Mr. Paul McAuliffe:

I thank the Acting Chairman and members of the committee. We very much appreciate being here today. As chairperson of economic development and enterprise in Dublin City Council, I am joined by a number of my colleagues: Mr. Declan Wallace, assistant chief executive; Mr. Greg Swift, head of enterprise and economic development; Ms Mary MacSweeney, deputy head of enterprise and economic development; and Mr. Steven O’Gara,who has assisted in the Dublin city economic summits, on which I intend to brief the committee. As the councillors in the room would acknowledge, it is always disconcerting when the officials are sitting behind one.

My remarks are based largely on two Brexit-related Dublin city economic summits that were held in July 2016 and May 2017. These round-table discussions included senior leaders of many sectoral, business, trade union and political organisations in the city, as well as State bodies. My remarks are also informed by the new Dublin Economic Monitor- a joint initiative on behalf of the four Dublin local authorities to track economic developments in the capital. I have a number of copies of the bulletin for the committee.

It is a useful policy tool to assess what happens in Dublin's economy.

The first summit took place three weeks after the referendum. It focused on the potential challenges and opportunities that face Dublin city following the referendum. We were pleased that representatives from both the British and Irish Governments were able to attend as the Minister of State, Deputy Eoghan Murphy, and the British ambassador, Mr. Chilcott, attended a round-table discussion.

With 28% of the national population living in Dublin and 45% of the GDP generated in the city, it is not a surprise that many of the national Brexit challenges have an impact on Dublin. I will not repeat the challenges as the committee has already heard about them from other delegates. I will briefly mention the concerns of the retail, tourism and university sectors. They were mentioned at the summit and are worth noting. In terms of retail, 40% of Dublin city centre stores belong to UK chainstores. There are concerns that even without tariffs there may be an inflationary impact on Dublin consumers as a result of Brexit. The tourism sector employs one in seven Dublin workers. The sector was one of the sectors that felt the immediate impact of a weakened sterling following the Brexit vote. There have been calls for increased promotion particularly in eurozone markets. There are concerns that increased prices in the Dublin tourism sector has affected the city's attractiveness as a destination. As for education, there are concerns that British and Northern Irish students who study in Dublin, as well as Dublin students who study in the UK, will be treated as international rather than EU students after Brexit with higher tuition fees being imposed as a result. Equally, concerns were expressed about existing and future research partnerships between Ireland and UK educational institutions.

I urge members to read the outcome report from our Brexit summit as it has more detailed analysis on the sectors in Dublin city that have seen the impact of Brexit. Today, I shall focus on the main issues that face Dublin as a result of Brexit. One of the strong outcomes from the summit was the Lord Mayor's task force on Brexit. I refer to the joint initiative called Greater Dublin's Greater Than Ever, which was developed by the Mansion House and the British Irish Chamber of Commerce. The project aims to promote the positive elements of the city with a video and promotional material. The material has been distributed and used for the past six months to convey the message that Dublin is a place for investment.

In the limited time available, I will focus on the capacity and infrastructure of the city of Dublin. While wearing the blue jersey to promote Dublin abroad, we also need to address potential threats. Many of the infrastructural challenges predate Brexit but Brexit has brought them into sharper focus. A city with capacity can respond positively to increasing numbers of people coming to visit, live and work here. However, a city with insufficient infrastructure will be unable to respond.

It is accepted that financial services and other London-based companies were or are looking at Dublin as a possible relocation centre. However, Dublin's ability to take advantage of the opportunities that arise from Brexit was a running theme throughout our discussions at the two summits. The capacity of the existing infrastructure to bear extra weight and for expansion arose repeatedly, particularly in terms of housing, transport, and hotel and office space.

The Dublin Chamber of Commerce attended the second summit in May 2017. One of its representatives stated that in meeting the challenges and opportunities provided by Brexit, housing supply, commuting and travel times were the most practical and quantifiable measures that any local authority could deal with. Tackling these issues would make the city more competitive both for the people already living and working here but also in being able to attract new investment. Dublin's ability to meet a growth in demand for office space was a concern 12 months ago. Assurances were given at the summit that a sufficient pipeline of office space was in development. At present it is believed that we will be able to handle an uptake in demand generated by companies moving their operations from London and elsewhere in the UK to Dublin.

According to comments made by CBRE at the summit, the largest number of queries received about office space in Dublin had came from the technology sector. The sector was fearful of immigration controls being introduced in the UK, as it would restrict an ability to attract the necessary workers. Concerns were raised about housing 12 months ago and they remain. There has been much coverage of the housing shortage in Dublin from a social perspective but it also has a massive economic impact. The shortage must be addressed if we are to be in a position to attract new employers. CBRE reported that housing was the number one issue its occupiers asked about. CBRE also stated that potential investors are looking at the cost of rental accommodation for their workers because of the implications that has on wage costs. Members can imagine how even a small number of highly paid financial workers moving to Dublin with a high disposable income might affect the already heated rental market.

Dr. Ronan Lyons, Department of Economics, Trinity College Dublin prepared a special paper on housing for the second summit. He said housing accounted for a quarter of the city’s competitiveness. Three quarters of the cost base for most modern multinationals is labour and one third of most households' incomes is spent on housing. Therefore, a quarter of Dublin's competitiveness comes down to housing, a fact that is not normally considered. Dr. Lyons reported that Ireland has perhaps been too good at attracting foreign direct investment and, therefore, has not considered the influence of domestic and international factors. There was a lot of focus on corporate tax in the 1970s, 1980s and 1990s. However, the cost of living and quality of life issues will be our challenge in Dublin in future decades. To illustrate the point, the Lord Mayor of Dublin and I recently met a co-founder of one of the world's largest social media technology companies. In discussing the company's plan to invest in Dublin, we spent a considerable amount of time addressing concerns about housing and the availability of school places.

The north Dublin think tank, NorDubCo, told our second infrastructure summit that from its engagement with multinational organisations, the housing of workers in other cities could often be solved with money. However, due to the scarcity of housing in Dublin, companies could not be certain that money alone would resolve the issue.

Equally, significant investment in transport is required to facilitate movement and reduce commuting times. Even with metro north and the DART underground, Dublin is facing a decade of increased congestion and lengthy commuter times. With an ever increasing number of people living and working in the city, an ambitious plan is needed to fund cycling infrastructure, quality bus corridors and integrated bus routes. We need to move away from short-term project-based planning to longer-term multi-agency planning in order that investors coming to the city can see a clear line of sight on big capital infrastructure. We also need to scale up our infrastructure and to do so we need investment.

The Dublin city local economic and community plan was published last year. It identified over 300 actions that Dublin City Council and other State bodies in the city must take in 2016 and 2017 to address quality of life issues. The plan rightly identified that a great city to live in is also a great city to invest in and vice versa. In order for Dublin to face the Brexit challenge we must now decide to deliver and invest.

My colleague, Mr. Greg Swift, will address some of the issues and projects that we have undertaken to support businesses in the city.