Mary Mitchell O'Connor (Dún Laoghaire, Fine Gael) | Oireachtas source

I congratulate Deputy Mary Butler on her appointment as Chairman and wish her the very best. I am glad to have Deputies Niall Collins, Stephen S. Donnelly, Tom Neville, Bríd Smith, Noel Rock and Maurice Quinlivan as members of the committee.

I am grateful for the opportunity to say a few introductory words on the Department's 2016 Estimate. Initially, I will refer briefly to the high-level details of the financial allocations across the Department for this year. I will then provide a brief commentary on recent progress across the jobs, innovation and regulation agendas, the three big programme expenditure programmes within the Estimate. Time permitting, I will also briefly allude to our plans to continue on the road to full employment and our target to create a further 200,000 jobs by 2020.

On the 2016 financial details, the total gross allocation for the Department is €810,000,047, as per the published 2016 Revised Estimates Volume. This includes funding for the Department, its offices and agencies. It compares to a 2015 Estimate provision of €810.1 million. Therefore, for 2016 it is essentially a no-change scenario in terms of the quantum of the Exchequer funding provision. Nonetheless, there are some modest changes between the capital and the current expenditure distributions. This year the Department and its agencies have a total of €513 million available in Exchequer capital funding.

This represents an increase of €4 million on the 2015 capital allocation of €509 million. However, it is important that committee members recognise that the Department was provided with an additional €50 million in capital moneys through a Supplementary Estimate in December 2015. The purpose of the Supplementary Estimate was to provide €21 million for IDA Ireland, mainly to commence its first and new five-year regional property programme.

The December 2015 Supplementary Estimate provided €29 million for innovation supports which helped to meet some commitments earlier than anticipated. It created additional headroom for extra activity by the agencies in 2016.

The most significant change in capital allocations this year is the increase in IDA Ireland's capital provision. IDA Ireland sees a €27 million increase on its 2015 total capital allocation of €95 million, resulting in a total of €122 million this year. Essentially, this increase will enable IDA Ireland to continue progress on its regional property programme during 2016. This is part of the €150 million five-year new IDA Ireland regional property programme announced in February 2015.

As highlighted in the material provided for committee members, the Department's capital expenditure to the end of May was €7 million, or 4% behind profile. It is a timing issue across the capital programmes and not indicative of any delayed activity or problem.

At this point of the year, we still anticipate capital expenditure in 2016 across the Department’s Vote such is the demand for enterprise and innovation supports. With regard to current pay and non-pay moneys, the allocation covering my Department, offices and agencies this year amounts to a total of €297.4 million gross. This is split across pay, at €155 million; pensions, at €49 million; and other non-pay elements, at €93 million. The figure of €155 million for pay covers the pay of approximately 850 staff in the Department and its offices. It covers approximately 1,600 staff in the enterprise agencies.

Our current expenditure is €5.7 million, which was 5% behind at the end of May. It is too early in the financial year to make definitive year-end projections of current expenditure. Committee members should be aware that any movement of moneys across subheads within the year requires the formal approval of the Minister for Public Expenditure and Reform. It is not something a Department can do unilaterally. This process is typically conducted shortly before the financial year-end, in November or December.

I will comment briefly on what we are doing with the total allocations this year, most of which are set out in specific actions articulated in the 2016 Action Plan for Jobs. As set out in the briefing material provided for committee members late last week, enterprise supports are multi-annual in nature. Therefore, the primary focus of Enterprise Ireland, IDA Ireland and local enterprise offices this year is on continuing the excellent job results they delivered in 2015. Last year Enterprise Ireland, IDA Ireland and local enterprise office clients, collectively, delivered over 44,000 gross new jobs, which resulted in 25,000 net new jobs. These results make 2015 a record year for the enterprise agencies. It means that over 410,000 jobs in the economy are now in companies directly supported by Enterprise Ireland, IDA Ireland and the local enterprise offices. This is the highest figure ever.

Allowing for the multiplier effect, a similar number of jobs, 400,000, is generated in terms of services and sub-supply to enterprise agency-supported clients. This year, through their capital programmes, Enterprise Ireland, IDA Ireland and the local enterprise offices will target a further 32,000 gross new jobs. There is good progress on the jobs front in the year to date but, as Minister of State, I want to ensure that we do even better. However, given the scale of agency operations, which span many thousands of clients, it is not possible to quantify the precise employment figures at this stage of the year. IDA Ireland will present its mid-year figures in early July. Enterprise Ireland and the local enterprise offices conduct an annual business survey of their clients at the end of the year. What we can say, however, is that good progress continues on the jobs front, as evidenced in the most recent CSO figures showing unemployment has dipped under 8% for the first time in over seven years.

Yesterday, I was delighted to announce the achievement of record export figures by Enterprise Ireland-supported clients. In 2015, exports by Enterprise Ireland companies surpassed €20 billion for the first time. This represents a 10% increase over 2014 export levels. There were increased exports in all sectors, with the biggest increases in the software, construction and manufacturing sectors. The primary policy supports underpinning these excellent results and our future targets are set out in Enterprise 2025. Enterprise 2025 is our new ten-year enterprise and jobs strategy, and it was published in late 2015. A core element of the strategy is the eight regional action plans that the Department co-ordinated and developed from early 2015 onwards. These are also complemented by Innovation 2020, our new national science strategy, on which I am sure the Minister of State, Deputy Halligan, will comment as we move into the examination of programme expenditure area B, which covers innovation. I am sure he will want to briefly outline some of the positive developments being supported through subhead B.4 of our Vote, concerning science and technology development. Under this subhead, significant capital investments are being made through Science Foundation Ireland and Enterprise Ireland. A key target of Enterprise 2025, which is also highlighted in the regional action plans, is our target of delivering a further 200,000 jobs in the period to 2020. Some 135,000 of these are targeted to be in the regions. Across the eight regional action plans, we are aiming for jobs growth of 10% to 15%. Admittedly, these are ambitious targets but I would point to the fact that since the action plan for jobs commenced in 2012, we now have over 155,000 more people working. We are approaching the point where 2 million people in the country will be at work.

While we have made excellent progress of the jobs front, bringing the unemployment rate below 8%, we recognise that there is further work to be done. A key deliverable for me this year is embedding the eight regional action plans. We recognise that there is a need to ensure more balanced regional economic growth. That is why we have developed the eight targeted regional plans, which will concentrate on specific regional strengths. We shall have the first update reports on implementation of these plans in the next couple of months.

Some important contributory aspects of our overall enterprise strategy fall within the areas of responsibility of the Minister of State, Deputy Breen.

I am sure that when we come to programme C, expenditure regulation, the Minister of State will elaborate further on some of the key factors underpinning our enterprise policy, such as a harmonious and effective industrial relations system and ensuring that work pays. I leave my comments there for the moment so that we can proceed to examine the respective programme expenditure areas.