Oireachtas Joint and Select Committees

Tuesday, 26 February 2013

Joint Oireachtas Committee on Jobs, Enterprise and Innovation

Action Plan for Jobs 2012 and 2013: Discussion with Minister for Jobs, Enterprise and Innovation

2:35 pm

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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"Formidable", as they say in French. I will try to respond to each of the questions.

Clearly our ambition to create 100,000 jobs will require a shift change from the status quo that is being projected on the existing performance of the economy. That is the reason for this initiative of "disruptive change" to break the patterns and trends, to open up new opportunities. This is about being ambitious. Each year we need to be more ambitious and this year we have taken the approach outlined in my opening statement, picking areas in which we believe we can position ourselves strategically to do something that will be decisive in its impact. I think we are about to change the performance of the economy. We cannot just accepting the existing performance.

We will first bring the industry players into the monitoring group so that they will play an active role in the group but they will be looking very specifically at these areas of expertise, in which we are seeking to deliver significant change, ICT, big data, energy and so on. The people will be selected to match the opportunities. We will select people who we think can contribute to the areas that have an input. They will also have a role of looking to how we deepen the connections and not only monitoring what we are doing in 2013, such as in the new technology centre in big data. Yesterday we launched the largest ever research centre specialising in big data, data analytics and so on. We are also driving the pilot schemes in the public service, doing the skill analysis of where we need to be. Those people will be in a position to not only monitor what we have already committed to but to identify the areas in which challenges will present. We need to get closer to industry to help develop the appropriate responses. The ICT initiative in Skillsnet is a good model, in which industry, education and enterprise sectors sat down together and bought into the system. Industry committed to take people on work experience, to take people to interviews so that the training they got during their conversion courses was embedded within the sector. That model of partnership was a success in the ICT area and we want to deepen it.

Reform of the work permit system will not include a tech visa as envisaged by some people who suggested that anybody with a technical qualification could just come into the country and be granted an open ended visa. It will be related to companies with vacancies but there will be significant changes in the system. People who are seeking to recruit in areas of shortage and will be trusted partners can rely on the system to support their recruitment. We propose to reduce the time one waits for a visa by about one third. At present one can only recruit an ICT person for the ICT sector, without having to undergo a labour market test. In future ICT personnel in any sector will not have to go through a labour market test. A range of simplifications have been spelled out and we will implement them. This will mean bringing fresh legislation to the Oireachtas.

The Deputy is correct to state that inspections will follow on from licensing. They are a more complex challenge. The concept of a single portal is having a single interface with the business - the people in the back office do what must be done - but it should make things simple for business.

The system of inspection gets to the point of whether one can integrate the different inspectorates, so that one has general inspectors who have a range of skill across food, environmental and labour market conditions. That is a good question. We have not done the research yet to identify our capacity to do that. We are looking at shared inspections but the process will take time. It is a harder ask.

JobsPlus will be run by the Department of Social Protection. All costs will be covered and the employer will get €75 a week off the pay costs. It will be a cash refund for the employer who takes on an employee for more than 30 hours per week. The scheme will be made as simple as possible, the full administrative work must be done but there are no conditions such as applied to the PRSI scheme, in which case the employer had to guarantee the job would last for a certain duration. Under the Revenue Job Assist scheme, an employer would get no relief if the business did not make a profit, and in cases where businesses made a profit, they could not get it until the financial year was over and the employer had made returns to Revenue. There were many obstacles to these schemes, apart from whether people knew about the schemes. We have removed those obstacles. The ambition was that 10,000 people would avail of the PRSI scheme, however even after increasing its attractiveness by 50%, only 1,000 people availed of it. I think more factors in addition to advertising will have to be changed, for example the terms of reference.

I will now deal with lending to SME companies. The surveys conducted by Red C on lending to SMEs shows an improvement. Both the demand for credit from SMEs, in particular from the Microfinance Fund is improving. The refusal rate is falling. There is some improvement in the area. Our refusal rates are still high by international standards. Very few people are triggering the appeal mechanism, either by making an internal appeal to the banks or appealing their case to the Credit Review Office. If one believes the report of the Credit Review Office, although they are only seeing a very small portion of the loans, many of Mr. Trethowan's decisions are turning over the bank decisions. There is still concern that bankable projects are not getting through. We require a better analysis of exactly what is happening with the loans that are turned down; why the SMEs do not appeal the decision, and ways to make the option to appeal the bank's decision an easier option to take. We are going to look at ways to do that. It will be the role of the State Bodies group. It is already in place in the Department of Jobs, Enterprise and Innovation, Department of Finance and key players across the sector such as the National Pensions Reserve Fund, NPRF and others such as Enterprise Ireland.

Let us sweat the new instruments we have put into the field and look into greater detail as to what is happening in the banks. That is the reason we have put our money in the bank and we need to get the money to work better.

The terms of reference have not yet been agreed. We expect to meet the departmental committee before the end of the second quarter. I have good contact with the retail sector and they have welcomed the licensing reform. They welcome the online initiative. We are doing things that seek to support that.