Frances Fitzgerald (Dublin Mid West, Fine Gael) | Oireachtas source

I welcome the opportunity to make introductory remarks relating to the mid-year review of my Department's 2017 Estimates. I am accompanied by the Minister of State, Deputy Halligan, who has responsibility for innovation, research and development. We have given the committee a briefing and I hope it will give members a clear understanding of what we are delivering for the money voted by the Oireachtas.

To summarise briefly, the 2017 total gross allocation for my Department and its offices and agencies is €858.42 million, an increase of approximately 6% on last year's allocation of €810.47 million as per the published Revised Estimates Volume. The Department's allocation is divided between €303.4 million in current expenditure and €555 million in capital expenditure. The current expenditure allocation includes an additional €3 million in Brexit-specific pay moneys provided in budget 2017 to support the recruitment of an additional 40 to 50 staff across the Department's Vote. I will confine my remarks to jobs and enterprise development and the Minister of State, Deputy Halligan, will provide details on the Department's innovation programme. If it suits the committee I will speak again when we move to section C with regard to regulation.

The total gross capital and current expenditure by the Department in the first six months of 2017 was €333.96 million. At that point it was €26.5 million behind the expected expenditure position as profiled at the start of the year, or just under 8%. In terms of current expenditure, the end of June position shows that gross expenditure was €135.9 million, which is approximately €6 million behind the original profile. The main reason for this relates to variances in pay and non-pay expenditure. These were due to a number of factors, including delays in relocating a number of departmental units, delays in filling vacancies in varying areas, timing delays and so forth.

Gross capital expenditure to the end of June was just over €198 million, which is €20.5 million behind the original profile. As the committee will be well aware, variances in capital expenditure can arise for a number of reasons, including timing of demands for grant offerings, timing of expenditure reports being submitted by agency clients, agencies own-resource income, which is a feature here, property-related issues and the quality of grant applications being made to an agency. Notwithstanding the capital expenditure variance at the end of June, it is my expectation that there will be a full spend of the Department's capital allocation in 2017. As advised, my Department secured additional capital by way of a Supplementary Estimate in 2015 and 2016. These moneys enabled it to meet some existing commitments and thereby enhanced the new business capacity of a number of its agencies for future years. In the event that capital savings arise elsewhere across the Exchequer by year-end, my Department will explore, in conjunction with the Minister for Finance, the possibility of seeking another Supplementary Estimate in late 2017.

I will briefly outline some of the aspects of the work of the Department in the jobs and enterprise area. At the end of 2016, more than 435,000 people were working in client companies being supported directly by the Department's enterprise agencies. That is an all-time record level of employment across the agencies. Allowing for the multiplier effect, I think it is safe to say a similar number of people were being indirectly supported in services and sub-supply. This means that in excess of 850,000 people - or two out of every five of those in employment - throughout the country are being supported through the enterprise agencies. Furthermore, it is interesting to note that approximately 90% of the Enterprise Ireland and IDA Ireland directly-supported jobs are full-time in nature.

During 2016, the enterprise development programmes of the Department's enterprise agencies also continued to make a significant contribution to growing employment in the regions with 52% of new jobs created by IDA Ireland clients and 61% of jobs created by Enterprise Ireland clients in 2016 being based outside of Dublin. IDA Ireland client companies created a total of 11,842 net new jobs across a range of sectors last year, with every region posting net gains. Total employment in overseas companies at the end of 2016 was 199,877, the highest figure ever recorded. I am pleased to state that progress has continued in 2017. IDA Ireland job approvals are up 22% in 2017 compared with the first half of 2016. Investments approved by IDA Ireland in the first half of 2017 will lead to the creation of more than 11,000 jobs as companies roll out their plans in the coming months and years.

The increased allocation made to the IDA Ireland's capital base in 2017 has allowed it to continue to further progress its regional property programme. In the first half of 2017, advanced facilities have already been constructed and completed in Sligo, Castlebar and Tralee. Preparations in respect of delivering advanced facilities and buildings at other regional locations also continues, with a further six expected to be completed in 2018.

More than 201,000 people are now directly employed by Enterprise Ireland-supported companies, the highest in the history of the agency. Significantly, 65% or 130,000 of those jobs are located outside Dublin. Enterprise Ireland clients also recorded export sales of €21.6 billion in 2016, an increase of 6% on 2015. This is a good news story in terms of job creation generally, regional job creation in particular and exports.

In May 2017 Enterprise Ireland launched a new regional enterprise development fund to the value of €60 million over a number of years. The fund is a competitive one and it will support the regional Action Plan for Jobs and the Action Plan for Rural Development as they are rolled out. There will be many collaborative initiatives in respect of that fund building on industry strengths and driving job creation across the regions.

The local enterprise offices, LEOs, play a key role in supporting employment. LEO-supported clients created 7,883 gross new jobs across all regions. That resulted in a net gain of an extra 3,679new jobs. At the end of 2016, the number employed across LEO client companies reached 34,000 jobsin total. This year the LEOs have targeted the approval of 920 projects for grant support, with an associated full-time equivalent of more than 2,300 new jobs. They have set ambitious targets in terms of mentoring and participation. They appear to be on course to deliver their targets for 2017 with the approval of 461 projects around the country in the first six months of 2017, which are projected to deliver more than 1,100 new jobs.

The big issue facing the country - not least businesses and the enterprise sector - is Brexit. It is a generational challenge for all member states of the EU, not least Ireland. Clearly, there are threats and opportunities posed by the challenge of Brexit and that is a primary focus of Departments. We are central to the diplomatic effort that is ongoing, in addition to my colleagues across the Government. We are engaging with our EU partners, including the European Commission, individual member states and the European Parliament, as we saw today. We very much want to get across to them the uniqueness of Ireland's relationship with the UK and the potential impact of Brexit on Ireland. We are also engaging with counterparts in the UK at ministerial level. Members have a detailed briefing on that so I will not go into it in any greater depth.

The Action Plan for Jobs has a particular focus on Brexit and we are also carrying out a review of Enterprise 2025 in the context of Brexit. Every item of policy and work in other areas has to be Brexit-proofed in order that we might ensure that we have both the right policies and the specific policy responses in place. We are looking at a number of policy responses to help business as well. I could go into detail on those. My Department also has a number of initiatives in place to allow it - across the board - to have a better response to Brexit. I could go into detail on those if members would like me to do so.