Oireachtas Joint and Select Committees

Tuesday, 9 July 2013

Joint Oireachtas Committee on Jobs, Enterprise and Innovation

Action Plan for Jobs 2013: Discussion with Minister for Jobs, Enterprise and Innovation

1:50 pm

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael) | Oireachtas source

I was coming to that. We have definitely done a lot of work. As job numbers in the pharmaceutical sector have been stable, there has been no impact on employment. Part of that is due to the fact that IDA Ireland is looking at new opportunities in the bio-pharmaceutical and other sectors. While we are inevitably losing jobs in some sectors, we are expanding elsewhere. As the Deputy acknowledged, we have established the Synthesis and Solid State Pharmaceutical Centre in the University of Limerick as the nucleus. It is a €40 million investment, 30% of which has come from industry. All of the large pharmaceutical companies are involved. We are assisting, through IDA Ireland, normal transformation supports but also this special research centre to try to assist companies to reposition. There are opportunities in this sector, with the convergence of IT and pharmaceuticals, and the trick is to try to stay ahead of these trends. Employment levels actually grew in this sector, despite the patent cliff problems. It is encouraging that the strategy is working.

Deputy Peadar Tóibín's portrayal of what was happening was a little unfair. I know there is an element of political presentation, but if one is coming from an economy losing jobs at a rate of 90,000 per year, one is not going to suddenly see a surge into the positive zone. Seeing 20,000 net extra people at work in the past 12 months is an encouraging sign and it certainly does not dispose me to change our target of 100,000 by the end of 2016. That remains our target and we should continue to work towards it.

The Deputy is right that the national quarterly household survey figures showed that a large proportion of the new jobs created were part-time, but, interestingly, in the last two quarters alone there has been growth in the full-time dimension. The other interesting piece of evidence is that if one looks only at the October numbers for the agencies, the full-time work figures completely dominated the part-time work figures. The agencies' October numbers showed that of the new jobs created - roughly 9,600 - only 700 were part-time, which means that the vast majority of the additional jobs were full-time. We are seeing a pattern as we come out of the recession where initially there was only part-time employment available. I hope the indications are that more of the jobs will be full time. In terms of agency-supported employment which is predominantly export driven, it is encouraging to see the very high proportion of full-time jobs in its portfolio of companies. Clearly, this is an issue. There are patterns of part-time working with which one would not be happy, but there is also legitimate expansion whereby people start off in part-time jobs.

I refer to one of the exciting things about JobsPlus. A large number of sectors are moving into the plus zone where they are actually expanding employment across a range of operations. This is a good time to introduce a simplified measure to help people to take employees off the long-term unemployment lists. There are conditions in that one must be working 30 hours and at least four days a week. The Government incentives which we are putting in place are very much geared towards creating full-time employment rather than part-time employment.

I accept the point made about procurement. There is a dilemma. When one has to consolidate public spending and if one can purchase more efficiently, it saves cutting staff, front-line services or raising taxes. Naturally, a forensic look at public procurement must be part of any fiscal correction. We have been trying to ensure that while we must get value from public procurement, we do not put obstacles in the way of SMEs. The new national procurement officer has been promoted and he is seeking to ensure SME access. The Department of Finance has rules about tendering such that one does not bundle packages of work such that SMEs cannot possibly tender for them and one does not have unnecessarily high thresholds for insurance requirements. That has been included in the criteria for tendering.

We also have a number of very successful programmes whereby Enterprise Ireland is working with the procurement service and InterTradeIreland. In terms of value for money, InterTradeIreland's initiative on public procurement is showing the best performance of any of its programmes in terms of the return to business. There are opportunities for SMEs if they participate in some of these programmes to access funding. Yesterday we were in Waterford and the head of the county enterprise board, soon to be a local enterprise office, pointed out that it published in an e-zine. All of the electronic tenders are put to a rake of businesses in the area and from its monitoring, many of them are not opened. Many businesses do not think about public procurement as an opportunity. We are, therefore, trying to work with companies to open up access. Later in the week we will meet the new procurement officer to outline some of the concerns raised with the Deputy and which are continually raised with us. One of the things we are obviously keen to see is more innovative procurement - in other words, one would tender to solve a problem rather than putting out a tender involving large quantities and materials. That gives small businesses a much better chance.

I accept that the legislative programme is behind schedule. We have not been able to meet all of our deadlines. Much of this has been due to the fact that troika work had precedence. Last year we fast-tracked our competition legislation to meets its requirements on penalties and so on, of which Deputies were critical. That pushed everything out of the way. There are problems in getting things through, but we are working really well and have better arrangements in place with the Office of the Attorney General. I hope that as a result we will be able to improve the flow.

The credit guarantee scheme is showing an improved take-up. On 5 July the figure was €6.5 million; therefore, it is up considerably. There are 49 live cases. Between the two schemes, 414 jobs were created or maintained.

In the case of microfinance, the loan value is €1.3 million, which figure relates to 79 microenterprises and the approval rate is 45%. They are beginning to gain traction and we are continuing to promote them. We recently had meetings with one of the banks. We will meet all of them to make sure those who are refused loans are alerted to this programme at the point of refusal, which is the critical point. Approximately 24,000 small businesses have been refused loans. If we can get one quarter of these to apply for microfinance, we will believe we are accessing our target group. We are trying to secure better arrangements with the banks in order that people will be alerted.

The final issue raised by the Deputy was the question of regional spread. To be fair, the regional spread in the Enterprise Ireland and Forfás figures is not bad, even if it is not ideal. Just one region did not see an expansion in employment. Most of the regions outside Dublin saw increases of 5,600, 5,800 and 1,200. If I had my calculator, I could give the Deputy all of the figures which are in the public domain. We are seeing a spread. The Deputy will be aware that the foreign direct investment projects we are winning are increasingly focused on the deep labour and skills pools found in the cities. That is a feature of the profile of the projects we are winning. We are trying to expand this, for example, by placing an emphasis on emerging companies and developing the Connect Ireland programme. We are trying to put new tools in the field to attract foreign direct investment that is less likely to need to be based in large urban centres. That work is ongoing.

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