Thursday, 4 March 2004

Questions (79, 80, 81)

Richard Bruton

Question:

74 Mr. R. Bruton asked the Tánaiste and Minister for Enterprise, Trade and Employment the details of the grant cost per job approved by the IDA and the grant cost per job sustained by the IDA in the years since 1980. [7361/04]

View answer

Written answers (Question to Minister for Enterprise)

IDA Ireland does not provide details of grant costs per job approved for confidentiality and competitive reasons. The table provides details of the cost per job sustained by the IDA in the years since 1980. The cost per job sustained is calculated by taking into account all IDA Ireland expenditure to all firms in the period of calculation. Only jobs created during and sustained to the end of each seven-year period are credited in thecalculations.

Cost Per Job Sustained (Constant 2002 Prices)

Period

1981/1987

1982/1988

1983/1989

1984/1990

1985/1991

1986/1992

1987/1993

1988/1994

Cost €

50,413

45,220

38,802

34,060

32,369

30,350

25,417

20,625

Period

1989/1995

1990/1996

1991/1997

1992/1998

1993/1999

1994/2000

1995/2001

1996/2002

Cost €

18,960

18,428

17,965

17,166

15,124

14,076

14,017

15,897

Source: Forfás Annual Employment Survey 2002

Richard Bruton

Question:

75 Mr. R. Bruton asked the Tánaiste and Minister for Enterprise, Trade and Employment the details of the number of jobs in IDAassisted foreign owned enterprises since 1980. [7362/04]

View answer

The table provides details of permanent jobs in IDA assisted foreign owned enterprises since1980:

Number of permanent jobs in IDA assisted foreign owned enterprises since 1980.

Year

1980

1981

1982

1983

1984

1985

1986

1987

1988

Jobs

64,048

68,345

68,471

65,819

64,154

62,648

64,099

63,820

67,065

Year

1989

1990

1991

1992

1993

1994

1995

1996

1997

Jobs

72,067

75,484

77,026

78,233

80,594

84,945

92,015

99,127

108,669

Year

1998

1999

2000

2001

2002

2003

Jobs

117,247

125,272

139,752

134,907

130,591

127,616

Source: Annual Forfás Employment Survey

Richard Bruton

Question:

76 Mr. R. Bruton asked the Tánaiste and Minister for Enterprise, Trade and Employment the restrictions on State aid which apply in the Border, Midland and West region, in the Dublin region, and in the rest of the country under EU rules; and if she will outline the guidelines for deciding on levels of grant aid to new investors by the IDA in the respective regions. [7363/04]

View answer

Under Ireland's regional aid map for the period 2000-06 the maximum aid rates permissible for regional aid towards investment and job creation in the designated regions are set out:

Aid rates (%) for initial investment for regions in Ireland

2000

2001

2002

2003

2004-06

‘C’ Region

South-East

40

37

31

26

20

Mid-West

40

37

31

26

20

plus

South-West

40

37

31

26

20

10% gross

Mid-East

40

35

29

23

18

for

Dublin

17.5

17.5

17.5

17.5

17.5

SMEs

‘A’ Region

Border, Midlands, West

40

40

40

40

40

plus 15% gross for SMEs

The rates above are subject to the new multisectoral framework for large investment projects, which progressively reduces the effective grant ceiling for regional aid below the levels set out above where the value of the investment being aided exceeds €50 million inclusive of grant assistance.

As the table indicates, from 2000 Ireland was still entitled to provide significant rates of regional aid throughout the country and less so in the Dublin region. In line with the regional aid map, regional aid can continue to be awarded up to a rate of 40%, or 55% for SMEs, in the BMW region until the end of 2006. The aid rates elsewhere, other than Dublin, have been gradually declining since 2000. This is due to the fact that, in accordance with Article 87(3) of the EU Treaty, regional aid is permitted in the most disadvantaged regions of the European Community only where the standard of living is abnormally low or where there is serious underemployment. In less disadvantaged regions, regional aid may be given where such aid does not affect trading conditions to an extent contrary to the common interest.

While the regional aid rates listed above are secure until end 2006, given Ireland's level of economic development in recent years we cannot expect to be able to provide significant rates of regional aid after 2006. In addition, the European Commission has signalled its intention to significantly reduce the scope for regional aid for large companies in all member states after 2006. However, it should be remembered that regional aid is not the only form of State aid that may be given to assist company development. State aid may also be given throughout Ireland under various EU guidelines relating to European Community objectives such as research and development, employment, development of SMEs, training, and environmental protection.

In deciding on levels of grant aid within the rates permitted in the Regional Aid Map, IDA Ireland operates a set of internal negotiating guidelines. These negotiating guidelines are designed to ensure that the maximum value for money is achieved consistent with facilitating the development of desirable investment initiatives; provide more aid for particularly high quality and strategically important investments that are in line with enterprise development policy and Ireland's competitive characteristics; and help implement IDA Ireland's regional development strategy, which includes a high priority on increasing the level of investment going into less developed regions, particularly the BMW.

It is important to remember that EU State aid regulations apply to all member states. IDA Ireland continues to successfully attract investment within the framework set by the existing regulations.