Oireachtas Joint and Select Committees

Tuesday, 18 June 2013

Joint Oireachtas Committee on Jobs, Enterprise and Innovation

South-East Economic Development Strategy Report: Discussion

1:30 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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We will move on to our next item of business, a discussion with representatives of the local authorities, chambers of commerce and community enterprises in the south east on the south-east economic development strategy report being prepared by Senator David Cullinane. I welcome all of our guests to our discussion on the report into which Senator David Cullinane has put a great deal of work in the past few months. He has carried out many interviews and engaged with many stakeholders, but before we finalise the report, it is important that we have a chance to discuss some of the issues involved with our guests. We have set aside today to discuss all of the options, suggestions and areas in which we can make improvements. The committee is anxious to ensure the report will help in pulling together existing reports and information and, apart from adding a critique, add new suggestions and value to them.

I welcome to our first session Mr. Joe Crockett, Kilkenny county manager; Ms Nora Widgre, president, Waterford Chamber of Commerce; Mr. Michael Walsh, Waterford city manager; and Mr. Senan Cooke, Dunhill Community Enterprises. All of our guests are very welcome, but I extend a special welcome to Mr. Crockett. We had him in County Meath when I was first elected to the local authority and I am delighted that he is here as part of the group.

By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. If they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against a person, persons or an entity by name or in such a way as to make him, her or it identifiable. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable.

I call on Mr. Crockett to make his presentation.

Mr. Joe Crockett:

I thank the Chairman and members of the committee for focusing on the south east and for the work that has been done so far by the rapporteur, Senator David Cullinane. I will briefly go through the presentation I forwarded to the committee. I only want to talk about three issues and will leave the rest of the presentation as a written document, if that is in order.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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That is fine.

Mr. Joe Crockett:

The three issues are the top three bullet points set out in the presentation, namely, policy and economic development, the importance of third level education and research, and farming and agribusiness. If members have questions about the rest of the presentation, I can address them.

On how the region should perform, in 2010 Kilkenny County Council started to examine how we might develop an economic model for ourselves. In examining the issue of economic development the key elements to be considered are what the State is trying to do, what its main economic policies are and where the competitive advantages it sees for itself lie at national level. One then works down through regional economic policy, as identified by Forfás which has been the most active agency in dealing with this issue. It has produced the regional competitiveness agendas, while the council has produced its own economic development strategy which focuses on the issues I mentioned, namely, third level education and research, tourism, agribusiness and so on.

A new regional economic model is being prepared by the Department of the Environment, Community and Local Government. We do not know what its shape will be, but there is a need for an alignment between the three levels, namely, national, regional and local. If there was policy and objectives harmonisation between all of the enterprise agencies involved, there would be a greater focus and better spend by everybody. That would be very helpful, not only to the south-east region but to all regions.

With regard to any policy document we might have, rather than being about policy it is more important that it be about strategy, and real strategy at that. Instead of being a wish list for everybody in the audience, it would be far more effective if it were limited to high-level strategic objectives that would lead to real change on a multi-annual basis. For example, in the south east we could focus on key infrastructure that is required and the key sectors for development. I suggest that a new model for economic development should be aligned and should comprise a unified set of national, regional and local objectives. It should be strategic and multi-annual, and focus on a relatively small number of key infrastructures and policies that would have an impact over a five or six-year period.

The key requirement for the south east is a new type of third level education and research that is based on an applied education model and that focuses on the sectors identified for growth. Rather than a traditional university, which is focused on academic research and so on, we need an applied university that is closely aligned with cutting-edge objectives of key sectors in the region that are capable of export or indigenous growth. That is the single most important measure that the Government could implement to help the region. We need a technological university in the south east that focuses on applied education, particularly research, and that must be aligned with what the growth sectors in that region which could deliver on a national and international basis. The key research arm of Waterford Institute of Technology is the Telecommunications Software and Systems Group, TSSG. The group has been very successful and I want to express my full support for what it does. An expansion would be beneficial, working with Institute of Technology, Carlow.

With regard to the potential for a sectoral approach, obviously farming or agri-business is the single most important growth sector not just in the south east but across many other regions. One of the things we did that was useful - I would suggest this as a case study of how to find new ways to develop - was that, rather than relying on the State agencies to provide the best thinking on growth, we decided it would be better to bring in the chief executives of key companies in the sector one wants to expand. That is what Kilkenny County Council did. We asked the chief executives of Glanbia, Dawn Meats, Brett Brothers, Connolly's Red Mills and Oldtown Bakeries, as well as Leader representatives and ourselves at the county council, to set out the high-level objectives that agri-business could deliver, not just for Kilkenny but for the whole region. The chief executives outlined for us their thoughts and those of their companies when it came to growth. With that information we could work upwards by talking to others - county councils, farmers, the IFA, Enterprise Ireland, IDA Ireland or whoever - about how we can grow and about the key objectives and strategies. The high-level group identified two strands of growth, one of which was expansion of the milk industry. As the committee will be aware, the milk quota will be lifted in 2015. That means there should be growth of between 40% and 60% in milk supply across Ireland, of which most will be in the south-east region, which is at the centre, as it comprises the bulk of the milk field. We are looking at growth of about 30% in cow numbers, and the rest will be achieved through productivity and other measures.

This is a significant opportunity for the country because all of this development is for export growth. If, as a country, we decide to be the world leader in everything related to agri-business, whether we are talking about milk or beef, and to drive the sector as far up the value chain as possible for exports, that is the way to go. We should back this up with research and development at the new applied university and become the best at everything to do with farming, particularly engineering, technology and industry. That is my suggested model for growth in this sector, but also in other sectors. For too long we have relied heavily on IDA Ireland and Enterprise Ireland, good as they are. Although they are good at what they do, we need to find new models of partnership comprising top-level chief executives in the sectors that we want to expand.

I have other models for regional tourism and services. The county council has bought the Smithwicks site in Kilkenny, which offers great potential for growth. Life sciences are important, and we work with our colleagues in Waterford on strategic water and wastewater facilities. We need strategic infrastructure such as Waterford port, Waterford airport and a linked hub consisting of Waterford city, Kilkenny city and Wexford.

Local authorities can establish links with the markets in which we want these sectors to grow. Kilkenny County Council has been twinned with Suzhou in China, where Glanbia has its overseas operation. The county council is working on that relationship, and that is a model on which other authorities should focus. Twinning should be used as means to foster and provide a foundation for export-led growth, however limited.

1:40 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I thank Mr. Crockett. Before moving on to the next presentation I wish to welcome Mr. Jonathan Earl, whom I omitted when introducing the delegations. I call Ms Nora Widger.

Ms Nora Widger:

I thank the Chairman for inviting Waterford Chamber of Commerce to make a presentation to the joint committee. I was recently appointed President of Waterford Chamber of Commerce and I am joined today by my fellow board member Mr. Jonathan Earl. Since 1787 the chamber has offered a voice to Waterford business. At present its membership ranges from the smallest SMEs to multinationals with a base in Waterford. The chamber of commerce represents a cross-section of commercial life and is committed to working closely with all who champion Waterford.

SEEDS is the acronym for the south east economic development strategy, which Senator Cullinane is working on as a rapporteur for the committee. In a way, seeds are also the topic of my presentation, in which I will speak about what Waterford Chamber of Commerce sees as the seeds of economic recovery for the city and the region. While I want to take the opportunity to look to a better future and how we might reach it, we cannot ignore the real and serious economic challenge we face, with more than 55,000 people on the live register in the region in May. It is no coincidence that just 23.1% of people in the south east who have completed their full-time education have a third-level qualification, compared with a national average of 29%. In short, not enough job opportunities are being created in the region and too few of those out of work have the skills for the available jobs.

Having outlined the challenges, I will now strike a more positive note by mentioning the first-class employers that are currently operating in Waterford. There are more than 30 IDA-supported multinational companies in Waterford city and county, employing well over 5,000 people. Our success stories include TEVA, Honeywell, Sun Life Financial and Bausch & Lomb, which currently employs more than 1,200 people. We are also very proud of Genzyme, which employs more than 550 people at its Waterford site. An equally welcome new arrival is Nypro Healthcare. In the indigenous sector, Eishtec is an outsourced contact centre that was established by three local people who had worked together previously and now employs more than 400 people in Waterford, although as recently as May 2011 it had only nine employees. Two entrepreneurs who used to work together in a pharmaceutical multinational in Waterford have set up EirGen Pharma, which employs around 80 people. It is a great example of the spin-off benefits to be gained from building expertise in world-class manufacturing. In addition, there was announcement last May from a WIT spin-out company called FeedHenry of the creation of an extra 100 jobs and an investment of €7 million, which was also very welcome.

Whether we are talking about multinational or indigenous companies, the key for Waterford and the south east is to have operations that are constantly moving up the value chain, so that they are less exposed to relocation to cheaper sites overseas. We also need to avoid over-reliance on a single employer, as happened with Waterford Crystal.

The food sector is also important to Waterford. Glanbia is investing €150 million in a world-class milk processing facility at Belview. Also in the agri-business sector, Dawn Meats is creating 65 additional jobs, so agribusiness is a very important sector for Waterford and the south east. While the unemployment situation in Waterford and the south east is grave, we are certainly not without hope or without the drive and energy to achieve the region's potential.

Late last month, the Minister for Education and Skills, Deputy Ruairí Quinn, gave approval for Waterford Institute of Technology and Institute of Technology Carlow to continue their work towards a merger with a view to being re-designated as technological university of the south east. The provision of a university in the south east is of tremendous importance and rapid progress towards delivery on this overdue issue is perhaps the highest-impact intervention that could be made to accelerate the region’s journey towards economic recovery. The university will act as a catalyst for increased inward investment but it will also foster emerging enterprises and provide a pool of skilled graduates for those companies with growth potential. As well as the direct economic impact, there will also be tremendous spin-off effects as Waterford and the south east no longer see the annual brain drain of some of our highest-achieving young people to universities in other regions in what often becomes a permanent relocation as they go on to build their lives in the university cities.

In addition to university-level education and the related fourth-level research, development and innovation, we also need to see more targeted training interventions to allow those who lose their jobs in traditional factories, shops or call centres or who have been out of the labour market for some time, to get the skills needed for those jobs that are now available. Similarly, those in low-skilled employment need specific support to position themselves better for roles in the smart economy.

As Waterford counts down to its 1,100-year celebrations in 2014, the rich history of Ireland’s oldest city is captured brilliantly through the three top-class museums in our Viking triangle. Tourism and hospitality is an important sector for Waterford and the south east. We have been fortunate to see the House of Waterford Crystal flourish. This year, an estimated 160,000 visitors will tour the facility with four out of five of those coming from outside of Ireland.

The infrastructure work completed over the last five years leaves Waterford much more accessible from Dublin with over a €1 billion invested between the M9 motorway and the N25 Waterford city bypass. However, there are two major infrastructure assets in Waterford that are currently under-used but which offer huge potential for further growth.

Waterford Airport currently has direct passenger flights operated by Flybe that connect the south east with Birmingham and Manchester as well as onward destinations through those two hubs. A key priority for the chamber of commerce at the moment is to see the airport sustained and developed further with the resumption of a London service and further investment to copper-fasten its future. Direct air access to our biggest trading partner is obviously vital. Waterford Airport supports considerable direct and indirect employment. A relatively modest investment in a runway extension at the regional airport would allow it to cater for a wider range of aircraft and this is part of the key to attracting new carriers.

Given our location as the closest port of Ireland to southern Britain and mainland Europe, the port of Waterford at Belview in south County Kilkenny is another key piece of infrastructure located in the south east but serving a much wider area. The port is of national significance and this was formally recognised in the national ports policy published in March. The south east is somewhat unusual in that it has two ports of national significance – Waterford and Rosslare – and another of regional significance in New Ross. Our challenge is to ensure that each port develops to its maximum potential and that taken together they deliver the greatest value to the region and the country. For Ireland Inc. to continue trading successfully globally, it is clear that we need to make more efficient use of our port capacity and reduce the reliance on Dublin port. If Ireland is to offer competitive shipping services for exporters then we need to make maximum use of all our existing port capacity and not continue to over-centralise in Dublin port.

As well as addressing that imbalance in a way that benefits all businesses which ship goods internationally, supporting the development of an appropriate suite of shipping services at the south east ports will also allow us to better leverage the massive road infrastructure investment that has already been made. Having mentioned some of their blue-chip clients in Waterford and conscious that they continue to focus intensively on the south east, I am not about to criticise IDA Ireland and Enterprise Ireland for their work in the city and the wider region. Rather, I ask that they keep up the good work, maintain the momentum that is beginning to build and also to reach out to the various Waterford stakeholders to ascertain if there is anything additional we can usefully do to support their efforts. I would be particularly keen to know that we are developing and maintaining a sound strategic land bank and turnkey business premises for investors with the potential to create sustainable employment. Have we the sites and properties ready to go for the next generation of companies? If not, we must act now. Not a single job creation opportunity can be lost for the want of a base location.

Given the jobs crisis that exists in the south east, Waterford Chamber of Commerce would argue that the region should now qualify for the highest available level of incentives to support investment that leads to sustainable job creation. Indeed, we would see merit in a special designation of certain locations for development once there was a corresponding commitment to create and sustain employment in growth sectors.

Along with the more obvious hard infrastructure of roads and third and fourth-level education, the task of attracting additional foreign direct investment and supporting home-grown companies to grow is undoubtedly made easier where there is a vibrant urban core to a region’s gateway city. With disposable incomes in the south east lagging behind the national average and dragging down consumer spending and confidence, this is an acute challenge for Waterford. Some great work is under way by Waterford City Council and its partners, including the chamber of commerce, to revitalise the city centre.

In mentioning the city council, I also welcome the decision by Government to give local authorities a stronger and more formalised role in promoting economic development as part of the local government reform programme. This makes sense as it recognises the unique contribution that local authorities can make in helping to create a business-friendly environment that supports enterprises – whether this is a craft jeweller starting his or her own market stall or a multinational looking at potential sites for a 500-job manufacturing plant. Indeed, given that small start-ups have some of the greatest potential to flourish and to put down deep roots in Waterford, I know that the council will continue to support that sector so that one and two-person companies starting out do not flounder for the want of low-cost but high-value support.

In the wider national context, Waterford Chamber of Commerce endorses the alternative Chambers Ireland ten-point plan for micro, small and medium-sized enterprises. Key taxation initiatives and reforms will also be sought in the chambers of commerce movement’s national pre-budget submission. Taken together, these interventions have the potential to create up to 30,000 new jobs in this sector. As a country, we need ambition, vision and drive so that working together we can deliver on the Taoiseach’s challenge to make Ireland the best small country in the world in which to do business.

I thank the Chairman on behalf of Waterford Chamber of Commerce for inviting us to input to the committee's discussions today. I wish you and your colleagues, including Senator Cullinane from Waterford, all the best with your work on the south east economic development strategy. We hope the seeds planted now will bear rich fruit for years to come.

1:50 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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There may not be much left for Michael Walsh to say as Nora Widger have covered everything. I also wish to formally thank Mr. Walsh for facilitating the committee having a meeting in his offices a number of months ago.

Mr. Michael Walsh:

I will be brief as both Mr. Crockett and Ms Widger have covered a lot of the ground. Waterford and the south east general are under-performing economically. Relative to other regions there has been a decline. In some respects that is not rational because the region has a lot of natural advantages. As Mr. Crockett outlined, there is fertile land and an agri-industry which is at the forefront nationally and is world class by any standard. Equally the region is proximate to internal and external markets. It should not be the case that it is under-performing. It seems to be a systemic weakness, something that is not right. I will not over-elaborate on the reasons because there is a multitude of them and the situation is complex. Some of the reasons include a reliance on traditional industries up to relatively recently. That transition is now happening and it needs to be given even more energy to bring about a new economy. There is a little bit of an issue with educational attainment and there is talk of a technological university but the statistics do not lie in that context. External competition is a catch-all I use but the reality is that the external competition is very near, the two big brothers in Dublin and Cork are now within one and a half hour's journey. They are pulling at the edges of the region which has a population of 500,000 but the two big beasts are attracting the population on either side of the region. Internal competition may be over-egged but the region is unique in the country in that it contains four significant urban areas within a 30 mile range which are competing with each other.

That is a good thing in some respects, but it sometimes means we are all fighting over the same cake and must be alert to the danger of somebody else coming in and stealing it. I do not wish to overemphasise that aspect, but it does happen.

The south east's relatively poor performance in terms of attracting foreign direct investment is a significant challenge. In the past ten or 15 years, Waterford and the south east have been outperformed by most other regions. Again, there is probably no simple answer to this problem. IDA Ireland is applying significant energy to addressing it and there have been several wins recently, which are more than welcome. In the case of Waterford city specifically, in the 13 years or so since Genzyme opened its facility, there has been nothing in the realm of foreign direct investment where there was not a distinct Waterford connection, either in the form of the expansion of a local enterprise or a personnel connection, for example.

Another problem we are facing is that branding has been an issue for the region historically. When one thinks of the west or south west, for instance, a very concise image comes into one's head. The south east, on the other hand, is lacking a distinctive branding. That is a challenge for us. In the case of Waterford itself, as the gateway city, there have been specific issues with branding, whether arising from industrial strife or other issues that fed into it. We are doing significant work to rectify that.

I was careful in choosing my wording when I referred to political priority. If I were to be kind about it, I would say that taking a long-term view, a period of 20 or 30 years perhaps, we did not always have sufficient weight in the scrum of political decision making on the national stage. That has negatively impacted to some extent over the longer term.

In terms of actions that can be taken to address these problems, Mr. Crockett has touched on many of them. Any analysis of recovery for regions and cities as a generality would suggest that collaboration is the key. In our case, this would involve collaboration not just across individual local authorities but across a whole range of sectors, including the private sector. That is a challenge we are determined to meet. We have convened a south-east forum which includes representation by Mr. Crockett, my other colleague managers, the institutes of technology and enterprise agencies. We are looking to develop that as an action forum which could function as a catalyst for recovery.

The Cabinet decision to establish a technological university in the south east is extremely welcome. As Mr. Crockett observed, there must be a close relationship with business, not only in terms of the provision of the academic and professional skills which feed enterprise but also in terms of a research relationship which fits the distinct role and functionality of a technological university. The provision of technological university status is a psychological game changer in many respects and one that must be delivered as soon as possible.

Another area where there is no conflict whatsoever in terms of our collective goals is food and tourism. There is an opportunity in the south east to build a serious tourism proposition around heritage and culture. Mr. Crockett mentioned agrifood as a particular area of strength. We have, in addition, a distinctive pharmaceutical and life sciences presence in the region as a whole, as well as significant activity in the area of engineering. While some aspects of engineering are seen as old school, the reality is that innovations in that sphere are very new school indeed. Aerospace technology, for example, is represented in the region, and there is activity in the area of technical standards and so on. There are certainly opportunities in that regard.

I have already referred to the problems with branding. The rebranding work is an ongoing effort, with a particular focus on culture and festivals. We have engaged in several initiatives with Waterford Crystal, the visitor centre being an important aspect of that, as part of a package of rebranding measures for the city. That rebranding effort is also taking place at the regional level.

In terms of public sector prioritisation, the question is whether the south east needs help. We are saying that it does and, moreover, that it deserves a degree of priority at Government level. In fairness to the Minister, he has personally chaired the action plan on jobs for the south east. I would like to see that engagement transition into a scenario where leadership would be given at departmental and cross-departmental level. Going back to the issue of collaboration and joined-up Government, there are very few initiatives that can be delivered by single entities working independently. A cross-representational approach is usually required. Such would be a natural transition in this case, but I am not sure it is fair to expect the Minister to lead it on an ongoing basis in the context of the required time commitment.

We are working to make the local realignments work across the region, in conjunction with the enterprise boards and community development organisations. We have developed an economic strategy which we hope the Minister will publish in the coming weeks. We have no agenda other than to obtain the best possible output in economic development terms. In Waterford city we are seriously engaged in the effort to resource economic development. We have appointed a dedicated director of services for economic development and we intend, as part of the amalgamation, to resource that role very significantly. We are also looking to build on external relationships, including the connection with our twin city of Rochester in New York state. That city is an interesting case in terms of how it has managed the transition of Eastman Kodak from a company which employed 70,000 people less than ten years ago to 7,000 today. We have much to learn from that engagement.

In the shorter term we could do with a few wins, and we are working hard with the enterprise agencies and others in that regard. As I said, the establishment of a technological university is a game changer and we must immediately commit ourselves to its delivery. It will be a resource for enterprise and for the region as a whole in terms of economic development. It also offers scope for additional labour activation measures for unemployed people in Waterford and elsewhere in the south east. Another short-term measure that would be of help would be the provision of enhanced broadband connectivity. I have mentioned the efforts to improve our foreign direct investment, FDI, performance. In addition, any assistance in the infrastructure area would be very helpful. In short, we are seeking to invest very significantly in the regeneration of Waterford city centre, and any support in that regard would be most welcome.

2:00 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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Thank you, Mr. Walsh. I invite Mr. Senan Cooke of Dunhill Community Enterprises to make a statement.

Mr. Senan Cooke:

Thank you, Chairman. I will be steering the discussion to community enterprise level, where real changes can be made and the benefits of the new strategy, infrastructure enhancements and all the other improvements at the higher level can impact significantly. There is, unfortunately, a sense of real helplessness in many communities in the context of high unemployment and forced emigration. For young people in particular, leaving college and seeking to secure employment is a daunting prospect. Our population is better educated, more business literate, more well travelled and well networked and more confident than ever before. However, families, clubs and communities are heavily impacted by unemployment and forced emigration. People have every incentive to get involved in efforts to improve the situation where the opportunity is available.

Community enterprise is often taken to be exactly the same as social enterprise, but there is a difference. There are different levels of enterprise support, namely, fully-funded employment, partly-funded employment and self-sustaining, profit-making enterprises. We are interested in the third of those. I have been a voluntary activist and researcher in enterprise development in the Waterford area since 1993, Dunhill being my local area. People have come from all over the country to Dunhill to discuss what can be done at grassroots level in communities.

Community enterprise is not just social enterprise, which brings up a whole range of problems in terms of a definition, about fully-funded employment, partly funded employment and third level which we are interested in is self-sustaining employment, profit-making enterprises. research from 1993

We have been invited to speak in communities from Kerry to Mayo and from Monaghan to Carlow. This proposal is a result of all that consultation and research. There is significant evidence available for anyone who wants to examine it that indicates that this proposal will work. The proposal is that a programme for economic self-reliance is developed which targets the creation of ten jobs in every community in the region. We all know that the modest target of ten jobs could be achieved if we mobilised all the resources available in every community, the business people, the farmers, the craftspeople and everyone else being the main resource. If that is achieved, we know that the community will have identified its own resources, developed a good relationship with the agencies, gained a great deal of confidence, built up a network and will go on to create 20, 30 or 40 jobs in the area.

We would hope that by empowering people in their own community, those with the biggest stake in the community would get involved, and it would only take one person in any community to start this programme. It does not need the involvement of many people. One person who is highly motivated could organise a business mentor group that would mentor individuals within that community to create the jobs.

We believe this programme would require a south-east enterprise development forum that would mobilise and co-ordinate the resources, pilot a variety of enterprise projects across the five counties for replication across the region, remove barriers to progress, establish a shared learning centre of best practice and projects, and maximise third level engagement directly with communities through joint funding and research.

We believe this programme would best work if local government agencies could be changed slightly but dramatically from being a support agency structure to a solutions enterprise structure. The difference between being a solutions enterprise structure and a support agency structure is massive, but not in terms of restructuring. It is a change of mindset and the introduction of skills. If we could get State agencies to become solutions agencies, there would be a dramatic engagement by dedicated, committed, highly qualified people living in communities who are watching helplessly their own communities, clubs and families being affected badly by high unemployment and emigration. This is something that would work and would be seen to work within the community, and instead of helplessness we would have hope. Instead of standing back, we would have full engagement. There are hundreds of such examples throughout the country and perhaps even 100 in the south east. All that is needed is to identify them, establish best practice and get the best from the ones that are working and offer to assist the rest of the communities within the region.

Following the 1980s, the Programme for Economic and Social Progress 1991-1993 was agreed and from it emerged the Leader partnership and the county enterprise boards structures. They helped communities to make dramatic improvements across a range of developments from heritage to tourism to social and charitable initiatives. Those communities that organised themselves under the Leader partnership, the county enterprise boards and the local authorities are now ready to take the next step - which is a much tougher and challenging step but a necessary one - to create enterprises. A range of community groups in the south east and other regions are ready to take that step.

We need the Government and the EU to devise a complementary economic stimulus and it need not be in the form of money. If Leader II or CEB II, as it were - I do not know what is happening regarding the restructuring of local authorities - were brought in, through Government policy, to link up and engage directly with the communities on the ground, that would have a profound effect on the political atmosphere, on gaining respect for political institutions and for the local authority. All I ask is that the report would recommend that this proposal for community enterprise with the target of creating of ten jobs per community be investigated. The evidence is there to support it and if the proposal were investigated, it would be acted on straight away.

2:10 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I will move on to questions. Before I call Deputy Calleary, l will first call our rapporteur, Senator Cullinane. As we have had a number of presentations, we are a little behind on time and while the rapporteur may need some more time, I ask the members to be brief in their questions. I will take three groupings of questions.

Photo of David CullinaneDavid Cullinane (Sinn Fein)
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I will be as brief as I can, to be helpful. I welcome the witnesses and thank them for coming here today. I met some of them already as part of the consultation process and there are some I have not met.

Mr. Michael Walsh clearly set out the challenges the south east faces. Any of the research we carried out into examining the south east economically, and the Forfás report was the most recent one, showed that, unfortunately, the region has underperformed in terms of educational attainment, entrepreneurial activity and economic activity generally, and that it has a high level of unemployment. Equally, there are huge strengths in the region, and Mr. Michael Walsh hit on a key point when he said that there is no good reason the south east is underperforming to the extent that it is. There is probably a myriad of reasons that is the case. During my consultations across the region, it struck me that there is huge potential in the region, and if we exploit that and can make things work, we can certainly turn things around. The key factor here is integration and cohesion at a regional level.

I agree with the Kilkenny county manager, Mr. Joe Crockett, that we need to join up policy from national to local level. That is one of the problems. We have not had that. We can all be critical of enterprise agencies in terms of perhaps their perceived failures in the region, but what we need to do is identify the strengths of the region and the key areas, and some of those have been identified, and how we can develop an integrated strategy that is rooted in the needs of the community and, more importantly, in the region, but also that is rooted in the needs of enterprise and industry. We do not have that to the extent we need it. We need to do a bit more work in that area, and we need to take that on board in terms of vision and policy.

I have a few questions on some issues that arose during the consultations. One of the criticisms is that the enterprise agencies are not doing enough, and whether that is fair or unfair or that is a perception or reality, that is an opinion. The IDA has produced its own reports and a breakdown, on a county by county basis, of the number of site visits there have been for each county and region and the number of jobs that have been created and lost. Unfortunately, during the past four to five years, the south east has not faired all that well. One of the reasons the IDA offers for this is that while it has a job of work to do to bring jobs to the State, equally it would cite a lack of property solutions as a problem in the region. Is that the case? I know that might be different in certain counties. It seems to be more of a problem in Wexford and there may be other areas. Is that a problem and, if it is, local authorities have a responsibility also to be part of that solution.

Is there merit in the IDA having a regional office in the south east? How important would that be and would that be something the mangers present and the chamber of commerce would support?

Regarding the university issue, we all accept that would be a game changer. I am very supportive of a technological university. I know there are people who would have a different view and they make comparisons with Trinity, UCC and UCD, but it comes down to the needs of the community in the region. I would favour a university that is based on innovation, research and development, creating that critical mass of research and development and fostering creativity. That is what it is about for the region and we are certainly very strong on that. I know that Waterford IT will address us later and the Telecommunications Software & Systems Group, TSSG, is first class in terms of research and development.

I could not speak more highly of it. It has expanded into the Kilkenny area as well. It is doing significant work that goes unnoticed and, if we can, we must sell what is being done there more. This is an opportunity for us to do it. I would see that as an advantage. If we are going to have a technological university it must be based on the needs of the region and be clearly aligned to industry. What are the witnesses' views in that regard?

In terms of research and development capacity, a hub could be created linking in with Clonmel. There are links with Limerick IT and Wexford and there is a new relationship between Carlow IT and Waterford IT. What more could be done to ensure we have enough research and development capacity to meet the needs of industry? In what industries do we not have sufficient research and development capacity?

Reference was made to two ports – Rosslare Europort and Waterford Port - by Ms Widger. Unfortunately, both of them have seen a drop in activity. Rosslare Europort, which is a roll-on roll-off port, has seen a 30% drop in freight since 2008, which is a considerable number. The situation in Waterford Port is worse than that. It has gone from 20% of the national share of lift-on lift-off traffic to 5%. We must identify the challenges and see what can be done. A review of ports is currently ongoing. The situation in Rosslare is unique because of the complication of the relationship with Fishguard. There was a call for a single independent authority for Rosslare. I would welcome the views of managers and others on the issue.

How important is the Belview site? We have received good news from Glanbia. Its announcement is positive but there is still considerable potential for the site, with its abundant water supply. Mr. Crockett referred to that. What more could we do to exploit the potential of the Belview site?

My next question relates to the airport and is aimed at everyone. One could argue whether the airport is in the right location. However, it is where it is and it is the regional airport. There is a need to expand the runway to allow for different types of aircraft, which would open up new opportunities for the region. How important is the airport economically?

In response to what Mr. Crockett said about agriculture, there is significant potential in the context of Food Harvest 2020. With the abolition of milk quotas and the expansion in dairy and beef production there will be significant opportunities, and that is one thing on which the south east must focus, because we can benefit enormously. I referred to the Glanbia announcement. What supports must be put in place to allow farmers to capitalise on the opportunities? Mr. Crockett previously mentioned compliance with the EU water framework directive and the nitrates directive, which are important, but farmers will also require practical supports from the banks if they want to expand their businesses. All such issues will be important and we must plan now. We can have all the targets we like but if we do not plan for it, it will not happen. We must do some work in that regard. What is Mr. Crockett’s view?

With regard to regional tourism, the south west and the west have been very good in terms of marketing and branding. What more can we do in the south east to provide a regional offering?

My final point relates to life sciences, which has been mentioned. We face challenges in terms of the expiry of patents and competition with eastern European countries and Asia. How relevant is that to the south east?

I support Mr. Cooke’s contribution on community enterprise, which is hugely important. Co-operatives are another matter we must examine. I endorse everything he said about the importance of community enterprise.

2:20 pm

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I apologise for being late. I welcome the groups, particularly the chamber of commerce witnesses. I know many of their predecessors. They have done a great job. I also know Mr. Crockett.

If I want to go to the south east in the morning, what is the labour profile and skills analysis that is available to me? What qualifications are available within the region if I want to locate a factory or tech centre there in the morning? What kind of labour force is available to me?

Could someone clarify the exact position with regard to the port at Belview? I gather it is in Kilkenny but it is part of Waterford Port. It pays rates in Kilkenny. What is the management structure? I do not want to get into the row between Waterford and Kilkenny but the chamber might be freer to express a view on the issue. Is the expansion and promotion of the city of Waterford an issue? I come from Ballina, from where we used to ship a lot of material from a couple of local industries to Waterford. We ship a lot less there now as it goes to Dublin. What is the unique selling point of a port in Waterford when there is the Europort in Rosslare and Dublin Port? What is the position in terms of the future port strategy?

I support the technological university but I am also concerned. Institutes of technology have served the country well and there is a rush to get rid of them. It is like moving the car up a model. Mr. Walsh said he wants to promote the engineering sector. Is there a danger that in moving to a technological university and all that goes with it, including research and development, we will forget the nuts and bolts of what the IT sector was set up to do? It is an area we are very much coming back to focus on again in this country. Perhaps it is a question for the groups that will come later, but what is being done to ensure the traditional engineering focus of institutes of technology will be maintained in the new technological university?

I am from the west and we would say we are not getting enough love either. We hear from every group that comes before the committee and as we travel around the country that all the funding is going to Dublin, Galway and Cork. Waterford seems to be getting huge exposure this week on Today FM in particular. Well done on that. What is different about the south-eastern region? What can the witnesses say is specifically different about their region and what does it have that another region could not offer to an employer?

Photo of John DeasyJohn Deasy (Waterford, Fine Gael)
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I will try to be as narrow and specific as I possibly can, given that the discussion is broad and there is very little time. I thank the witnesses for being present today. I will start with Mr. Joe Crockett. He spoke about the general issue of harmonisation of national, regional and local policies, which is critical. I have been thinking about that myself. Ms Widger gave two specific examples of pieces of infrastructure that need consideration, namely, the airport and the ports. I will single out the airport. It is a critical time now for the airport, which is a key piece of infrastructure, and we have been talking about it for a long time. The manager of the airport, Mr. Graham Doyle, is leaving - which is bad news, in my opinion - to become an assistant secretary in the Department of Transport, Tourism and Sport. It is significant that he is departing. There are three options for the airport. We are talking about €1.25 million for the first and cheapest option. The second option would cost approximately €7 million. To bring 737s into Waterford would cost approximately €10 million. Realistically, we are talking about an extension that would cost approximately €1.25 million, the cost of a three-bedroom semi-detached house in parts of this city a few years ago. It is not a lot of money. As far as the Department is concerned, the case is being made, successfully, that it is worth investing in the airport. The people who have worked there for the past four years have used every penny to try to lay the ground at the airport for additional expansion at the north and south ends of the runway to bring in different kinds of jet aircraft, as Ms Widger outlined, and to connect to London in particular.

I will come to what Mr. Crockett said, but we have a national issue in terms of how we look at our budgets and how flexible and adaptable our budgets are generally. I wish to focus on the Department of Transport, Tourism and Sport for a moment, and examine how money is allocated. We all have a responsibility - to use the words of the Minister, Deputy Varadkar - to invest in infrastructure and other items that are drivers of growth. If we are all of the opinion that the airport is a key piece of infrastructure then we must examine the entirety of the transport budget and ask ourselves one question, namely, whether we are prioritising what we should prioritise from the budget. In that context, the answer is "No". I am having a discussion on the matter with the Minister currently.

In terms of the way it works, there is a capital budget for roads, a capital budget for rail and a capital budget for smarter travel. There are projects such as the Greenway projects throughout the country. When it comes to the local authorities, they have some discretion to use the money allocated to them for a capital project, such as the airport, but it is not entirely within their "ask" responsibility to do that. My point is that budgets within the Department are not flexible enough. If we are all in agreement that this is a key piece of infrastructure, and it does not involve a lot of money, why has it not been done?

Mr. Walsh said he did not want to be political but in the past ten years, and with respect to my Fianna Fáil colleague on my right, the decline of those two key pieces of infrastructure started when there was a Cabinet member in Waterford, and everybody in Waterford will acknowledge that. The decline of the port and the airport started while that was the case, but we are where we are.

In terms of what we need to do, the country managers are present. Picking up on what Mr. Crockett said with regard to the harmonisation of the regional, the national and the local, we have to have an urgent discussion within the Department of Transport, Tourism and Sport on what we believe are the key pieces of infrastructure and what needs to be funded. That might mean examining the budgets for roads and smarter travel and deciding that we may not need all of that. It may not be wise for us to continue spending millions of euro on something like smarter travel when a vital piece of infrastructure for the south east is not being funded sufficiently, and it does not involve a lot of money. We have these meetings all the time but it is key that we deal with a specific area and start thinking about how to get around a problem that has existed for a long time. If we do not do that, we will be having this discussion five years from now. In a way that answers Deputy Calleary's question about the way we spend the money. The question is the way we should be spending money in the different regions.

I thank Senator Cullinane for his work on putting all of this together. It is valuable. I hope we can get something out of it, but that is the main question I wanted to pose.

2:30 pm

Photo of Paudie CoffeyPaudie Coffey (Waterford, Fine Gael)
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I thank the delegation for attending to outline the real concerns in the economy of the south east region. I thank Senator Cullinane, as rapporteur, for this report. I look forward to its publication because it will be an important document in terms of how we identify where we want to go in the south east region.

I grew up in Waterford, in the south east region, and I agree that we have fundamental flaws in the structure of the region. Whether they are infrastructural, societal or governmental we are very much on the hind foot, so to speak. It was once a strong manufacturing region that depended on traditional industry, as the manager said, but we now face new challenges, and Government recognises that. What concerns me most, however, is the lack of coherence within the region. As a region we are not competing with other regions. That has been the case for many years but it is explicit now with the challenges we face.

As policy makers and as politicians we must take into account what the witnesses have come here today to say to us. We know much of it already but we must ask ourselves how we can best achieve what we set out to achieve. I agree with Mr. Crockett that the first thing we need is a coherent regional strategy that identifies growth areas into which we can put our resources, as Deputy Deasy said, prioritise our budgets, prioritise our policies and go for it. Unfortunately, the south east region has been fragmented heretofore. We have a good deal of work to do. That is even in recent debates whether on the medical side, industry or education in that segments within our own region are pulling it apart. That is the way I see it. Until we come together as a region and adopt a coherent regional strategy, we will not make the progress we need to make. When we identify that strategy and adopt those objectives, we must identify the priorities and the drivers. It is then up to all of us, as stakeholders in the region, to put in the resources that are required.

In response to Deputy Calleary, I know the west has suffered in the past but it is not suffering as badly as the south east region is currently, especially Waterford city, which is on its knees economically. It needs help, and I ask him to open his eyes and ears to what the people are saying here today.

My question is to both managers. How best do they believe we can achieve that regional coherence from a local authority and service level? How can Government, and we as policy makers, support that?

I address my remarks to Mr. Senan Cooke. The bottom up proposal of enterprise in communities is very important. I come from a family that has created 15 jobs in our community. I can tell the witnesses it has taken a generation of hard work to create those jobs, with only some support in the latter years. It is a huge challenge to create jobs in small communities but it is not a challenge we should give up on. We must motivate our citizens, our local authorities and our policy makers to look again to communities where there is real potential, and small jobs is where we will make the difference. I fully support Mr. Cooke's proposal and I hope this committee will examine more closely the bottom up approach because small micro-enterprises growing over generations will be more sustainable and viable in the longer term. I hope we will see progress on that front.

Photo of Ann PhelanAnn Phelan (Carlow-Kilkenny, Labour)
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I welcome the witnesses. I was a member of Kilkenny County Council when we adopted the economic strategy in 2010. I welcome Mr. Senan Cooke because I believe his initiative in the communities is extremely important, and not just in terms of job creation. We continually talk about creating jobs but it is important to keep what is already in place to ensure we do not slide under that critical element where there is no road back. I support Mr. Cooke in all of that.

My question is to Mr. Crockett. I have had this discussion with the Minister, Deputy Bruton, after the TalkTalk episode in Waterford where I put forward the notion that we can let IDA Ireland and Enterprise Ireland do what they were set up to do because they are the icing on the cake but we must be looking at our indigenous industries in the south east region. Mr. Crockett mentioned some of them but I want to talk about the Carlow end where we have an excellent company called Keenan's.

A down side of what happened in the region was the loss of the sugar industry. We will have a presentation on that later but even the dogs in the street knew that was the worst possible idea, and we have regretted it ever since. It was a very large employer, and not just of the farmers who were growing the crop. The road haulage industry was involved also. Everybody benefited from it, even down to the local newspaper shop. That was a retrograde step.

I welcome Mr. Crockett's outlook that we need to harmonise from the top down. When he brought all his chief executives officers together what barriers, if any, did they say there were to doing business in Ireland? What do we need to do, as public representatives, to break down those barriers if any exist?

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I will be brief. I have just one question and it relates to the airport. Obviously, having the longer airport runway means that planes with jet engines can land, which opens up opportunities. Are there any discussions on the possibility that if this were to happen particular airlines would be willing to consider opening up routes in Waterford?

I want to keep this conversation real. I am a Dublin based Deputy and the reality, in terms of foreign direct investment, is that when the executives of companies like Google, PayPal and their brother and sister companies come to this country they do not want to travel any further than about an hour when they got off a transatlantic flight to go to their company.

This point is something of an elephant in the room. While this may open up something, from a practical point of view and in particular with regard to foreign direct investment, not many companies - and transatlantic companies in particular - will be willing to consider flying to London and then on to Waterford. There are issues in this regard, and I would be doing the witnesses a disfavour were I not to make this point. However, Deputy Ann Phelan made a good point that one strength Waterford will have will be in its indigenous industries, in particular given the changes to the milk quota regime and so on from 2014 onwards. However, I seek an answer to that question on the runway and, were this to happen, the intention of any airline in this regard.

2:40 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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As the witnesses are aware, Deputy Lyons, who comes from the centre of Dublin, is the joint committee's expert on milk quotas. However, before turning to the answers for this session, I remind members we are running a little late. I apologise again to the presenters for the next two sessions but we are slightly behind. I suppose the first session was going to take some time just to set the scene, but I ask the witnesses to be brief in their answers. They may forward additional written information or add it to the report being drawn up by Senator Cullinane. However, many questions have been asked and I acknowledge they cannot respond within a minute either. Many areas have been covered, some of which have touched on issues for the second session on the third level sector. Consequently, the witnesses may leave some of those questions if they do not wish to deal with them during this session. In keeping the same order as the presentations were made, I invite Mr. Joe Crockett to respond.

Mr. Joe Crockett:

I thank members for their questions. I will try to go through them as briefly as possible. With the permission of the Chairman, I will leave the Waterford Airport questions to my colleague, Mr. Michael Walsh. While we both are on the Waterford Airport board, I would be most grateful were Mike to deal with that.

Like the other members, I thank Senator Cullinane for his work as rapporteur in highlighting the issues. He asked a number of questions and I agree with all the points he and all the other speakers made on the need for an integrated strategy, which for me is critical.

On the question of property and property solutions, it is the case at present that for any place in which the Celtic tiger had been roaring, the property boom took place and there are leftover office buildings, there are particular commercial advantages to taking up such buildings at present because they can be let at such a low rent. In the case of any city or place that does not have major office facilities in place, it is not possible to compete with the very low prices that are available in locations such as Dublin, Cork and Limerick, and this is a difficulty.

In respect of other property solutions, it is the case that I suspect there is plenty of zoned land around the region. As to whether there is plenty of serviced land and with regard to the supply that is needed, that is another question. One thing we did collectively with regard to, for instance, Belview as a strategic site was to state it did have the strategic resource of having a block of land, a huge supply of water, a huge wastewater treatment capacity, a port and the railway right on the dockside. This is a strategic advantage which, for example, Cork does not have and is one reason the Port of Cork was refused permission to expand. Consequently, we have strategic advantage and it is a case of following through on the strategic advantage that exists.

On the question Senator Cullinane asked regarding what steps could be taken to support the education sector, I suggest there are two key steps. The first obviously pertains to the follow-through on the technological university. In addition, I refer to the allocation of research funding by bodies such as Science Foundation Ireland. If, for example, the State recognises the south east is to grow in areas such as agriculture and agribusiness and the related technology as well as in areas such as medical devices or the life sciences, then the resources must travel with it. If one is to be serious about economic development, there must be a fair sharing out around proven leaders such as Waterford Institute of Technology and Institute of Technology Carlow that in turn link and work collaboratively with others.

For example, Deputy Calleary asked what is the specific thing the south east does better than everyone else, and that thing is food and agribusiness. This is something on which the south east leads the world. We will be supplying into Europe and into China and our companies such as Glanbia, Keenan or Dawn Meats supply the world. Therefore, it is my contention that we should do everything we possibly can to be world leaders in everything to do with agribusiness, agribusiness development and support, research and development, technology and so on. The same point applies in respect of the other big area we have, which is medical devices.

Again, every region has its strengths. In the case of the west or the mid-west, it may be aviation, for example, or in the case of Dublin, it might be financing. However, every place has its strengths and there will be some overlaps, such as can happen in respect of tourism. In the whole, however, everyone will contribute. For example, because the west has a very good tourism offering, as does the south east with regard to, for example, Kilkenny or the Viking past in Waterford, we can all contribute nationally to this. I hope I have dealt with the three principal points made by Senator Cullinane.

Deputy Calleary also raised questions on Belview and on the skill set. The Forfás regional competitiveness agenda report sets out the full data he sought and we can supply that to him, if he wishes. However, the key thing to note about the region is that it has a population of approximately 500,000, which is a viable economic market in its own right. Therefore, from my point of view, the south east as it currently stands should have its own subregional development. I note the Minister for the Environment, Community and Local Government has proposed that there be three super regions but that within this, there should be room for subregional development. On the question of Belview, in my view it is a strategic national asset as well as being a regional asset and an asset for Kilkenny and Waterford. We work collaboratively to make that what it is today. Many members have mentioned that Glanbia has gone into that site and there is no doubt in my view that once Glanbia has put in its €160 million worth of investment, others will follow. Consequently, I am interested in getting ready for the next wave of development.

Another point to bear in mind in respect of the Harvest 2020 proposals is that agricultural development will not stop at 2020. This was one of the surprises to me. It will continue to grow post 2020, as there still is a lot of capacity post 2020 for agriculture and agriproducts, and this is something we must bear in mind as we think about potential and where we should put our research and development money.

Deputy Deasy raised the specific question of critical infrastructure priorities, and I agree completely with his assessment on the need for the State and the region to agree on the key infrastructure drivers we must have to drive strategic economic growth. For me, the airport is one of the elements of strategic infrastructure, as is the port. In place-making terms, the city of Waterford and the two hubs of Wexford and Kilkenny are equally important economic considerations that we must develop because place-making in its own right is a key requirement for economic development. In respect of foreign direct investment or indigenous development, it is known that a place must have all the services and must be attractive. It must appeal to tourists and citizens and to investors at national, regional, international and local levels. These are the things we must bear in mind. I take what Deputy Deasy said about the need for airport expansion and I agree with him completely.

Deputy Coffey raised the question of the lack of regional coherence and asked what is the best regional model. My hope for the reform programme or the next level of announcement from the Department of the Environment, Community and Local Government or from the Government is a new model of regional economic development that aligns objectives and focuses on the new energies that might be possible by bringing in the cutting-edge thinking of the chief executive officers in the key sectors and which sets out high level strategies on which each region and subregion must agree, whether it pertains to the port and the airport or Waterford city and the hubs, as well as one's key sectors. This for me is the way ahead and I really hope this is what will emerge next. Consequently, I agree completely with Deputy Coffey's view on the need for a new model of regional development that overcomes the current levels of disparity that exist.

Deputy Ann Phelan asked what barriers the chief executive officers identified in the discussion. The key points to emerge from those discussions were the need for closer alignment with the State sector in respect of regulatory issues, specifically on the water framework directive and on the nitrates directive, and to come up with new solutions to overcome the potential business risks these two issues present, Clearly, we must hold the nitrates derogation we have at present.

We have to comply with the water framework directive, not alone as a regulatory requirement but also as a contractual requirement for major international buyers. If one examines the contracts for major bulk-buying for Dawn Meats, Glanbia or anybody else, the contract might be the thickness of two or three telephone directories approximately one third of which will be on environment requirements. Therefore, there is a need for a fundamental shift in our understanding of water and the ownership of water to ensure high performance and compliance with the water framework directive.

On the food side, the CEOs raised the offer of the major companies being able to support SMEs in that sector. Glanbia, to give the company its due, set out a strategy for export growth for 12 to 14 small food companies across the region and it is a model that other major companies could adopt. I would commend Glanbia for its support for this development. Those were the two particular matters identified.

Deputy Lyons raised the question of the airline and the predominance of the great economic powerhouse of Dublin, plus all of its considerable critical mass in labour force, services and infrastructure, including the airport. If, however, one is serious about regional economic development for a region that is experiencing difficulty, one must look at the services such as key infrastructure, such as airport, port, cities and technological universities, to ensure there is a platform for growth.

2:50 pm

Ms Nora Widger:

I will not address everybody individually but there are a couple of key areas on which I want answer. In particular, on Deputy Calleary's question on national ports, the national ports policy formally recognised that Waterford and Rosslare are ports of national significance. He asked about competitive advantage. The competitive advantage of Waterford and Rosslare is their proximity to the south of England and all that offers for economic development for us in the south east, and also mainland Europe.

On the connectivity issue, Waterford port is the only port which has direct rail connectivity for low-load container traffic to lift on and lift off. It is vital that the Government pursues a roadmap for Waterford port to give it new impetus and energy to develop to its potential, and Rosslare likewise. During the boom, Dublin Port grew as a result of all of the imports coming into the country and the ancillary services - distribution centres - that were built up closely associated with it. Waterford and Rosslare, and the south east ports, need the Government, as part of the national ports policy, to formally adopt a new roadmap for the south east ports.

On the airport, I am pleased to hear Deputy Deasy refer to €1.25 million, which seems like a small sum of money to get an extended runway in Waterford airport, which is vital for its future and survival.

With regard to the ongoing talks with various agencies, I will let Mr. Michael Walsh, Waterford city manager, take that up. He sits on the board there. On connectivity to the rest of Ireland, the M9 now offers fast access from Dublin to Waterford from the point of view of FDI companies investing in Waterford. Moving on to the FDI issue,-----

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I made the point that, no matter how good the road, being an hour from Dublin was the tipping point for many FDI companies.

Ms Nora Widger:

I take Deputy Lyons' point about the use of hubs. Birmingham is a hub to the rest of the world and if Waterford airport has the connectivity to Birmingham, that, in turn, delivers connectivity to the rest of the world.

Returning to the FDI question, it is important that there is a key location in Waterford and in the south east for IDA Ireland-based investment companies. There are sites in Waterford which may not be readily suitable for new FDI companies. Going back to Mr. Michael Walsh's point about new companies coming in, we have not seen one for quite a while. I believe that a regional director and regional presence from IDA Ireland is needed now in Waterford.

Finally, on indigenous businesses, the ten-point chambers' plan contains many ideas on incentives for indigenous companies regarding tax and creating employment. That is certainly something of merit that can be looked at.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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On that last point, the committee is meeting Chambers Ireland next week to discuss the ten-point plan in view of the budget as well. I thank Ms Widger.

Mr. Michael Walsh:

In one form or another, most items have been addressed. The regional coherence issue is one. The technological university can be a significant platform for building that. Equally, it is about concentrating on the matters from which there are outputs and results. Tourism and the agri-sector, as Mr. Crockett stated, are two areas, along with the technological university, that can give us a real focus at a regional level and start to deliver that coherence which, perhaps, has not been here heretofore.

I agree with Ms Widger in the context of an IDA Ireland regional director. Certainly, at a perception level, the relationship between performance in the FDI area and the non-presence of an IDA Ireland director is strongly reinforced across the south east region.

There is continuing dialogue with the airlines. There is an issue in the context of the existing runway length. A very moderate investment will significantly increase the potential operators there. Certainly, there are operators interested. Getting that signed up is akin to the chicken and the egg. If one had the limited extension, I would be fairly satisfied one could deliver the airlines. We already have Flybe. We certainly have a viable Luton route. We are not seeking to build an international airport to compete with the likes of Dublin, Cork and Shannon but we are seeking a niche regional airport that can give direct connectivity. It is based also on tourism and building our tourism proposition overall. The simple reality, for example, on that previous Luton route was that well over 50% of the traffic was inbound in the context of tourism, targeting a relatively niche element of the London market and helping to pull through localised marketing, in other words, pulling additional tourists into Ireland Inc. rather than merely robbing it from any place else. That point needs to be made.

On the basic point about FDI in terms of the hour for the airport and otherwise, it is one of the players in the game in our experience. With many bigger players, competitiveness is their key issue. We lost a good deal of jobs in Waterford. If we are honest about it, Ireland Inc., through the Celtic tiger years, got slightly uncompetitive in many contexts and we certainly saw manifestations of that. There has been a phenomenal transition, in Waterford and right across the south-east region, in terms of living costs, wage costs and a host of areas that are bringing us significantly back into that piece. Certainly, be it the likes of Bausch + Lomb or Teva Pharmaceuticals, in terms of the skill-sets that are available, they have no difficulty in attracting staff. The reality is that much of the population in the south east developed their skills elsewhere. We are tending to lose them. The challenge is to bring them back. Once we do, one of the great stories we must tell is that we retain better than any other region. That, of course, is because of the good weather and the overall living environment.

Mr. Senan Cooke:

I want to make two points. One is that Dunhill completed two Interreg projects recently. One of them was Interreg Action, which was on social enterprise. It was to identify, develop and promote social enterprise. We found that there were 218 social enterprises in County Waterford and we suspect there are approximately 300. All of them are central to rural communities, to urban communities and especially to isolated communities. The main recommendation from it was that we develop a south east social enterprise brokerage and that we could do the same in every county in the south east, which would amount to over 1,000 or maybe 2,000. We believe that when people would see the result of the audit they would suddenly realise that these were crucial to maintaining the social and economic fabric of communities.

The second recommendation concerned Interreg HERCULES, which was about tourism's sense of place.

The main recommendation that came from that was that we could, through collaboration, set up a 12-month tourism season in County Waterford and the rest of the south east. It was clear that if we could do it, additional jobs could be created. If we acted on this immediately, jobs could be created. Even if only a small number of jobs were created, it would be a signal that jobs would be created from the bottom up. It would mean so much to the people involved and their communities.

3:00 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I thank all the witnesses for their presentations and comments and for answering questions.

Photo of Ann PhelanAnn Phelan (Carlow-Kilkenny, Labour)
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I apologise on behalf of Deputy Ciara Conway who, unfortunately, could not attend today. She would have been very vocal regarding today's proceedings.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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If the witnesses have further comments, they may send them to us in writing. All submissions will be included in the report. We hope to launch the report in July, but it depends on Senator Cullinane's work programme. We are working him very hard. We will probably discuss the report with the witnesses when it is finished.

Sitting suspended at 3.31 p.m. and resumed at 3.34 p.m.