Before we adjourned the debate I was congratulating the Minister for giving much needed relief to the hard-pressed newspaper industry. There is no doubt the Irish paper industry was in a parlous condition and that many jobs were at risk in provincial newspapers and in national newspapers. There was a question mark over the survival of at least two national newspapers. I suggested that the time was ripe for the creation of a press council because I think the level of journalistic licence has exceeded the bounds of acceptability in some journals. The reduction in VAT was welcome and opportune because the circulation of the Irish papers was wilting under the onslaught of papers such as the Daily Mirror, The Star and The Sun. Our papers were unable to compete with the cover prices of the English newspapers.
I congratulated the Minister and Deputy McCreevy for combining so effectively to reduce the penal imposition of 20 per cent VAT on betting to the more realistic figure of 10 per cent. I do not have to tell anybody here of the importance of the Irish racing industry. We lead the world in few things but we lead it with the Irish thoroughbred. The whole Irish racing industry will benefit from the reduction in tax to a more realistic level. The man in the street, the bookmaker and the racing industry will benefit but the chief beneficiary will be the Minister because it is an open secret that there was very considerable evasion of betting taxes. I should like to think that perhaps my own honesty was to a small degree rewarded because Deputy McCreevy and I had to run the gauntlet of some rather self-righteous and sanctimonious criticism, including that of that unofficial ombudsman, the noted letter writer, Liam T. Deegan. However, we succeeded in getting the tax reduced and from various contacts I believe it will be a success. While there are a few cowboys in different areas, the Exchequer will benefit tremendously. If the bookmakers and the punters play their part, I hope we may have a further reduction to 5 per cent next year.
Unemployment is the burning topic in this country, next to the biggest problem which concerns the rising crime rate. Many speakers have suggested that the unemployment level is a recent phenomenon, something that has occurred since we came to office, but that is ridiculous. Unemployment is a problem that is relative to each year and the reason Fianna Fáil are in the political wilderness is because of the level of unemployment in recent years, allied to the ball and chain that hangs around their feet, namely, the 1977 manifesto.
I suggest the time has come for a radical reappraisal of the unemployment situation. Up to now we have been following conventional, stereotyped Civil Service schemes but they are no solution. The various schemes put forward by AnCO and the National Manpower Agency are welcome but basically they are 20th century relief schemes. There is no continuity and many young people are frustrated when they find after completion of a six-month course that there is no possibility of continuing employment. That is why the Government should address themselves seriously to this whole matter.
Many radical proposals will have to be considered. The concept of work sharing will have to be examined and that will be bitterly resented by those who are fortunate enough to have jobs. However, if the thousands of young people are to have any hope of employment, work sharing must become a reality in the future. I suggest that the Government should consider the introduction of an attractive, tax-free retirement incentive scheme to allow people in the public sector to retire at 60 years and ultimately at 55. In that way we could create employment and set a good example in respect of work sharing. The abolition of overtime will also have to be considered.
Another thorny question that will have to be looked at is the number of married women who are working. I am sure I shall draw the wrath of most of the married women when I say that but I believe there are many elderly married women who are working who do not need to work. In this connection I refer in particular to the nursing and teaching professions. There is a school outside Dundalk where there are seven married women employed and each of them is married to a person who is in good employment. I do not think that should be allowed to continue. In the case of elderly ladies whose families are reared, they should move aside and allow young people — perhaps their own daughters and sons — to get employment.
I should like now to say a few words about my own devastated region. I referred to it earlier as the hind-tit of Ireland, the neglected region of the country. I suggested the pendulum of deprivation had swung from the west of 25 years ago to the north-eastern region of today. In the report last year of the European Economic and Social Council it identified the Border areas as the most deprived in Europe. I have lived all my life in Dundalk and I can vouch that Dundalk is on its knees. It is pleading for help and I am pleading on its behalf for some Government support.
In the 16 years of the horrific Ulster troubles no other town has suffered as badly as Dundalk and compensatory measures have not been introduced by any Government. Yet, the British Government have introduced compensatory measures for the border towns in the North. They have provided millions of pounds for extensive developments, for housing programmes, leisure centres, libraries and swimming pools. My town has been denied any of that kind of money but the more serious aspect is the unwelcome tag we have been given by the foreign media of El Paso. That has definitely proved to be a deterrent to the efforts of the IDA to attract industry to my region.
The last investment in Dundalk was in 1969, 16 long years ago. Dundalk is the largest town in Ireland with 27,000 people. Our problems have been further exacerbated by the slow demise of the footwear industry. For many years we were proud of our footwear industry. Dundalk was the home of the footwear industry but now the bell is tolling for that industry. There is very little hope for it because of our entry to the Common Market and the removal of various tariffs. At one time more than 2,000 people were employed in the footwear industry in Dundalk but now there are only 100 to 150 with the proposed closure of Clarks (Ireland) Limited.
Several Fianna Fáil speakers from my constituency have suggested that the Irish Government were at fault for this closure but that is nonsense. There has been a gradual demise in this industry since our entry to the EC ten years ago. I refute the suggestion that the Government did not react quickly enough to the closure of this factory. I want to say quite categorically that this Government were monitoring the situation and were fully aware of the precarious existence of Clarks factory. Contrary to the usual procedure, in which companies in difficulty come to the Government looking for help, this Government called in the management of Clarks on two occasions and offered them very attractive incentives to stay here. But Clarks had a death wish; they wanted to fold up. I believe the Brighton bombing was the final nail in the coffin. That spelled the end of Clarks as we knew it in Dundalk. I want to state categorically that this Government acted very responsibly in this case.
The Minister for Finance has done a lot to alleivate the hardships in the Border region but he has not gone far enough. If the measures he has introduced, such as the reduction in spirits, are effective, why not do the same for beer which is the drink of the average working man? I believe the law of diminishing returns exists in that area; but, if the Minister reduced this tax on beer, it would discourage people from crossing the Border. The real reason people cross the Border is because of the difference in VAT rates and the only answer in the long term is the harmonisation of VAT rates North and South of the Border. A country with 3,500,000 people cannot compete with a country with 60 million people and more efforts must be made to harmonise VAT rates. Otherwise the north-east region of this country will be decimated.
The increased price of petrol has only increased the attractiveness of crossing the Border. I would like to draw the Minister's attention to the figures released by the Ulster Office. They said that £500 million was spent across the Border last year. I cannot understand how that can be condoned. The once ghost town of Newry has been turned into an El Dorado as a result of Government policies. Recently the chairman of the Newry Chamber of Commerce stated that 80 buses each Saturday were going into Newry and that in the 12 weeks before Christmas people from the Republic had spent £150 million in the Six Counties. Dundalk and other Border towns are haemorrhaging as a result of that.
I would like to mention the threat posed to one of Dundalk's remaining industries, an industry of which we are particularly proud, and that is the 150 year old industry of P.J. Carroll. They employ 600 workers. This firm made 115 people redundant last year for the first time in their very proud history. This is one of the showpieces of Irish industry and is the particular pride and showpiece of Dundalk. Out of the £350 million which the Exchequer take from the cigarette industry, P.J. Carrol contributed £175 million plus a further £12 million in employees' taxation last year. That is a very sizeable contribution. While I appreciate that there is a very definite health hazard associated with cigarette smoking, in a democracy the right to choose is paramount. I believe the threat posed to the industry by the Minister for Health is very serious because of its unfairness to home market producers. They cannot advertise yet imported magazines carry large glossy advertisements which were placed outside the country. That puts the future of the Irish tobacco Industry at risk and does not make for fair competition. The industry recognise that there is a health hazard associated with cigarette smoking, but they feel they have been penalised unfairly.
A further inequality associated with the cigarette industry is the fact that each year they are regarded as fair game by successive Ministers for Finance. Everyone accepts that, but each year the industry is taxed at double the rate of inflation. That is very unfair to the man in the street and to the industry, which is worth £350 million to the Exchequer. Some recognition of the value of that industry should be introduced. I suggest that the drink industry brings more hardship, and in some cases even death, to families and the time has come for an easing of the taxation burden on the cigarette industry. This is the heaviest taxed industry in the country.
Dundalk cannot wait for a possible harmonisation of VAT rates in years to come. Some method must be found to stem the flood of people converging on Belfast, Armagh and Newry from every county. The Southern Irish market is so lucrative to the people in the North that the Belfast City Council have taken a stand at the Leisure Fair Exhibition in Dublin. They are offering all types of incentives to people to cross the Border, including the offer of free holidays to the winners. Last November we had the spectacle of CIE carrying 2,000 people across the Border to leave their money with Margaret Thatcher. A semi-State body should not offer cheap excursion fares. The people should be asked to spend their money here so that their children will have a future.
I commend the Government on the definite success of the enterprise allowance scheme introduced this year. It was introduced as a pilot scheme with 100 places and there was an avalanche of applications. The Government opened the doors to receive them and up to 6,000 were accommodated in self help enterprises. This is an excellent scheme which allows people to try to initiate some type of business for themselves with State help. Outside of Dublin the Dundalk area was one of the best successes. It indicates the level of unemployment in my town, a level which has now risen to 24 per cent of the workforce.
I listened to other speakers enumerating the difficulties of their counties on the employment front and, while I understand their plight, the plight of Dundalk is the worst. The unemployment problem here as well as the money flowing across the Border has combined to ravage the whole area. There are more shops for sale in Dundalk than at any other time. We are in a desperate plight for employment. Dundalk has been upgraded by the IDA in recent times but the emphasis on obtaining employment in Cork, Galway, Waterford and Limerick has not been placed on obtaining employment for Dundalk.
The Government have now accepted the great need for employment in the town and I urge them to bring in a major replacement industry for the shoe industry which sustained Dundalk for so long. The Government should give priority to the needs of the Border areas and must accept that the biggest town in Ireland, Dundalk, has been denied a major industry for too long. Political expediency could attract industries to that region and on behalf of the people of Dundalk and north Louth I demand that this Government bring an industry to Dundalk in the next two years.