On behalf of my colleagues on the committee, I extend a céad míle fáilte to members of the delegation who are very welcome. The histories of Finland and this country, both of whom gained independence around the same time, have a striking number of parallels. I have been informed that your committee is a new one formed after the March elections this year. The staff of this Parliament have had an excellent relationship with the Finnish embassy in Dublin virtually since its establishment. I have great pleasure in welcoming the chairman and delegation from the administration committee of the Finnish Parliament, together with His Excellency, the ambassador. I invite the chairman, Mr. Matti Vaisto to give his address.
Visit of Finnish Delegation.
Mr. Matti Vaisto
Mr. Chairman, your Excellency, dear members of the committee, the committee brings regards from Finland where the sun was more prominent than here.
We can agree with that.
Mr. Vaisto
Summer is arriving and the committee members are more than welcome to visit Finland.
Thank you.
Mr. Vaisto
Finnish parliamentary elections were held in March and there is a new government in place. This trip is the first one by a committee to an EU nation, or indeed any nation.
I will say a few words about our brief. We mainly deal with domestic politics and we also prepare reports for Parliament. The legislative areas on which we focus are the police, border control, local government and regional development. The brief of this committee is small enterprise in particular. This area is a significant one in terms of regional development. We would like to hear about the work of the committee, the Irish Parliament in general, and the topical issues.
We have a former Minister for the Environment, Deputy Howlin, who will speak about regional development.
I welcome the delegation. I am very impressed that its members have been brought directly from the airport to work. It is important that there is leisure time provided in Dublin and beyond here as well.
As a former Minister for the Environment, I have had the privilege of visiting Finland. Alas, that was some years ago. This ministerial brief also includes the area of local government and local administration. My equivalent Finnish colleague at the time shared the Christian name of the ambassador. His name was Pekka Haavisto of the Green Party. Although I have survived, I understand that he is no longer in Parliament.
The committee system we have established is based on the fact that each committee monitors and mirrors a Department of State. The Department for which we have the responsibility to overview and scrutinise is the Department of Enterprise, Trade and Employment. The issues that are most pressing for us centre on the pressures that are on businesses, particularly small businesses, in more difficult economic circumstances. For example, the issue of affordable insurance has become a huge matter for the survival of small businesses, particularly in view of increased insurance costs in the aftermath of the 11 September tragedy in the United States.
As a legislative committee, we look at all legislation that comes from the Department of Enterprise, Trade and Employment on a line by line basis. We also scrutinise all European directives and proposals for directives that are pertinent to the Department. Sometimes this will involve officials outside the Department. Before the arrival of the delegation we had a discussion with officials from the Department of Agriculture and Food in regard to food hygiene laws because they will impact on business.
That is an overview of our work in a nutshell. I am sure any member of the committee would be delighted to respond to any particular area of interest to the chairman or members.
Mr. Vaisto
On practical matters, what is our timetable?
Approximately 40 minutes to one hour. The Order of Business in Parliament takes place in 40 minutes.
Mr. Vaisto
There are normally 17 members of the committee but, unfortunately, not everyone was able to travel. All political parties are represented on the committee which is made up of members from the Coalition Party, Social Democrats, Christian Democrats and the youngest member of the Finnish Parliament, the Centre Party, the Swedish Party, deputy chairman, Left Alliance, secretary to the committee and her clerk and assistant, and the chairman is a member of the Centre Party.
Does the chairman wish to put a question to the committee? Our meeting last week with the Polish committee was very successful with each member asking a question relevant to their portfolio.
Mr. Vaisto
Yes.
Mr. Ahti Vielma
How does an enterprise receive EU funding?
Ireland has been very successful in drawing down EU funding during our membership of the European Union. We have been able to do so from a number of different funds because of the low economic base at which Ireland joined the Union. We were able to access a number of different funds, most important of which were Structural and Cohesion Funds, to build our infrastructure. That has been done successfully. It has not been possible for individual enterprises to access funds directly through Brussels. It has always been conduited through State agencies such as a Department or an agency established by a Government Department.
In terms of small enterprises, Ireland developed a model - it has been looked at by many other countries - of supporting on a partnership basis enterprise at local level primarily by the establishment of county local enterprise groups which involve all social partners at a local level. That is the access point for small enterprises to get funding.
Mr. Lasse Hautala
The EU is enlarging and it is quite likely Ireland will lose some of the funding it has been receiving. How will this impact on Ireland's future?
It is already happening. Part of our country is in transition. A particular region, known as the border, midlands and western region, still receives the same amount of funding under Structural and Cohesion funds. Other regions such as the south west, Dublin, mid-east and mid-west receive about 20% of the funding they require. We do realise what is happening and we will have to address public-private partnerships in the future. We see that as a way forward in motivating the private sector which has been the backbone in taking our economy from one of the very lowest in 1987 to one of the strongest today.
Mr. Veijo Puhjo
It is interesting that the Department of the Environment brief also covers local government. That is quite unusual.
Yes.
Mr. Puhjo
I have a brief question about the Department of the Environment, Heritage and Local Government regarding two separate issues. The first is a spatial issue. Finland is a large country geographically. It is quite different from Ireland in that sense. Some constituencies might be as large as Ireland. Is it possible to think of the whole of Ireland as actually part of Dublin, or the environment of Dublin, spatially? Secondly, in Finland the Department of the Environment deals with environmental issues in terms of protection and zoning matters. Protection is the nature of the department's dealings in regard to the environment. All of these would affect local government. How do spatial development and environmental development relate to each other in the Department of the Environment, Heritage and Local Government?
As a result of history our Department of the Environment, Heritage and Local Government is a broad Department. Although it has responsibility for environmental protection it has also responsibility for local government, franchise law - electoral law - roads, housing, urban renewal, spatial planning and fire and emergency services. I have probably forgotten some of its other responsibilities. It is a large Department.
Heritage is linked to it also.
Heritage which used to be a separate department recently became part of it too. Water and sanitation are also a part of it. The Department spends almost half of the public capital programme. It is a Department where one can link environmental planning and protection into the construction required to improve infrastructure. Environmental protection is factored into road building and sanitary schemes etc. The Department works effectively on that basis although some say it is too large.
One of the difficulties we have is that unlike Finland we have a centralised Government system. We do not have hugely devolved powers at regional level. Something we have talked about for a long time but with which we have never effectively grappled is the devolution of real power to a regional base. It is a matter of debate. We could learn from Finland's experience to devolve power to where it is most effective.
In regard to the dominance of Dublin, we now have a national spatial plan which deliberately seeks to transfer industrial and infrastructural development and population away from the cluster around Dublin, which currently has a third of the national population, and tries to sustain regional development on a balanced basis.
Ms Tuula Vaatainen
Just like here great gains have been made in Finland regarding enterprise. However there are also many obstacles. What do the Irish see as the main obstacles to the development of enterprises?
We have done extremely well from European funding. We would have made better use of that funding if we had identified and done something earlier about our lack of local government. The dispersal of funding to the regions was not as successful as it should have been because of our lack of a proper local government structure. The consequence of that was the concentration of industry and enterprise in the Dublin area which is now causing serious problems.
When the delegation first came in today and listed its responsibilities I wondered how it was connected to this committee until it said it regarded small enterprise and business as being an important part of your responsibility at regional level. Unfortunately, in Ireland we do not give local government the kind of authority and powers we ought to give it. We have a lot to learn. If we made any mistake in the past it was to have an over-centralised system resulting in industry and enterprise being centred on the east coast.
In the past two years, insurance costs for small industry have doubled and energy costs have increased by 25%. There has been increased competition from low cost countries. The value of the euro against the US dollar and sterling has caused much concern. The biggest challenge for local authorities is waste disposal.
Mr. Hannu Hoskonen
I represent the most eastern area in the Finnish Parliament. The chairman of this committee used to be the most eastern Deputy, from near the Russian border. I am aware that the regional differences in Finland are quite wide and they are growing. Is this the case in Ireland? I note that you referred to Objective One and transition areas. How has Ireland dealt with the differences between regions? Does the funding come from the EU or from the national Government?
Obviously there is a difference in scale between the two countries. Ireland is a much smaller island than the area of Finland so the geographical stretch is not nearly so challenging but the economic disparity is real. Deputy Murphy and the Chairman made the point that we have not tackled sufficiently the issue of regional disparity in terms of poverty and income differences. Inequality is not necessarily a regional issue alone; in other words, wealth and poverty can be side by side within a region. Dublin, for example, is the wealthiest part of the State but there are very disadvantaged communities within Dublin. A range of specific initiatives have in the past been funded by the European Union under social policy initiatives but increasingly they are now being funded by the domestic Exchequer. Unfortunately the economic situation in Ireland has disimproved to some degree in the last year. Those projects can be squeezed and maintaining specific policies to combat inequality is a matter of considerable debate within the Irish political system. There will be a debate on that issue in the House tonight.
Mr. Lauri Kahkonen
I have a few questions about the work of parliamentary committees. How many committees are there and how many meetings do they have every week? Are most Deputies members of a committee? How much time every week do Deputies devote to committee work and to constituency work? How much money is spent by a candidate at election time?
There is a regulation governing the amount of money that can be spent by a candidate. A candidate cannot spend more than €20,000 in a three-seat constituency and €30,000 in a five-seat constituency. There are 14 committees in the Houses of the Oireachtas and a new committee may be constituted soon. This committee sits once a week to deal with the matter of insurance. We will probably sit two extra days a week for the next five weeks to deal with this matter.
The work of a parliamentarian in Ireland could take 70 hours per week on constituency work, Parliament work and travel between the Parliament and the constituencies. It is very time consuming. It is being reviewed on an ongoing basis. Last week we introduced a new law preventing a Member of Parliament from being a member of a local authority or local committees such as health boards and vocational education committees, known as the elimination of the dual mandate. This will free up parliamentarians' time and allow them to be more focused on Parliament than they were when they were members of local authorities, which most Members of Parliament were before they became Members of Parliament.
Our Order of Business will take place at 11.35 a.m.
Mr. Tapari Tolli
I have a question about SMEs. Ireland has successfully founded new enterprises. What sorts of carrots have been used nationally regarding taxation, training, funding, etc.?
It is a very good question. This is an area on which we have been working for a long time. Perhaps Deputy Howlin would like to take that question. Members of the delegation might like to take with them, Sustaining Progress: Social Partnership Agreement 2003-2005.
I will briefly speak about the general enterprise culture we try to create in Ireland, which has been extraordinarily successful in the past decade. Our biggest single economic success in enterprise and employment has been in attracting inward investment by the very large, primarily American, multinational companies. I know one of the largest multinational companies in the world is Finnish. A quarter of all European investment by the large American corporations in recent years has been in Ireland. As a result the majority of the huge IT and health care companies have made investments here. They employ very large numbers of people and have very important infrastructure here.
Our challenge has been to not only have those large companies manufacture here but also to get them to engage in primary research and development. We have developed linkages between our third level colleges and new industries to grow business parks and to grow the next generation of technology. One of the areas we are now investigating is biotechnology. Europe's largest biotechnology park is currently being developed in Ireland. This will employ many thousands of Irish graduates. A Bill is currently going through the Dáil to establish a new science authority, which will be given €635 million to attract the best individuals and groups in research to locate in Ireland to develop the new cutting edge technologies. That has been one large component of our economic success.
The other significant issue, as mentioned by the Chairman, was an agreement more than a decade ago when our economy was very weak to create social partnership at a national level. We brought together Government, Parliament, the trade union movement, employers, farmers and ultimately the non-governmental organisations to work out a programme agreeing investment programmes and the State's taxation regime. It eliminated disputes and allowed people to plan investments in a structured way. That helped small and medium sized enterprises as well as larger enterprises.
At a local level, we created local area partnerships, which basically replicated at local level what we had constructed at national level. Other countries have looked at this model.
I join in welcoming the Finnish delegation. From a historical perspective, there has been a remarkable achievement in maintaining Finland's independence against Soviet imperialism and overwhelming odds. We can learn from the Finnish experience in a number of areas, notably in the development of major indigenous industries such as Nokia. In Ireland, we have multinationals such as Intel and Dell. Finland is like Ireland in many respects, situated at the periphery of Europe and with a relatively small population. It has achieved remarkable success in establishing its own major multinational company.
In the area of foodstuffs, Finland has also gone one step further. In Ireland, we have major producers such as Kerry and Glanbia. The success of Benecol is particularly noteworthy, not alone in maintaining people's health but also improving health in terms of influencing eating habits and the use of biotechnology. That will be a feature of developments in the food industry over the next few years. In the area of mineral extraction, the Finnish company, Autokumpo, has been doing business very successfully in Ireland in the extraction of ore at Tara Mines and the development of major companies throughout the world. While Ireland has provided skilled labour and R&D for foreign multinationals, Finland has achieved remarkable results in developing its own indigenous companies.
There is just time for one further question as the Order of Business will commence shortly in the Dáil.
I join in welcoming the Finnish delegation. Finland seems to be a world leader in relation to waste disposal. In Ireland, there is considerable opposition to land fill disposal and incineration. Recycling is being actively encouraged here. How was the Finnish public persuaded to accept incineration and land fill as part of the waste disposal system?
Mr. Vielma
There are three relevant aspects, namely, attitude change, location - sometimes wrong decisions were made and the location of incinerators had to be changed - and we have to bear in mind that incinerators may increase in size and involve transport of materials over longer distances. Accordingly, concentration of incinerators is an important issue. Company structure is another relevant consideration, as between companies in which local authorities can become shareholders and those which are privately owned.
I thank our guests for joining us for this morning's very useful discussion. I wish them a successful visit to our country and a safe return journey to Finland. We are most grateful for the kind invitation to visit Finland, which we will consider very seriously in the course of drawing up our programme for the remainder of this year and next year. On behalf of the committee, I will now make a small presentation to the chairman of the delegation.
Mr. Vaisto
It is clear there are common interests between our countries which will ensure the continuation of co-operation, both directly and at EU level. Co-operation at EU level is particularly important to the development of our economies and ensuring employment. Members of your committee will be most welcome to visit Finland and we look forward to that occasion.
The joint committee adjourned at 11.50 a.m. until 9.30 a.m. on Wednesday, 28 May 2003.