Vol. 648 No. 4
6 Deputy Olwyn Enright asked the Minister for Enterprise, Trade and Employment the links that exist between his Department and the local authorities and the Department of Environment, Heritage and Local Government in educating small businesses on the planning process; and if he will make a statement on the matter. [8456/08]
The provision of information in respect of the planning process is a matter for the Department of the Environment, Heritage and Local Government and local authorities. I understand that the Department provides documentation in respect of this issue, including the leaflet, "Planning for the Business Person".
Enterprise development agencies operating under the aegis of my Department provide general advice and assistance to small businesses over a range of issues affecting the start-up and expansion of business. The level and nature of the advice required differ from business to business depending on a business's stage of development, the particular business sector and the background and experience of the promoter involved. These development agencies do not have any formal role in advising on planning matters and would refer such businesses to the planning department of the relevant local authority for information on the most appropriate course of action to take.
Nevertheless, agencies such as Enterprise Ireland and the county enterprise boards have a strong working relationship with local authorities in ensuring that the proper business infrastructure is in place to nurture enterprises for their future development and growth. We will keep this issue under review.
While I thank the Minister for his answer, the question was meant to elicit a longer response, as it involved more than just the planning process, namely, working with local authorities. Our business sector needs more guidance and advice on how to engage with local authorities and similar standards should apply in the dealings with each authority, which I am sure the Minister would accept. It is his job to engage and help businesses in this respect because, unless one is a politician, understanding how local government works is a minefield. Businesses should not need to knock on councillors' or Deputies' doors to get help. While I accept this does not occur everywhere, the situation must be improved. Some councils' planning and economic officers work well, but not all of them do. We must level the playing field between councils. Red tape and delays scare business away. Contribution levies are bad enough without delays in the system. There is an obligation on both Ministers to put their heads together to try to fast-track this issue.
This is the job of directors of enterprise, which are positions of employment in many local authorities. I am glad the Deputy raised this question, as it gives me an opportunity to make a few points. I am concerned that in some local authority areas, the issue of enterprise has fallen down the ladder. Family enterprises and so on that have been in rural locations for 30 years or so are jumping many hurdles when it comes to planning the expansion of existing facilities. We will not bring multinational companies to such rural locations. People are being told to go 20 miles down the road to an urban centre.
And pay big money.
Yes, to set up one's business again. Enterprise Ireland is giving grants to companies in terms of human resources, research and development and so on but, thanks to development levies, those grants are increasingly going from one State agency to the county manager. Through the Small Business Forum, we made strong representations to the then Minister for the Environment, Heritage and Local Government that resulted in new guidelines being issued to local authorities. However, even the high level group on manufacturing, which will shortly engage with the social partners, is highlighting the issue of local authority development levies and their impact on business and manufacturing.
There was a time when local authorities hunted for business and jobs. They also sought meetings with me, which is still the case, but there is a mismatch between that aspiration and policy objective and the reality on the ground in terms of planning, development levies and the overall attitude to business, which is no longer as pro-enterprise as I, as Minister, would like it to be. This is particularly the case in rural Ireland, where we need to facilitate rather than penalise the traditional enterprises that have thrived for a long time. This is a concern I share with my Government colleagues and we set up an interdepartmental group to activate the work of the Enterprise Strategy Group report and the Small Business Forum to determine whether we can get a more collective opinion on competitiveness in enterprise.
The Minister is in a better position to get something done about this matter. I hope we can knock heads in this regard and keep pushing it in the coming years. This significant and important issue for rural Ireland in particular and the greater Dublin area must be taken seriously. I accept that the Minister has done work in this area, but the issue must be pushed and certain Ministers should know more about it.
I salute the Minister's efforts in respect of rural areas. Coming from one of those areas as I do, our future may be bound to facilitating small and cottage industries. County Westmeath is progressive in this regard, but could the Minister discuss this matter with local authorities?
That some local authorities are not facilitative and are not seeking opportunities are issues that have been raised at the Joint Committee on Enterprise, Trade and Employment, of which I am Chairman. Through the strategy group, can the Minister ensure a broad formula is sent to local authorities setting out the objectives of the Department of Enterprise, Trade and Employment and Enterprise Ireland? Any planning obstacles should be smoothed out and people should not make smokescreen objections to deter others from setting up in particular areas. Instead of facilitating the important employment opportunities provided by small companies, perhaps too much attention is being paid to minimalist objections.
I accept the broad thrust of Deputy Penrose's proposition, and that my Government colleagues and I have a collective responsibility in this regard that I must discharge. I take on board the Deputy's opinion that my Department should meet local authority managers. Traditionally, it was a matter for the Minister for the Environment, Heritage and Local Government. On an individual basis, I meet local authority managers as I travel the country, but there may be a case to be made for a more formal approach. Equally, I would be prepared to work with the committee of which the Deputy is Chairman to focus on this issue and to develop an Oireachtas policy framework.
It is on our list.
It would put into context the Oireachtas' opinion in this regard, not just the Executive's.
I would accept that.
7 Deputy Andrew Doyle asked the Minister for Enterprise, Trade and Employment if he has discussed with the Competition Authority their submission to the Government’s Alcohol Advisory Group that there should be no ban on below cost selling of alcohol; his views on such a proposal; and if he will make a statement on the matter. [8455/08]
The Competition Authority made a submission to the Government alcohol advisory group last month and, subsequently, made it available on its own website. As the independent statutory agency responsible for the enforcement of competition law in the State, the authority is entitled to respond to public consultations. While I have not discussed the submission with the authority, I am aware of the opinions expressed therein. I do not consider it appropriate, however, to comment on the submission, as the advisory group is considering all submissions made to it. The authority is independent and I cannot interfere in its right to make submissions and so on.
The groceries order was not designed to tackle the issue of alcohol abuse, there is no evidence to suggest that it was capable of doing so and it was a wholly inappropriate mechanism by which to seek to control alcohol consumption. The order was not a ban on selling below cost. Rather, it prevented sale below invoice price. In effect, it prevented sale at a price that could be, and often was, considerably above cost. The re-introduction of a ban on below cost selling of alcohol will not result in the Government taking upon itself the power to set prices. Rather, it will take the power of setting minimum prices for alcohol away from one element of the supply chain, the retailer, and handing it to another element, the wholesaler. It will guarantee a margin to the retailer and the publican and, thus, increase the profits to be derived from selling alcohol. Promoting the profitability of alcohol undermines the objective of reducing consumption and also penalises the moderate drinker.
There is a perceived link between the abolition of the groceries order and increased alcohol consumption. However, statistics published by the World Health Organisation show that, apart from a slight dip in 1983, alcohol consumption, measured in litres per capita, increased from 4.83 to 11.23 between the period 1970 and 2001. The groceries order was in operation throughout that period and did not have an impact on this phenomenon. Since 2002, average consumption has decreased very slightly from 11.22 litres to 10.61 litres in 2005. Central Statistics Office figures indicate that the price of alcohol increased during the period from 1976 to 2006.
Combined, the WHO and CSO data clearly show year on year increases in alcohol consumption during a time when price control mechanisms were in place and when the price of alcohol also increased. Price control mechanisms have in the past failed to halt the increase in consumption.
I appreciate that the current level of alcohol consumption in Ireland is excessive and I am fully aware of the range of problems associated with excessive levels of consumption. I welcome the establishment of the Government alcohol advisory group, which is indeed timely, and I will work with my colleague, the Minster for Justice, Equality and Law Reform to advance its objectives.
This is clearly an issue and we must focus on creating the best mechanisms to deal with the unacceptable manifestation of excessive alcohol consumption in our society.
There are many aspects to this debate. I asked this question because I assumed the Department would be in discussion with the Competition Authority or one of its agents. I understand that the authority is independent.
The Minister may quote reports stating that the overall level of alcohol consumption has fallen but this is not the real issue. Certain people are influenced by advertisements for the bulk-buying of alcohol at below-cost price, which can encourage over indulgence and the abuse of alcohol. The issue is not the overall level of alcohol consumption but binge drinkers who cause problems at home, in families and on the street. There is much evidence to suggest that the abolition of the groceries order has facilitated the below-cost selling of alcohol. I understand that the groceries order was never meant to apply to alcohol but I was informed in a committee that the Minister was advised that this might be a byproduct of its abolition.
As I said two weeks ago, I believe this could be a case where common sense should take precedence over ideology. Perhaps the arrangements applying to alcohol, which allow big businesses to sell it cheaply, thereby encouraging its abuse through bulk buying, should be changed.
The issue of alcohol is multifaceted and the advisory group established by the Minster for Justice, Equality and Law Reform is examining a range of issues. I took this opportunity to put the groceries order debate in context. Much alcohol is now imported and there are issues such as unit cost and selling price, which are provisions defined in legislation. There is significant difficulty in trying to identify costs and one runs the risk of facilitating the importation of cheaper brands of alcohol from overseas, which was happening prior to the abolition of the groceries order. Some of these brands have a higher alcohol content than the brands we are used to.
The advisory group has also examined the significant increase in the number of supermarkets, convenience stores and petrol stations with off-licences and the manner and conditions of the sale of alcohol products in such outlets, including below-unit cost selling and special promotions. It is looking at the number of special exemption orders, which permit longer opening hours, that are being obtained by licensed premises around the country and the use, adequacy and effectiveness of existing sanctions and penalties, particularly those directed at combating excessive and underage alcohol consumption. A range of issues will come under the remit of the advisory group.
I am open to debate on this issue but it is complex. The previous Minister for Justice, Equality and Law Reform banned happy hours, special promotions and so on in pubs. In my opinion there are issues we can deal with and under-age drinking and so on need attention.
8 Deputy Enda Kenny asked the Minister for Enterprise, Trade and Employment the percentage of Industrial Development Authority created jobs in the border midland western region in the past 12 months; and if he will make a statement on the matter. [8471/08]
IDA Ireland is the agency with statutory responsibility for the attraction of foreign direct investment, FDI, to Ireland and its regions. The marketing of individual areas for new or expansion FDI investments and jobs is a day-to-day operational matter for the agency.
During 2007, the latest period for which data are available, 9,216 new jobs were created in IDA supported companies, of which 1,446 were created in the Border, midlands and western, BMW, region. This figure represents 16% of all new jobs created that year.
At present there are 184 IDA supported companies in the BMW region employing 26,430 people, which represents almost 20% of all IDA supported employment in the country. The impact of FDI in Ireland goes much deeper than job creation alone. The positive impact is visible in many key aspects of Irish life. Foreign-owned companies are at the cutting edge of demand for high skills, advanced management training and business processes, which permeates the wider business community. These companies have contributed to the broadening of the economic base in Ireland by fostering entrepreneurial activities and new start-up companies aimed at supporting and selling to foreign-owned companies.
In line with the national spatial strategy, IDA is focused on delivering investments to all of the gateway and hub locations. This strategy involves matching investor requirements with the competencies, infrastructure and critical mass of these locations to secure the maximum number of investments for Ireland. The key sectors of focus for IDA are life sciences, information and communications technologies and high-value international services activities. Of the five strategic sites currently being marketed by IDA Ireland, two are in the BMW region, one in Galway and one in Louth and another is on the way.
The nature of foreign direct investment has changed and Ireland is now competing for premium mobile investments against the most advanced countries in the world. As Ireland competes for investments at the highest end of the value chain the concept of scale is crucial to our economic destiny. Leading corporations require a significant population of highly qualified and talented individuals, effective physical and digital infrastructure and the availability of sophisticated professional support services. If we are to make progress in attracting FDI to the regions we need to continue our investments under the national development plan, NDP, and all economic and social stakeholders will need to commit to the goal of balanced regional development as envisaged in the national spatial strategy. Future thinking and action must have a regional rather than a local bias and this requires a significant change in mindset.
I am confident that the policies being pursued by the development agencies, together with the roll-out of the national development plan, will continue to bear fruit in terms of employment and investment in the region.
The target of 50% has not been reached.
What target is the Deputy referring to?
IDA Ireland has a target to create 50% of all new jobs in the BMW region. This is stated as a policy in everything we read; the Minister answered a question in this regard in recent weeks and gave the percentages.
The fact that the Minister is unaware of this target probably answers my question. The target has not been reached in any year of the past seven years; levels of 36%, 41%, 44% and 45% were reached. That the target has not been reached may be explained by the fact that nobody knows it exists. Is the target to remain or will it be changed because it would be nice to reach it one year in seven?
The Minister mentioned the national spatial strategy but is there any intention to review its success? It has never been debated properly and it is felt that my county got a raw deal in the strategy. I understand that the strategy does not relate directly to the Minister's Department but this area is related to the original question.
As I said a few minutes ago, Westmeath's is one of the most progressive local authorities in attracting employment and generating opportunities. Mullingar is an excellent location; it is centrally located, has a good road network, the N4 and N52 lead into it, and excellent school, leisure and train facilities. Was Mullingar not nominated as a strategic site? It has 75 acres of developed land in the BMW region.
Are we talking about strategic sites?
Why has the IDA not designated Mullingar as a strategic site? I wrote to the authority in this regard on 12 February as chairperson of the committee and am very disappointed that I have not yet received an answer. I am not a great believer in technology: I contacted the IDA in an e-mail for the attention of its chief executive on 12 February at 5.20 p.m.
Did the Deputy press "send"?
I am sure I will get an answer in due course because he is a busy man.
What is the IDA doing to attract industry to Longford and Westmeath? I know there has been much good news in Athlone and that is important because there have been significant job losses there. What has the IDA done for Longford and what has it done for Mullingar? There is an excellent, 75 acre, well-serviced site there. What is being done to attract industries in the fields of technology, pharmaceuticals and services? Westmeath County Council did much to facilitate the availability of the aforementioned site. Am I wrong in saying the centre of the country, the heart of the BMW region, Mullingar, is not on the map?
Can the Minister correct it? Did I hear him correctly? Did I hear Louth and Galway being mentioned while Westmeath was not?
That is strategic. I will explain.
If the IDA was working, surely the geographical centre of the country, the intersection of the N4, N6 and N52, would be included. It is no wonder we have got nothing for years in Mullingar if that is the position.
As we are over time on this question I ask the Minister to be as brief as possible.
I did not anticipate Deputy Penrose endeavouring to outdo Senator Cassidy on the virtues of Mullingar. Deputy Mary O'Rourke is keeping a watchful eye on both of you in terms of job creation in Westmeath.
She is also watching the Minister.
The objective of 50% was for new greenfield projects. The general question the Deputy asked was about jobs created.
That is only greenfield sites.
That was always the objective. I will go through that in a moment.
That is fine.
The 16% I mentioned is of all new jobs created, that is, 9,216 in 2007. How many existing companies create additional jobs by new project expansions and so on? Quite a number of the 9,000 jobs would be expansions to existing facilities and the operations of companies that already exist in Ireland. The greenfield ones are new projects. Substantial progress was achieved during the period 2000 to 2006. Some 36% of all new greenfield jobs were located in the area. I have a table here which I can send on to the Deputy——
I have it.
It shows the following — 45% in 2000, 43% in 2001, 44% in 2002, 46% in 2003, 41% in 2004, 39% in 2005 and 36% in 2006. Very significant progress was made by the IDA in the BMW region and there were very significant projects across the region.
In reply to Deputy Penrose's question, the IDA has business parks across the country, including a substantial one for which I dug the sod in Mullingar to great aplomb.
At Marlinstown Park.
I would refer the Deputy to Carlow. I spent a number of years going there and took many heated attacks and so on in regard to our inability——
What about Athy?
In the space of four or five months we had the announcement of Merck Sharp & Dohme for Carlow and two weeks ago, an internationally traded service company, Unum. The idea of having property solutions is very important.
The strategic serviced sites to which I referred are a new development by the IDA in terms of major sites with all the utilities in place and the planning permission secured in advance. The one I referred to was in Oranmore, Galway, which is for a bio-pharmaceutical facility. A similar one is being provided in Louth. Ringaskiddy would have been an existing one that was conceived 20 or 30 years ago. The idea is to have significant land solutions in place in the various regions to attract the more significant bio-pharmaceutical or some of the FAB projects.
Perhaps the Minister would conclude. We are way off time.
I am mindful of the claims of Mullingar to inward investment, given its centrality to the nation. I will continue to work with the IDA to try to bring investment there.
And to Athy.
I thank the Minister for the correction in regard to the green field jobs and so on. If the Minister looks at the percentages he will see they are falling miserably from 50%.
Not miserably.
There is a big difference between 36% and 50%. The trend is in the wrong direction whether the Minister likes it or not. We will come back to it again.
The Deputy is representing his leader very well. He is even prepared to go to Carlow and sacrifice his own constituency.
I will come back to that later.
9 Deputy Dan Neville asked the Minister for Enterprise, Trade and Employment the net gain in Industrial Development Authority generated jobs over the past five years; if he is satisfied with the net return to the State; his forecasts for IDA job creation in the next five years; and if he will make a statement on the matter. [8487/08]
The Forfás annual employment survey shows that in five-year period from 2003 to 2007 the net gain in the numbers of new jobs created in IDA supported companies amounted to 4,623. This relatively small net gain masks the fact that there has been a considerable churn in employment in client companies.
The significance of foreign direct investment to Ireland's current economic prosperity and future growth should not be underestimated. The level of FDI in Ireland, relative to the size of the economy, is one of the highest in the world. Today employment in IDA companies directly accounts for over 136,000 jobs or 42% of industrial and financial employment in the economy. The average salary in IDA supported companies in 2007 was almost €44,000, or 19% above the average industrial wage of €36,800. This reflects the higher skills of the new positions being created by these investments. IDA supported companies paid an estimated €3 billion in corporate tax in 2007. They also accounted for approximately 85% of manufacturing company's exports. They accounted for €15.87 billion in direct expenditure within the economy, comprised of €6.73 billion on payroll, €5.71 billion on services and €3.43 billion on Irish materials. These investments have also generated significant indirect employment in indigenous sub supply and service companies.
The impact of FDI in Ireland goes much deeper than job creation and financial contribution to the economy, the positive impact is visible in may key aspects of Irish life. Foreign-owned companies are at the cutting edge of demand for high skills, advanced management training and of business process, which permeates the wider business community. These companies are leading contributors to national research and innovation agenda through substantial capital and intellectual investment in company owned research facilities and in widespread collaboration with third level institutions and dedicated research institutions. Through their success they have contributed to the broadening of the economic base in Ireland by linking to and fostering entrepreneurial activities and indigenous start-ups aimed at supporting and selling to foreign owned companies.
I am satisfied that the expenditure incurred by IDA in attracting new inward investment represents significant value for money and an excellent return on investment for the State.
While neither IDA Ireland nor I make forecasts as to the number of jobs to be created in any one year I am satisfied that the agency has a healthy pipeline of prospective new projects in place and, given the successes of the agency in previous years, I share their confidence that Ireland is well placed to secure significant investment for 2008 and the years ahead.
I agree that the IDA gets good value for money. It came before the joint committee recently and it is clear it is doing a very good job for the money its gets. There is no problem in that area. When one includes the other agencies, Enterprise Ireland and Shannon Development, it averages out at approximately 2,500 net jobs per year. We mentioned targets earlier. I appreciate the Minister cannot predict exact numbers, but going forward would the Minister be happy with a net return of 2,500 to 3,000 jobs per year? Should we aim higher or is there anything that can be done by the Department to improve that even further? Some counties, I can name them if the Minister wishes but there are seven or eight on my list, are down a good deal of jobs over the years; they have experienced a net loss rather than net gain. In general, are there any plans to increase the overall figure from 2,500 to 3,000 per year?
The question asks about the net gain. That is a fair question because it amassed some of the bigger issues. A total of 53,976 jobs was created over that period.
I am not disputing that. That is not the issue.
That is a huge number. Unfortunately 49,300 odd jobs were lost. That reflects the churn in the economy. Fortunately, over the past decade we have been in the strong position where we created many jobs in services and the indigenous sector improved. We have had record job creation figures of 80,000 last year and 90,000 the previous year. We have created more jobs than we have lost.
In terms of the future, the 2007 business environment ranking of the economist intelligence unit ranked Ireland in tenth place globally out of 82 countries, naming it as one of the most attractive business locations in the world. Once we continue to get that type of international recognition, in terms of the attractiveness of Ireland as a location, notwithstanding the significant global competition in terms of wage costs, emerging markets and emerging economies, we are confident we can continue to secure significant investments. If one looks at the last month alone, we have had good quality investments from Zimmer in Shannon to Citco in Cork and Vistakon in Limerick, all high value.
Not in Kerry.
Watch this space in regard to Kerry. We do not like putting targets on it because although I understand fully the Deputy's sincerity, I know what he would do with them if we did not reach them. The IDA, of course, has benchmarks and targets for the different sectors.
My main concern is that even in the past ten good years, the gain was not very good. I am concerned that in tougher times the net gain might drop slightly.
To qualify that, the period 2001 to 2004 was not a great period given the post dotcom experience. The FDI situation——
That was not what was said in the 2002 election campaign.
The people were worried in 2002, which is why they voted us back in. They felt we were a safer hand at the tiller.
We will not talk about last year.
There was a reduction in activity in the years after the international problems in the post 2001 scenario.
I will be parochial on this issue. I am delighted to see the Minister has satisfied my colleague, the Minister of State, Deputy McGuinness, with regard to Carlow-Kilkenny. The same cannot be said for south Kildare area, where there are five IDA sites. When I wrote to the Minister about this, he accepted he would meet me but that meeting never took place, unfortunately. In the past five years, only three visits to south Kildare have been organised by the IDA and, of those, only one resulted in a second visit.
The Minister of State, Deputy McGuinness, can explain to the Minister that if one is travelling through Kildare in the morning, all one will see is a red necklace of cars ahead. Everyone is travelling out of Castledermot, Athy, Monasterevin, Kildare and Kilcullen, where there has been no development for many years. There has been a haemorrhage of jobs and a list as long as my arm of closures over the years.
I hope the Minister will reconsider this issue. I have continually put down questions on what the IDA intends to do with the lands. All it has done is to put the Monasterevin GAA club off land it has not been able to sell for five years. It is a joke. I want the Minister to honour his commitment to meet the three Oireachtas Members from Kildare South, if that is the road he wants to take. In the initial stages, he promised me he would meet me but it never happened. If he wants to honour his commitment to meet, I have no problem who he meets. However, there is a need to meet someone with regard to that area. We have seen development in Carlow and other areas but, while there is an unemployment blackspot in south Kildare, there have been only three IDA visits in five years.
To follow up on that point, the IDA sometimes holds blocks of land where projects did not work out for it. We all accept that this land was bought in good faith. Is it the Minister's intention to discuss with the IDA the possibility of it giving that land to local authorities? While the IDA wants major industry in sectors such as the pharmaceutical and biotechnology sectors, it could give these lands to local authorities or county enterprise boards at the market value at which it bought them, not at today's market value, which would ruin the local authorities and boards. I do not suggest this would solve the problem raised by Deputy Wall.
A number of people made submissions to the joint committee that an ideal way to give small start-up units an opportunity would be for the IDA to trade land with the local authorities or the county enterprise boards from the landbank it was not successful in marketing. In this way, small indigenous industries would be given an opportunity to take off. Perhaps this is the way forward.
I have visited Athy——
The Minister did not honour the commitment.
I am surprised at that.
I will have to check that.
The Minister suggested it, not me.
We are out of time. I am anxious that the Minister would conclude.
He will remedy the problem.
We certainly will. In my opening reply, I stated that we will have to try to think regionally as opposed to locally. Kildare overall has done extremely well in terms of employment creation.
Draw a line through it.
That said, we will work on certain areas. Some counties which have done very well in terms of their commuter traffic, such as County Meath, did not complain. They analysed the situation and produced information that is now of value to would-be investors. They made the point that as there is significant commuter traffic into Dublin in IT and life sciences, the people are all prepared to work in the county if the investors located there. We have had good announcements from towns in Meath such as Navan and others.
We look forward to more.
That kind of can-do attitude is important at local level, with county enterprise boards working with the local authorities.
With regard to Deputy Penrose's point, the IDA has sold much land to county councils in recent times. I am anxious that the land would continue to be used for employment purposes and indigenous purposes. However, in order to build the sites at Oranmore and so on, it must charge the current market value. It then uses that resource to provide better and more modern facilities to help attract quality investments, which has been the strategy for a number of years and enables us to undertake the projects in Oranmore, in County Louth and elsewhere. In addition, the number of sites has reduced considerably.
On a personal level, I was never a great supporter of the State selling land or having a sale here and there just for the sake of it. I like the idea of selling to the county councils where there is no prospect of multinationals coming in but where we could get significant indigenous projects off the ground. The indigenous story is important and growing. That sector also needs property solutions, which is where we must focus.
I fully agree.
Written Answers follow Adjournment Debate.
