Unemployment: Motion.

Deputy Leo Varadkar

I move:

"That Dáil Éireann:

notes that the Standardised Unemployment Rate (SUR) has risen to 12.7% which is the second highest in the EU;

notes that there are 434,700 people on the live register, the highest figure ever;

notes that there are 85,910 people under the age of 25 on the live register;

notes that unemployment is higher now than when the Government came to power in 1997;

recognises that unemployment has social as well as economic consequences;

regrets the reality that tens of thousands of young people have to emigrate once more; and

calls on the Government to:

put job creation and job retention at the centre of its economic strategy;

reduce the level of employer's PRSI;

establish a national internship programme to provide part-time placements in the public, private and voluntary sectors for unemployed graduates with funding for a higher degree or diploma;

provide 10,000 second-chance education places for former construction and other workers with no basic qualifications;

mandate the Office of Public Works, FÁS and local authorities to take on all redundant apprentices to ensure that they can complete their training;

provide 5,000 more Community Employment schemes;

introduce workshare to subsidise the incomes of employees put on short-time and to provide them with training when they are not working as an alternative to redundancy; and

introduce a major stimulus to the economy by implementing Fine Gael's ‘New Era' proposals."

With permission of the House, I wish to share time with Deputies Deasy, Connaughton, Breen, Joe Carey, Feighan, Tom Sheahan and Doyle.

It gives me great pleasure to move this motion this evening. For the past few weeks politics has very much been dominated by personality politics. We have had the resignations of George Lee and Déirdre de Búrca, the resignation from Government of Deputy O'Dea and some hours ago, with great regret, the resignation of Deputy Sargent as Minister of State. However, politics is not about personalities and individuals or at least it should not be. Politics is about the 4.5 million citizens of this country. This evening in particular we wish to focus on the 437,000 people on the live register and the approximately 85,000 young people who are signing on. The purpose of this motion is to highlight the seriousness of the situation and to put forward some of Fine Gael's positive ideas to help alleviate this young person's recession.

This is a young person's recession. Certainly everyone in every sector has taken a hit, but those who are most exposed in this recession are young people. They are the ones most likely to be out of work and most likely to have to emigrate. They are the ones, who if they are in work, are the most likely to be on temporary contracts without protection or pension provision. They are the ones most likely to be burdened by heavy debts, mortgages and for the first time since 1930 the spectre of debt deflation and ever rising debt repayments taking up an ever-shrinking income. With tonight's motion I want to speak to them.

The motion highlights the seriousness of the situation. While it is true that we are facing an international recession and that other countries are also suffering, in the space of two years Ireland has gone from a country of relatively low unemployment to a country that has the second highest unemployment in the eurozone, regardless of how it is measured. It is a very serious situation which should not be treated lightly. Some 12.7% of the adult population are unemployed with another 7% claiming disability allowance and another 4% or 5% receiving the one-parent family payment. That means that more than 20% of our population of working age are now not working and are dependent on social welfare for their income. That is not sustainable or desirable. It has major economic consequences in that the country is borrowing money to pay for social welfare. It also has major social consequences because people who end up on welfare for more than six months or a year very often stay on welfare for the rest of their lives, stuck in a relative-poverty trap, and nobody wants that.

We are making a number of proposals this evening. Fine Gael is proposing a national internship programme to be targeted at very many graduates who cannot find employment, including young nurses, physiotherapists, architects and other graduates. We want the Minister to make available some of the places in the public service that have been left vacant because of the recruitment ban to allow young graduates to work in those positions for 20 hours a week, receiving the full entry rate in those employments and not the social welfare rate as is the case with work placement programme. They should also receive a small bursary with which they can in the other 20 hours study for a higher degree, diploma or masters. This is not anything like the Government's work placement programme. It is a serious proposal to give people real experience and allow them to train at the same time. It is not essentially free labour, which is what the Government is offering with the WPP.

We also want second-chance education. Quite cheaply we can provide 10,000 additional places for people to re-enter education. There are very many people, particularly young construction workers, who left school early to do apprenticeships or just to take up work in construction. They got paid very well during the boom years — perhaps as much as €2,000 a week — but now find themselves out of work and with no qualifications suitable to the current environment and no prospect of ever earning a good income again. We need to help them to go back to school. It should not be just for eight or nine months as is the case with the back to education allowance, but a serious programme to allow them to go back to school for two years to do their leaving certificate examinations and then enter college. They should be paid to do so for that two-year period, covering the summer period also and not just the eight months provided for in the back to education scheme.

We call on the Government to create an apprenticeship guarantee. Some 7,000 apprentices are in between stages now and cannot get beyond the work experience they need. A model exists — the community youth training programme that was used in the 1980s to take on apprentices who were in exactly the same position as they are now. We need to take on apprentices to build community centres and schools, and do public works. People can go around the country now and see community centres with the small FÁS logo on them. They were built in the 1980s when a Government at that time thought it appropriate to take on unemployed apprentices to allow them at the very least to finish their training. We are calling on the Government to do that this evening.

We also call on the Government to expand the CE schemes, which used to employ 44,000 but have now been cut to 22,000. They could be brought back to 27,000 with relative ease and minimal expense.

We also call on the Government to introduce a work share arrangement, the kurzarbeit geld system, as is used in Germany or work-share as used in Rhode Island in the United States. For example, an employer of 100 employees instead of laying off 10 employees would be allowed to keep them all on but put 20 of them on short time and the Government would subsidise the difference. This can be only a temporary measure and cannot work forever. For employers facing a cyclical downturn or a temporary blip in sales orders, this kind of mechanism could save many jobs. In Germany at the moment it is saving 500,000 jobs. We believe in Ireland it could save between 10,000 and 15,000 and would be a much more effective measure than the Government’s current temporary employment subsidy scheme.

We also ask the Government to cut the tax on jobs — employer's PRSI. An employer hiring somebody must pay a 10% tax for doing so. It costs an employer at least €220 a week for an employee earning €200. We are asking the Government to reduce employer's PRSI not just for people coming off the dole, but to reduce it across the board. The cost of employing people needs to be reduced so as to stop taxation on employment as the Government is doing now and to use the proceeds of the carbon tax to offset this. The ESRI estimates, in the event, that this could create more than 30,000 jobs over two years.

We are also asking the Tánaiste to give serious consideration to Fine Gael's NewERA plan. There is a considerable amount of money to be tapped into, such as hedge funds, pension funds etc. Many people have money in savings and we need to get that money invested in the economy. NewERA is our vehicle for doing exactly that. Essentially, it means using the semi-States, privatising some of them and using that revenue as well as taking some revenue from the pension funds — retooling and rebuilding the semi-States to allow them to invest in the economy, to build broadband, invest in alternative energy and use them as the engines for growth. It is a matter of bringing the private capital that is available back into the economy and investing for the future.

Finally, I wish to address the Government's counter motion, which is disappointing. It is self-congratulatory, there are no new ideas in it and no new measures. There is no hope in the counter motion tabled by the Tánaiste. We are not going to play personality politics, however, and this is a serious issue. We have highlighted the problem and put forward eight solutions we believe are viable. We humbly ask her, if she is serious about unemployment and really cares about the 85,000 young people who are unemployed, to withdraw her counter motion, to come behind us and not divide the House. I ask the Tánaiste, the Fianna Fáil backbenchers, the Green Party and the Independents not to divide the House and support the positive motion we have put forward.

Deputy John Deasy

The statistics for my constituency, Waterford, with regard to under-25s unemployed are as follows: in the Dungarvan area it has increased by 146.5% over the last two years while the figure for Waterford city, although a little better, is at about 90%, which is still a big figure.

In the last couple of days I have attended a few meeting on job creation. One was with the city manager and his officials yesterday. Another was with an accountancy firm trying to promote entrepreneurs in the city of Waterford. Today I had a meeting with a very successful community development group. One issue has arisen again and again, namely, that there is serious doubt, which I share, as to whether the State agencies tasked with retraining and job creation have adapted, or can adapt, to the economic crisis. I have to ask why it is Waterford City Council that is putting together a small business loan scheme and co-ordinating the different agencies dealing with job creation in the city. The answer is that no one else seems willing to do so.

More significant, however, is the issue of how individual agencies are dealing with unemployment issues. In some cases they are dealing with them in the same manner as they were two or three years ago. I do not see any sense of urgency within some elements of local government and especially in State agencies. In the boom years these agencies multiplied. They grew bigger, wages increased within them, better properties were rented and in some cases such as FÁS they lost sight of their original purpose. At the heads of these agencies we need risk takers, people with business acumen and commercial experience. Instead, this Government has promoted risk averse individuals, bureaucrats and generally safety-first merchants who——

Deputy Mary Coughlan

I hope the chairman of the IDA is not included in that category, in fairness to him.

Deputy John Deasy

——regard innovation, first and foremost, as something that might threaten their pension if something went wrong. In some cases these organisations have become so fat they do not have the flexibility and mindset necessary to deal radically with the differences that have arisen in the labour market. In Waterford we have haemorrhaged manufacturing jobs. Foreign direct investment is almost at a standstill and small businesses are collapsing as they will continue to do over the next few months. Most people are adapting, however, realising they must do so to survive. Are the Government agencies capable and willing to adapt quickly enough to the unique and sometimes localised difficulties that our workforce is encountering? As time goes by I am less convinced of their ability and resolution to change themselves in order to deal with the massive rate of unemployment and the issues that exist around this. At the head of these State agencies we need experienced business orientated minds. We do not need and cannot afford any longer bureaucrats or political appointees whose business skills do not mirror the scale of difficulty that our workforce finds itself in.

Deputy Mary Coughlan

The Deputy is casting aspersions on the chairman of the IDA.

Deputy John Deasy

The Tánaiste will have her chance.

Deputy Paul Connaughton

She got her chance and did not take it.

Deputy Paul Connaughton

No other topic to be discussed in this House will be as important as this one. We are now speaking on behalf of 434,000 people throughout the country who have nothing to look forward to every day but the dole.

To give an idea of how widespread is the malaise, even in the peripheral areas, in one month alone, from December to January, unemployment in Ballinasloe went up to 2,643, equivalent to a rise of 3.2%, in Clifden it was 7.6%, Galway city 2.5%, Gort 7.3%, Loughrea 5% and in the Tuam area it went up to 3,400, a 5.3% increase. If this is going to continue it will be extremely difficult for the Government to pay the social welfare bill. Nobody wants to be on social welfare and the vast majority of the 434,000 are asking whether there is a way out and if anyone has the answer.

I am not saying there is a magical answer which will solve all the problems, but I genuinely believe that if there is a will, there is a way to make a start. The start made by Fine Gael in terms of the hours, weeks and months that have gone into the preparation of those five or six plans is very significant. I ask the Minister to take them seriously, because that is what parliamentary democracy is all about. So far, however, the Tánaiste and her Ministers of State have taken no notice of anybody and that is the cul-de-sac in which she finds herself.

A two-pronged attack is required. Take the simple proposals like the community employment, CE, schemes. All over the country there is a world of work to be done, with people wanting to go out. I have been told by people that they are ready to earn the equivalent of what they can get on social welfare, just as long as they are working. The community people want them to work and there is no shortage of good schemes. Take the NewERA, as proposed by Deputy Coveney. That is the most fundamental proposal for change in the semi-States I have ever come across. It has been market tested and we genuinely believe in terms of the investment it will attract in the future, it will certainly mean there will be a revitalised engine in the State, with all types of new jobs being created that were never dreamt of before. I am talking about energy, broadband etc. and all the things that will make us extremely competitive when this terrible storm blows over, which it will in time.

I say straight to the Tánaiste's face that the problem with the Government is that it appears to be so bogged down, it is akin to rabbits being caught in headlights. It has no direction, and it appears there is no hope from the Government's viewpoint. I acknowledge that it will be extremely difficult, but there are many ways to approach the problem of unemployment. The workshare initiative referred to by Deputy Varadkar, for instance, could be made to work very well.

There is nothing as degrading for a man or woman, regardless of age, as to have to stay at home without a job. It is an inhuman state for people. Even if they had to workshare over the next year or two until better times come, whatever it costs, I believe it is important to have that linkage, experience and training in the workforce. Anything is better than to be cut adrift.

Deputy Dinny McGinley

It is timely and appropriate that we are discussing this matter. It is probably the most serious crisis facing the country at the moment, with 434,000 unemployed.

I do not intend to dwell on the national problem but on the local one that affects my constituency and county. I compliment Deputy Varadkar for tabling very practical, down-to-earth proposals. They do not amount to rocket science, they are practical proposals some of which, if adopted, might have some effect on the numbers of unemployed throughout the country. As Deputy Connaughton stated, if some of these proposals, along with those contained in Deputy Coveney's NewERA document, were taken on board by the Government it might represent an attempt to address the crisis in which we find ourselves.

I refer to my county. In September 2007 there were 8,370 registered on the unemployment list in Donegal. Last January that figure had risen to 21,500, an increase of 156% — I worked it out on a calculator before coming down this evening. That is a vast increase.

The Tánaiste will agree that the industrial base of our county has been decimated since 1997 by the current Government and its two immediate predecessors. A litany of iconic industries in our county have closed down during these years. I refer to Fruit of the Loom. In such places as Malin Head, Buncrana, Milford, Raphoe and Dungloe, thousands of jobs were lost. I refer to Hospira in Donegal, with which the Tánaiste is very familiar. Between 600 and 700 jobs were lost there. I refer to UNIFI in Letterkenny and Donegal Parian China. I refer to companies in my area, including BMR, Comar Yarns, Dianorm, RMT, Europlast, Herdsman and Nena Models. The list goes on. Suffice it to say that since 1997, some 12,000 industrial jobs have been lost in Donegal.

The sad fact is that well in excess of one quarter of those who have lost their jobs are under 25 years of age. I came to Dublin last Tuesday. While flying up, I encountered three neighbours. They were young people who have possibly just graduated. I asked where they were going and they replied that they were going to Australia. These were young, well-educated, trained people going to Australia because there was absolutely no prospect of a job.

Fishing is at a low ebb. Killibegs is a ghost town compared to what it used to be years ago. The same goes for Burtonport. Agriculture has its own difficulties. Tourism in Donegal is in difficulties as well. All these industries are gone and there is no evidence of any recognition by the Government that these serious issues must be addressed. There is a good deal of emphasis on rescuing the banks and looking after fiscal matters. However, in my view and that of the 434,000 unemployed in this country, the most important issue is to address the unemployment crisis. We are getting rid of or exporting a generation of young people. They will settle in various countries. We have educated and trained such people. Will they ever come back? This is a serious situation. The Tánaiste and I represent the same constituency. She is in a position to do something about this. She had heard suggestions from this side of the House. I call on the Tánaiste to act upon some of them before we go into an economic tailspin from which we will never recover.

Deputy Joe Carey

I commend Deputy Varadkar for tabling this motion on behalf of Fine Gael this evening. This is a very timely and relevant motion. Unemployment has gripped this country yet again. Currently, some 434,700 people are on the live register, almost 86,000 of which are under 25 years of age. Unemployment is without doubt the over-riding issue facing our country. The creation and protection of jobs must be at the heart of Government policy. In particular, young people are feeling the pain of unemployment. Young men and women throughout the State have little or no prospect of gaining employment. This is a truly daunting situation faced by our young people. School leavers are left with the choice of joining the growing welfare queues or leaving the country and taking their hard-earned education to benefit other economies on other shores.

In my constituency of Clare almost 11,000 people are signing on, some 2,100 of which are under 25 years of age. During the past two years, the percentage of people under 25 years who are out of work has increased by 137%. In the mid-west there is an unemployment rate more than 1 % higher than the national rate of 12.7%.

I raise the possibility of establishing the Lynxs cargo facility at Shannon Airport. This project has the capability of creating thousands of jobs in the mid-west if the Government would only invest in the project and move it forwards. However, it requires the support of the Government and an investment of €7 million, which is not a great deal of money. Were such an investment to be made, it would attract assembly and manufacturing jobs to the Shannon region. I appeal to the Tánaiste to proceed with this proposal.

I appeal to the Government to listen to Deputies who propose such projects which could make this situation better. Fine Gael is aware of the stark reality. We have put together a plan of action to get young people out of their beds and back into the workplace. We need to halt the masses of young people who are emigrating. Without a real, focussed effort of proactive job creation we will have a generation of long-term unemployed people with little focus or hope. I appeal to Government Deputies to consider seriously the proposals in our document Hope for a Lost Generation rather than merely dismissing it, which is usually the case when we table such proposals under Private Members' business.

Like every Deputy in the Chamber, I have been inundated with young people at my constituency office. Such people are looking for a break and for the opportunity to make a contribution to the economy and to help to return it from the brink. In response to the many young people whom I met, I made a submission to Deputy Varadkar which has been fed into or the Hope for a Lost Generation document and I am very proud of this fact. I worked on this with my personal assistant Paul Bugler. These are real proposals that will create jobs, training opportunities and a second chance of education for our young people. I appeal to the Tánaiste not simply to cast aside these proposals. She should take them on board and actually do something about addressing the unemployment crisis in this country. The Tánaiste should take on board our plan which we offer gladly. The resulting 38,000 young people who will be taken off the dole queues will thank the Tánaiste for it.

Deputy Frank Feighan

I support the introduction by my colleague Deputy Varadkar of these very important proposals to the House. Out hearts go out to the 450,000 people on the live register. We are aware of the many people who have made a great contribution to the economy by providing employment and work to the country. However, many such people do not have money to put bread on the table now. They are the new poor. As politicians, we must give hope and leadership. We must have a sense of unity to provide some future not only for these people, but for their children. In recent years, we have seen many high profile job losses. However, most of the jobs lost that make the current figure of 450,000 are lost in groups of one, two, three four and five and these could be avoided.

Food processing has been a significant industry in my constituency but thousands of food processing jobs have been lost. Often such companies as Glanbia and Green Isle have pulled out for innocuous reasons, including a fire on one occasion and at other times because someone wished to start a union. Such companies move to other areas such as Dublin, the United Kingdom or Kildare. For some reason, the Government always gives such companies grants or compliments them for the work they do. Such companies are moving out of rural areas that badly require the jobs to retain people in these areas and this does not represent balanced development. Not enough has been done to protect the jobs in place.

Many opportunities exist and Deputy Varadkar has produced proposals which I welcome. One such proposal is the apprentice guarantee. I refer to the case of 700 apprentices. I have contacted the Tánaiste several times in respect of FÁS employees in Australia or the United States of America. There is no flexibility in FÁS. People want to finish their apprenticeships but FÁS has more or less said the courses must be finished in Ireland. A lady whose son is in Australia asked me how he could come back when there is no work here. People are not living in the real world. We must be flexible and compassionate towards young people who have perhaps done four out of five years of an apprenticeship. No flexibility is being shown towards them.

The workshare arrangement will protect jobs. The solution to the recession starts and ends with jobs but we must protect them first. Not enough is being done in this regard.

It is quite obvious that banks have stopped funding small businesses. Only for the credit unions, family and friends, most people with small businesses would have gone to the wall. However, most will go the wall unless the banks make credit available immediately. Unfortunately, they are more interested in repairing their balance sheets.

The role of the Western Investment Fund is to invest seed and venture capital in projects and businesses in the western region. Small businesses should be able to avail of it. The fund, under the Government, could take out shares in and make loans to companies to ensure they will be economically viable.

Deputy Tom Sheahan

I will concentrate on my portfolio, fisheries, in which sector job creation opportunities have been wasted. The operational programme for fisheries, which covers the period 2007 to 2013, has yet to be implemented by the Government although it is already 2010. The money available through the programme would create and sustain jobs. It is unacceptable that the Minister of State responsible for fisheries, Deputy Killeen, who took office in May 2008, has not implemented a programme for fisheries after nearly two years in office. It is not good enough.

The Cawley report, published in early 2008, recommended an investment of €100 million in aquaculture over five years. Not one cent has been spent on it in the past five years. Aquaculture industries currently employ 2,000 people. The IFA aquaculture team was before the Oireachtas Joint Committee on Agriculture, Fisheries and Food some time ago and outlined the possibility that exists for creating a further 2,000 jobs in the industry. For the life of me, I do not understand how a Minister of State in office for two years has failed to produce an operational programme for fisheries.

I am informed that Bord Iascaigh Mhara, which is responsible for fisheries, returned funding to the Exchequer last year because there was not an operational programme for fisheries in place. Since there was no programme, it was unable to advance capital grant aid to some of the small industries. At present, there are 100 small coastal firms engaged in shellfish production and aquaculture that are waiting to submit applications for capital funding but there is no point in their doing so because there is no operational programme for fisheries. They want to access the funding and create jobs.

All our EU competitors have opened their operational programmes and their industries are taking full advantage of the significant market demand for farmed fish and shellfish. In the past two years, through the inaction of the Minister of State in implementing an operational programme for fisheries, there have been missed opportunities in respect of at least 500 jobs in small coastal communities.

Some €5 million was allocated in the December budget for aquaculture. How can it be spent without an operational programme for fisheries? How can any job be created or sustained without such a programme? The possibilities that exist for an additional 2,000 jobs in the aquaculture industry and for a further €100 million in export revenue cannot be realised without a programme.

Since the departure of the Minister for Defence, Deputy O'Dea, we have been informed that the Minister of State at the Department of Agriculture, Fisheries and Food, Deputy Killeen, is one of the senior contenders for his post. A spade is a spade, not an earth-relocating implement. The Minister of State did not introduce the operational programme for fisheries and, by not doing so, he has adversely affected the creation of 500 jobs in the aquaculture industry.

Deputy Andrew Doyle

I commend Deputy Varadkar on tabling this motion. Job creation will be and should be the only show in town. When all the diversions of the past couple of weeks die down, there will still be serious unemployment and economic crises with which we must deal. Fine Gael has tried to forward some sensible solutions and some imaginative and creative ones, such as the workshare and national internship programmes. Many of the other proposals make absolute sense, such as the one to expand community employment schemes and afford people the dignity of dong something for the money they get. Let it be for the benefit of the community.

Details on the second-chance education scheme have been outlined. Some students left school for a summer job and decided not to go back because the temptation to have money in their pockets at the time was just too great. We can all say their decisions were based on the folly of youth but it is easy to understand why they took the career decisions they took.

I will deal with the area of interest to me. I regret that Deputy Sargent has stood down as Minister of State at the Department of Agriculture, Fisheries and Food. I found him frustrating at times in so far as he had a single-minded attitude to organic farming and certain other matters. However, we were always able to have a good robust debate on them.

The Minister for Enterprise, Trade and Employment is responsible for commissioning a study on a code of practice for the retail sector. This is very topical at present and the iron must be grabbed while hot because jobs are in jeopardy. We must put job creation and retention at the heart of the Government's economic strategy.

Fine Gael published a Food (Fair Trade and Information) Bill last August. It incorporates the necessary actions that need to be taken to protect those in the agrifood, supply and processing sectors. Ultimately, it is a consumer issue, not just one for producers. The Taoiseach stated today that anecdotal evidence is much easier to obtain than concrete proof, for understandable reasons. That speaks volumes about the circumstances in which we live. People are even afraid to talk secretly because they feel the big multiples will figure out who they are from the figures quoted.

I want to bring two other points to the attention of the Minister for Enterprise, Trade and Employment. An article in The Sunday Times contains a photograph of the Minister, which is flattering or unflattering depending on one’s perspective and quotes the chief executive of the Irish Exporters Association as having said the indigenous export sector is too small for a State-backed credit export insurance scheme. The figure of 9% quoted represents half of all exporting jobs. The rejection was on foot of a KPMG report. We have not seen that report despite several requests for it. Will the Tánaiste clarify whether the report will be made available? It goes on to state that Mr. Denis Brosnan is not very happy with the Limerick regeneration scheme and is threatening to quit because he is frustrated.

I wish to make a further point about the new funding premiums regime in the banks. Small businesses have made representations to me about this. They have never been in default and are good clients of the bank but a 2.8% premium will be attached to their facilities over a five year period purely because the banks have such a bad credit rating. Perhaps the Tánaiste will respond on that point.

Tánaiste and Minister for Enterprise, Trade and Employment (Deputy Mary Coughlan)

I move amendment No. 1:

To delete all words after "Dáil Éireann" and substitute the following:

"recognising the challenge faced by many individuals and families following the loss of a job or income during this difficult economic period;

acknowledges the strong matrix of State supports the Government has put in place to support job-seekers and families;

endorses the initiatives taken by Government to strengthen national competitiveness and underpin future economic growth;

supports the actions set out in the Government's smart economy framework and its commitment to make Ireland a leading knowledge and innovation economy;

commends the Government for implementing policies which aim to support enterprises, protect jobs and stimulate employment creation, including the:

ongoing work of Enterprise Ireland and IDA Ireland in attracting foreign direct investment and promoting enterprise development and employment growth in businesses;

introduction of the enterprise stabilisation fund that will invest €100 million in supporting viable but vulnerable companies in these difficult economic times;

introduction of the employment subsidy scheme, which will between 2009 and 2010 invest €135 million in either directly or indirectly supporting approximately 80,000 jobs;

introduction of a PRSI exemption for employers creating new jobs this year;

maintenance of substantial capital investment programme across Government;

implementation of key Government programmes such as the €425 million Rural Development Programme 2007-13, creating some 12,000 jobs, and the €1 million invested each week in the home energy savings scheme, providing work for some 3,690 registered contractors; and

provision of key infrastructure, such as broadband, where the number of subscribers has doubled during the lifetime of this Government, and electricity generation from local renewable sources, where at 15% we have already met our target for 2010;

and commends Government actions in support of activation and training for the unemployed through:

its €1 billion funding for a range of labour force measures which will assist those who have lost their jobs;

the prioritisation of four cohorts of the unemployed, including those under 35 years of age, for priority access to the State's support services for the unemployed;

the doubling of capacity in job search support services for the unemployed;

the continued increase in the number of training and work experience places for the unemployed, now standing at 147,000 places;

the introduction of new initiatives such as the work placement programme which includes special provision for graduate places;

the almost 10,400 training places for the unemployed and those on short-time working that will be provided by Skillnets and FÁS this year;

special arrangements to assist 4,000 redundant apprentices progress their apprenticeships;

the provision of opportunities for 166,000 learners, including those with basic skills needs, in further education programmes operated by VECs across the country;

the 140,000 full-time enrolments in our higher education sector, an increase of 4.5% over the 2008/09 academic year;

the 1,000 free or highly subsidised part-time places offered to unemployed graduates to pursue postgraduate programmes in higher education institutions last autumn;

the significant increase in the numbers of back to education allowance recipients to over 18,000;

the maintenance of service provision for communities and the provision of employment for 2,600 participants under the rural social scheme and 2,700 participants under the community services programme; and

the introduction of a new €20 million labour market activation fund aimed at supporting innovative proposals that are progression orientated for the unemployed."

Job creation in this country is the issue that tops my and this Government's agenda. It is the driving force behind so much of our work in stabilising our public finances and in getting our banking system working again. It is the reason that, in a time of significant current budget deficit, we are continuing to invest so heavily in our capital programme, in building necessary infrastructure and in enterprise, research and development. The Government is working hard to overcome the challenge of the live register figures. We are conscious that people across the country want to know we are taking the actions necessary to ensure Ireland is well positioned when this period of economic turmoil comes to an end. If we are remiss in anything, it is in terms of getting the message out to the public about what we are doing.

While I will elaborate on a number of these points, I will set out for the record just a portion of the work that I have undertaken as Minister for Enterprise, Trade and Employment over the period to date. The initiatives taken include, among others: introducing the employment subsidy scheme to help retain jobs in our vulnerable exporting companies; introducing the enterprise stabilisation fund to help protect jobs in our exporting companies hit by current difficulties; mandating comprehensive strategy reviews in IDA Ireland, Enterprise Ireland and Shannon Development; putting in place a code of conduct for business lending to SMEs in order that our SMEs know where they stand with regard to the banks; establishing a credit supply clearing group to tackle the credit supply issue, to establish the facts and to take on the spin and the myths; ongoing work on a proposal to Government for the establishment of a targeted loan guarantee scheme; successful introduction of a commitment by the Government to pay its debts to business within 15 rather than 30 days; a revamp of our public procurement policy to ensure greater SME access to public contracts; introduction of two separate Company Law Acts, the first to toughen our company law regime against potential abuse and the second to ensure Ireland is best positioned to maximise the attraction of job creating foreign direct investment; achieving the introduction of new tax changes to support job creation through research and development and the development of intellectual property assets in Ireland; securing the introduction of a PRSI exemption for employers creating new jobs this year; targeting enterprise funding and resources at new areas for job growth, such as the green enterprise sector; despite the financial situation, prioritising and investing significant capital moneys in research and development, science, technology and innovation for future job growth; rolling out a new marketing campaign to encourage investment in Ireland from our FDI target markets; putting in place an unprecedented level of training and activation measures to assist those seeking employment; introducing new and innovative programmes established to keep people in jobs deemed vulnerable and to get graduates work experience; opening training and activation opportunities to private and voluntary sector providers through the €20 million labour market activation fund; new types of FÁS courses to train and re-train people for jobs in new sectors, such as the green economy; increasing the number of places available on community employment schemes; and successful application for European Globalisation Fund funding for former Dell employees, with two other applications in progress at present.

I am confident that I, and the Government, are pursuing the correct policies that will enable this economy once again to return to growth and, more importantly, employment creation. Ireland as a small, open economy, is especially reliant on foreign trade and we are focused on ensuring that we can take advantage of the upturn in international growth and trade. Encouraging and positive trends are now visible. In recent months, international organisations such as the IMF and the OECD have upgraded their economic forecasts. In its most recent update in January, the IMF forecast that global economic growth would expand by 4% in 2010 and in 2011. This represented a substantial upward revision from its previous forecast which was published in October. Established trading partners such as the UK, the euro area and the United States are all expected to experience growth in the medium term, representing renewed opportunities for our exporters. Similarly, Irish exporters are making inroads into less familiar emerging markets whose growth remains buoyant.

In the past 18 months, Irish exports have performed extremely well in comparison with international counterparts. That must be reiterated because it is not getting across as part of what we have achieved. My goal is to maintain and enhance the policy environment that has facilitated this resilient performance and that will drive future export growth. We estimate that every job in Ireland associated with exporting sustains another job in the domestic economy.

International investment will continue to be a key driver of employment, exports and growth. We will continue to market the Ireland brand as a location of choice for new and existing investors. In September, I launched IDA's new innovation-focused overseas market campaign, designed to position Ireland as the pre-eminent location for companies that are seeking to invest in future innovation. It has received great acclaim in many of the serious publications in the United States. During 2009, we won a total of 125 foreign direct investments. Almost 70% of these investments were from existing IDA clients who are making further investments in this country, reinforcing Ireland's reputation as a key strategic global business hub.

In these turbulent economic times it is extremely significant that many of the world's leading companies continue to invest in Ireland in a wide array of activities including high end manufacturing, global services and research, development and innovation, RDI. In absolute numbers, Ireland is moving up the global rankings with regard to employment in research and development, having risen from 19th to 11th position in the latest "Global Location Trends" survey, which is a testament to the SSTI strategy being pursued. During 2010, the IDA will continue its work to capitalise on our quality workforce, our creativity, our international attitude to business, attractive incentives for research and development and our favourable tax climate to attract multinationals to set up a base in Ireland as a launch pad for markets in Europe, Africa and the Middle East. Already in 2010 there have been seven IDA supported announcements in Dublin, Galway and Tullamore and there will be a further significant announcement for the north east this week.

We are also working to develop the opportunities for Ireland to become a key European hub for the international funds industry. In this regard, I look forward to the proposed changes in the Finance Bill to strengthen Ireland's competitive edge. I also tasked the IDA with developing a new strategy for the future direction of foreign direct investment and it will be published shortly. It will include specific initiatives which the IDA will undertake to retain existing, and secure new, foreign direct investment. This strategy will identify the opportunities in foreign direct investment markets, while stressing the importance of restoring our relative international competitiveness so we maximise our potential to attract foreign direct investment. We have a new narrative here, which is our cost competitiveness as well as our reputation as a good place to do business, our talents and skills and our transparent tax regime.

Enterprise Ireland also delivers a wide range of supports to Irish companies, targeted at the specific requirements of clients throughout all regions to ensure that they develop to their full potential in terms of innovation and exports, which in turn stimulates job creation. Enterprise Ireland, in recognising the significant changes in the current economy both in Ireland and globally, has prepared a recovery strategy to identify the actions that will be undertaken to help clients in 2009 and 2010. I refute Deputy Deasy's comments on the work being done by the Department's agencies. They have clearly refocused on sustaining employment and creating new employment in particular sectors where there is huge potential for jobs and growth. Enterprise Ireland has focused its efforts on strengthening and sustaining companies of strategic importance through a range of initiatives focused on the needs of its client base.

With regard to my appointment of the chairmen of Enterprise Ireland and the IDA, nobody in the House could say that Mr. Liam O'Mahony is not a man of tremendous business acumen, strength and focus. That is the reason he was appointed and I thank him for accepting the appointment. He will clearly drive the IDA agenda. Many of the Deputies will have met Mr. Hugh Cooney. I have never met a man as enthusiastic and eager to support enterprise in this country. Mr. Dempsey who was appointed to FÁS — I am sure the Leas-Cheann Comhairle knows him — is a man of great energy and sincerity and will drive the agenda to the best of his ability with the members of the board who are clearly focused on what we can achieve with the strategic supports in place in our enterprise agencies.

The county and city enterprise boards continue to provide support for small businesses in the start-up and expansion phases. Job creation is an inherent consideration in the activities of the boards which will continue to assist micro-enterprises through direct grant aid to businesses and project promoters and the provision of a range of other important business supports such as mentoring, business training and business advice designed to stimulate indigenous enterprise creation and boost employment creation. The Minister of State has been very focused on renewing the focus and role of county enterprise boards which clearly have a local response to local needs and work closely with Leader companies under the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív.

The development of the smart or innovation-based economy is the key challenge facing Ireland as we lay the ground for economic recovery. We are well aware that our enterprise and investment landscape must continually be transformed to be competitive. Today the model for which we strive, as the basis of our economic renewal, is the smart economy , built on the dual strengths of our innovation and entrepreneurship. The Government has made a major commitment, through substantial public investment in the strategy for science, technology and innovation, SSTI, to making such a transition to the smart economy. This whole-of-government strategy focuses on research and the application and commercialisation of the fruits of that research and is spread across six Departments.

In December 2008 the Government reinforced the importance of the investment in the SSTI in the paper, Building Ireland's Smart Economy — A Framework for Sustainable Economic Renewal , which prioritised continued investment in science and engineering infrastructure and research. For us, building a smart economy is about the development and application of human capital, that is, the knowledge, skills and creativity of people, and our ability and effectiveness in translating ideas into valuable processes, products and services. In this context, Science Foundation Ireland is playing a critical role in building our competitive academic research base, while maintaining a strong focus on excellent research. This work has been highly rewarding as today Science Foundation Ireland funded researchers are connected to more than 300 companies in Ireland which support the employment of 56,000 people.

The objective of the research and development programmes administered by the State agencies is to harness the benefits of research collaboration for the benefit of the economy. This entails building a strong cadre of indigenous firms and attracting and further embedding leading multinational companies here. This is the essence of the SSTI which is proving to be the engine of economic growth. At this time of scarce economic resources, the Government has allocated €600 million to SSTI Departments and agencies in 2010 and we are confident that the net gain from such sustained investment will be more and better jobs.

If we examine the progress made in recent years, it is clear investment in the higher education sector is having a significant impact in terms of Ireland's human capital development, feeding through to the attraction of foreign direct investment and commercialisation. For example, last year 49% of the IDA's foreign direct investment wins were research, development and innovation related, valued at €500 million and built upon initial investments made through Science Foundation Ireland and the HEA. We are working to encourage indigenous enterprises to prosper. Evaluations of State support for research and development show that research and development performing companies have higher rates of growth in turnover, exports and employment and much higher productivity and export intensity than lower research and development performing companies.

New high potential start-ups will make a substantial contribution to export and job growth. In 2009 Enterprise Ireland supported 73 such companies across a wide range of knowledge-intensive sectors, including life sciences, biotechnology, medical devices and telecommunications, and a number of specific niche areas such as compliance and risk management. These companies are expected to create significant numbers of new jobs in the next three years, demonstrating that entrepreneurs across the country are capable of creating high value, export-focused businesses which support employment. It is only by implementing these policies and targeting our limited resources that we can can hope to position Ireland as a competitive, innovative location in which to do business, grow business and employment and create prosperity.

Ensuring our enterprises receive the support to assist them through the current difficult period is key to safeguarding employment, which is why I have introduced a broad range of enterprise support measures. Last year the Government introduced a €100 million enterprise stabilisation fund which aims to support viable but vulnerable companies experiencing difficulties because of the current economic climate. Companies receive funding which will go to support a range of activities, including market development, productivity improvements and product development. In 2009 €58 million was spent on 181 projects, supporting 7,500 jobs. The fund continues to be rolled out this year.

I am also very keen to support SMEs and particularly aware that there are difficulties for some businesses in accessing credit. To address this issue, the Minister for Finance announced a new credit review system in budget 2010. The credit review system will examine the credit policies and practices of the banks, in particular those pertaining to SMEs. This new system will inform the Government as to what further action might be necessary to secure the flow of credit to Irish enterprise and, through publication of the analysis from the review process, to help ensure the performance of the banks participating in NAMA is obvious to all.

An additional measure to support enterprises in retaining employees is the employment subsidy scheme which was introduced last year. Between 2009 and this year we are investing €135 million in this scheme, under which enterprises receive a subsidy of up to €9,100 for each subsidised job. There have been two calls under the employment subsidy scheme. The second is being assessed and it is expected that between the two approximately 80,000 jobs will be either directly or indirectly supported. The enterprise stabilisation fund and the employment subsidy scheme reflect the Government’s commitment and determination in assisting companies overcome this difficult period. Between the two schemes, we are investing €235 million directly in enterprises and safeguarding thousands of jobs and securing our enterprise capabilities in the process.

The Government is also encouraging employers to create new jobs through reducing the costs associated with employment. Under the employer jobs PRSI incentive scheme, when an employer creates a new job and takes on a person who has been unemployed for six months or more, the employer will be fully exempt from the liability to pay PRSI for the first year of that employment. This will give employers an 8% to 10% saving on employment costs for each new job created. It will actively encourage the creation of new employment now when it is most needed.

The PRSI exemption for employers creating new jobs this year is in addition to the maintenance of the substantial capital investment programme across government. Included in this is the national development programme and the implementation of key Government programmes such as the €425 million rural development programme 2007-13 which is creating some 12,000 jobs and the €1 million invested each week in the home energy savings scheme which provides work for some 3,690 registered contractors. The Government is also investing substantially in the provision of key infrastructure such as broadband, in respect of which the number of subscribers has doubled during the lifetime of the Government, and electricity generation from local renewable sources, in respect of which, at a figure of 15%, we have already met our target for 2010.

As I said, the Government remains fully committed to upskilling the unemployed in order that they will be successful in getting back into employment. My Department and I are proactively leading the Government's response to Ireland's unemployment level and driving implementation of the framework for sustainable economic renewal. The Cabinet sub-committee on economic renewal is also ensuring a co-ordinated approach across Departments in response to the rising numbers of the unemployed. This approach has included a substantial increase in the number of job search, training and work experience places available to unemployed persons. We are focusing our resources on a number of key cohorts of the unemployed which include the lower skilled, the long-term unemployed, those under 35 years of age and those formerly employed in the manufacturing, construction and retail sectors. These cohorts have been prioritised, as they are the most likely to drift into very long-term unemployment. The Government is investing substantial resources in tackling the unemployment problem. For instance, through my own Department, this year we will invest over €1 billion in the provision of a range of labour force measures.

As regards job search supports, in 2009 FÁS employment services, together with the local employment services, doubled their capacity. This means that the annual referral capacity under the national employment action plan rose from 78,000 people in 2008 to 147,000 last year. The additional resources allocated by the Government to tackle the rising unemployment rate have also enabled my Department to significantly expand the number of its activation training and work experience places. This year the total number of training and work experience activation places funded by my Department will be approximately 147,000. This compares to the 66,000 places that were delivered in 2008 and the 130,000 places delivered last year.

The bulk of this additional provision has been due to the increase in training places on short courses for the unemployed. FÁS now provides modular based training so that participants can pick which modules they most require to improve their skills and ultimately increase their employability while maintaining a close link to the labour market. In addition, training courses are being delivered in innovative formats such as on-line, blended learning and night courses. In this way we are providing a range of delivery methods in addition to the traditional classroom approach which enables more people access the services of FÁS.

I take this opportunity to inform the House that, in addition to the places I have just mentioned, this year Skillnets and FÁS will provide almost 10,400 training places for the unemployed or those on short-time working. I listened to a number of the issues which were raised regarding having people in productivity, especially those who are in short-term employment. Due to the economic downturn there are now many individuals who are working for two or three days each week and receiving social welfare payments for the days they are not working. Both Skillnets and FÁS are providing training opportunities for those in this situation. Individuals participating on these programmes can avail of training for the days they are not working while retaining their social welfare entitlements subject to the normal social welfare rules applying. This means that these individuals will now be able to use their reduced working week as an opportunity to upskill themselves thereby improving their employability. A key example was Element Six in Shannon, whereby Shannon Development, working with FÁS, was able to sustain employment and manufacturing in the mid-west. As a consequence of those interventions part-time workers being brought back to full-time work.

The Government is acutely aware of the large numbers of people under 25 who are now unemployed. That is why we have decided this cohort will receive priority access to the State's supports for the unemployed such as the FÁS employment and training services. I have also asked FAS to make significant prioritisation of services for the under 25s a key element in its provision in 2010. An initiative has been put in place also to activate 18 and 19 year olds immediately instead of their waiting the usual three months for this automatic activation. The main specific provision for early school leavers continues to be training at community training centres and vocational education committees under the Youthreach programme. The Government is maintaining the 6,000 places available in this programme at a cost of approximately €110 million.

Another important initiative of particular relevance to this cohort is the work placement programme which has 2,000 places, of which 1,000 are for graduates. Participants on the programme gain work experience for a period of up to nine months and may retain their social welfare entitlements subject to the normal social welfare rules applying. This work experience will significantly improve their chances of securing paid employment in the future.

As regards support for redundant apprentices, the Government has implemented a variety of measures, which will support around 4,000 redundant apprentices to progress their apprenticeships. Examples of the measures introduced include agreeing with ESB networks to take on 400 redundant apprentices at phases 5 and 7, over a period of 18 months; amending the rules for off-the-job training to facilitate redundant apprentices progress their apprenticeship; and introducing the employer based redundant apprentice rotation scheme to facilitate and support employers to provide on-the-job training for redundant apprentices.

For the information of Members, a new scheme for 2010 will be announced very shortly. It arises from the evaluations that have taken place and from the absolute necessity that all these young people complete their education and on-the-job training so that they will have the necessary qualifications when they have finished. That is very much a target of the work to be carried out in FÁS this year. In addition, the institutes of technology are providing a programme for redundant apprentices, which will provide them with a level 5 FETAC award and allows for access and transfer of credits to other post-apprenticeship programmes.

The education sector has also been very proactive in responding to the need for increased offerings for the unemployed. This can be seen clearly in the significant increase in the number of back to education allowance recipients to more than 18,000 people, many of whom are participating in further and higher education programmes. This year in the further education sector an estimated 126,000 learners will benefit from part-time learning opportunities for the low-skilled, the disadvantaged and for those who are unemployed. In addition, 40,000 learners will benefit from full-time further education opportunities under Youthreach, the vocational training opportunity scheme and the post-leaving certificate programmes. These programmes are targeted at the unemployed or are specifically designed to enhance participants’ employability.

With regard to the higher education sector there is clear evidence which shows that increasing numbers of people are choosing to pursue third and fourth level education. This is a welcome trend at a time of reduced opportunity for school leavers entering into the labour market. The total number of full-time enrolments in universities and institutes of technology is projected to be over 140,000 for this academic year, an increase of 4.5% on the last academic year. During 2009, a number of new initiatives were taken by the higher education sector to support unemployed people return to education and engage in upskilling. More than 900 unemployed people participated in short courses in the institutes of technology and 160 students undertook accelerated level 6 programmes.

In addition, from September 2009, almost 1,000 free or highly subsidised part-time places were offered to unemployed graduates to pursue postgraduate programmes in higher education institutions. A further 800 places were offered to part-time undergraduate courses. Both the undergraduate and postgraduate courses provided under this initiative were in areas that support the goals of the Government's smart economy framework and meet the future skills needs of the economy. If any Members have the opportunity to meet people on those programmes they will be very complimentary about the work being done and the speed at which new programmes to accelerate and provide convergance and blended learning. These new opportunities have been very beneficial. We should compliment the institutes of technology for the flexibility they showed in providing those courses.

In terms of social inclusion and supporting local employment in our communities the Government remains fully committed. Since the last two budgets I have increased the number of places on community employment by 900. This means that this year there will be almost 23,300 community employment places. I have also announced the creation of a €20 million labour market activation fund. This fund, which is being managed by my Department, will seek to support innovative proposals over and above mainstream provision for the unemployed. I am sure Members will agree that the issue is that many of those who are now unemployed are not necessarily those who found themselves underemployed or unemployed in the early 1980s. We are dealing with a new cohort of people and it is on that basis we shall go to the private sector to discover what new opportunities and innovative measures might be introduced. The fund will be open for the public, private and community and voluntary sectors to submit applications and such expressions of interest will be published in newspapers very soon.

It is expected that this fund will provide at least 3,500 training places. The activation fund will target the low skilled and those formerly employed in declining sectors such as the construction, retail and manufacturing sectors. There will be a particular focus on those aged under 35 and those who are unemployed for one year. Successful proposals will be those which can show they will provide the unemployed with skills that are in demand to enable them secure employment or to progress them on the pathways to employment. A call for proposals is expected to be issued in the very near future.

In the time remaining to me I will address a number of issues that were raised. Other Members of the House may take up others. Bhí mé ag éisteacht le mo chomhghleacaí mar gheall ar an rud a bhí ag dul ar aghaidh thíos i mo cheantar féin. B'fhéidir go rinne sé dearmad ar an sár-obair atá déanta ag Údarás na Gaeltachta ar son muintir an cheantair. Cuireadh polasaí úr i bhfeidhm nuair a bhí mé mar Aire Stáit, ag éirí as na himpleachtaí a bhí i mo cheantar féin agus, go mórmhór, i gceantar an Teachta MacFhionnghaile thíos i nGaoth Dobhair. Bhí béim ar an dífhostaíocht i mo cheantar agus i gContae Dhún na nGall go hiomlán. Bhíomar ábalta níos mó postanna a chruthú agus a chaomhnú sna cheantair Ghaeltachta. Is breá an rud é go rabhamar ábalta é sin a dhéanamh. Cé go bhfuil deacrachtaí agam agus ag an Aire, an Teachta Ó Cuív, tá obair idir lámha againn ar pholasaí úr chun tacaíocht a thabhairt do mhuintir na Gaeltachta. Tá béim á chur ar sin i mo cheantar féin. Ag éirí as sin, tá mé dóchasach go mbeidh níos mó postanna le fáil sa Ghaeltacht, go mórmhór in áiteanna iargúlta.

Regarding a number of the issues raised, I very much appreciate that public representatives are under pressure in their localities. Of all the Members in the House, I appreciate that perhaps more than others. That is why the target on regional development, replacement of jobs, driving innovation and creating new opportunities is very much the drive I have. Contrary to opinion, I have plenty of drive and focus in that context.

We will continue to be focused in driving our new responses to the challenges we have at present in this country. I have highlighted a number of the initiatives that will be taken to deal clearly with the needs of the people who have unfortunately found themselves unemployed. I will be very determined in ensuring we will continue to have a country where it is good to do business, where we will have scale and internationalisation and where we will continue to attract foreign direct investment.

Deputy Willie Penrose

I wish to share time with Deputies Morgan, Shortall and Tuffy.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Deputy Willie Penrose

This is an important motion. We in the Labour Party have our own views in regard to how to create and sustain employment and generate new jobs. Nevertheless, the thrust of this motion is important in so far as it is focused on the most important issue that will confront this country and its 4.5 million people, so it is critical we focus on it. It is an important issue confronting the Government at this time and it is disturbing to note the Government has not confronted the problem, irrespective of the fine speech by Tánaiste, Deputy Coughlan.

I freely admit there is no silver bullet that will deal with this problem but we need a comprehensive integrated plan and the Government simply does not have one. There is no innovation, no drive, no initiative, just the same old failed solutions signifying a Government bereft of ideas and drained of energy because it is in situ for too long. It is basically a clapped out Government, which is what happens. The epitome of this is the claim that an increase of 900 places on community employment schemes is an achievement.

Deputy Mary Coughlan

It is, when we have no money.

Deputy Willie Penrose

This is why the whole structure is collapsing. The Government is paying out the same amount of money on social welfare. Why not transfer that money from the social welfare budget to the enterprise budget so it can be devoted to CE schemes, where people have an opportunity to participate, make a contribution and feel they have something to give? They can participate in the enhancement of their communities and feel they have been recognised for the effort, they can learn skills, including interpersonal skills, and use their talents, whether it be in painting, maintenance, carpentry or plumbing.

Reference was made to the SME credit review system. What do we want a review system for? This is a Government made of reports — it knows nothing but reports and putting an issue to another body for consideration. The Government is elected to make decisions and come forward with solutions. It is not elected to send reports to every quango, like the circular bird, and get back the answer it knows will come back in any case. The Government is procrastinating, obfuscating and delaying while those 440,000 people who need our attention and look to this House to come forward with solutions must wait, although they themselves are prepared to bring forward solutions.

We in the Labour Party are listening and we will react. People are saying there are no policies and no solutions. The Labour Party document, Jobs and Recovery, was published on 4 December and we advocated that the Government should consider it. Fine Gael and Sinn Féin have their policy solutions, which are also worth consideration. This is not the sole preserve of the Government, which should listen. That is part of its problem. The Government is blind to any idea emanating from any source and it is deaf because it does not want to give any credit to anybody else that comes forward with an idea that would provide the pathway to a solution.

The banking crisis dominated discussion of economic policy in the past year, both in this House and in the media. Not nearly enough attention has been paid to the equally serious unemployment crisis. The two crises are, of course, interlinked. The crazed construction bubble which was fuelled by the irresponsible policy of the Government and its predecessor led to a totally unsustainable expansion of the construction industry which, at the height of the boom, constituted 13% of GDP compared to an average of 5% for the EU. It is significant that the highest unemployment rates in the EU are in Ireland, Spain, Latvia and Lithuania, all of which experienced property bubbles. By contrast, countries such as Germany, France, the Netherlands and Belgium, though they have experienced significant falls in output, have had less of an increase in unemployment. Those countries are also better placed to engage in stimulus policies as they were not relying on ephemeral tax revenues from the property bubble to fund public spending.

How in the name of God do we think we are so powerful in this country of 4.5 million people that we do not need a stimulus package, when every European country and countries across the globe are depending on stimulus packages? Why do we feel we are so special? We are an insular country which needs aeroplanes to bring people to and from here. While some suggest we do not have the money for a stimulus, we managed to bankroll the banks by taking money from the National Pensions Reserve Fund.

I remember Fianna Fáil's great myth that it was sacrilege for any Government or party to propose raiding the National Pensions Reserve Fund. They lost their conscience and had no scruples about raiding it when it suited them. I remember what they said back in 1997 and 2002 — I am not so deaf or stupid not to remember what they were saying. They made that point clear and they had a willing and compliant media to make it for them. While I acknowledge we need a working banking system, if that money can be taken for the banks, why not do the same to create jobs? The Labour Party proposed that €1.15 billion be put into a job generation fund. The 440,000 people who are on the dole queues are not there of their own free will, do not want to be there and would like to be working. People are prepared to adapt and to take less, so long as they are working, because it gives them peace of mind.

Unemployment has negative effects that go beyond the loss of income for people of any age. It is associated with illness, mental stress, depression and a reduction in life expectancy. There is a well-established link between crime rates and unemployment, particularly property-related crimes. Sustained unemployment when young has very negative long-term consequences for those who experience it. Young people who are unemployed at the beginning of their working life tend to have lower productivity, lower incomes and poorer labour market experience in later life. This information comes from the UK economist, Professor David Blanchflower, an authority on youth unemployment, who has written that unemployment in youth creates "permanent scars" rather than "temporary blemishes". That is a significant statement. It is why we are very much focused on the third of young men between 18 and 25 years who are unemployed. It is a disturbing statistic and one we must try to address. It is not an issue of point-scoring; it is an issue of trying to address an extremely important question. I accept it is not easy to tackle — let us be clear and honest with one another about that. However, we must try.

While the Minister of State will probably not agree, an issue arises as follows. Since the 1980s, the triumph of monetarist economic policy has led western governments of all hues to give priority to low inflation over all other economic goals. The charter of the European Central Bank requires that we have to keep inflation below 3%. While I am certainly not advocating inflationary policies, EU policy makers should bear in mind that there is evidence that a 1% increase in unemployment reduces overall economic well-being twice as much as an equivalent 1% increase in inflation. Economists call this the misery index.

As always happens when unemployment rises, the political right, unwilling to accept the failure of the policies, seeks to explain unemployment as being the result of unemployment benefits or the minimum wage being too high. There is little evidence to support either of these assertions. In the USA, unemployment is higher in states that have a minimum wage than in those that do not. The Scandinavian countries have the highest unemployment benefits in the world but have lower unemployment. There is ample evidence from many countries that what Marx called the reserve army of the unemployed is a conscript army, not a volunteer army.

There are still some anomalies in the social welfare system which make it difficult for young people to enter the labour force and these need to be addressed. Unemployment benefits have been significantly reduced for people under 25 on the basis that most of them do not have to make significant payments such as mortgage repayments. The consequence of this reduction is that some young people are now compelled from economic necessity to live with their parents, making them less mobile in seeking whatever jobs may be available. Youth unemployment is now at an alarming level, and we should be particularly concerned about those young people who left the education system without skills and qualifications. Even at the height of the boom young people were enticed out of education by the high wages available in the construction industry. Those people are deserving of particular support if they become unemployed.

I have much more to say but the Leas-Cheann Comhairle has indicated that my time is up. We must all put our shoulders to the wheel to seek solutions to this problem. We in the Labour Party will play a positive and proactive role in that regard. I appeal to the Government to come to the table with an open mind.

Deputy Arthur Morgan

I thank Deputy Penrose for sharing time. I would be grateful if he might also share his lungs with me. I would be proud to match his delivery, fair play to him.

Deputy Leo Varadkar

That could be taken up in all sorts of ways.

Deputy Arthur Morgan

Perhaps, but I am sure the Leas-Cheann Comhairle knows what I mean.

Deputy Conor Lenihan

The Deputy is not yet on life support.

Deputy Arthur Morgan

We must act to address the unacceptable flow of young people into long-term unemployment. The Government does not seem to appreciate not merely the economic but also the social consequences of a situation where 20% of under 25s are unemployed. If this economic downturn persists and there are no jobs for those people for the next two, three or four years, they will fall into the rut of long-term unemployment. Many of these young people are highly educated, competent and able. All they need is an opportunity to prove their capabilities. The negligence the Government has shown in dealing with them is utterly unacceptable.

There is no sign of a Government policy to stem the flow of youth unemployment. The only solution offered to date has been to reduce welfare payments to young people. I oppose that policy steadfastly because nobody should be punished for what is not his or her fault. The budget in April last year reduced the jobseeker's allowance for under 20s to €100 per week, while the December budget extended reductions to those under 25. The overwhelming majority of these young people would be happy to work if any were available. To punish them in this manner is grossly unacceptable. All young people in receipt of a welfare payment would have been subjected to a means test, and their approval for payments indicates that they have no or inadequate income to sustain their needs. This is proof positive that these young people do not have the means to survive in any meaningful way. The treatment they have met with from the Government is degrading. The majority want to contribute to society both economically and socially but they are not being given the opportunity to do so. Moreover, their lack of employment is inhibiting their future development.

The Minister of State must have some understanding of how frustrating it is to feel completely isolated and out of work for long periods with no prospect of a change in circumstances. That lack of prospects is a reality for many and there is little Government action in that regard. If young people had the opportunity to secure work placements, for example, they could undoubtedly bring a substantial amount of innovation and creativity to the table. The reduction in welfare rates will not create jobs. I agree entirely with Deputy Penrose that this is the missing element. I apologise that I missed the other contributions but I was taking part in the debate on the Finance Bill in committee. I would have preferred to be here because this is the cutting edge of the debate. We must all knock our heads together to ensure jobs and opportunities are available for young people.

In regard to education and training, it is important that whatever schemes the Government eventually proposes are meaningful and appropriate. Much of the activity in FÁS is significantly obsolete and irrelevant to the modern world, particularly as we move towards the knowledge economy. That is not to knock everything FÁS is doing. It is important in light of the poor reputation of some of the senior management that we do not tarnish the entire organisation. It is important to recognise that there are many solid and sound workers within the organisation. However, we must go beyond FÁS training. In France and Belgium, for instance, any person who is unemployed for more than three months is given a job placement. A significant majority of youngsters in this State would relish the opportunity to partake in the enterprise culture and learn about business. Such a scheme would afford them an outlet for their innovation and creativity. However, the Government is doing nothing like that. The only support available of this type is for those who have done extremely well in education, which is far too limited in scope.

There is poor training provision across the board, and not just for people who are unemployed. I spoke yesterday to a young man who is in the middle of an apprenticeship and is looking for his third assessment. He is 159th on the list. He was due to be placed in April but I am told there is not the remotest chance of that. He will be lucky to be assessed in September. What hope has this young man of developing his skills to the maximum of his potential when that is the level of provision being offered by the State? It is entirely unacceptable.

I disagree with the substantial traits of Fine Gael policy in this area. The withholding of welfare payments in certain circumstances amounts to holding young people to ransom. This is not a black and white issue. We must recognise the need to offer training that is modern and appropriate to the ambitions of young people. To come at it in a punitive way is not the right approach. As I said, there are shortcomings in FÁS but Fine Gael policy in that area is quite harsh. The Government should conduct a skills audit of young people who are unemployed. There is no one size fits all solution given their various abilities and ambitions. For example, their business skills, research and innovation capabilities must be examined and allowed to develop. There are 434,700 good reasons that we should look after these youngsters.

In regard to job creation, I tabled a parliamentary question today inquiring about the jobs created and lost in IDA-supported companies in Cork, Dublin and Limerick, respectively. I am informed that 1,082 jobs were created and 2,422 lost in Cork; 1,786 created and 6,805 lost in Dublin; and 169 created and 2,519 lost in Limerick. These numbers refer only to IDA-supported enterprises. Those are scary figures. We need Government action, we need innovation and creativity and we need to think outside the box. As Deputy Penrose said, we need to consider the example of what is happening in other countries and how they are dealing with this crisis.

Debate adjourned.

Dáil Éireann debate - Tuesday, 23 Feb 2010

Unemployment: Motion.

Dáil Éireann debate -
Tuesday, 23 Feb 2010