Written Answers. - Preparation for European Monetary Union.
Ivor Callely
Ceist:
102
Mr. Callely
asked the
Minister for Enterprise and Employment
the measures, if any, he has initiated to prepare Irish industry for the developments of the European Market and any repercussions; and if he will make a statement on the matter.
[7601/96]
The central issue which will impact on industry in EU terms is the development of economic and monetary union. There is much that we can, and are doing, to ensure that we maximise the benefits of European Monetary Union and minimise any difficulties which could potentially arise in the employment context.
The key issue will be to ensure macroeconomic stability and a further Programme for Competitiveness and Work would make a useful contribution to such stability if it can be achieved at the right price.
The cost environment provided by the Irish economy has a major impact on the ability of Irish industry to achieve a high level of competitiveness on both domestic and international markets and so to enhance both wealth and employment creation. While individual companies are responsible for the development of competitive capabilities and aspects such as management, marketing, product and process development and quality control systems, competitiveness is determined at several distinct levels. The Government is well aware of the role which it must play in facilitating and enhancing this competitiveness.
In the 1995 and 1996 budgets measures such as improvements in income tax and PRSI were introduced. These had the objective of further improving the economic climate and will be of considerable benefit to Irish firms in their efforts to reduce costs and improve competitiveness. The measures were aimed in particular at helping the labour intensive industries, in which indigenous firms tend to predominate. The improvements in income tax and employee PRSI will underpin the moderate wage developments enshrined in theProgramme for Competitiveness and Work.
It is also acknowledged that traditional industries face a struggle to survive if the variety of structural inefficiencies, problems of scale and under-capitalisation which affect many of the firms operating in that sector, are not addressed. These problems are not insurmountable and can be overcome through a combination of adaptation measures. Forbairt is actively working with and supporting those firms in the traditional sector and that organisation is exclusively dedicated to facilitating the adaptation and expansion of indigenous industry. A determination to adapt to an increasingly competitive trading environment on the part of every individual company which operates in this sector is absolutely essential. The need to prepare for and to embrace change will become even more urgent as we approach European Monetary Union.
Irish industry is increasingly aware of the competitive global environment in which it operates. The industrial development and training agencies under my Department provide a wide range of programmes to enhance the competitiveness of the industry and services sectors and to ensure that skilled workers are available to take advantage of the new occupational opportunities which are opening up. Change will increasingly be a feature of modern working life and employment development policies have to be centrally informed by that reality. Such policies are kept under review by my Department and its agencies and are changed or refined to take account of developments, both within the European Union and in the wider world with which we trade.
ADAPT, an initiative to assist industry to cope with and benefit from change is also administered by my Department. This is a European Union wide programme which is financed by the social fund. It aims to facilitate adaptation to industrial change and the promotion of new forms of employment. This country has been allocated £23 million under the programme, which will be operational at the end of this century.
I have approved 44 projects to operate to end-1997 under ADAPT. These are promoted by a range of organisations, including 17 private companies and six social partner organisations, as well as by education and training institutions and community organisations. Each project, in co-operation with partners in other member states of the European Union, is piloting a new approach to the development of personnel in the work situation, having regard to changing European and world markets. I will examine the outcome of these projects to ensure that the learning gained under ADAPT is fully reflected in our policies on industrial development. Further opportunities to develop innovative approaches in this area will arise when additional funds are made available next year.
