Thursday, 23 November 2017

Questions (21)

Mary Butler

Question:

21. Deputy Mary Butler asked the Tánaiste and Minister for Business, Enterprise and Innovation if she will address the fact that the south-east region returns just 45% of the PAYE income tax per head (details supplied) as per the south-east economic monitor; and if she will make a statement on the matter. [49515/17]

View answer

Written answers (Question to Business)

This Government and my Department value an evidence based approach as part of our efforts to ensure that work pays.  In that context I note the findings of the South East Economic Monitor as referenced in the Deputy's question in relation to examining income tax returns as a proxy for job quality and employment levels. A closer examination of the research and analysis behind the findings and the associated underlying assumptions would be required before I could make further comment on the specifics of the data quoted by the Deputy. In addition, as the Deputy is aware, issues relating to income tax are a matter for the Minister for Finance.

As regards the core issue raised however, it is the case that delivering sustainable employment and higher standards of living for all is the central objective of enterprise policy as set out by my Department in Enterprise 2025. This means creating the environment for quality jobs, enabling flexibility without exploitation, and a regulatory environment that remains attuned to changing work organization and society over the coming decade.

The enterprise agencies IDA Ireland and Enterprise Ireland (EI), together with the Local Enterprise Offices (LEOs) are focused on the creation of quality employment, taking into account the multidimensional aspects that define quality: ensuring opportunities for advancement that includes workplace learning and development; ensuring that people are educated and trained to meet the needs of industry; and recognizing the opportunities presented by entrepreneurship as an alternative career path.

IDA is targeting a minimum increase in investment of 30 to 40 percent in the South-East region over the period of its strategy to 2019. IDA positions the South East in the market place as an investment location with a strong ecosystem of both indigenous and multinational companies operating across a diverse range of sectors, including clusters in the Life Sciences and Financial Services/Business Services sectors, and strong FDI Engineering manufacturing businesses.

At the end of 2016, there were 13,369 employed at 72 IDA companies in the South-East region.

EI continues to engage with its 530 client companies in the South East to help establish their clients’ business needs and deliver quality jobs. In 2016, over 20,000 people were employed in EI supported companies in the South East.

In 2016, a total of 1,283 gross jobs were created by companies that have been supported by the LEOs in the South-East. Total employment among the South-East LEO clients was 6,690 at the end of last year. 

Key to delivering on the vision set out in Enterprise 2025 is that we optimize the job creation potential of our regions, building on distinctive strengths and assets, and that is the aim of the Regional Action Plans for Jobs launched by my Department in 2015.

These Regional Plans are crucial to meeting the Government’s ambition to create an additional 200,000 jobs, of which 135,000 are outside the Dublin region by 2020.

What the regional action plans can do is get things working from the bottom up, in partnership with the enterprise sector and other regional actors, building and reinforcing local strengths.

The South-East Action Plan for Jobs aims to increase employment in the region by 10-15% over the period to 2020, resulting in delivery of 25,000 jobs.

In addition to the FDI investment target increase of 30-40 percent, the South East Plan also aims to achieve a 25 percent increase in the number of start-ups in the region, improve the scaling performance of companies by 25 percent and improve the 5 year survival rate of companies by 25 percent.

The Local Authorities, enterprise agencies, and other key public and private sector stakeholders in the region have been strongly involved in, and are key drivers of, the South-East Action Plan. In addition, the Regional APJ Implementation Committee is working with the South East Regional Skills Forum to assess and respond to the skills needs of industry and prospective employees in the region.

As a result of a focused collaborative approach and a range of reforms, there has been a substantial improvement in the South-East region since the commencement of the National Action Plan for Jobs in 2012, with an additional 33,600 in employment in Q2 2017 compared to Q1 2012.

There are now 13,000 more people in work in the region since the launch of the Regional Action Plan initiative in Q1 2015.

The sectors which showed the highest employment growth since 2015 were Construction, Professional, scientific and technical activities and the Hospitality sector.

In addition, the unemployment rate in the South-East region has fallen from 12.8% in Q1 2015 to 8.1% in Q2 of this year

However, there is still work to be done: the unemployment rate in the South East is still over 1 percentage point higher than the (Q2 2017) national average of 6.4%.

To complement the Regional Action Plan for Jobs process, Enterprise Ireland, with the support of my Department, in May, launched a Regional Enterprise Development Fund of up to €60 million to grow and sustain jobs across the regions over a four-year period. The Fund aims to support significant regional initiatives, to build on sectoral strengths and to improve enterprise capability. An announcement of successful projects under the first call should take place by year end.

Collaboration is key to the success of employment initiatives such as the South East Action Plan for Jobs, and I want to promote the idea of people working together in the region to come up with new ideas, including those that could be considered under the Regional Enterprise Development Fund.

Additional funding of €150m is also being made available to the IDA to support its Regional Property Programme and drive job creation in the multi-national sector.