Leaders’ Questions

Before the referendum date was set, I said we would favour it not being held in the immediate aftermath of the French presidential election because it had the potential to cause uncertainty. This has happened to a certain degree and needs to be addressed. I ask the Taoiseach to give the House some clarity on the situation. It is fair to say that Mr. Hollande favours balanced budgets and fiscal rules but also wants to see a growth agenda. That is a welcome opinion and we in Ireland should welcome a stronger growth agenda across Europe. We have consistently called for that over the past 15 months. I believe the Taoiseach will agree that it need not have any implications for the stability treaty. However, it requires countries such as Ireland to speak up and back him on a far more ambitious agenda than we have had to date from the European leadership.

A special meeting of EU leaders is scheduled in two weeks' time. Between now and then I ask the Taoiseach to indicate to the House whether he will be lobbying for specific new growth measures in addition to the fiscal treaty. In particular will he support the call for a broadening of the mandate of the European Central Bank, the creation of infrastructure bonds via the European Investment Bank and the creation of euro bonds themselves? Are there specific issues relating to the growth agenda on which he will engage with other European leaders? Can the Taoiseach confirm that Mr. Hollande favours fiscal rules and balanced budgets? He is very clear that he does not want to change the key element of the establishment of a permanent funding mechanism for countries in need of support - the European Stability Mechanism. It has been suggested this morning that negotiations might begin to add to the treaty some specifics on the concept of growth.

The decision to be made on 31 May is a decision by the Irish people for Ireland and its future. The people are being asked for their permission to ratify the treaty signed on 2 March. I congratulate Mr. François Hollande on his election as President of France. I have noted his comments on growth, balanced budgets, the need for an ESM and also the need for a more concentrated focus on a growth agenda for Europe, which is in everybody's interest. I welcome his statement from the point of view that Ireland and other countries have been talking about this agenda for some months.

I spoke to President Van Rompuy on Sunday and urged him to hold a summit meeting on a growth agenda. On 23 May, after the French President has been ratified, the meeting will take place and the Heads of Government will look at the areas for growth and investment as part of that agenda and, I would assume, come back at the June meeting with specific proposals, including some of those the Deputy mentioned. This is clearly in Ireland's interest. In saying that we support a growth agenda, we do so in principle but there are issues that are clearly not in Ireland's interests, including changes to corporation tax rates.

For the period ahead, the campaign here will focus on the positive reasons that Ireland should vote for this treaty, including continued access to investors' decisions to invest in Ireland and the lists of job announcements. The access to the permanent mechanism of the ESM is the insurance policy or the back-stop that countries will look for and this will also put good housekeeping rules in order here so our country does not end up in serious difficulties again.

I have congratulated Francois Hollande. I expect to speak to him this week and clearly as far as his comments have been made to date about additional measures in terms of growth and investment, these are to be supported. The more that European economies can grow and prosper, the better it is for our country. Clearly, it should be said that we must appreciate the difficulties and the challenges that people have faced up to in this country and that is paying dividends in the recognition that Ireland has moved considerably from where it was, having been linked with other countries just a short time ago.

Over the next week, I assume the question of the agenda of the meeting of 23 May will be clarified. I will be happy to share that with the House and take proposals from Members in respect of their views about issues that should be discussed for investment and for a growth agenda.

We would appreciate some specifics on the growth agenda. It is all well to talk about it but we need specific proposals on it and Ireland should be tabling some measures because an opportunity exists now, particularly in terms of something over and above the fiscal treaty. We have consistently argued the fiscal treaty is an essential step for Ireland's recovery but that it needs much more, particularly from the European Central Bank and other measures. The Tánaiste is in Paris and if he gets to meet Mr. Hollande, he might convey to him that reality does not necessarily change after elections, as we know here and elsewhere. The French may get to realise that sooner rather than later. It is important that Europe holds its nerve and keeps on a credible pathway out of this crisis.

In that context, the Greek elections, if anything, are more serious in terms of their potential implications for the euro itself. Has there been any contact across Europe following those elections on the Greek bailout programme and the serious situation it faces in terms of funding requirements? It will need a major tranche of funding shortly and the implications of a potential default would be widespread for the entire eurozone area. As a Government and a country, we must keep a watchful eye on that. I ask the Taoiseach to ensure that across Europe, the full implications of what may happen in Greece in the coming months are fully taken on board and the necessary contingency plans are made.

The Greek situation shows what happens where there is a complete failure of confidence for investment in an economy like Greece. The process must take place; Mr Samaras was unable to form a government, and it has now passed to the next largest party and, beyond that, a judge might be appointed to run the country for a period while the possibility of further elections looms. The question of the Greek bailout that has been approved and voted for will come into focus depending on how that process goes.

As far as the agenda for growth items, the Deputy mentioned euro bonds, a sufficiently high firewall, the future role of the ECB, the capacity of the European Investment Bank to fund projects that are sustainable and worthwhile and the issue of Structural Funds that remain unspent in some countries. In Greece, €16 billion was allocated but it cannot be spent because there is no back-up from the Greek economy. Other countries, however, including this country, have plenty of projects that are sustainable and that could ahead. These issues must be examined.

I noted an interesting speech by the German Minister for Finance, Mr. Wolfgang Schäuble, where he talked about increasing rates of pay for German workers, an indication of a country in surplus that wants to spend and therefore stimulate the country while other countries are trying to deal with deficits. These are indications of attitudes emerging. I look forward to the meeting on 23 May, where we can have a strong discussion about a European summit on growth and investment. I will be happy to inform other Deputies that the Government will consider a list of potential issues we will see as providing a stimulus and an opportunity for Europe and for Ireland. Our question is to be answered on 31 May, the question of Ireland's future. A "Yes" vote will guarantee confidence and a future while a "No" vote will create confusion and uncertainty and an instinct this is not the right thing to do.

Would the Ceann Comhairle agree with me that it is surreal to listen to the dialogue between an Teachta Martin and the Taoiseach? It is like dialogue in an echo chamber.

The Ceann Comhairle does not comment on contributions.

It took Deputy Adams long enough to discover dialogue.

Especially with section 31.

Sometimes I would like to be able to comment.

I would also like to congratulate Francois Hollande. The message is not who was elected but that citizens spoke and in France and Greece, and in local elections in Italy, Germany and Britain, they rejected austerity. This referendum on 31 May allows Irish citizens - the Taoiseach did not want a referendum - an opportunity to join the growing Europe-wide movement to see investment in jobs and growth. A strong "No" vote will see this goes beyond rhetoric. Austerity is not working. We have had five austerity budgets under Fianna Fáil and the current Government, with the social consequences for citizens becoming worse and worse, with half a million unemployed and tens of thousands emigrating, families unable to pay bills and poverty increasing.

The Taoiseach will recall that before every EU summit, Sinn Féin urged him to ensure growth and jobs were at the heart of any agreement. The Taoiseach rejected this sensible approach and repeatedly refused to seek a write-down of the private banking debt. Now with the tide of popular opinion demanding jobs and growth across the EU, this Government has suddenly discovered a rhetorical sense of these policies. Citizens will not be fooled by this or by lip-service to it. Will the Taoiseach take this opportunity to set the record straight and admit austerity does not work and that we need to get people back to work?

I certainly will set the record straight. Deputy Adams and his people have put forward a proposition that the Irish people should vote against this treaty. The Deputy's cohort at the back, absent today, stated this will require €10 billion extra in taxes.

It is all cannibalism.

Deputy Adams thinks-----

First is the €6 billion in cuts.

-----he can come in here the day before Europe Day, with his fantasy economics and ask the people to close the deficit in one fell swoop of €10 billion when that would give a lethal injection to the economy.

We have not suggested that. That is a straw.

The people will not wear that. The Deputy has not answered any question as to where he would raise the moneys to run the services in this country, including for gardaí, teachers, nurses, doctors and everybody else who provides the public services he mentioned.

If the Taoiseach opens his ears he will hear.

I stated on many occasions that austerity is not the answer for dealing with prosperity for the future. This treaty is both preventive and corrective and is one element of what we have to do. Since last March the Government has been talking about investment, growth and opportunities. That is what a "Yes" vote will give: certainty to the bailout of the ESM, were such ever required as an insurance policy; certainty to the continued line of investment in this country; and legislation to ensure that no future Government will never create difficulties for the people with these issues. If the Deputy's proposition were to be put forward as policy, the €10 billion charge in taxes-----

That is not Sinn Féin policy.

----- that would result from a "No" vote would deliver a lethal injection to the economy. The Deputy knows that and his heart is not in this argument.

Deputies

Hear, hear.

I thank the Taoiseach for that rather disingenuous answer. As he knows, we do not have a cohort at the back. We have a duly mandated team of Seanadóirí and Teachtaí Dála anseo. With a mind to the awful social consequences, unlike the Government, we have put forward thoughtful costed propositions as to how we can grow our way out of the difficulties and get our people back to work.

Last week, Mario Draghi spelled out his vision for the austerity treaty, describing it as "a fiscal union in which the national Governments will have to accept a delegation of fiscal authority and sovereignty to a central authority". Tá sé soléir go n-aontaíonn an Taoiseach leis an méid seo. Cén fáth? An gcuimhníonn sé an sean-dán? "Mór mo ghlóir/ Mé a rug Cú Chulainn cróga/ Mór mo náire/ Mo chlann féin a dhíol a máthair." What will this mean? The Taoiseach clearly agrees with the delegation, as Mr. Draghi calls it, of fiscal sovereignty to a central authority. This will mean a delegation of fiscal authority, putting in place the setting of taxes over sovereign states in the EU.

Why should Irish citizens vote for a treaty that means handing over what is left of our economic decision-making? The Taoiseach rightly criticised the Fianna Fáil Government when it handed over sovereignty to the EU and the IMF. Indeed, the Minister for Finance, Deputy Noonan, described the 2011 budget as a "puppet budget from a puppet Government". Cad í an difríocht anois? Why does the Taoiseach support the abandonment of economic sovereignty? Why does he believe that tax measures, public spending targets or welfare rates should be set in Brussels or Berlin rather than here in the Oireachtas?

It seems the Deputy is suffering from some kind of a complex in this regard. I understand he has called in the reinforcements from the group, Europe of Freedom and Democracy, which is led by UKIP. I thought the Sinn Féin campaign was sufficiently robust to make the case on its own.

Is that a blue shirt party?

From the Tory party of Ireland.

The Deputy's absent colleague was screeching about austerity, with which the Deputy agrees, given that he stated that €10 billion will be required in extra taxes if the people vote against this treaty.

Misleading the Dáil.

As he knows, that would completely destroy inward investment.

Was that not the Lisbon argument? Some 70,000 jobs were lost there.

The reasons the people should vote for this treaty are, first, to continue the very strong line of investment into the country, as evidenced by announcements made by a whole series of multinationals.

Answer the question, Taoiseach.

As I pointed out, the value of that in deficit reduction is enormous. Second, there is the guarantee of having an insurance policy in the ESM, which has been voted for by the European countries, if people vote "Yes", on the assumption it may never be required but that if it was, it would be there.

The third reason is good housekeeping rules. As I have said to the Deputy on many occasions-----

Answer the question, Taoiseach.

-----it is necessary for this country to put its own house in order.

You cannot do that by yourself. Berlin has to do it first.

Given that the people have risen to the challenge in this regard, Ireland is in a very different position than it was only 12 months ago. International economic, business and political commentary now sees this country as heading in the right direction. The consumer confidence index has been up for the past four months and growth has reappeared, albeit on a small scale, for the first time in many years.

What about the gross figures?

Employment has stabilised and decisions are being taken that will continue to open the doors for business, jobs and investment in this country.

I welcome the decision by President Van Rompuy, to whom I spoke over the weekend, to hold a European summit on growth on 23 May. I reiterate, for the past number of months it has been a requirement for European states to focus on this and it is of direct impact on our people. A "Yes" vote guarantees confidence and continued investment. A "No" vote casts us into the mire of uncertainty and confusion-----

The big bad wolf.

-----where Deputy Adams and his party would love the country to be.

It would appear that indigenous home-grown job creation plans are being relegated to the subs' bench in favour of high-optic photo-calls of international announcements. Although all Members welcome the recent jobs announcements by SAP, Apple and other foreign direct investors, I have concerns as to the backbone of the job creation portfolio of this Government because it seems, in part, to be selective and it does not put the shoulder to the wheel when it comes to supporting ground-up solutions. The focus is entirely on foreign direct investment, ignoring the potential of the domestic economy and the urgency for same to be supported.

Speaking in a Dáil debate last month, the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, stated: "Supporting balanced regional development and creating jobs in rural locations is a priority." However, to take one case in point, the Western Development Commission has published a report, Creative Sector in the Western Region - Future Growth Trajectories. This reports warrants real attention in an economy that is looking for answers as it outlines the possibility of creating 20,000 jobs over the coming ten years within the creative industries area.

Has a single Department read the report? Has any Department spoken to the statutory agency that wrote it? The answer is a clear "No". Across the seven counties, Donegal, Mayo, Galway, Leitrim, Roscommon, Clare and Sligo, this sector reported total sales in 2010 of €206 million, with exports close to €57 million annually. The potential 20,000 jobs are not getting there fast enough to stop the tide of emigration. Seeing the destruction of families and communities in my county, Donegal, is very painful. The very fabric of our social capital is being torn apart. Emigration is keeping the live register figures for County Donegal-----

A question, please.

-----down at 21,000. It seems this is the only answer the Government has for reducing unemployment in the north west.

Do you have a question, Deputy?

What are the Government's rural job creation priorities? Why has a report of such potential, issued from the Western Development Commission, been completely ignored?

The line of investment into the country from outside is a signal of confidence in our people and in our country on the part of decision-makers abroad. I am sure the Deputy heard the chief executive of the Industrial Development Authority talking this morning about the great clusters of world leaders in industry now in the country, be they in software, IT or whatever. The reason they are here is their belief and confidence in our workforce, the ease of doing business here, the productivity, the targets set and the capacity of the Irish workforce to measure up to whatever the challenge may be. That is evident throughout the country. The next wave of investment will come from small and medium enterprises in order to deal with the demands and requirements of many of these companies. That is why the focus of the Government has been to strengthen the business model for small and medium-sized enterprises and micro-enterprises. It is why the jobs action plan was published in February, with 270 proposals. The first quarterly report showed a significant fulfilment of the proposals. It is why the Government published legislation dealing with the partial loan credit guarantee scheme so that small companies can access credit from the banks, each of which has guaranteed over €3 billion of new lending this year. It is why the Government wants to move on with the micro-finance agency, which can leverage €100 million for very small operators. Following the decisions on VAT and PRSI, particularly in the hospitality sector, 11,000 new jobs have been created in the food and agriculture sector. There was no increase in income tax and taxes on jobs so that we can unleash the potential of small business operators. That will apply in Donegal as well as Wexford and County Louth as well as County Cork.

I do not accept the premise of Deputy Pringle that the Government is not focusing on the sector. It is, which is why JobBridge and Pathways to Work have brought about significant improvements in well-qualified people taking up employment through JobBridge. The Pathways to Work scheme is proving exceptionally beneficial for those who unfortunately found themselves out of work. The change is coming in the Department of Social Protection, where people who lose a job will be offered opportunities for retraining, upskilling and a change of direction in their career. I recently visited the Google headquarters and spoke to some of the 1,000 engineers there. The average length of time people have a job in a company like that is four years following which they change direction. We must deal with the future which being created. The emphasis of Government will be to continue to roll out its jobs action programme for those companies so that the news can be, from Dunlewey to Bundoran, that new places are being opened and that two or three new people are being recruited on a regular basis. I understand the scale of emigration and what it means but it is important not to lose hope and confidence. Government decisions in this area help the environment. From my perspective, I want to be able to prove by 2016 that we are the best small country in the world in which to do business.

Those are fine words but they do not mean much on the ground when over 1,200 small businesses across the country have failed in the past two years. We should be building our indigenous sector to stand up and service itself and the country rather than serving the foreign direct investors already here. The report from the Western Development Commission clearly sets out how it can be done. I call on the Taoiseach not to tie himself to the rhetoric but to support industries and allow them to develop jobs. Jobs in small businesses across the country will keep things going. The rhetoric of the Taoiseach is very different to the experience of most people across the country who comprise the economy on which people depend day-to-day for their survival and to stem the tide of emigration. I ask the Taoiseach to look at the Western Development Commission report, see its value and ensure that its recommendations are implemented so that we can have a domestic industry that can stand on its own, not just to service foreign direct investment.

The Western Development Commission has produced some fine reports. I read the reports and I meet the commission on a reasonably regular basis to hear its views and about its capacity to co-ordinate the effort between agencies, Departments and businesses. I had the privilege of visiting China recently to meet elements of the political process and the business world. Some 90 companies from Ireland were there and each of them signed contracts, which are collectively worth €35 million. Some of them are spread across the west and in niche areas. Enormous potential exists in that area. Companies from Ireland employ over 100,000 people across 50 states in the US. These are not phantom companies, they involve men and women producing goods that are exported and employ people in other countries. That is why the confidence of the fiscal stability treaty will mean that where Europe focuses on the growth agenda, it will help many small companies, including those in County Donegal, to export to larger markets where the products will be bought.

The Western Development Commission report is valuable, as are all the reports, but the focus and the emphasis of the Government is to open the doors for small businesses to have access to credit so that they can make cashflow projections. In the past, if a company sought extra money from the bank, money was thrown at the company if it had property. That is no longer the case and cashflow projections are required now. There must be compatibility in that the business must be sustainable in its potential. I do not accept the premise of Deputy Pringle and, while I would like more people to be employed today, the emphasis of the Government and the Cabinet, through the action plan for jobs, is to stimulate the economy and prove that we can create an environment and a sense of confidence where employers and those with initiative will take on new people and rise to the challenge of the potential for producing goods that can be sold on the export market. This will generate income for the country.