Dáil Éireann díospóireacht -
Tuesday, 3 May 2011

Vol. 731 No. 1

Leaders’ Questions

Deputy Micheál Martin

The Taoiseach will be aware of the latest data showing manufacturing activity continues to grow and has just reached its second highest level in 11 years. At the same time, the enterprise agencies are reporting a very strong pipeline of investment projects, some of which have already been announced. Following the practice of his predecessor, will the Taoiseach use his visit to New York to talk to important members of the business community about Ireland's economic message? Given the strength of inward investment and the support American companies have shown for Ireland in recent months and years, it is clear they already know Ireland is open for business. Of critical concern to those companies in terms of job creation are the question of corporation tax and the broader issue of the harmonisation of taxes across the European Union.

Given the clarity of the policy on corporation tax, the rate of which is accepted at this stage, will the Taoiseach use his visit tomorrow to state clearly Ireland will not accept any proposals on the tax base that would have the effect of increasing the taxes payable by companies that have invested here and which are investing here? Will he ascertain the latest position on President Obama's Administration's tax policy on US multinationals' overseas activities?

The Taoiseach

The Deputy states the obvious in stating exports have been running at a surplus for 21 months and that the interest in investment in this country is still exceptionally high. I heard first-hand evidence of this when speaking to a significant number of business interests in Washington during St. Patrick's week, as did the Tánaiste and Minister for Foreign Affairs and Trade, Deputy Gilmore, in New York. It is indicative of the fact that countries are in a position to buy products coming from Ireland. I stated previously that Intel, one of the leading companies in the world, is currently spending €0.5 billion on expanding its plant in Leixlip to be in a position to compete for the next wave of fabrication investment. This will have a direct spin-off effect on Irish industries capable of meeting the very stringent demands associated with elements of the service industry in this regard.

The Deputy is aware that the European Commission has legal responsibility to produce legislation. The legislation on the common consolidated corporate tax base has been produced and Ireland will obviously participate in the discussions, albeit against a background of healthy scepticism suggesting a common base would be bad not only for Ireland but also for Europe. I will make my case based on that fact. The Deputy, as a former Minister for Foreign Affairs, is aware, as am I, of what this means for Ireland. It would represent a massive breach of trust.

I raised the question of the US Administration's view on taxation when I was in Washington. While I cannot speak for President Obama's Administration or the Republican Party, I do not see this as being a priority for either. The view that Ireland is some kind of tax haven has been dealt with, including by the former Government, and cleared up a number of years ago. This is still the position.

Deputy Micheál Martin

Over the past week, Ministers appear to have been sent out daily to brief journalists on the likely contents of the forthcoming jobs initiative. In fairness, the programme for Government did promise a new approach to discussing budgets before publication. This is well under way. The Taoiseach admitted that the Government had over-hyped the jobs budget promised in a wide range of pre-election documents. We were led to believe a definite economic stimulus would be provided when the Government entered office but it is now to be a revenue-neutral initiative. It appears from what can be read from the spin of ministerial leaks that a number of the specific initiatives to be announced next week involve renouncing and rebranding initiatives that are already under way. For example, the smart grid strategic research cluster——

An Ceann Comhairle

These are supplementary questions.

Deputy Micheál Martin

I am just coming to my question. Will the Taoiseach instruct his Ministers to commit to publishing, in the documents that will be issued next week supporting the jobs initiative, details of all activities that have already been planned and those that are to be stopped in order to fund the initiative itself?

The Taoiseach

It is perfectly obvious that jobs, job creation and an injection of confidence into the indigenous economy must be and are a priority of the Government. That is why the jobs initiative will be announced by the Minister for Finance in the House on Tuesday, 10 May.

Given that the rate of unemployment is over 14% and that 440,000 are on the live register, we have tried, within the constraints imposed on the country through the IMF-EU deal, to provide an incentive, encouragement and a boost of confidence for employers to hire new workers and expand their businesses, and the elements that will allow this to happen. I have been surprised at the range of ideas — some were very workable and credible and others were not — that have been flooding in from various sectors throughout the country. The Minister for Finance will give the full details on the jobs initiative to the House next Tuesday and we will have an opportunity to discuss it. I make no bones about the fact that it will not sort out Ireland's unemployment problem overnight. The intention is to provide, within the existing constraints, confidence that will stimulate interest, growth, jobs and opportunities in the economy. All the details will be available next Tuesday.

Deputy Mary Lou McDonald

I am sure the Taoiseach will join me in commending the emergency services whose members spent last weekend fighting gorse fires that threatened farmland and family homes. I have no doubt their sterling work has saved lives. It is ironic that we see such work being done at a time when the public sector and public servants are under threat from the Taoiseach's Administration.

The Taoiseach mentioned the growth in exports. The Department of Finance, in its latest economic update for the European Commission, states starkly the Government has achieved a growth rate as near to zero as one could get. The unemployment rate is at crisis point, as the Taoiseach concedes, and the domestic economy is in a mess. We still pump expensive money into Anglo Irish Bank. Although the writing is on the wall and it is now very apparent the austerity approach is not working and will not work, the Government refuses to wake up and smell the coffee. The Taoiseach now tells us there will be a jobs initiative. The language being used in respect of the budget is interesting; we are told it will be fiscally neutral, or revenue neutral, and that there will also be counterbalancing measures to give it life. Will the Taoiseach shed some light on this? How does he propose to invest in a serious jobs strategy? What cutbacks or taxation increases does he envisage to facilitate the jobs initiative? If the Taoiseach wishes to talk about confidence and morale in the country, will he at some point consider that the economic strategy of cutbacks and deflation, so ably passed into his hands by the previous Administration, has not worked and will not?

The Taoiseach

I am sure the Deputy will join me in condemning what appears to be deliberate arson attacks by a person or persons unknown in various locations throughout the country. Vegetation was destroyed as a result of the frost last winter and the current dry weather, so with the strong breeze these fires have become quite dangerous. I spoke to the Minister for the Environment, Community and Local Government and he was in constant touch with the emergency officer in the Department and with the fire officers and emergency services in the counties affected. I commend the work of all involved in the emergency services, particularly on evacuating people to safety from houses in Donegal. I also commend the farming community for lending equipment such as slurry tanks and so forth to assist in putting out the fires. The emergency services also assisted with helicopters. In Ireland, people are accustomed to praying for fine weather or for rain according to the seasons. The rain that is threatened for the weekend might well be a benefit in quenching the fires that continue to burn at higher levels on our mountains.

The jobs initiative will be introduced by the Minister for Finance in the Dáil next Tuesday. It will be fiscally neutral. At a time such as this I would love to be in a position to reel out to the nation the benefit of what could be spent of the €3 billion commitment arising from the promissory note to Anglo Irish Bank and Irish Nationwide Building Society, INBS, for each of the next ten years, but that is the situation we are in. Given that constraint on the Government, the Minister for Finance will introduce a jobs initiative that will be fiscally neutral. He will point out how adjustments and payments can be made for the initiative. I hope that in the ensuing debate Members will dwell on the reality, and not theory, of what we can actually do. I hope the package being put together will bring about an understanding of our current position and the truth of the scale of the problem, but within that the opportunity for providing careers and employment, for taking on new workers and for retraining. All these areas will be covered in the Minister's statement on Tuesday and the House will have the opportunity to debate it in due course.

Deputy Mary Lou McDonald

In that reality, of course, the decision to pump those billions into Anglo Irish Bank, which the Taoiseach has supported, is not fiscally neutral. The Taoiseach said adjustments will be made. I discern from this that we face further cutbacks in order to give life to this jobs initiative. Can he confirm that? The Taoiseach appears to be hiding behind language. When all the evidence suggests that the deflationary cutback model has failed and not proved to be a remedy for our unemployment problem, it is ironic that the Taoiseach would seek to introduce a jobs initiative based on that same deflationary approach.

The Taoiseach

I would not get carried away with what the Deputy discerns from my words. A total of €6 billion is being taken out of the economy in 2011 and obviously that is not all about growth and productivity. This is the first Government in the history of the State to initiate a serious, comprehensive analysis of how taxpayers' money is spent. That will conclude in September, when the Government and the people will know the true scale of the analysis. We are pursuing the elimination of waste, duplication and triplication. There has been allocations of money and nobody knows where it went; we are having difficulty tracing it. There are huge amounts in some Departments. All of this must be dealt with as it is important in the context of the Government and the Minister for Finance looking at the bigger picture and examining the efficiency of spending at the conclusion of the review in September.

The situation in which the country finds itself is challenging, but not hopeless. As a public representative I meet people throughout the country and they have a yearning to get through this recession. However, they want the truth about the scale of the reality we face so the Government can sort it out, and they are willing to help in that provided their contribution is recognised and is fair. When the Minister for Finance outlines the jobs initiative on Tuesday, the Government intends to stimulate the indigenous economy so it can complement what is happening in the export sector, where productivity is high and exports have been running a surplus for 21 months. The first semblance of external confidence is in that sector.

It is not the way one would wish to be in Government but that is the challenge we have accepted. We will meet it and overcome it by working with our people to come through this with a much leaner, more efficient process of doing business in Ireland. That message must be conveyed throughout the world for the benefit of everybody, both at home and abroad.

Deputy Shane Ross

I congratulate the Taoiseach on the marriage last Friday of one of his Ministers of State, who is seated behind him, to a Member of the Upper House. I hope she will not have any divided loyalties when she is obliged to vote for the abolition by referendum of the House of which her husband is a Member.

The second congratulations I wish to extend to the Taoiseach is on a serious matter. I congratulate him on what occurred during the recess when he met the Chief Justice, who presumably had come to request something of him. He was sent off with a referendum in his pocket. That was most welcome. It was appropriate that the Taoiseach should address that issue by promising a referendum on the position of the Judiciary and why judges have such a special position of privilege in the Constitution, particularly in view of their salaries. In view of the commendable reform he has announced regarding State appointments, although he has not gone nearly far enough, I ask the Taoiseach to follow up on that by examining more seriously the appointment of members of the Judiciary.

Appointment to the Judiciary is another area that is blatantly political. I do not know if Members of the House know how judges are appointed but the judicial advisory board, which is stuffed with political appointees, makes recommendations to the Government on the appointment of all members of the Judiciary.

An Ceann Comhairle

Does the Deputy have a question?

Deputy Shane Ross

In view of the fact that the Government makes each appointment after seven names are submitted to it, would the Taoiseach consider introducing similar reforms in the appointment of members of the Judiciary to those he has promised to introduce in the case of appointments to other State bodies? In other words, will he allow those whom he and the Government propose to put on the Bench to be put before the cameras and the Oireachtas committees?

The Taoiseach

I join Deputy Ross in congratulating the Minister of State, Deputy Lucinda Creighton, on her marriage to Senator Paul Bradford. I wish them well for the future. There is no point of contention about that.

Deputy Shane Ross

She did not invite a Member of the Technical Group to the wedding.

Deputy Eamonn Maloney

It was a happy affair.

The Taoiseach

If Deputy Ross ever has the opportunity to serve in government——

Deputy Shane Ross

One day.

The Taoiseach

——he will discover that the process of sanctioning persons for appointment to the Judiciary is by way of Cabinet approval of recommendations put forward by the Minister for Justice and Equality. When the rainbow coalition was in government several years ago, the Judicial Appointments Advisory Board was established to bring some form of process into being. The appointment of judges is an extremely serious matter, particularly in the context of their independence from the Executive and in light of the job with which they are charged. It is clear that there is need for sensitivity with regard to how the process to which I refer operates.

As Deputy Ross is aware, members of the Cabinet do not know the names of persons to be nominated as judges until these are produced by the Minister for Justice and Equality of the day. Rather than having a situation where names are being bandied about in public and where there might be comment on the qualifications or otherwise of particular individuals, the position is that the Judicial Appointments Advisory Board makes a recommendation and this is discussed by the Attorney General and the Minister for Justice and Equality, who then brings a nomination to the Cabinet for approval.

Deputy Shane Ross

Is the Taoiseach satisfied that there are ten members on the Judicial Appointments Advisory Board? Without going into the details relating to the entire board, I point out that three of the members are known as lay members. These three members of the board have retired and this has resulted in a corresponding number of vacancies. When it was in office, the previous Government filled such vacancies by appointing a person who previously served as Fianna Fáil's director of elections in Dún Laoghaire and another——

Deputy Pat Rabbitte

I do not believe it.

(Interruptions).

Deputy Shane Ross

——who previously ran as a Fianna Fáil candidate for election to Europe.

Deputy Ciarán Lynch

An agent provocateur.

Deputy Shane Ross

I did not have time to research the third person put forward for appointment but I suspect that individual possesses similar credentials to the other two. Will the Taoiseach provide an assurance that he will not fill the vacancies to which I refer with the same political bias as that displayed by his predecessors?

Deputy Pat Rabbitte

They will not be filled by the same three individuals in any event.

(Interruptions).

The Taoiseach

I assure the Deputy that I have no intention of appointing the Fianna Fáil director of elections to any position.

(Interruptions).

An Ceann Comhairle

We must proceed to the Order of Business.