Mr. John Murphy:

As Mr. Murray mentioned, one of the challenges facing Europe is the level of energy costs and one can look at this in a number of different ways. One is to state one should forget about environmental targets and simply focus on a cheap energy policy but that is not a sustainable solution. As for the climate change policy, we recognise there are significant reasons for taking a leadership role in Europe on climate change. A second way to look at this is to manage demand for energy and in the research and innovation area, much of the focus has been on smarter ways of doing that. Part of the agenda for manufacturing must concern ways of addressing energy costs, smarter ways of manufacturing and all that. Nevertheless, the reality is that our energy costs are substantially higher than in the United States, for example, and this issue must be addressed. Mr. Murray referred to how the United States is bringing back manufacturing because it has become more cost-competitive and we must recognise this. This is the reason there has been a focus on having greater flexibility in how we reach climate change targets to avoid, through having a rigid target, imposing additional costs on business. We must try to take a more balanced approach.

The Department has a focus on having a better internal market in energy. A fair bit of progress has been made on an all-island energy market and I have looked at the east-west energy links but for Europe as a whole, there must be a more efficient internal market in energy and more work remains to be done in this regard. Our focus is very much on these other major policy pillars, which must reflect the concern for competitiveness and this is where we will seek to make that input. However, we will seek to make it in a way that also recognises the importance of the other policy agendas, just as we would hope those who are pursuing environmental or other policy goals would recognise the enterprise agenda.