I move:
That Seanad Éireann, recognising the urgent need to create jobs in the services sector, calls on the Government to implement immediately the recommendations of the National Economic and Social Forum Report No. 7.
I thank the Minister for Enterprise and Employment, Deputy Bruton, for coming to the House tonight. Rarely has anyone put down a motion so long in advance and had such good fortune in terms of what was announced in the newspapers today on the same topic as I. We tabled this motion on the jobs potential in the services sector some time ago. Today we had welcome news in the labour force survey about the increase in employment. There has been a real increase of 49,000 jobs. This must be very satisfactory from the Government's point of view given that the number on the live register has gone up and down so much and has not shown a great improvement. It shows that, although the number on the live register is regrettably high, there has been a welcome increase in the number with jobs in the past year. I gather it is the largest increase in the near history of the State and it is the largest increase per capita in the European Union.
It was interesting to note that, of the 49,000 jobs created, 38,000 are in the services sector. Most surveys I have read on jobs in the services sector have suggested that they are all low paid and mainly for women. However, this survey showed that 50 per cent of the jobs were for men. I have no idea how well paid they are, but I will address that later.
The services sector is an important area of employment in a developed economy. The more developed an economy the more likely it is to have plenty of jobs in the services sector. We pride ourselves on becoming a more developed economy. It is a labour intensive sector and there is normally a lot of room for expansion. We have the smallest proportion of employees in the services sector in the European Union. We are far behind the United State where 70 per cent are employed in that sector. The public is beginning to realise the importance of this sector.
Recently when the jobs at Intel in Leixlip were announced, one of the first things we heard was that it would create at least another 1,000 to 2,000 spin off jobs in the services sector. I was delighted to see a young man who owned a small Italian restaurant in Leixlip being interviewed about the possibility of increasing the size of his restaurant. He said he would increase its size and he would go up market. He pointed out that if people were employed in manufacturing in the area they would come out at lunch-time and in the evenings for celebrations. He graphically illustrated how improvements in employment in the manufacturing sector can have a spin off effect on the services sector.
I am a member of the National Economic and Social Forum. The most useful report we produced was that on the jobs potential in the services sector. As I said, the jobs potential in this sector is well known. However, such jobs have always been looked down on because they were often part-time, temporary, with low status and considered of little value to the economy. I believe this has been due to poor employment practices. Now the quality of service has been improved, many jobs have improved. It is difficult to categorise whether a job is in the manufacturing or services sector because so many services are involved in industry today. I do not see why we should look down on part-time jobs because it is likely that there will be fewer 39 or 40 hours per week or 52 weeks per year jobs for life. We should remember that Denmark has a high number of part-time employees and it is a prosperous economy.
One of the most important elements in the forum report was the urgency with which the Government must tackle the development of closer co-ordination between taxation and social welfare services. We were promised a social welfare-taxation card, although I have not yet seen it. This is a serious impediment to people accepting jobs which may not be long-term because they are afraid of losing benefits and they will need to be on unemployment benefit for weeks before they return to their previous situation. It is not the money which worries people but the loss of fringe benefits, in particular the medical card. I asked previous Ministers when discussing unemployment to try to ensure that the position of children is not affected so that parents would be encouraged to take up even short-term employment.
The public sector has a considerable number of employees. I am fascinated when I hear people calling for cuts in the number of people employed in the public service. Are they calling for cuts in the number of nurses, medical personnel, gardaí or teachers? I will spare civil servants' blushes by saying they are also valued members of the community. Earlier today we spoke about the establishment of the Irish Medicines Board — an area in the State service where there is enormous potential for job creation. Dossiers on the evaluation of drugs valued at £50,000 each will be sent out from the Central Medicines Evaluation Agency in London. Because these drugs will be partly in the public service area, will we say we cannot do these evaluations when we know it would create an enormous amount of employment for those in the technical and professional areas?
Sometimes I think it is amazing that there is a private services sector in this country because we have done little to encourage it until recently. The setting up of the county enterprise partnership boards was a good move and the much maligned FÁS has done a lot in terms of training. A large part of this report on the jobs potential in the service industry focuses on training as well as taxation. Unfortunately until recently we looked on training as something which people picked up as they went along. Someone once said to me that most waiters in this country appear to be waiting to go back to college. However, with the improvement in the tourism industry and the demand by visitors for improved services in hotels and restaurants, we have had to set up better courses in CERT and Cathal Brugha Street. I commend both on their efforts. Without high standards in these services we will not get return visitors and that must be an important aspect of education and training.
Manufacturing firms devote too little time to research and training. It is important to remember that both areas provide employment. Very little time is spent in firms on managerial reorganisation and think tanks.
The area of help with domestic chores within the home has been seriously neglected. I ask the Minister to look at the taxation situation in this regard. We spend an enormous amount on carers and some very highly paid people have to give up work to care for elderly people, in particular. It must be within the remit of the Department of Finance to make tax exempt the employment of those who look after the elderly in their home, so that the person whose responsibility they are can go out to work. The same applies to the employment of those who mind small children. That would allow people who have to give up lucrative jobs, where they contributed a great deal to the economy from the point of view of taxation, to stay in their jobs and to employ someone else who will be paying taxes.
I cannot understand why there are such difficulties with this, but it is an area which needs to be addressed. The report strongly recommended that this should be made possible and that child care provision should be made affordable, accessible and available to parents and their children. It is important to remember that these child care facilities will employ other people.
I received the banks' charter for small business customers in the post this morning. People have great difficulties in getting bank loans or financing to start small service industries. It appears to be easier to borrow £1 million than to borrow a few hundred pounds to buy a sewing machine in order to start a small repairs business which might employ one or two people. I strongly suggest to the Minister that he should try to make the banks more realistic as they seem to look on such people as bad debts. I know that one must save with a credit union before one can borrow from them. However, they have told me that they frequently give loans to people to set up small businesses in the services sector and that they have a 100 per cent repayment record. Therefore, such potential borrowers should not be automatically regarded as liabilities.
I wish to commend First Step, which was set up by Mrs. Norma Smurfit and some friends and which has done some of the most imaginative work in this country in giving small amounts of money to people wishing to set up small enterprises. They say that they have an enormously high success rate and very little defaulting on repayments.
I know that it is important to employ 200, 300 or 1,000 people. However, if one reads the report in todays newspaper and considers how many small enterprises were involved in creating those 38,000 jobs, one realises that far more attention should be paid to promoting in every way possible the services industry.