutions, including the police, becomes the norm. As with all communities suffering poverty, crime can become rife. The misconception that immigrant communities are inherently more crime ridden than the native born population begins to find favour. People coming to our shores who gain employment must also be integrated as part of our society to head off the race problems seen in other jurisdictions. This will not happen by accident and the education system will have a role to play in ensuring people are tolerant of migrants.

Figures in the quarterly national household survey paint a rosy picture overall but there are some worrying trends. The number of people classified as unemployed has risen, while those employed in both agriculture and manufacturing continue to decline. The Fine Gael Party has called on the Government to adopt an action plan for both these sectors of the economy. As an economy or a society, we cannot exist within the service sector. We must do what we can to maintain a manufacturing base because it is the key to spin-off development of ancillary services and industries. We must not allow the flight from the land to continue unabated. We must find roles for people in agriculture or on the land to play in the development of rural communities. We cannot leave the people employed in those sectors to the vagaries of globalisation.

I note a recent comment on manufacturing that the continuing decline illustrates the competitiveness challenge facing Irish industry as a result of the increases in non-pay costs such as energy and waste management in particular. The Government has a role to play in making Ireland a more attractive place for Irish people to work and do business by addressing those issues of competitiveness. I differ from the Government's version of events in that I believe it has allowed the competitiveness agenda to slip. We were fourth in the OECD world competitiveness forum rankings in 2000. We are now 26th, which is evidence that we have slipped.

It has been recognised in numerous studies that there is a competition deficit in this country. Across key sectors of the economy, including many directly controlled by the State, there is an absence of a competitive dynamic that would provide consumers of services with a wide choice. The former chairman of the Competition Authority, Mr. Fingleton, whose position is now vacant, outlined the scale of concentration resulting from the legacy of an anti-competitive and anti-consumer policy and culture. In particular he highlighted core areas of the economy where there are high levels of concentration and where consumers do not have adequate competition and choice. He outlined the presence of effective State monopolies in the postal service, energy, transport, health insurance, television and forestry. He also outlined other sectors where leading private sector firms have a market share of 50% or more, leading to concentration. There is one sector in particular where four firms alone control more than 80% of the market.

These are key issues for the provision to the consumer of better services, such as legal services, energy and waste management, at a cheaper cost. We must address them on behalf of the users of those services. Poor competition in the provision of goods and services adds to the daily living costs for consumers and businesses, especially small businesses. The Competition Act 1991 was reviewed in 2002 but could go much further in dealing with the issues.

I do not subscribe to the Government's policy of having a regulator for everything. Even the Minister for Justice, Equality and Law Reform got in on the act yesterday for auctioneers and estate agents. I understand the direction in which he wants to go to protect the consumer but we should not allow empire building by one regulator after another where no cross-cutting issues are discussed or developed between them. Each of the regulators' offices has a separate legal department, a separate accountancy department and other separate sections for a wide variety of consumer issues.

The Commission for Electricity Regulation is suffering enormously from regulatory capture. Most of the people involved in it were civil servants in the former Department of Energy. A cosy relationship has developed in some sectors of competition policy between regulators and the industry they are supposed to be independently assessing so that new competition is brought into the marketplace. That independent assessment is not happening and Government policy on how regulation operates needs to be reviewed urgently.

Approximately half the workforce is not in a pension scheme. This is a challenge. Figures from the Irish Association of Pension Funds show the average contribution to pension schemes is10%. However, to maintain an adequate income in retirement, the figure should be more like 15% to 25%. The Government is discussing this issue at present and I expect it will have a statement to make on the matter in the context of the forthcoming budget. It is another issue for which we must plan ahead.

If we want to plan for an enlarged population we should not repeat the mistakes of the past where there was no policy for migration, infrastructural development, pension contributions or competitiveness issues. We need a co-ordinated approach to plan the migration of people into this country to enlarge its population. Good progress has been made but major challenges lie ahead and we must meet them if we are to ensure we can compete with countries in the Far East and eastern Europe and continue to enjoy strong economic growth for the benefit of the people we represent who work and live here.

Mr. Howlin

I wish to share time with Deputy Burton. Like Deputy Hogan I was surprised to see this item on the Order Paper because there are many pressing matters in the legislative sphere for the House to give its attention to. The question was answered when the Minister gave his speech. As somebody who is an admirer of the Minister' s ability I was disappointed with the speech. His use of stark statistical analysis of where this country and society are going and his litany of self-congratulatory facts did him no justice.

We all share in the success story that is Ireland which Members on all sides of the House had a hand in creating. We do not all claim credit for it at every opportunity. More important for people listening to this debate and for policymakers is how we address the extraordinary challenges and opportunities of the demographic projections presented in this analysis.

There are some starkly worrying issues. The population of greater Dublin will continue to dominate. Mr. Frank McDonald, who has been a commentator on these matters for a long time, summarises that we are creating a city state. Greater Dublin is projected to have more than 40% of the population in 2021 and will so dominate Ireland in terms of infrastructure and economic activity that it will not be healthy for the organisation of a balanced country.

There have been debates in this House and the Government has made detailed statements on its spatial strategy. What does it mean? We learn new words like gateways and hubs but that is all we know about them. It reminds me of the RAPID programme, where the Government, to pretend it was doing something about inequality, re-labelled normal Government expenditure as socially focused expenditure. What specifically is being done about spatial planning in this country? Where are the driven Government strategies to develop regional centres and to ensure that the infrastructure and jobs go to those regional centres?

In reality the development of Ireland, of which the Minister is so proud, is not being planned in a rational way by Government or by these Houses. It is developer-led. Developers determine where population is to grow by planning and building houses. The whole planning process is overwhelmed by it. In my county the best efforts of forward planning are undermined by the requirement to deal with current applications that are being made in large volumes as developers seek to make profits. If we do not exert control over the strategy, we will pay dearly for it in decades to come.

The statistics for migration patterns are stark in the volumes they predict. There will be at least 30,000 new migrants per year for the next 19 or 20 years, and that is a conservative estimate. We seem to have no strategy for dealing with an evolving society. My colleague Deputy Burton has an even more direct experience of this. Society in towns, villages, urban areas and constituencies as a whole is changing, but in an almost haphazard way.

The economy needs workers so we invite them in, particularly from new EU member states, but there is no structure for integration. People are struggling to come to terms with the changing pattern of worker in our society. We do not have an overall plan for integration to ensure we are bedding down a balanced society that will create, as I mentioned last week, a new and different Irish community instead of ghettoising people because they have an economic short-term value and then rejecting them. I do not see any sense to this, and I had hoped the Minister would give some visionary comments to the House today in his contribution on these important matters.

An overwhelming issue is the need for joined up Government. I do not see sense in attempts at this either. The Joint Committee on Enterprise and Small Business had a stark presentation from Mr. Eddie Shaw of the National Safety Council this morning. If the Minister reads his contribution, he will find robust criticism regarding a lack of joined up Government thinking on road safety. It applies to all issues that are to be dealt with in dealing with a demographic shift that is unprecedented in a century. The National Roads Authority is building roads but it is doing so in a slow and piecemeal fashion, leaving gaps within all our national systems. Where other countries might see the need for a metro in a city such as Dublin and proceed in a structured fashion, we seem to be paralysed by analysis and unable to put basic facilities in place.

In my county of Wexford, there has been a 12.5% increase in population since the last census, from 1996 to 2002. The increase is geographically narrowly focused in north Wexford and the strip of county on the coast. There is no other planning however. There are two secondary schools in north Wexford, one of which by volume is by far the biggest secondary school in Ireland. That school cannot take any more pupils. The county is trying to catch up, stating the need for a new secondary school in Gorey and the development of Kilmuckridge. However, this is occurring years after the population is in place. People are struggling and there are crazy transport routes ferrying people from north Wexford to Wexford town to receive education. This is because education needs are not being linked with the requirements of the changing population distribution in the country.

The same can be said about leisure facilities. Houses are built because developers submit planning applications, but the infrastructure is not being put in place to create societies beyond that. A wilderness is often being created instead in the name of profit, which has significant social implications for the future.

The Labour Party is this week publishing a comprehensive document on child care, which I will not discuss in any detail as that will be raised by our spokesman. A number of people, both men and women, are telling us that they are fed up with some aspects of the Celtic tiger, such as endless working hours in the name of productivity. They are fed up with getting up at 6 a.m. and not getting home until late. They are worried about their family life or the lack of contact with their children. These are issues of values that must be discussed in tandem with the Minister's litany of economic progress. We are not an economy but a society. If we think of ourselves exclusively as an economy and think of people as units of work rather than citizens in an evolving society, we will make the wrong decisions. We may make no decisions at all.

Where are the grand ideas to restructure Ireland? The only new town we built is Ennis, and we did not put in place the resources to meet all the needs of that town when we started. Where are the new cities and towns? Where are the new modes of transport which are required, and where are the new innovative educational facilities that will ensure we do not create the city state that Frank McDonald is mindful of? Have we the strategies to explore the notion of manufacturing jobs being the hub of economic success? Where are the strategies to deal with the loss of manufacturing jobs currently taking place? Where are the plans to ensure all areas of the country benefit equally from the economic progress that has characterised Ireland for the past decade?

Ms Burton

The figures released by the CSO show further startling increases in population. The answer to my colleague Deputy Howlin's questions about the new cities is that these new cities are already here.

Mr. Howlin

They are grafted on.

Ms Burton

They are in a necklace around the western side of the Dublin region. They start at Tallaght and go on to Lucan, Clondalkin, Leixlip, Blanchardstown, Clonee, Dunboyne, Swords and Balbriggan. This does not take into account large areas such as Ashbourne on the fringes. This is where an enormous concentration of the new population is.

I have the honour of representing Dublin West. The west of Dublin is struggling to deal with what is occurring. This Government mainly has a type of planning led by developers and the building industry, so it is for profit rather than for people. One change in strategy we wish to see is planning which benefits people and communities rather than for the profit of builders and developers. Builders and developers must make money, but they are making it currently at excessive levels on the backs of struggling new communities which are being left bereft.

Does the Minister realise it is now easier for somebody in west Dublin to buy a house in Cavan, Duleek or Leitrim, where they may get a tax break with the house? In such locations they get a bigger house on a bigger plot of land. As a result of the lack of transportation within the Dublin West area, they may be faster travelling to Dublin, moving on main roads by car, than if they came from a local Dublin estate. This is because public transport currently available is not sufficient.

The leader of the Labour Party, Deputy Rabbitte, and I stood at Clonsilla railway station last Monday morning at 8 a.m. Pat Kenny discussed the same rail line on his programme yesterday. The people were crammed on the train, and it is locally referred to as the Calcutta express. The cramming is to a point that if a woman is heavily pregnant, she can no longer take the train. The level of overcrowding is dangerous. In the latter years of the rainbow Government, this line was marked for expansion. When the Fianna Fáil and PD coalition Government came into office, the proposals were re-examined, which took three or four years. The expansion, on a modest scale, occurred about a year and a half ago. It took eight years to upgrade this magnificent Victorian inheritance of a full railway line to the west of Dublin.

As a result of the Meath by-election, a hastily put together study was published on the re-opening of the Dunboyne railway line. Todd Andrews sold the line, so the reinstatement of the line must be planned after the land is bought back. Anyone with experience knows that each of those stages will take several years. Commuters are buying houses and they are being made car dependent by this Government because they cannot buy a house with access to decent public transport or a quality bus corridor.

There is now a division between the east and west sides of Dublin. The east side is the gold coast and the west side is where ordinary people and immigrants live and people have no public transport. The quality bus corridor into Donnybrook is wonderful. However, it now takes nearly 40 minutes more to get into the centre on a QBC from the west side of Dublin than it did when there was no QBC. This is because the Minister for Transport, Deputy Brennan, cannot release additional buses because he is caught in an ideological problem on whether or not public bus services should exist.

Ms C. Murphy

The focus of the Minister's speech was on what a great economy we have. None of us doubts that jobs are being created all of the time. We should not use the data to sing the praises of the economy, however, without analysing them. There is little reason for gathering them in the first place if we are not going to use them.

We can see from the data there is a significant increase in the number of women participating in the work force. It does not take a rocket scientist to figure out that there will be increased child care needs. Even though this data is published quarterly, it took a by-election and the opportunity afforded to the public to take ownership of the issue for that issue to be taken seriously. We will see if the issue is dealt with in the budget but there is no doubt that the lack of affordable child care is an impediment to the participation of women in the work force.

Why do we always have to get to a crisis before we deal with it? We can anticipate it and see it jumping out off the page, as is the case with congestion. All one has to do is go out any morning on to the N1, N2, N3, N4, and the N7. People are living very far away from where they are working, yet the report shows that the lowest level of unemployment is in the mid-east region. People are moving further away from their work place and are struggling with the congestion, which is having a bearing on the quality of their lives and their communities. With women participating to an ever greater extent in the workforce, communities are losing people who would otherwise be volunteering. Resident and voluntary group meetings are dominated by women. If we want to build solid communities, that volunteering time must be replaced in a more structured way.

When a company is locating its business in an area, the quality of the living environment there has a direct bearing on its decision. Companies such Intel and Hewlett Packard, which are located in my area, tell me exactly that. Child care, transport and accommodation jump out of this report as issues that must be addressed beyond the statistics on who is working, where they are working and the increase in the numbers of those employed.

About 13 years ago, the Dublin transportation initiative was begun after the Government informed the European Union that congestion was a serious impediment to the progress of the economy. I wish we could only roll back the clock to those levels of congestion because we are seriously beyond the point of gridlock. It typically takes an hour to drive four or miles at peak times, which is absolutely untenable.

Professor Joe Lee recently spoke about a sense of place and how we had lost it. He said that we had become a nation of consumers and producers, where only one generation was involved, with no place for the old and the young. That is a fair description of what is happening. The public is way ahead on this and people see that there must be a connection between building an economy and building a society. They want to see what the Government claims is a great economy turned into a quality of life, with improved transport, child care and a reduction in accommodation costs.

Mr. Eamon Ryan

The Minister says that we must be strategic and he is right. I would like him to read the comments in The Irish Catholic by the architect of that strategic thinking which brought us economic success, Dr. Ken Whitaker. He said that economic growth does not necessarily lead to a peaceful, civilised or more idealistic society, and that there are values, moral and intellectual, which are higher than mere economics. If only this Government would listen to that strategic thinking. We certainly need wealth but we need it to be shared out so that we can live in a successful, civilised, peaceful society.

Government Members thought they would have an easy ride today and be able to claim that we are doing brilliantly. It is interesting to hear the strong and consistent message from different speakers today stating that while these statistics tell a tale of economic success, they also tell us a tale of a society that is deeply unhappy with the way the Government is leading the country.

My wife is currently in the workplace. She is at home with our children. I do not see that work as any different or less valuable — it is more valuable — than the work that I am doing here. However, that work is not valued by this Government. The Minister has just stated that we must get people into the workforce, regardless of the future that leaves for the children in our country. The child care policy of the Progressive Democrats certainly could have been written by IBEC, setting the needs of our children in the context of the workforce, rather than vice versa. Such an approach is not only wrong, but in the long run it corrodes and eats into the social capital upon which a successful economy depends.

The Government should stop the constant mantra that we need people in the workforce to keep the economy growing, as if economic growth in itself was exactly the thing we need. It is clear that such is not the case. I celebrate the arrival of so many immigrants into Ireland in recent years, but I do not want to see it planned on the basis of doing all we can to make sure that economic growth continues.

I am not sure that it is clever, although Fianna Fáil would think so, that we are building 70,000 housing units per annum on the basis that it is good for the building industry. We will engage in an incredibly difficult balancing act by keeping this pump-primed economy going. I fear that if we just solely concentrate on pumping economic growth, if at some stage there is a property collapse, we will have a far more dramatic downturn because we have followed this mantra to keep the economy growing at full speed.

Deputy Burton referred to the lack of transport, which we have raised for 15 years in the House. It is not just on the west side of the city that this Government has failed, with the Calcutta express running through Clonsilla. I am sure the Minister of State at the Department of the Taoiseach, Deputy Kitt, is aware that already, people must also be forced into carriages on the Luas in the mornings because the system cannot cope with the sheer demand for public transport. At the same time, the Government spends four times more on new roads than on public transport. It will postpone the public transport projects again in its updated transport plan.

The consistent message from the Opposition side of the House is that while our economy has done well and the statistics show massive growth, it is clear the Government is getting other essential aspects of governance fundamentally wrong.

Clearly the manner in which this wealth is shared out is not working and does not lead to everyone enjoying the prosperity that these figures suggest. It is fine for the Progressive Democrats, who represent the wealthiest 5% of the population. It is fine for Fianna Fáil, who represent the building and developers' community, the people who have benefited by far the most. However, while the vast majority of the people welcome the fact that there is not emigration like in the 1980s or the kind of poverty that scarred this country for so long, they are unwilling to pay the price, in terms of imbalances and pressures, to keep the wealthiest people and the building community happy in the future.

Mr. Morgan

This debate provides a timely opportunity to discuss the Government's abject failure to plan for the needs of the increased and increasing population. I refer to the failure of the Government to prepare for the housing, transport and health care needs of the increased population. Members should stop patting themselves on the back.

We have over-priced houses and 50,000 families on social housing waiting lists. As other speakers have noted, we have overcrowded hospitals, traffic congestion and jam-packed commuter trains. By April of this year, the population of this State had reached 4.13 million people. Rapid population increases as a result of economic growth have exacerbated problems with shortfalls in the provision of public services such as health, transport, education and housing. It has contributed to deterioration in the quality of life for many in this State. Increased tax revenues from the increased workforce have not been put back into increased services for the increased population. This is a dangerous mistake. As the population continues to grow, services and infrastructure will be stretched to the limit.

The Government failed to plan for the long-term housing needs of a growing population. The housing stock per population ratio of the Twenty-six Counties was 390 units per 1,000 of population at the end of 2003, compared to an EU 15 average of 440 units per 1,000 of population. Many of the 50,000 families on social housing waiting lists have been waiting for years to be housed. Some, such as single males, find it particularly difficult to secure social housing. The National Economic and Social Council stated:

An increase of permanent social housing units owned and managed by local authorities and voluntary and co-operative bodies, in the order of 73,000 in net terms between 2005 and 2012 is necessary to meet the need for social housing.

Nearly a year after the publication of that important report, the Government has yet to make any statement indicating whether it accepts this recommendation. In no other area of policy has a hands-off approach been more evident than with regard to housing. It is bizarre that something so vital to life is so ignored by the Government. What is the Government's housing strategy? How does it intend to address the housing needs of our increasing population?

Population growth has not been met by a growth in the capacity of the health service. The effects are seen in overcrowding in accident and emergency units, bed shortages and unacceptable waiting times for urgent medical intervention. A total of 3,000 extra beds in public hospitals by 2011 were promised in the national health strategy of 2001. As of this month, only 800 have been provided according to Government figures. Plans for primary care centres across the State have been put on hold.

Unfortunately, the treatment received by many migrants who come to this State is the unpalatable truth that lies behind these statistics. While I will not go into the issue in detail, the Government reaction shows no sign that it is committed to cracking down on such exploitation. The pathetic strength of the labour inspectorate alone is testimony to this.

According to the figures under discussion, the total immigration flow into the State in the 12 months to April 2005 was estimated at 70,000, 38% of whom were nationals of the ten new EU accession states. At the time of their accession, the Government introduced a two year habitual residence requirement before workers could access social assistance. Sinn Féin opposed the introduction of these restrictions, arguing that the proposals would expose migrant workers to unnecessary hardship. Evidence has now come to light of the hardships experienced by such workers in situations where they unexpectedly become unemployed and where their accommodation was linked to their employment in some cases, they became homeless.

Yesterday, the Irish Congress of Trade Unions published a briefing paper on migration policy and the rights of migrant workers, in which it called for the amendment of the habitual residence requirement to specifically allow for the payment of social assistance or benefit to workers on employment permits who are made redundant or who have been unfairly dismissed, including constructive dismissal.

This is a reasonable demand upon which I urge the Government to act without delay.

Minister of State at the Department of the Taoiseach (Mr. Kitt)

I welcome this debate. As Chief Whip, I have responsibility for the Central Statistics Office and, consequently, am fortunate to be in a position to see the figures as they are compiled. In this case, Members are discussing the quarterly national household survey. While I am disappointed that we have not heard more ideas from the Opposition spokespersons, I make no apologies for making some remarks with regard to the Government's performance.

The recently published quarterly national household survey provides a most useful and detailed update on how the Irish economy is performing and on how the population is benefiting from ongoing growth and development. I listened with interest to a radio interview with a representative of the International Monetary Fund, IMF, on Monday, concerning the recent report of the IMF into the performance of the economy. He clearly stated on at least two occasions, that the success of the Irish economy was due in large part to sound management of the economy by the Government over the past ten to 15 years.

It would be useful to reflect on the cornerstones and pillars of what is a new Ireland. Admittedly, it is an Ireland that is at times bewildering in its complexities and challenges. However, to listen to the Opposition in recent months, a stranger would be forgiven for thinking that the country was teetering on collapse and about to re-enter a former dark and gloomy period. It is a truism to suggest that the days of doom and gloom in the recent past in Ireland only come to mind when thinking of the Opposition parties and their sporadic attempts at government.

When one considers this country's achievements in the past 18 years of almost exclusively Fianna Fáil-led Governments, one striking policy above all others has worked to ensure continued and sustained success since the late 1980s. It has given birth to a new Ireland and has enabled it to grow, prosper and develop. That policy is one of partnership.

The policy of partnership, in which all the social partners including businesses, farmers, employers, trade unions, workers and the unemployed collectively agree on our future, has been firmly in place not simply for a couple of years in a single programme, but for several programmes, spanning almost two decades. I am proud to state that Fianna Fáil, introduced this overwhelmingly inclusive policy that has resulted in gains for everyone. This partnership approach has enabled us to manage rapid change successfully and to build popular support for the steps necessary to achieve continued growth and employment. More than ever, Ireland now needs the continued stability that such partnership provides.

I heard Deputies Eamon Ryan and Howlin discuss the need to view Ireland as a society and not as an economy. I assure them that Members on the Government side of the House view this country as a society. However, I suggest to both Deputies that people living in a society require jobs. We need taxes to pay for the services required in health, education and elsewhere. We are as much concerned about quality of life issues as the Opposition Deputies. I note again that I have heard little in the way of ideas from the Opposition Deputies today.

This new Ireland is a better place because of the talent, creativity, hard work and enterprise of the Irish people and a Government that works with them. This policy of partnership, solidarity and many other enlightened policies has resulted in Ireland coming of age and it is seen by many developing economies as a model to be emulated.

Over a period totalling almost 18 years and during our recent concurrent period in office of eight years and running, the enlightened policies of Fianna Fáil and its partners on health, enterprise, investment, taxation, transport, social, sporting and cultural affairs and on the building of community services have brought us to where we are today. It is no accident that a generation of young people has grown up and prospered never having known an elected Fine Gael-Labour coalition. It is a generation since a Fine Gael-Labour coalition was elected to govern this country and it was a period marked by economic darkness and depression, a time of lurching from crisis to crisis and instability. It is no accident that all the gains, the growth, the unfulfilled potential and the dormant ambition that lay untapped has flowered in the intervening period while Fianna Fáil-led Governments took the courageous and often painful decisions necessary to turn the country around and went on to build and manage the prosperity of the nation.

The short-lived so-called rainbow coalition that was in Government from 1994-97 briefly reaped the reward of others' hard labour and the claims to the contrary are totally unsustainable and without foundation. The truth is that the foundations had been firmly laid for this rainbow Government by each of the three preceding Fianna Fáil-led Governments. What has been built on those solid foundations? Since 1997 alone, more than 450,000 new jobs have been created. A staggering one in every four jobs in Ireland has been created during the lifetime of this Government.

It is accurate to state that in Ireland we have achieved virtually full employment and this year has seen employment pass the 2 million mark for the first time. The scale of the turn around is dramatic and is too easily forgotten. Ireland has an unmatched rate of unemployment, half the European average. We have been in the favourable position of being able to offer employment to nearly 200,000 people who have moved here from overseas to find employment and make their contribution. At 4.2%, our unemployment rate is half the EU average and less than half the rate it was in 1997.

There are many statistics in the quarterly national household survey that merit closer scrutiny and commentary. The number in employment has grown this year so far by 93,000, which is an additional 93,000 people working and taking home pay. This is the highest annual growth rate recorded since the second quarter of 2000. Therefore, this year witnessed a record growth in the labour force, even greater than the phenomenal growth experienced in the late 1990s. It is important to note that the increases in employment were almost universal, with increases recorded in construction, financial and other business services. In the BMW region, employment is up 5.7% or 26,600 people.

Since 1997, this Government has halved the national debt and we consequently pay €1 billion less in interest than in 1997. It was this Government that created the National Pension Reserve Fund so that our citizens could look forward to a comfortable retirement in future years.

There are many areas of dramatic improvement and growth worth mentioning but I will limit myself in the context of this debate to the dramatic leaps made in the arena of education since 1997. The statistics speak for themselves, namely, over 4,500 additional teachers, including 3,000 resource teachers, the lowest class sizes in the history of Irish education, in excess of 30,000 new college places, 6,000 special needs assistants, all Irish schools have access to the Internet and we are on target to deliver broadband to all schools within months. Department of Education and Science funding for research, which stood at zero in 1997, is now over €500 million. This is without mentioning all the improvements, extensions, new buildings, refurbishments and sports halls that have been built within that period.

Yes, there are challenges and obstacles and, yes, sometimes we do get it wrong but we have a record of achievements that matches our aspirations. We know what needs to be done and have plans and programmes in place to implement our policies.

Aside from aspiring to office, what plans has the Opposition to speak of? We have heard none today. This country was on its economic knees 18 years ago and violent conflict was the order of the day. Since then, the longest and largest period of sustained economic growth in our history has made us the envy of developing countries and of wealthy countries alike. The peace process is alive and the war is over.

We are rightly proud of our record of achievements but we do not let it blind us to the challenges that lie ahead, of which there are many. Almost all indicators on the Irish economy in 2005 point to further strong growth in domestic activity. Consumer spending has picked up momentum, investment is also gaining strongly, especially business investment, while housing activity remains buoyant. It now seems likely that housing completions this year will match 2004's record figure of 77,000. Deputy Eamon Ryan asked whether we need these but I will ask him to talk with some of the first-time buyers and young people who need them desperately.

Tax receipts also rose strongly in the first nine months of 2005, reflecting our robust economic performance. Employment growth, good fiscal policy, generous tax cuts and social welfare increases in the last budget have also contributed to a healthy economy. We in Government are proud of what we have done and achieved in working with others to build the new Ireland. We are well aware of the unfinished business that needs to be addressed.

We have heard absolutely nothing from the Opposition about its vision for the future. We have heard no new ideas or policies or initiatives or how they plan to pay for them. We on this side of the House have a very clear vision for the future of our country, which has been articulated many times by the Taoiseach, Deputy Bertie Ahern. I concur wholeheartedly with the Taoiseach when he says he wants Ireland to be: "A good country in which to live, to work, to invest, to grow up in and to grow old in, a country that has the potential to enjoy a truly great economy and a truly great society".

This Government has worked in partnership with others to realise this vision. I have no doubt that when we all face the electorate in 2007, we will be given a mandate to continue in Government, to build on the unprecedented progress already made and to fulfil the potential of this country and of its people.

A Labour Party Deputy spoke about the spatial strategy and asked what other cities are developing throughout this country. I remind the House that, apart from Dublin, there are cities such as Galway in my native county, which has become the medical device capital of the west and Europe, Limerick, Waterford, where financial services are thriving, Cork and many others.

Mr. M. Ahern

Hear, hear.

Mr. Kitt

It is not true to say no progress is being made on the spatial strategy.

I thought the Opposition would take the opportunity of this debate to come up with some ideas and real policies and cost them as we did when we were in Opposition. It would make for a much better democracy overall and we are ready to take on the Opposition whenever the date for the next election is announced.

Mr. M. Ahern

Well done.

Mr. Glennon

Hear, hear.

We must put in place structures to deal with the difficulties that arise. Many towns do not want to experience what happened in Leixlip. Every town should agree to 400 or 500 new private houses and increase its population by a few thousand. However, for some strange reason, people by their nature do not like additional people coming into their area. Many of those towns do not have the internal infrastructure such as a bridge over a river, a streetscape to deal with the growth or it is too costly to introduce the infrastructure required.

We must examine the concept of creating new small towns as opposed to developing big towns such as Galway or Mullingar as in the national spatial strategy. Instead of these towns getting out of control we should examine the idea of taking the population that must move into an area and creating small towns with populations of between 3,000 and 5,000. I articulated this policy vision for many years but unfortunately it fell on deaf ears. The Government should examine it.

Wicklow has strange planning processes that people do not understand. A planning policy existed whereby only locals could live in houses sold in towns. With the exception of large towns on the east coast, if new houses were built, only people from Wicklow could live in them. That was a crazy policy and I was opposed to it. It was changed and now if a new development is built, 50% can be bought by Dubs, for want of a better word, and 50% by locals. It is difficult to agree with that policy. If I drive through Germany or France and see a scheme of houses being built in a town and on inquiring to buy I am told I cannot do so because I am from Ireland, I would take umbrage. Central government states that it is Wicklow County Council's decision but it is not. The decision was taken based on the strategic planning guidelines and the interpretation given to the county council by the Department. It is supposed to be applicable to Meath, Wicklow and Kildare. Meath and Kildare did not strictly follow suit but Wicklow did.

We also have a difficulty with roads. The N11 on the eastern side of the county is a good road and most of it is completed. However, the N81 on the western side of the county is one of the worst and most dangerous roads in the country. The national development plan mentions that it will be upgraded between Blessington and Tallaght. That national development plan finishes next year but nothing has happened with regard to the upgrade of the road. I invite anyone to drive along it. It is treacherous.

With regard to public transport, a second rail line is required on the east coast. That would mean boring through Bray Head. Perhaps we still have the equipment used in the port tunnel. Running a second line through Wicklow and along the coast must be examined. The DART runs as far as Greystones and should be brought as far as Wicklow Town, which is a primary growth area.

The Minister for Enterprise, Trade and Employment spoke on education and either he or the Minister of State, Deputy Kitt, referred to lower class sizes. The Government made a commitment to have a pupil-teacher ratio of less than 20:1 in classes of children under nine years of age. It is no longer a commitment; perhaps it is an aspiration. The Government did not live up to it. During that period, 30,000 new college places were created.

Wicklow has sought an outreach for a third level institution because of the hit it took in terms of the increase in population during the past 15 to 20 years. We have not received any co-operation from central government. As recently as last week I received a reply from the Minister stating no plans were in place. However, the local authority and a developer have entered into negotiations with respect to buying the old Claremont college in Rathnew along with 60 acres. They will promote the project in conjunction with the Institute of Technology Carlow. I appreciate any support the Government can give to that.

I regret that the Government sought to use this time to spin propaganda. I thank the almost exclusively Fianna Fáil Government. We will remember that when we face the many difficulties in the month ahead.

Mr. M. Ahern

"Almost" is a big word.

Mr. Timmins

A few bad years.

Mr. Glennon

Listening to Deputy Timmins during the past five minutes, I had to pinch myself to see whether I had suddenly been co-opted onto Wicklow County Council. I welcome the opportunity to speak on this issue. Listening to the tenor of the debate earlier, someone stated it was a nice idea on behalf of the Government to have this discussion so we could get involved in an exercise of self-congratulation. We should be given credit for the fact that we are far too knowledgeable about the quality of the Opposition in this House to know we would never get away with that.

I have pleasure in informing the Opposition that the real idea of this discussion was to show how bankrupt of ideas the Opposition is. In that regard I have no hesitation in indulging in an exercise of self-congratulation. If one listened to the last hour of input to this discussion, it is patently evident how devoid the Opposition is of any constructive ideas. I heard somebody state recently that there is much less to the Opposition in the House than meets the eye and it is a good description. I would never claim a monopoly on wisdom on this issue or any other issue, and I speak on behalf of everyone in the Government parties.

Mr. Timmins

Hear, hear. I agree with the speaker.

Mr. Glennon

However, after this discussion I have my doubts. The Opposition's performance has been quite remarkable. We have had entirely subjective opinions given from different angles and it is entirely understandable in the circumstances.

I wish to make one particular point regarding a radio interview to which my colleague, the Minister of State, Deputy Kitt, referred. It is worth repeating. The discussion took place on Monday evening and concerned the recent report of the International Monetary Fund on the performance of the economy. The spokesperson for the International Monetary Fund clearly stated on two occasions that the success of the Irish economy was due in large, not in full, to sound management of the economy by the Government during the past ten to 15 years.

Debate adjourned.

Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.

Dáil Éireann debate - Wednesday, 19 Oct 2005

Quarterly National Household Survey: Statements.

Dáil Éireann debate -
Wednesday, 19 Oct 2005