Mr. Gerard Brady:

On housing and the indigenous sector, we get it from all kinds of members. It is definitely a piece in the skills challenge for multinationals but it is the single biggest driver of wages and wage costs above what one would expect from inflation, productivity and other costs of living that one would normally see in a normal industrial relations context. We are seeing housing costs drive that for indigenous companies. It is happening at a time when inflation across the economy is really low. Accordingly, companies cannot pass on the wage costs through price increases and it is really cutting their margins very fine. In the indigenous exporting sectors, it is a major issue for urban-based companies. Wage costs and the pressures on them are increasing quickly. At the same time, currency swings in the main market in the UK are cutting margins.

It is particularly an issue for companies in some larger urban areas but it is spreading. We are starting to see in the Dublin commuter belt, as well as the Cork commuter belt, people pushing out further because of housing pressures in the cities. This is putting pressures on rental and housing costs in towns such as Portlaoise, Navan and Mullingar. That is putting pressure on companies which cannot pass on those increases, in particular indigenous manufacturing.

That is causing severe difficulties for them at a time when they do not need those difficulties.

In recent years we made big calls in terms of trying to get the State to build more social housing. One would not see many business organisations across Europe calling for more social housing but we believe that is a key piece of the process, as well as making sure that the planning system affords the delivery of private sector housing. We are starting to see some signs that it is ramping up but the population pressure issues are acute. It is an issue of success. The Dublin and Cork economies are doing so well it is very difficult for the housing sector to keep up with the current demand, never mind the excess demand that is coming on all the time. We are staring to see real pressures from it. I would not like to leave the committee that it is only an issue for multinationals. It is a massive issue and probably the major feedback we get from human resources, HR, and industrial relations people within our indigenous companies.