Seanad Éireann debate -
Tuesday, 1 Jun 2010

Vol. 203 No. 2

Job Creation

Senator Pearse Doherty

The issues of job creation and unemployment are close to everyone's hearts with the country suffering huge job losses over the past two years. County Donegal has always had a massive unemployment level, often double the national average and in some areas even three and four times it. It is an issue that never went away in Donegal, now made worse by the economic downturn and the Government's lack of a job creation strategy.

In Donegal, over 21,000 are out of work of whom 5,000 are under 25 years. It is heartbreaking to see the statistics of young males under 25 who make up a large proportion of that figure. Some have given up hope of finding employment and are emigrating, leaving our fine shores in search of brighter prospects elsewhere.

The Minister for Enterprise, Trade and Innovation must ensure towns in south Donegal, in particular, are targeted by IDA Ireland as sites for overseas development and investment. Donegal town, Bundoran and Ballyshannon need particular investment as they have been badly hit by unemployment.

In the past several years I have put in parliamentary questions through my party's Dáil colleagues seeking information as to what the Government has done for job creation in Donegal. We all believed matters would have got better with Deputy Mary Coughlan being appointed Tánaiste and Minister for Enterprise, Trade and Employment.

The facts, however, I uncovered from the replies to my parliamentary questions are startling. In 2003, 1,740 designed itineraries were hosted by the Tánaiste and IDA Ireland at different sites throughout the Twenty-six Counties but only a handful were held in south-west Donegal. There was one visit to Ballyshannon in 2004 and one to Donegal town in 2005. Why have there not been other visits to these towns since then?

While I accept we are in difficult economic times, from 2005 to 2007 the outlook was not as gloomy with giveaway budgets but no visits to IDA itineraries were held in Ballyshannon, Bundoran or Donegal town. It is very clear from my reading that the Government has given up on inward investment in these towns where we have seen many job losses.

I welcome the fact that, eventually, we will see new jobs being created Donegal town in the form of the 75 jobs confirmed at Abbott. However, we are acutely aware that these jobs were promised in August 2005 when the company shed 560 jobs. We are playing catch-up and have had to wait five years to begin to do so. We need an energetic, ruthless and targeted investment programme from the IDA, supported by the Government, to show the international companies of the world that Donegal town, Bundoran and Ballyshannon have much to offer. They have the parts, sites, skills, people, attractions and the potential to generate income and profits for such companies, if only we could include them in their portfolios.

I hope to receive a positive response from the Minister of State. It is clear, no matter on what side of the argument we come down, that we all need to work together. The towns to which I have referred need support not only from politicians, but also from the Government and job creation agencies. They will also need inward investment if we can attract it to them.

Minister of State at the Department of Enterprise, Trade and Innovation (Deputy Billy Kelleher)

I thank the Senator for raising this issue.

I wish to outline in broad terms that there are great challenges globally on the international scene in efforts to encourage inward investment, especially because there is a consolidation of many multinational companies throughout the world. This, of itself, creates uncertainly and can slow the pipeline. In general, IDA Ireland is actively promoting Ireland as a location and we are now targeting areas outside the traditional zones as part of the new strategy. It is important to acknowledge that there are significant international pressures. This transcends into job losses or a lack of creativity at home with regard to job creation. I emphasise to the Senator that Donegal is a priority area and that we are trying to insist on companies considering Donegal as a location for inward investment.

IDA Ireland is actively encouraging new investment in Donegal in knowledge-based industries. This is part of a focused strategy to replace the traditional clothing and textile industries which have been declining in the north-west region in recent years. During the past five years IDA Ireland supported companies in Donegal have created more than 663 new jobs. There are 12 IDA Ireland supported companies in Donegal, trading internationally and employing 1,684 full-time staff in the software development, systems development and medical technology industries. New companies such as Pramerica and United Health which have located in Donegal are continuously growing and recruiting, as is Abbott, to which the Senator referred.

IDA Ireland's main emphasis is on building an international and financial services cluster and it is making strides in delivering on this, evidenced by the quality of the existing companies and the announcement of an expansion of 123 jobs by Sita Inc. In addition, IDA Ireland is actively promoting Donegal as a successful location for high-end manufacturing, especially to companies in the medical technologies sector. This is proving successful with projects from Medisize and Zeus Industrial Products Limited which has opened a European operations centre for the production and distribution of precision medical tubing products.

Another primary focus for IDA Ireland in Donegal is the designated linked gateway of Letterkenny-Derry. Significant investment has also been undertaken in developing property solutions through the provision of a business and technology park, with three advance buildings in Letterkenny. This focus involves developing stronger economic links with Invest Northern Ireland which includes initiatives such as the north-west business and technology zone which is aimed at promoting the linked gateway of Letterkenny-Derry in line with the objectives of the national spatial strategy and the Northern Ireland regional development strategy.

The delivery of physical, social and economic infrastructure is key to securing inward investment and IDA Ireland continues to be engaged in identifying and prioritising investment in these areas in association with local partners. Positive developments include the delivery of the metropolitan area networks to towns in Donegal, with the direct international telecoms connectivity project funded under the INTERREG programme. Project Kelvin, as it is known, will provide a direct international telecoms link from Northern Ireland to north America by building an onshore link to the coast of Northern Ireland from an existing transatlantic submarine telecoms cable.

IDA Ireland recognises the need to work with its partners in Donegal to continue to address some key constraints, including strategic developments for foreign direct investment within the third level sector, local skills supply with an emphasis on medical technologies in Donegal and Derry and a requirement for improved access to international airports for its clients.

While IDA Ireland has made a significant contribution to regional development during the years, its capability to deliver is increasingly under pressure from enhanced global competition, EU regional aid limits and the changing needs of clients, as well as a lack of critical mass in some regions of the country. This issue must be overcome. The rise globally of metropolitan city regions as magnets of attraction is an added challenge. Ireland has only one such region, the greater Dublin area, which presents challenges for balanced regional development.

We are promoting Ireland as a location for key strategic inward investment and gaining competitiveness internationally. The downturn has forced a realignment of salaries and wages. It is recognised internationally that we are now becoming more competitive than in recent years vis-à-vis some of our major international competitors for the industries we seek to attract to Ireland, especially to areas such as Donegal and in such clusters as financial services and medical devices.

IDA Ireland's contribution to regional development is primarily as a stimulator of economic activity through key investment which brings high value employment, expertise and promotes confidence and overall economic dynamics within a region. Successful enterprise development and the creation of attractive locations are interdependent. Regions and gateways which support strong dynamic enterprise are crucial to Ireland's return to balanced economic growth. IDA Ireland will continue to focus on balanced development in these regional gateways.

Under its new strategy, IDA Ireland will continue to focus on delivering 50% of investment in the priority regional locations outside of Dublin and the south west. Some 50% of investment is dedicated to these key areas. The renewed emphasis of the proposed strategy features such regions as the west, the mid-west, the north west, including Sligo and Donegal, the north east, the midlands and the south east.

We will continue to understand the difficulties faced in Donegal because of the loss of traditional industries there in recent years. We are committed to ensuring this it will be seen as a strategic location for clustering developments. This is critically important. Companies will decide where they wish to locate. We must offer specific supports and infrastructure, third level facilities and a critical mass that is seen to be attractive to companies in the context of foreign direct investment. It is very difficult in the current international climate to attract inward investment to Ireland because of the consolidation of multinationals and the repatriation of some companies to their home countries is something we fight on a continual basis. Many other countries are competitive and offer very attractive packages such that we must be on top of our game in promoting Ireland, first and foremost, as a location for inward investment. Thereafter we must try to find companies which could benefit from locating in the regions. We are especially committed to trying to encourage IDA Ireland to promote Donegal in the attraction of financial services and medical technologies.

Senator Pearse Doherty

My questions referred to towns in south Donegal, including Donegal town, Bundoran and Ballyshannon. It would be more honest if the Minister of State were to inform us that the Government and IDA Ireland had given up on attracting foreign direct investment to these towns, especially Bundoran and Ballyshannon. We are all aware of plans to sell lands which IDA Ireland holds in these areas. Although the Minister of State referred to the Government continually prioritising Donegal, of the 12 companies located there by IDA Ireland, only two are located in Donegal South-West. They are at the lower end in terms of the number of jobs they provide, welcome though they are. There has not been an itinerary hosted by IDA Ireland or the Government since 2004 or 2005.

I welcome the new strategy and the fact that the Minister, Deputy Coughlan, was in charge at the time of its launch. It is a proposal for which I called in the report, Awakening the West. I completely reject the view of Fine Gael that all IDA Ireland jobs should be located in Dublin and Cork. On behalf of the towns mentioned, I make the case that they have a great deal to offer. It is fine to set a 50% target for places outside Dublin and Cork, but let us consider south Donegal, rather than Letterkenny, which always seems to be the case. Let us consider Donegal town, Ballyshannon and Bundoran and what these towns have to offer. If we just scratched the surface, we would be quite surprised at those towns' potential to help rebuild our economy.