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Dáil Éireann díospóireacht -
Thursday, 15 Oct 2020

Vol. 999 No. 4

Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions

Question No. 1 is in the name of Deputy O'Reilly but will be asked by Deputy Quinlivan.

Small and Medium Enterprises

Louise O'Reilly

Ceist:

1. Deputy Louise O'Reilly asked the Tánaiste and Minister for Enterprise, Trade and Employment if his Department will consider the establishment of an Industrial Development Authority or similar styled body specifically to focus on microbusinesses, workers' co-operatives, and small and medium-sized enterprises. [30000/20]

The question is about the establishment of an Irish enterprise agency. Will the Government consider the establishment of an Industrial Development Authority or similar body specifically to focus on microbusinesses, workers' co-operatives, and small and medium-sized enterprises?

The Government values the role of SMEs and microenterprises in our economy and as creators of employment throughout Ireland. Balancing our enterprise policy between foreign direct investment, FDI, export-only businesses and non-exporting indigenous firms is an important policy consideration and one which was touched upon by the OECD in its 2019 report on entrepreneurship and SME policy in Ireland. The OECD report refers to 250,000 active enterprises in Ireland, of which 92% are very small businesses with ten employees or fewer. Such a high number presents challenges in terms of the State’s engagement with and support for enterprises. It also creates challenges in complying with the EU's state aid rules. In terms of expanding the number of businesses eligible, the local enterprises offices, LEOs, have already started on this road with the productivity fund and business continuity voucher which targeted an expanded cohort of enterprises, namely, firms with up to 50 employees which would not customarily have qualified for funding. Enterprise Ireland is also working with a broader base of non-exporting SMEs, with the retail online scheme and the Covid-19 sustaining enterprise fund.

Whatever overarching institutional framework we have for developing microbusinesses and SMEs, it is important that a benign environment is in place for SMEs to start up, scale up, access international markets and enable SMEs to become more productive and ready for the transition to a digital and green economy. In that context, I have established the SME growth task force as committed to in the programme for Government. The task force is designing a national SME growth plan that will map out an ambitious long-term strategic blueprint for SMEs and entrepreneurs. It meets for the second time this Friday, 16 October and the possibility of establishing a new agency for SMEs will be part of its deliberations. The task force will also examine the recommendations of the 2019 OECD report, including the strategic framework and current delivery system for SME supports and entrepreneurship policy in Ireland. This new task force is composed of a broad range of business people with expertise in a range of sectors, as well as SME representative groups and other individuals uniquely positioned to contribute to a long-term vision for the SME sector and how best it can be supported by Government. I hope to receive recommendations from the task force in November.

I thank the Tánaiste for that response. As he said himself, almost 70% of people employed in Ireland are employed in small or medium enterprises. When speaking to those in these businesses, they often say they feel left behind and that successive Governments have preferred to focus on foreign direct investment instead of helping indigenous industry. Foreign direct investment has been a crucial component of Irish industrial strategy and has been really important for my own area, the mid-west. Almost 90% of all the State's exports originate from foreign-owned multinational corporations based in Ireland, and this acts as a boost to our GDP as well as being a significant job creator. SMEs however, are the lifeblood of the Irish economy and cannot be neglected. This is especially true as we face the twin crises of Brexit and Covid. There is an opportunity, however, in the midst of these crises for our SMEs and microbusinesses to capture the market share of any available opportunities which may arise due to Brexit in particular, and that is the reason we have put down this question.

The idea of a new agency is certainly something I have an open mind on. A lot of business people I talk to say they feel there is a gap. When a business is very small, it can get help from the local enterprise offices and, when it is a bit larger or is an exporter, from Enterprise Ireland, but there is a gap in between. The question is whether we fill that gap by expanding the role of Enterprise Ireland or the local enterprise offices or whether we set up a new agency to fill the gap. There is an important constraint we need to bear in mind here. When we are attracting FDI into Ireland, we are competing with Tel Aviv, Amsterdam, London and other places. When we are helping an exporter to export, it is generally competing with other companies abroad. An indigenous company, however, is very often competing with a company in the same town, two towns over or in the same county, and we must be very careful to not use taxpayers' money in the form of State aid to help one business to take business off another when both are in the same town or county. That is why there is often a constraint on what we can or should do.

As the Tánaiste said, some of the local enterprise agencies are quite good but some of them are not so good. That is why we see a specific focus being needed on local SMEs and small companies. We believe the greatest potential for growth in the next few years is within our SME sector. SMEs are the priority when it comes to fostering indigenous industries and ensuring job creation. With that in mind, I again ask whether the Tánaiste and his Department will consider the establishment of an Industrial Development Authority, IDA, style agency or similar enterprise agency specifically focused on microbusinesses, workers' co-operatives and small and medium-sized enterprises so they have a body to advise them specifically, help them and advocate for them? The IDA has done a wonderful job, as has Enterprise Ireland and InterTradeIreland, which is often forgotten. The latter agency has done really good work in recent years, creating and sustaining and keeping jobs going.

I do not really have anything to add to what I said earlier but I join the Deputy in acknowledging in particular the work InterTradeIreland does on cross-Border trade. We have provided that agency with extra funding for next year. I am keen to engage and work closely with my counterpart in the North, the Minister for the Economy, Ms Diane Dodds MLA, with whom I have already met, to see what is possible and what we can do on an all-island economy basis and to use that agency to its full potential as it is one that has more potential.

Sick Pay Scheme

Catherine Murphy

Ceist:

2. Deputy Catherine Murphy asked the Tánaiste and Minister for Enterprise, Trade and Employment the status of his work in relation to the introduction of a statutory sick pay scheme here; the level of stakeholder engagements he has embarked on; and if he has been contacted by persons opposed to such a scheme being introduced. [30805/20]

This question relates to the status of efforts to introduce a statutory sick pay scheme, the level of stakeholder engagement on same, whether there has been a substantial amount of that yet and who it was with and what timeline are we looking at for it.

I am committed to bringing in a statutory sick pay scheme for Ireland as part of my work programme for next year.

Such a scheme would improve workers' terms and conditions, particularly low paid workers, but there are various issues to consider before we establish the scheme.

As a starting point, I presented a draft issues paper on statutory sick pay to the labour employer economic forum, LEEF, sub-group on employment legislation and regulation on Wednesday, 30 September, with a view to commencing a consultation process. We had an initial discussion at the meeting and I asked employers, unions, ICTU and IBEC to consider the range of issues and policy options set out in the paper and submit their views to the Department by this week. I am not sure whether this has happened but we were due to hear back from them this week. Their views will be taken on board and a revised paper will then be discussed at a further meeting of the LEEF sub-group in November. I do not think any stakeholder is rigidly opposed to it. Certainly ICTU is in favour and the employer groups have pointed out that many employers already offer sick pay schemes. Of course, many do not.

There are cost implications and perhaps staffing and competitiveness implications for some companies, so all of these issues will have to be worked through carefully, thoroughly and quickly. Any move to introduce a new scheme that will impose further costs on business, particularly small businesses, cannot be done lightly. It needs to be structured in a way that ensures the benefits to workers, employers and society outweigh any costs involved and that the costs are shared. Micro and small businesses are particularly vulnerable. A statutory sick pay scheme must be balanced with the need to ensure the viability of businesses and the enterprise sector, thereby protecting jobs. Our focus is on getting people back to work as quickly as possible in all regions and all sectors, including the hospitality and retail sectors in particular.

I have committed to moving through the process, including a full public consultation, as quickly as possible and to publish the general scheme of a Bill by March 2021, with a view to having the Bill enacted in the second quarter of 2021 and up and running before the end of next year.

As an important first step on the road to a statutory sick pay scheme, this week the budget reduced the waiting days for illness benefit from six days to three.

We saw just how exposed we are due to the absence of sick pay in some sectors. The meat processing industry is probably the most high profile of these. It is a wet industry and an environment where colds and flus are very prevalent. Obviously this has fed into the risk that goes beyond the industry to the individuals themselves and to society generally. This is unlikely to change before next year.

The Minister mentioned sharing the cost and I ask him to expand on this. Was there anything in the budget about the State side? Most public servants will be covered but not the totality, particularly people subbing in and possibly people employed on an agency basis.

I thank the Deputy. I will have to defer to the Minister, Deputy McGrath, on the public sector side. What was in the budget was the reduction in the number of days to wait for illness benefit from six days to three days. This benefits employees and employers. If people are sick for any reason other than Covid they will now qualify for illness benefit on the fourth day rather than the seventh day, which was the case previously. I intend to bring it back to one or two days next year. This will benefit employees who are sick for reasons other than Covid. If they are sick because of Covid they will qualify for the pandemic illness benefit.

It will also be beneficial to employers who do pay sick pay because it means they can now reclaim more of that sick pay from the Social Insurance Fund. One of the reasons employers pay PRSI is so they can reclaim from the Social Insurance Fund.

We do need to share the cost. The Labour Party's Bill is well-intentioned but it puts the entire cost on the employer. If somebody is out for six weeks the employer would have to pay that person and hire another person to cover the absence. This could be very expensive for a very small employer. It is only fair that the costs should be shared.

Flexible Work Practices

Louise O'Reilly

Ceist:

3. Deputy Louise O'Reilly asked the Tánaiste and Minister for Enterprise, Trade and Employment if he will undertake the necessary legislative and tax changes to ensure that remote working and-or home working are recognised as forms of work that require specific safeguards, protections and allowances for workers. [30001/20]

I apologise for being late this morning. One of the delights of living in Dublin and in the country is occasionally getting stuck behind a tractor. My question is fairly straightforward. It relates to the explosion in the number of people working from home. Will the Minister consider putting in place recognition for remote working as a protected form of work, with particular safeguards, protections and allowances for these workers?

Having had the experience of being a member of Fingal County Council and being stuck behind a tractor not too far from Skerries I can understand how sometimes it can delay journeys.

As our country continues to navigate Covid-19, remote working has become more important than ever before. This is reflected in the programme for government, which contains commitments aimed at facilitating remote work across Ireland. The programme for government recognises that remote work can provide benefits in terms of regional development, climate action, work-life balance and female entrepreneurship.

As a response to Covid-19, my Department launched a new web page dedicated to providing guidance for working remotely. This web page is a central access point for all of the Government guidance currently available on remote working. It allows employers and employees to navigate the existing guidance and legislation relevant to remote working and provides information for people working from home during the course of the Covid-19 pandemic.

In July, the Department launched a public consultation on remote work. We received 522 submissions from employers, employees, representative bodies and special interest groups. Based on the analysis of the submissions, my Department is using the insights garnered to enhance and refine further the current remote working guidance and the forthcoming strategy. The web page will be updated regularly to reflect any changes made in response to the consultation, with the first update before the end of this year.

My Department will publish a remote working strategy before the end of the year and this work is taking place under the guidance of an interdepartmental group. The strategy will consider what changes are needed to develop an environment that encourages remote working solutions.

The programme for government contains a commitment to bring forward proposals on a right to disconnect, with consideration being given to a role for the Workplace Relations Commission in this regard.

In relation to taxation, there are already arrangements in place that allow remote workers to claim certain allowances to cover costs incurred due to working from home. As outlined in budget 2021, these arrangements have been extended to include the cost of broadband and claims for any other vouched expenses occurred wholly, exclusively and necessarily in the performance of the duties of their employment.

I thank the Minister. Technology now allows people to work from home and remotely work in a way that has never been possible before but there are a number of issues, chief among which is one to which the Minister referred. If people are working at home they are always at work and always at home. There needs to be a clear definition of remote work as a protected form of work. We have seen, and it should be encouraged, that people have the right to work from home. I worked for a union and we often fought for the right for people to be able to work from home and access remote working. Now we find it is almost an imperative and people are being encouraged to do it. It requires very specified legislation to ensure these protections are in place. We also need to be cognisant of the fact that many people live in overcrowded or unsuitable accommodation. For them, working from home is not necessarily an option but remote working in a hub or similar would be an option. This is something the Minister should also be looking at.

There are many ways in which the pandemic will change our world. One of these is how it has turned the world on its head when it comes to remote working and home working. What has happened over recent months as a consequence of the pandemic probably would have taken us ten years as a planned strategy. When we were writing the programme for government we were thinking about how we would retain what we have gained in terms of home working and remote working. Within a few months, we were wondering whether we would ever get people back to the offices because our city centres are in real trouble because of the lack of footfall.

What we are getting back from staff surveys is that approximately 10% or 15% are dying to get back to the office. These are often younger people, people working out of a bedroom while somebody else works out of the sitting room and people in apartments. Another 10% or 15% want to work from home forever and approximately 70% are in between and want blended working. This is the way to go and what our policy should try to facilitate, whereby people might spend a few days in HQ, a day or two at home and one day perhaps in a remote hub near where they live.

That is grand if there is a remote hub near where the person lives or if he or she has access to broadband, which many people do not. There needs to be a focus on establishing hubs. I would like to see some in my area, Balbriggan. There is a small, privately run one in Skerries but there is definitely scope for more in Balbriggan and other areas of north County Dublin, as well as across the board, to ensure that people can have the option. It needs to be a realistic option. The response from the Government has to focus on the needs of workers and employers and recognise there will be additional requirements from both parties - workers and employers. The employer has to ensure that the person will not lose out because he or she is remote working, while the employee has to ensure that he or she is able to perform all his or her duties. That will require a legislative change and particular protections because remote workers could turn out to be some of the most vulnerable workers as this issue progresses, and now is the time to have that conversation and to learn from the recent experience.

The Deputy is absolutely correct. The kinds of legislative change we need to think about include the right to request remote working or homeworking; the right to disconnect, so that the employee is not always at work when at home, which could be oppressive for people; and the risk to the country of losing people who currently live and work in Ireland to remote working from, perhaps, the Canary Islands, Ibiza, Poland or India. That is a risk to us in terms of losing jobs and revenue, so we need to be wise to it too.

Access to broadband is improving. The national broadband plan is happening now and is very much a reality on the ground. Hopefully, it will take four or five years, not six or seven. I am glad that as leader of the previous Government, we pressed ahead with it. We got almost no support from any other party but I do not think anyone would wish to cancel that contract now.

There is funding, both from my Department and that of the Minister, Deputy Humphreys, to develop remote hubs over the next couple of years. I have seen some great ones throughout the country, particularly where an old heritage building, such as an old bank or an old post office, in the middle of a village or town has been brought back to life. There are great opportunities in that regard.

Covid-19 Pandemic Supports

Mattie McGrath

Ceist:

4. Deputy Mattie McGrath asked the Tánaiste and Minister for Enterprise, Trade and Employment the specific measures he will provide to SMEs and the self-employed in the event of further restrictions to combat Covid-19. [30838/20]

What specific measures will be taken to help the self-employed, both those under the age of 66 and those over it, if new restrictions are imposed? It looks like this will happen because there was an announcement last night without any debate or discussion with any of the party or group leaders. What supports will be put in place for hard-pressed people who have given their lives to self-employment and to providing work for others?

The pandemic has caused untold damage to people's lives and livelihoods. We recognise that and the budget is an attempt to respond. Too many businesses have been severely impacted by the restrictions needed to ensure public health safety during the pandemic. The agenda has to be to protect public health while also trying to ensure we can keep our economy alive and open, keeping people in jobs and businesses open as long as possible. Our response to Covid-19 will continue to assist those businesses affected. The budget builds on announcements made in May and in the July stimulus plan.

Budget 2021 provides a significant additional package of tax and fiscal measures to build the resilience of the economy and help vulnerable but viable businesses in all sectors. It has been well recognised by the business community that this is what the budget is trying to achieve, that is, to protect and support businesses to keep their doors open, to keep their employees on the books and, at the first available opportunity, to be able to grow that number of employees and regrow their businesses. The budget comes in addition to the July stimulus plan, a substantial financial package to stimulate our economy worth more than €5 billion, including €2 billion in loan guarantees for the new credit guarantee scheme, the benefits of which will be seen in the months ahead.

Budget 2021 is unprecedented in scale at almost €18 billion. Its purpose is to protect the lives and livelihoods of everyone in the State, irrespective of age. In 2021, workers will see no increases to income tax, the universal social charge, USC, or PRSI; a modest increase in the minimum wage, as recommended by the Low Pay Commission; and a reduction from six to three in waiting days for illness benefit, to be paid on day four, which will be of assistance not only to employees but also to businesses because we all recognise that many SMEs have been trying to work with their employees and carry some of the costs of absenteeism and so on. It will certainly help them and lead to discussion on introducing statutory sick pay, which the Tánaiste mentioned earlier and flagged in recent days. Further measures include an extension of parental leave benefit by a further three weeks to five weeks, building on the work of the previous Government; an increase in the earned income tax credit for the self-employed; and self-employed workers in receipt of the pandemic unemployment payment, PUP, will now be able earn up to €480 per month. A strong case was made that some SMEs have begun to get back on their feet and get some work, but they also need the support of the PUP to keep them going.

There is also a new Covid restrictions support scheme, which has already been beneficial and will continue to be. The employment wage subsidy scheme will be extended, as will the commercial rates holiday, and there is more that I can outline in my follow-up response.

I welcome the initiatives in the budget but they will not be enough for certain cohorts of people, particularly the self-employed. I accept that everybody is affected and we are all in favour of trying to avoid the risks to public health. As the Tánaiste noted on "Claire Byrne Live", however, we have to balance that with everything else, and we have not been doing so. The Minister of State referred to the €480 that self-employed people can earn. I welcome that, not because it is a support but because they want to keep their businesses. If customers ring them, they want to be allowed to help them out because they do not want some large company taking their work from them. They value the service of their customers and their customers value the businesses; it is a quid pro quo.

Self-employed people over the age of 66 have been totally excluded, such as dance teachers, musicians, artists, lorry drivers and many others. If they do not pay rates, they will not be able to avail of the schemes because they park beside houses, even though they have so many expenses. They may have built up a wide network of customers and they want to be able to maintain that. I welcome the €480 a month for those reasons, rather than for the reasons the Minister of State outlined. It just goes to show that the researchers and the people in the Department do not get it or understand what it is like to be self-employed. There are not enough of them in the Chamber talking to the Minister, although there are enough of them in the party of the Minister and the Minister of State.

I am happy to hear suggestions and ideas that the Deputy has because we are still working through the SME growth task force. We will look at all ideas and initiatives. The economic recovery plan will be published in November, for which a €3.4 billion recovery fund has been set aside to fund ideas and new initiatives and to target certain sectors through our agencies. There is also contingency funding. More than €5 billion that has been set aside to work with during 2021, to fund ideas and initiatives and to target certain sectors through our agencies, has not been allocated in detail under the budget. We can fund any ideas the Deputy might bring forward.

This is very much a budget to support business and the self-employed. We have been engaging with businesses through representative bodies and individually in recent months to find out what their needs are, the first of which is the wage subsidy scheme. We have confirmed that the scheme can be extended beyond April next year if necessary, while the restart grant, processed through rates, has been very beneficial.

Our business supports do not differentiate by age. The Deputy mentioned people over the age of 66 but our business supports are for all businesses to keep their doors open. We recognise that at some restriction levels, some companies cannot function as they normally would. We will support them more greatly in such cases, which is what the Covid restrictions support scheme is for. The main thing is that we are supporting businesses and we will work with them. We will introduce sector-specific welfare if needs be.

The Minister of State, again, is not getting the point. The over-66s have been excluded. They did not get even an additional €5 in their pensions. They got nothing. They got nothing in the PUP, which they were not eligible for. It must be increased to €350 for the other self-employed people who need it right now. Of course I appreciate that the wage subsidy scheme has been extended and that it may be extended past April, and the extension of the PUP, but they need to be increased. The Government must consider the over-66s, who have been totally abandoned and whose businesses have closed. Many of them are publicans, taxi drivers, bus drivers for private companies, bus owners or musicians with wonderful talent to share with their communities, who love and miss them dearly. That whole cohort is being missed. We cannot just abandon those over the age of 66, some of whom are fitter than we will be at that age, God bless them.

We must ensure that the hospitality sector is protected too. The Government must deal with the regulators to ensure that utility providers are not screwing places that have closed, such as hotels and bed and breakfast businesses. When they have closed, they still must pay significant utility fees and that is totally unacceptable. The Minister of State is not listening. The Government is abandoning the over-66s.

To be clear, our business supports and all the initiatives we have announced, such as the July stimulus package of more than €5 billion, the budget package of close to €18 billion that was just announced and the business supports from the Department, do not discriminate by age and certainly would not do so. We support business and job creation and that is what we are trying to do. I am happy to say the budget has addressed every issue the Deputy raised. We will do more to support business-----

What did old age pensioners get?

I reiterate my point about business supports. If the Deputy wants to bring forward any initiatives or new ideas, we will work with them. We have worked with the events sector and the arts sector to try to respond. Naturally, the budget cannot plug every gap and every hole in the finances-----

The Government has abandoned the elderly.

-----but we are trying to reach out to the different sectors with the various schemes. Many businesses in the Deputy's county of Tipperary will benefit from the rates waiver. Rates have been cancelled for this year and will be subsidised by local government. There is also a fund for next year. The main asks of us from business were the restart grant, the Covid restrictions support scheme, the wage subsidy scheme and trying to manage the public health messaging so that they can keep their businesses open.

We will do that as long as we can on every level. That is what we will work on. Last night, we made changes in relation to retail to keep some of those businesses open.

Regional Development

Marian Harkin

Ceist:

5. Deputy Marian Harkin asked the Tánaiste and Minister for Enterprise, Trade and Employment the measures he will take to ensure the viability of businesses and SMEs in the regions post-Brexit that will deliver a fair distribution of investment in jobs in the regions. [30478/20]

I ask about the measures the Minister of State will take to ensure the viability of businesses and SMEs, particularly in the Border region post-Brexit, and to ensure there is a fair distribution of investment in the region.

I thank Deputy Harkin for her question and I assure her we are focused on balanced regional development and protecting the viability of businesses and SMEs throughout the country. This was the case generally even before Covid but it is certainly the case in relation to Covid and Brexit, which is coming down the tracks. We have taken a strong regional approach over the past seven or eight years as Fine Gael has been involved in various Governments. The statistics show the majority of jobs, more than 65%, are created outside of Dublin and in the regions. That is a constant aim and something we can never take for granted so we are constantly focused on pushing jobs out to the regions. Project 2040 and the long-term plans therein are about regional balance and investment for jobs in all sectors and services.

My Department and its agencies assist enterprises of all types and sizes in Ireland, and of all ages, to return to Deputy Mattie McGrath's point. This includes access to finance, management development, mentoring, business development programmes, market supports and trade promotion. In addition to the regional focus of the enterprise agencies and the network of local enterprise offices, LEOs, nine regional enterprise plans for the period to 2020 were launched in early 2019, building on the previous regional plans we had, and they are currently being implemented. These plans were developed by regional stakeholders and overseen by my Department. It is a bottom-up approach involving local players in collaboration to bring forward the best ideas and projects we can fund at a national level.

In preparing for Brexit, the Government has introduced a range of measures to assist businesses and SMEs, including Brexit checklists and advisory tools, direct grants and loans. For example, Enterprise Ireland is running an online customs insights course and will launch a new Brexit readiness checker, while the new €2 billion credit guarantee scheme is the largest guarantee scheme ever provided for Irish businesses. These measures ensure there is financial assistance and advice available for Irish businesses as they resume trading and rebuild through Covid and Brexit. The supports are available through our LEOs, Enterprise Ireland and the other agencies in our Department.

The regional enterprise development fund is currently funding 68 projects across all regions to a value of €100 million and the Border enterprise development fund is funding 11 projects in the Border region to a value €17 million, trying to target the resources where, as the Deputy rightly says, they are needed. In addition, 12 projects to the value of €4.6 million have been approved under the regional technology clustering fund. These projects will enable regions throughout Ireland to build enterprise capability and capacity in a post-Brexit environment.

I thank the Minister for his response. He said clearly there is a balance of development across the regions but does that explain why the European Commission has downgraded the Border and the northern and western area from a more developed to a transition region? That happened because the growth is not there, including in jobs. For example, the growth in high-value jobs in the north and west was 5.4%, whereas in the east and midlands it was 17%. The average wage is about €7,000 less. We do not need to hear more of the same. We need to see new innovations and actions to deliver that balance of development.

I agree that we do not need to hear more of the same and I constantly try to put out the view that people in here talk down rural and regional Ireland, though there are many opportunities and supports. The whole design of having the regional enterprise funds and regional plans is to tap in to the entrepreneurial spirit of those regions and get collaboration across State agencies and, more important, across the business community in those sectors. I have been involved with them in my previous time in the Department. There is much opportunity in those regions. It is fair to say that our efforts in the past seven or eight years have tried to redress a regional imbalance that happened for many years before that, probably for 30 or 40 years. Since 2014, 2015 and 2016 the focus has been on the regions and on direct investment there.

It is having positive results and I will give an example. In quarter 1 of 2015 in the Border region, unemployment was at 15.9%. By quarter 2 of this year, it was down to 5%, though it has been affected by Covid since then. In the midlands region, it was at nearly 15% and it was down to just under 6% earlier this year. We recognise that the past six or seven months have changed that picture and we have to refocus our minds but there has been a good deal of success. I said in my opening comments that I would not take that success for granted. There is much work to do to make sure it is sustainable growth and to create sustainable and high-end jobs in those regions. We are happy to work with the Deputy on that.

It is better to look to the future than the past. In that context, because we will now be a transition region, we have an opportunity for European structural and investment funds. That means there can be a better co-financing rate. Will this Government ensure the highest possible co-financing rate of 60% vis-à-vis 40% elsewhere? Will it look at integrated territorial investment? That has been applied across the EU to EU cohesion funds very successfully. Will the Minister of State commit to that and ensure the regional assemblies are the vehicle through which this growth can occur? That will be crucial over the next five years.

I welcome the involvement of the regional assemblies which have a very active role to play. We engaged with them quite a lot in the development of Project 2040, the national development plan, and the national planning framework around that to guarantee that those regions have long-term plans. I have said before in these Houses that if we are to permanently address an imbalance in regional development, it will not happen in one or two years. It will happen with sustained investment over a 20 or 30-year period but we have to have plans to match that. That is why, under Project 2040, they are 20-year plans with long-term commitments. In the budget announced this week, there is a capital spend of more than €10 million with a regional focus. We are investing the capital to match the plans and ambitions.

As a Department, we will work with all to maximise the drawdown from European co-funding initiatives. There is money set aside in our budget plans for more investment in the regions in our baseline funding and in the recovery fund we can draw on next year, with an extra €30 million available there for regional enterprises and supports. We are committed to doing this and will work with anybody who wants to help in that mission with a positive agenda. I agree with the Deputy that we should look forwards, not backwards.

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