Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Thursday, 22 Jun 2000

Vol. 521 No. 6

Adjournment Debate. - Job Losses.

I thank you, a Cheann Comhairle, for allowing me the opportunity to raise this important matter.

The IDA has had another successful year according to its 1999 annual report. Some 18,000 jobs were created, which is another record. This job creation level continues the unprecedented growth rates of the previous five years. It means that employment in IDA-supported companies has increased nationally by 50% since 1994. However, the same report makes grim reading for those of us in the north west region, particularly in County Donegal. The north west region consists of counties Donegal, Sligo and Leitrim. Of the 18,000 plus jobs created nationally in 1999, less than 300 came to the north west, or less than 2% of the total. However, the real situation is far more critical and disturbing.

During 1999, overall employment in IDA-backed industries in the north west declined by a massive 1,235 which is by far the highest reduction on record. It is estimated that 1,200 of these job losses were in County Donegal. The 1999 figures are not a once-off phenomenon. The north west has consistently lagged behind the other regions in each year since 1993. The difference is that 1999 was by far the worst year from the job losses perspective. Donegal has the highest unemployment rate in the country. While the national unemployment rate is 4.6%, in Donegal it is 20% or more. This is intolerable and cannot be allowed continue. There have been major job losses in Buncrana, Raphoe, Millford, the Finn Valley and throughout south Donegal. Unless the region is to go into an unemployment and economic tailspin drastic and urgent action must be taken.

I accept that IDA Ireland cannot direct industrialists to locate in an area against its better judgment. This is where Government policy plays a crucial role. The Government can direct that preferential treatment be given to industries that locate in certain areas. A company establishing an industry in Dublin gets almost the same level of grant assistance as one locating in Donegal. This policy is leading to an unbalanced regional distribution of jobs to the advantage of the east coast and to the detriment of the north west and Donegal. More generous concessions and incentives must be offered to companies willing to locate in the north west. Limited recognition was given to such a strategy in the Finance Act, 1998. That year the upper Shannon basin, comprising counties Leitrim and Longford and parts of Roscommon, Cavan and Sligo had been given generous concessions that can be availed of by industrialists and other investors who locate there. These incentives have already stabilised the employment situation in these counties and greatly increased economic development. The effectiveness of such tax incentives is beyond dispute. These concessions should be extended to Donegal immediately.

In the north west there is a core of educated and skilled young people, products of the Letterkenny and Sligo institutes of technology. However, they leave the area to take up employment with high-tech companies in Dublin and along the east coast. They leave by bus on Sunday evenings and return on Fridays for the weekend. Why can we not attract industries to the north west to provide employment for these young people in their own environment?

It is generally recognised that the quality of life in Donegal and in the north west is as good as, if not better, than that in Dublin. Housing is cheaper and travel is certainly much easier. We cannot afford to have the lifeblood of rural areas drained away. What is now a temporary weekly absence may eventually become permanent.

County Donegal has given this Government more loyalty and support than any other county – five out of its six Deputies support the Government in Dáil Éireann on a daily basis. The county is also represented by a Senator and an MEP who are Government supporters. However, in the area of investment and job creation that loyalty is not reciprocated by the Government. Donegal is being taken for granted. We simply cannot have a repeat of 1999. Rhetoric and promises are no longer acceptable or sufficient. We demand a fairer share of the spoils of the Celtic tiger economy, nothing less is acceptable. The Donegal task force has prepared a development blueprint for the county. Its immediate implementation is the only solution. This can only be done by a more determined and serious Government commitment – so far that commitment has been totally inadequate and pathetic.

I share the Deputy's concern at the decline in employment in the Donegal area as indicated in the recently published IDA Ireland 1999 annual report.

While almost 300 new jobs were filled in the north west region in 1999, the difficulties and challenges facing the textile sector, particularly the Fruit of the Loom plants in Donegal, impacted heavily on IDA Ireland's year end results. Job losses in Donegal amounted to nearly 1,200, attributable mainly to job reductions at Fruit of the Loom plants and the closure of the Austin Reed Donegal Shirt Company.

However, I assure the Deputy the Government is committed to ensuring the most equitable regional distribution of job opportunities and has impressed on the industrial development agencies – IDA Ireland and Enterprise Ireland – the crucial importance of making even greater efforts to provide employment throughout the county.

IDA Ireland and Enterprise Ireland are structured on a regional basis so as to facilitate a more balanced regional distribution of jobs and resources are being deployed to reflect this new focus. In addition, IDA Ireland is working closely with the providers of infrastructure and the educational/training bodies, etc. to deliver improved facilities for industry in the regions. The EU Commission has recognised the needs of the Donegal region in that it forms part of the Objective One region for development purposes and will benefit from a relatively higher level of permitted State aid under the new EU regional aid guidelines, 2000-2006.

IDA Ireland is committed to continuing to market the Donegal region as part of its overall target to deliver half of all new jobs from greenfield projects into the Objective One regions in the coming years. IDA Ireland has a regional office in Letterkenny and the agency has encouraged a large number of people to visit the region in the past 18 months. However, IDA's strategy is not merely a question of jobs dispersal, it also aims to bring a better mix of industry sectors and higher value industries to the regions.

As a result of this increased focus by the agency, there have been a number of project announcements over the past year. The securing and start up of the PacifiCare project in Letterkenny was evidence of an important turning point in the industrial base for Donegal and the announcement by Prudential Insurance Company of America to establish a software development centre in Letterkenny early in 2000 was a further significant flagship project to arrive in the region. Both of these are already key reference sellers for the region and their presence will drive further growth and opportunities in the period ahead. A German software company, Ebylls, is also setting up a software development project at the Letterkenny Institute of Technology. The company recently announced a plan to create 50 jobs in Letterkenny at full development.

An important aspect of attracting overseas industry to regional locations is the availability of quality industrial property. IDA has put in place a specific property programme which has resulted in the construction of new advance factory and office space in Letterkenny. The agency has also acquired five acres of land adjacent to the existing two acres of IDA land at Lisfannon, Buncrana. Consultants have been engaged to prepare a plan for the development of the land, which will include the construction of an advance factory. In addition, IDA Ireland continues to market the vacant Fruit of the Loom buildings in Milford and Raphoe. The agency is also marketing an advance factory in Carndonagh in conjunction with Enterprise Ireland.

The improvement of business support services, such as the new Derry-Dublin air service to commence immediately between Dublin and city of Derry airports and to be run by Aer Arann, will be a major boost for the work programme of the industrial development agencies. It is expected that this service will lead to an increase in the flow of business to County Donegal. The efforts of IDA Ireland and Enterprise Ireland in conjunction with the implementation of the recommendations of Donegal employment initiative will ensure that the needs of the entire county are reflected in the implementation of the national development plan. The plan envisages spending a higher amount per head of population in the largely rural Border, midland and west regions.

I thank the Deputy for raising this issue. My colleague, Deputy Cecilia Keaveney, has made the case for this region on many occasions—

I am sure she has.

—and it is important that I put that on record. I assure both Deputies that the ongoing co-ordinated job creation efforts by the development agencies in the Donegal region will continue and, the IDA will intensify its focus on winning new quality projects for the area.