Oireachtas Joint and Select Committees

Tuesday, 17 February 2015

Select Committee on Jobs, Enterprise and Innovation

Estimates for Public Services 2015
Vote 32 - Jobs, Enterprise and Innovation (Revised)

1:35 pm

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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We are meeting today to consider the Revised Estimate for Vote 32 - Jobs, Enterprise and Innovation for the year ending 31 December 2015, which was referred to the committee by an order of the Dáil on 18 December 2014. When the committee has considered the Revised Estimate this fact will be reported to the Dáil.

I welcome the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, the Ministers of State, Deputies Gerald Nash and Damien English, and their officials. I thank them for the briefing documents they have supplied to the committee.

As members have seen, the 2015 Revised Estimate was presented to the Dáil in programme-based format. This means the Revised Estimate as presented contains the following information for each programme: how the money allocated to the programme is proposed to be spent and the previous year's outturn in each case; the number of staff assigned to work connected with the programme and how this compares with the previous year; performance-related information and departmental outputs with corresponding information for the previous year; and performance and impact indicators with the previous year's information also.

Administrative expenditure for the Vote as a whole is summarised in more detail than previously.

The Revised Estimate gives us an opportunity to review whether the targets set and the distribution of moneys across the Vote are appropriate in all circumstances and demonstrate the best use of resources. It also gives us an opportunity to explore issues facing the Minister in terms of the 2015 allocation to his Department.

A timetable for today's meeting has been circulated and agreed. It allows for a brief opening statement by the Minister, followed by a discussion on the 2015 Revised Estimate and questions on each programme listed therein. I invite the Minister to begin.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I thank the committee for facilitating us. It is an honour to attend.

As members will see, we are seeking a €790 million allocation for 2015. We can stand over the value that we are yielding from the budgets the committee is giving us. The amount is broken down into capital expenditure of €489 million and current expenditure of €301 million. Our capital expenditure shows a modest improvement and we continue to make savings on the current side. The one factor that members must watch out for is the 27th pay day in 2015, which may result in a change. There is also a technical adjustment, in that €39 million is being switched from the current side of the capital side. Members should bear these factors in mind when assessing the Estimate.

This is a year in which we can expect solid progress across all of the areas in which we operate. IDA Ireland and Enterprise Ireland had a record year. Significantly, Enterprise Ireland's net employment creation exceeded that of IDA Ireland for the first time in a number of years. This shows the powerful recovery that is occurring in many Irish-owned, export-oriented enterprises. I do not know whether the figures are presented in this document, but members will also see that there has been a diversification in Enterprise Ireland companies' export destinations. Many committee members have been keen to see this, with emerging markets becoming a more significant player. What economists call Irish companies' export propensity - in other words, the percentage of their output that they export - is steadily increasing. The committee is seeing a strong fight back by Irish companies finding new markets and using exports as a key driver of recovery. We are improving in competitiveness rankings. As the Minister of State, Deputy English, will undoubtedly point out, our ranking in terms of the impact of our innovation spend is also improving. We are showing good, solid progress.

We are also continuing to undertake structural reforms within the Department. This plays an important part in ensuring that we yield-----

(Interruptions).

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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That was not my telephone.

The reforms play an important part in ensuring that we yield value for money. They are reflected in the Estimate. In April, we dissolved the county enterprise boards, CEBs, and established local enterprise offices, LEOs. Since then and under the new service-level agreement with Enterprise Ireland, there has been a new dynamic in those offices. As the CEOs of local authorities, county and city managers are significant new drivers of enterprise. This alliance is working well and the LEOs are showing a good impact. They have rolled out new projects successfully, for example, for young entrepreneurs. They are also showing an impact on micro-finance, where the take-up level has nearly doubled. They have been key agents.

We have dissolved Forfás. Deputy Calleary is concerned that, since its functions were brought into the Department, we have blunted Forfás, but that is not the case. It has been key to driving the Action Plan for Jobs and, through the National Competitiveness Council, continues to have an edge in its work. Shannon Development was formally dissolved. We merged the Competition Authority and the National Consumer Agency. The new commission is settling down well. We passed the Companies Act 2014, which is major legislation. I thank the Oireachtas for facilitating it. It was years in process.

The workplace relations commission, WRC, Bill is nearing the end of its legislative process.

It is another major reform undertaken within the Department that is delivering better impacts and quicker hearing of cases. Members will be aware of the proposal to establish a low pay commission, which initiative will be undertaken by the new Minister of State, Deputy Nash. Work on this initiative is advancing and the Minister of State, Deputy Nash, will shortly announce the membership of the new board of the commission. He is also progressing the construction contracts legislation, which members will be aware had been held up.

Looking to the future, we are seeking to identify the areas we need to continue to improve. There is no doubt that the two main areas in this regard are entrepreneurship, where we can significantly improve our performance, and regional development. Although every region has experienced overall employment growth, including through Enterprise Ireland and IDA, as measured by the QNHS there is no doubt that we can improve our capacity to exploit the potential of our regions. This is something I am very keen to do. We are starting a process this year which I hope will drive that forward in a way that has not been done before. We are looking forward to a high quality of application for some of the competitive funds we are setting. Our hope is that not only will this result in a more concerted action by the existing agencies in the regions, with a much more strategic look by those agencies at the regions, but that the process will act as a catalyst for the many other players in the regions in terms of their impact on enterprise growth.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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We will now consider the Revised Estimate and, in particular, performance and expenditure proposals for 2015, programme by programme commencing with programme A - jobs and enterprise development. I ask members to identify the subhead of the programme to which they are referring when asking a question. We will start with the general position in relation to savings measures that are to be introduced in 2015 and then move on to consider performance and expenditure proposals for 2015. Programme A deals with jobs, enterprise and development. Subhead A3 deals with agency legacy payments; A4 with InterTradeIreland; A5 with IDA Ireland; A6 with export credit insurance; A7 with Enterprise Ireland; A8 with local enterprise development; A9 with monitoring of EU programmes; A10 with INTERREG; A11 with NSAI; A12 with the temporary loan guarantee scheme; A13 with subs to international organisations; A14 with commissions, committees and inquiries; and A15 with other services.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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On subheads A1, A5, A7 and A8 and the relevant subhead dealing with the credit guarantee scheme-----

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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We will deal with subhead A1 later. The Deputy should commence with questions on subhead A3.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I welcome the Minister, the Ministers of State, Deputies English and Nash, and their officials. I also thank the committee secretariat for the brief provided to members.

On subhead A5, I take this opportunity to congratulate IDA Ireland and all involved on the successful year they have had. However, is it a matter of concern to the Minister that while 15,012 jobs were created in 2014, 7,881 jobs were lost in IDA client companies, which equates to 52% of the number of jobs created? It is a similar story in terms of Enterprise Ireland. Is any work being done within the Department on identifying the reason for this high proportion of job losses? Given the level of investment and fantastic effort that went into securing those 15,000 jobs, what work is being done to identify where those jobs are being lost?

The Minister announced last week that under the IDA building programme for 2015 onwards, it is proposed to construct more advance units. Perhaps he would update the committee on the three units announced. I understand the units at Waterford and Letterkenny are almost complete. What is the position in regard to the Athlone unit? The Minister might also expand on his commitment in the Dáil last Thursday regarding additional IDA capital expenditure on existing IDA parks.

On subhead A7, I congratulate Enterprise Ireland on its success. However, as in the case of IDA Ireland while it was responsible for the creation of 19,705 jobs, 11,229 EI client jobs were lost, giving a net of 8,476 jobs created, which equates to a 56% of a loss. Again, this is a matter of concern.

With regard to subhead A8, I congratulate the local employment offices, LEOs, which are definitely up and running. One gets the sense that they have hit the ground running. As the Minister acknowledged, there is no doubt that they have made an impact on Microfinance Ireland. I have not seen a figure relating to the number of jobs they, or the old county enterprise boards, CEBs, created in 2014 and how many were lost in CEB enterprise client companies. If the Minister has that, perhaps he would provide it.

I cannot find the subhead for the credit guarantee scheme.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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It is A12.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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A sum of €15 million out of €150 million has been approved. We had a discussion about this last Thursday during Question Time. The Minister made a significant announcement about expanding the credit guarantee scheme to companies whose banks are exiting the market and are selling off their loan portfolios. I cannot stress enough how urgent that is. It really cannot wait. A major bank - I will not name it and it is not a pillar bank - is selling off its loan portfolio and these are exactly the companies I suspect the Minister has in mind. They are running out of time, so when will we see the proposal and the legislation? Is there any way the Minister can introduce this on a temporary basis for the companies that are running out of time with their banks?

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I invite the Minister to respond on subheads A5, A7, A8 and A12.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I will take them in order. The Deputy is correct to alert us to job losses, but that rate of job loss in the context of the IDA's total portfolio is 4%, which is one of the lowest on record. It is marginally higher than last year, but last year it was at an extraordinarily low level. We take a very keen interest in companies in difficulty. The IDA has a substantial transformation programme targeted at identifying companies that need improvement in some area or another. This year, for the first time, we are introducing a budget in the Action Plan for Jobs focused on lean processes to be applied in those companies and on management development to be available to the IDA. Some of the EI programmes that were in place and which have established a track record are now being extended into the IDA. Indeed, some of the lean process is done by EI on behalf of the IDA, so we are expanding the knowledge that was learned in Enterprise Ireland.

The same can be said of Enterprise Ireland, although I do not have the exact percentages. Again, last year was higher than the previous year, but it was a very low number in the previous year. What we saw in 2014 was something of a comeback in the level of job losses in some of the company base. However, I expect that in the recession years there was a big shake-out and that left something of a dip, but we are well below what would traditionally be a norm for a job loss rate. Nevertheless, the Deputy is correct and we are very alert to it. It is key. Maintaining a job is much easier than creating a new one, certainly in Enterprise Ireland companies.

With regard to the new units, the midland building is located at the IDA Garrycastle business and technology park. It is 2,600 sq. m. I will get the Deputy an update on the exact state of play on that, as I do not have the latest one with me.

On the LEO job creation, the LEOs are reporting full-time gains of 3,127 and part-time gains of 1,132. Those are probably gross gains.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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The Minister can refer back to me with the details.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Actually, these are net numbers. The net figure is 3,690 full-time equivalents, made up of 3,127 full-time and 1,132 part-time. It is very satisfactory.

The service level agreement is only beginning to have an impact. The LEOs will develop their first annual plans this year. That process is ongoing at present and it is a big part of the regional enterprise approach.

There are two elements to the loan guarantee, and the Minister of State, Deputy Gerald Nash, is taking responsibility in this area. We have a legislative area, which is the extension of terms and certain changes. We are also bringing in a scheme that does not require legislative action, also to be dealt with by Deputy Nash. The legislation is being worked on. It is a more complicated piece of legislation than we would have hoped in terms of getting the drafting done. The matter is being given top priority within the Department and we are working with the Office of the Parliamentary Counsel.

Photo of Gerald NashGerald Nash (Louth, Labour)
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I know Deputy Calleary is well aware of the issue of exiting banks and refinancing of loans. We are going to do two things in terms of adapting this scheme, which is permissible under the existing Act in any event. I will lay the new scheme before the House over the next few days. We are making significant progress on the matter. As we have stated previously, the scheme will allow for refinancing where an SME's bank has exited or is exiting the SME credit market. It will also allow us to extend the maximum length of the guarantee from three to seven years. That change is imminent and it will be laid before the Houses shortly.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I ask the Minister of State to give a briefing on the scheme, as the matter is urgent, as he will know himself.

Photo of Gerald NashGerald Nash (Louth, Labour)
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I will definitely do so.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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Every Member should get a briefing on it.

Photo of Gerald NashGerald Nash (Louth, Labour)
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It will command broad support. I will be happy to do that.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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The IDA will be developing proposals to improve existing business parks and identifying areas where it needs to make other property investments - land banks, service sites or whatever. That would be part of its own five-year plan, which it will announce fairly soon. This will set out its approach.

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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I welcome the Minister, the Ministers of State and the officials.

I wish to ask a couple of question on subheads A5, IDA Ireland, and A7, Enterprise Ireland. I welcome the success in 2014. Already this year, 2015, we have had major jobs announcements, including in my own area of Galway. I welcome the increased allocations in the Estimates for those areas, including allocations for IDA Ireland, Enterprise Ireland and the LEOs.

With regard to the future, it is grand, as far as I know, to allow Northern Ireland to set its own corporation tax rate. Can the Ministers let me know the strategies IDA Ireland will adopt to anticipate the move?

My next question relates to the debate that is taking place in my other committee, the Oireachtas Joint Committee on European Affairs, on the possible exit of Britain from the EU. Would this be an opportunity for Ireland? Have IDA Ireland and Enterprise Ireland mentioned the development in their negotiations? Jobs are not created overnight; it is a long-term process. I would like the delegation to comment on the matter.

In regard to LEOs, there has been an increase in funding, and one of the outcomes is the implementation of 31 local enterprise development plans. Is the Minister confident that each LEO is properly funded? I am not talking about my own county. Having talked to colleagues whose counties have LEOs, I heard one express the view that the LEO office consisted of two individuals. Are counties monitored individually to track the staffing level in LEOs and whether they have the resources to complete the work they need to do?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I thank the Deputy for his acknowledgement of the progress being made. Some exciting announcements have been made, particularly on the Enterprise Ireland side. One can genuinely say we have Mittelstand companies, as they would be described in Germany, such as the likes of Combilift and Ribworld. There are several that are now proving their capacity to be global players and they have the ambition to match.

I see no problem or threat in Northern Ireland having its own capacity to set corporate tax rates.

One is competing daily with other European destinations or Singapore. The competition for foreign direct investment is fierce. Anything that is good for the island of Ireland's economy is really good for all of us. I have no concerns on that front. We compete all the time and we will continue to compete. Obviously what might happen in the United Kingdom referendum in 2017 is an issue on which one will comment with a certain level of caution. Other people are making decisions about their future. In the natural course of such things, it throws up threats and opportunities. I think the balance of advantage for Ireland as a country is to see Britain remain in the European Union. Britain is our main trading partner, but of course we do not control the outcome of the referendum and we have to look at how we minimise the threats and take the opportunities that come as a result of such decisions. While there is very active assessment of this, we will not try to influence the decisions of the British. We work with the UK all the time. We have a very close relationship and clearly that relationship will remain.

The local enterprise offices, LEOs were established with both the existing complement of staff from the county enterprise boards and an incoming complement of staff from the local authorities. It was bringing in the local authority business units, so there is no LEO operating with a lower staff complement than it had in the beginning. We are conducting a review of resources and clearly we will be looking at the adequacy of the support in all cases. We have specific permission also to have a graduate programme so we will be introducing graduates not to replace the core strength of the existing LEOs but to improve customer delivery and service and so on. Obviously we are looking at this very closely. There are four positions for head of enterprise currently being advertised in different areas by the Public Appointments Service. Some unevenness has been inherited from the existing structure but we are trying to ensure we deliver an even service, and as resources become available, we will strengthen services. We have specific opportunities to place graduates.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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We will now deal with programme B - Innovations. Does the Minister of State, Deputy English, wish to make a brief opening statement?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I cannot repeat or stress often enough that innovation is at the heart of competitive advantage. If one looks at the companies that are engaged in innovation and research and development, the case is proven by the increase in exports and the creation of more jobs. Consecutive governments in the past 15 years have enjoyed success. Our aim is to continue to build on that. We invest €730 million annually in research, which is a significant investment. We constantly monitor it and keep working on it to ensure we get the results from it.

The Minister, Deputy Bruton, commented on the question of global rankings, but let me add that we are first in the world for the availability of skilled labour, we are 11th in the global innovation index in 2014, and we are 13th in the world for university, industry preparation and research and development. We are punching above our weight in some categories and that is where we want to be.

The key highlights for 2014 is the 102 high venture start-ups with a three-year commitment of more than 1,500 jobs. There have been more than 1,700 collaborations between industry, third level institutions and Science Foundation Ireland researchers supporting the development of close business links between industry and research and the research system. We are trying to build on that. The plans for 2015 will be to enhance that relationship and to encourage more SMEs to get involved in the research community. Five new research centres have been funded by SFI through an investment of €155 million. We thought it would have been two centres but five is a success story this year.

Some 475 students and researchers have been appointed on structured PhD and emerging technology programmes. This is another example of something we want to encourage. Since we last met, we have published Ireland's first national directory of research centres of scale. Some Deputies will have a copy of the directory in front of them. This important point of contact will flag to people looking in how the system works and where they can make contact.

The first national innovation showcase, which was held at the National Convention Centre, was a great success. It was fully subscribed. It was probably over-booked. Over 2,000 entrepreneurs, industry representatives and researchers from around the country were involved that day. It worked out very well. Many relationships were developed and many connections were made on the day. It is something we want to build on. I am not sure when we will have the next one. We will learn from this one. Industry feedback has been very good. We will be aiming to hold another event, in 2015 if possible. The aim behind this is to develop our Horizon 2020 applications. If we are to achieve our targets in this regard, there needs to be much more involvement from the SME sector and from the multinationals. Our higher education institutions are probably doing their bit in terms of percentages, but we need to get a greater involvement from business as well.

I have touched on a few areas. We are attempting to prioritise the funding that is available for the prioritisation agenda, which covers the 14 main areas. I suppose our science sectors of excellence will push that agenda as well. That is just a short summary.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I thank the Minister of State. Do Deputies have any questions on programme B?

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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Can the Minister explain why subhead B5 provides for a reduction in the funding allocated for the programme for research in third level institutions?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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The programme for research in third level institutions is coming to a natural end. The funding comes in blocks. The current block is nearly running out. Fewer than 18 projects are being finalised. Expenditure on students and PhDs is now regarded as capital expenditure as a result of a change in the accountancy rules. The programme in question is winding down naturally. Investment in this whole area, in terms of maintenance and additional capital requirements, is being looked at in the new strategy that is being considered at the moment. A study that is ongoing will report into that and feed into our strategy, which we hope to have published in July of this year.

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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Okay. Under subhead B4, which relates to research, there has been an increase of €100,000 in the science and technology development programme. What are the specific areas at which this will be targeted?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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In terms of personnel, the main aim is to get more collaborations. It will follow the 14 prioritisation areas we have identified. These are key areas for Ireland to build excellence in. The aim would be to have another 1,000 collaborations with industry and new industry over the year ahead through the various agencies, including Enterprise Ireland, Science Foundation Ireland and IDA Ireland. We recognise that if we are going to build on this, we need to push it constantly and get new players in. That involves attracting new industry as well.

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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It has been suggested in the past couple of years that a referendum will be held in the whole patent area. I know there is referendum fatigue in the country. What sort of timescale is in place for that?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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It would have been nice to have fitted it in this year. I know this committee has had an active role in pursuing the matter. I think the Government has made the right decision in this area. We will have a local division of that as well. I think that has satisfied most of the concerns that were expressed at this committee over the years. The referendum has to be passed by the third quarter of 2016. I would imagine at this stage that we will possibly see a referendum sometime in 2016. It does not look to be on the agenda for this year because I think people are fatigued in that area. I think it has to be passed by the autumn of 2016 at the latest. It is an important one for the country. This committee will have a role in it because it has been involved from an early stage. Some of these referendums do not catch the imagination of the public even though they are important. This referendum will be important because it will make it much easier for Irish inventors, scientists and researchers and other companies to get involved in this market and to get patents. It will make it much more affordable for new emerging players in this area. I think it will be important for this one to be passed. We will engage with the committee on it closer to the time if that is okay.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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Does the Minister of State, Deputy Nash, wish to make an opening statement on programme C?

Photo of Gerald NashGerald Nash (Louth, Labour)
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I am fine, thanks.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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Under programme C, we will consider subhead C3, Workplace Relations Commission; subhead C4, grants for trade unions for advisory and education services; subhead C5, Health and Safety Authority; subhead C6, trade union amalgamations; subhead C7, Office of the Director of Corporate Enforcement; subhead C8, Competition and Consumer Protection Commission; subhead C9, Personal Injuries Assessment Board; subhead C10, customer support; subhead C11, Companies Registration Office and Registry of Friendly Societies; subhead C12, Irish Accounting and Auditing Supervisory Authority; subhead C13, Low Pay Commission; subhead C14, subscriptions to international organisations; subhead C15, commissions, committees and inquiries; and subhead C16, legal costs.

Are there any questions?

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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On subhead C5 and the Health and Safety Authority, in particular the agricultural side of things, representatives from the authority appeared before the Committee on Agriculture, Food and the Marine some time ago. There is an ongoing high number of deaths in this area, in particular of young children. It was stated that there will be a reduction in the number of inspectors but an increase in the number of discussion groups. Does the Minister of State have any information on how this will operate or what sort of roll-out or timeframe is envisaged?

Photo of Gerald NashGerald Nash (Louth, Labour)
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As I understand it, farm safety walks are a relatively new innovation and something the Health and Safety Authority wishes to promote. The authority takes what might be described as a blended approach to safety issues. From the point of view of farm safety, the number of farm fatalities in recent months, including those of young children and experienced farm workers and owners, is very concerning. The view taken by the HSA is that resources need to be directed towards farm safety walks, discussions groups and this type of engagement. Inspections in isolation do not seem to be bringing down the number of fatalities. There is a huge job of work to be done by all of us to raise awareness. We in public office and the representative organisations, including the IFA and the ICMSA, must work closely with the HSA and other relevant organisations to try to create a wider awareness of farm safety. This is a priority for me. The Health and Safety Authority and I plan over the next couple of months to hold a series of events throughout the country on what is called Workers' Memorial Day to raise awareness of safety in the workplace. This will include farms as well. I am quite positive about the approach being taken in terms of farm safety walks. People in my community in Louth have engaged in such processes and have found them useful. This approach will enable the HSA to reach a wider number of farm workers and owners over the next period and to promote the safety message.

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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There is an Estimate for the low pay commission, which is welcome. Will the Minister of State comment on the timeframe?

Photo of Gerald NashGerald Nash (Louth, Labour)
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This is a new innovation in the public policy landscape. Today I will be announcing the composition of the low pay commission. I hope that the chairman designate will have the opportunity to speak to the committee over the next while. The commission is a priority for Government in terms of our dignity at work agenda and making work pay. This year there is a budget of €500,000. We have modelled this very closely on the budget for the Irish Fiscal Advisory Council and the arrangements will be the same. It will be staffed, in an advisory capacity, by staff from the Department who will work to support the low pay commission. The Estimate breaks down as €270,000 current pay and €230,000 current non-pay. There will be significant resources, therefore, to allow it to carry out and commission research where gaps emerge. For those who have seen the terms of reference, which I distributed to the committee recently, and the heads of the Bill, the data sets that the low pay commission will use to arrive at its annual recommendation for an appropriate national minimum wage are clear. Where there are gaps, the commission will be enabled to initiate research to fill those gaps to ensure that it can arrive at a rate for the national minimum wage in an evidence-based and robust way. The work will start very soon. I expect the first meeting to take place over the next couple of weeks and to have a recommendation from the low pay commission in the summer.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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We will move on to programme D, appropriations-in-aid. Do members have any questions on this programme?

If there are no further questions, we will move on to the administration subheads under each programme. These include subheads A1, A2, B1, B2, C1 and C2. Do members have any questions? Everyone is satisfied. I take it the discussion has concluded, although if anyone wishes to make closing remarks, they would be most welcome.

Photo of Michael ConaghanMichael Conaghan (Dublin South Central, Labour)
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I am sorry that I was late. I was at another meeting and I could not get away.

The economy has made a successful comeback and people on the streets are now beginning to talk about it. They see the evidence among their families and communities. I live in Ballyfermot. I am close to what people say in terms of unemployment because there are high levels of unemployment there. It is pleasing to see that people are beginning to have confidence in the recovery. This is largely the work of the Ministers in this room. They have taken on a singularly difficult portfolio and have done remarkably well to make the progress that has been made in a short period. I am keen to emphasise that. It is gratifying, especially speaking as someone in one of the Government parties.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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It makes life easier.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I thank Deputy Conaghan. The truth is that Irish enterprise and Irish workers have shown remarkable resilience in the face of difficult circumstances. We have seen them finding new markets, going further afield, applying innovation and applying more lean processes to become globally competitive. They have been extraordinarily successful in this regard. We have yet to see the confirmed Enterprise Ireland expert numbers but it appears they have performed exceptionally well in 2014, certainly beyond wildest expectations. With their backs to the wall, people have shown fantastic ingenuity.

Another encouraging aspect is that we are beginning to see start-ups on a far wider scale. It is heartening to see the growth in the numbers of people starting their own business. Moreover, the indication is that the number of people who would consider starting their own business is even higher or at least showing greater growth. There seems to be a good climate here.

The challenge for all of us is to ensure that the policy regimes sustain these changes. This good growth has not happened by accident. We have moved mountains across all Departments, not only ours, to consider the skills base, the tax mix as well as the things we do in the areas of health, education, the environment and infrastructure to make it easier. These policies must be sustained. We need to be competitive in the long term if we are to achieve sustainable full employment.

Twice in a generation I have seen a situation where the country has had within its grasp the capability of becoming a full employment economy on a sustainable basis. However, we lost the run of ourselves and committed to unsustainable policies that simply fell flat on their face. Significant damage was done. One of the things we need to learn is that policy matters. The type of sustained policies we have been trying to put in place are important for the long term for this economy as well as for our capacity to provide employment for people who genuinely want to stay here. Perhaps this does not apply to everyone. Some people will want to travel. However, we need to be able to get back to a position where anyone who wishes it can choose to work in this economy, and we are on the way. Unemployment and emigration are coming down, but we need to sustain the approach.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I wish to add to the comments of Deputy Conaghan. It seems more jobs are becoming available as well. There is an issue now in respect of ensuring we have the skills to fill all the jobs being created, now and in the months and years ahead.

Under the Action Plan for Jobs, one of the indicators of performance is the national talent drive. This involves making sure we have a good deal of home-grown talent to fill these jobs, but it will make it a little easier to bring in talent from abroad, when necessary, to augment that supply.

This committee has considered reports over the years which have identified areas like apprenticeships, where we have to change how we do it. The main aim of this year's Action Plan for Jobs is to have a further engagement between industry and the education system to ensure we are developing the skills and the jobs we need.

There may be a role, following on from some of the previous reports, in making that connection.

The new apprenticeship council, which was formed before Christmas, has made a call for proposals from industry, representative bodies and so on for new apprenticeship suggestions. Various Departments are now out beating the bushes to get people, organisations and industries interested and coming in with their ideas. We need to do some work to make sure this happens.

We need to develop schemes that have on-the-job training, involve employers in identifying courses, needs and so on, and make sure they are involved in training and outputs. This is important because there is no point in creating jobs in six months' time if we cannot fill them with people who are living in the country. A lot of work needs to be done and we are focused on it. It is in the Action Plan for Jobs. The committee was part of that in recent years and we need to build on it.

There is an awareness issue, and industry has to step up. There is no point in members of the committee telling people around the country that they could employ 50 or 60 people if they will not get involved in training them to make sure the skills exist. It is a challenge and a sign of recovery, but we have to build on that.

Photo of Gerald NashGerald Nash (Louth, Labour)
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I welcome Deputy Conaghan's remarks. As a Minister of State with responsibility for SMEs, I have had the opportunity over the past few months to travel around the country and talk to SME owners and managers about their experiences. We are now in an entirely different space even compared to two years ago. There is now much more confidence out there. The local enterprise office approach is working. I visited quite a number of them over the past few weeks. That is not to say there are not still challenges. We need to keep a very close eye on their resources and make sure they are supported in developing over the next period and meeting the challenges that exist. One of the most significant things Ministers and Ministers of State can do over the next period is to marshal through regional economic strategies. It is no longer any use to try to create the impression that every region of the country is competing for the same type of foreign direct investment. We need a balanced regional approach.

The regional economic strategies will essentially be an action plan for jobs at a local and regional level. That is a process initiated by my colleague, the Minister, Deputy Bruton, and Department officials. It is a strategy that has been proven to work. We will see a process whereby local agencies such as the IDA or Enterprise Ireland will take responsibility for driving these strategies and showing leadership at a local level - working with local authorities, third level institutes, local enterprise offices and so on - to make sure we get the balanced regional economic activity that we need. There is very little point in having an economic recovery that is focused on our main cities. We will spread that right across the country and will have a very involved process in terms of developing regional strategies.

It is also important that we have harmonious industrial relations and progressive legislation - it is recognised that our legislation is the best in developed economies - which is developed in partnership with employers and trade unions in the way that we seek to address issues around the REA and collective bargaining legislation. It is important that we do that in collaboration and partnership with employers, trade unions and those who represent working people.

With regard to balanced economic development, I do not mean just regional development. I also mean making work pay and making sure that people are always better off in work rather than ensnared in a social welfare system from which they cannot get out. The best thing we can do is to provide somebody with the dignity of a job, and that is what we are all committed to doing. We have seen our economy recover considerably over the recent past. There is still a lot to do, and we are all very focused on that in terms of regional strategies and all the work we are doing in the Department. We can be positive and optimistic about the future.

Photo of Michael ConaghanMichael Conaghan (Dublin South Central, Labour)
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I ask the Minister of State to keep a sharper eye on small craft industries which sometimes go unnoticed. One such industry started in a prefab in a VEC school in Ballyfermot 14 years ago and was the beginning of the modern film animation industry. It has now been to Hollywood on four occasions for the Oscars. There are other people in creative categories who may need to put their heads over the water.

We must let the people involved in those types of small-scale initiatives know there are supports and funding available to assist them. I was on the board of that school at the time the project was launched. Initiatives like that can be multiplied several times, as I am sure is happening throughout the country, but they need recognition and support from the beginning. We must keep a sharper eye out for those types of creative efforts. It would be enormously encouraging for those involved if somebody could reach out to them at an early stage in their development and offer a small grant or other types of support.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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The local enterprise offices are effectively first-stop shops for all such initiatives, but we are also stepping up the advertising of the more than 80 programmes that are available to small and start-up businesses. We have a website, actionplanforjobs.ie, which includes a tool that allows users to input information about the profile of their businesses and obtain information on suitable financing options, whether that be microfinance, for example, a tax break for former PAYE workers setting up a company, or something else. Many of these schemes have take-up way below their capability, and we want to see progress in that regard.

As the Minister of State, Deputy Nash, outlined, the thinking behind the regional enterprise strategy is that there are many opportunities for community enterprise centres to become much more innovative in what they offer their client base. They might tap into institutes of education, for instance, or tap into a chamber of commerce with accountancy support. There is scope to have an entrepreneur in residence or available as an advisory resource. Those little hubs have good potential to step up their performance, and that is what we hope will come out of this regional call. We want people to consider how they can tap into available resources and make more of what they currently have and are doing. One idea might be seek the assistance of a local person who is recognised as an entrepreneur made good and get some momentum behind particular initiatives. There are great ideas out there and there are people doing great things, but we need to tap into them at regional level. That is what we are hoping will come out of this initiative.

Photo of Seán KyneSeán Kyne (Galway West, Fine Gael)
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The Action Plans for Jobs spans several Departments and has a particular relevance to rural affairs, agriculture and the environment, all of which are connected with the Leader programme. As part of the new rural development plan, that programme might not be approved until the end of year. In other words, because of the changeover with the Common Agricultural Policy regime and the rural development programme, the programme is effectively in abeyance. Will the Minister comment on that?

The Minister of State, Deputy Nash, referred to the provision of rural broadband services. I acknowledge that the roll-out plan is proceeding and there is European Commission approval for state aid. However, it is vital that progress be made as quickly as possible. Is there potential to expedite the tendering process? Even though good plans have been put forward by Vodafone in co-operation with various groups, they are targeting places that already have adequate broadband. In fact, there is reference to the 50 largest towns, which includes Dublin, Galway and other urban centres. I understand there are commercial reasons for that, but the problem is that it is the areas outside these urban centres which are dealing with inadequate service.

My final point is more of a political one, but it seems okay to raise it as there are only Government Members present. We are well on our way to achieving the target of creating 100,000 new jobs during the Government's term in office. I am concerned, however, that the target of 40,000 for this year is a little ambitious. Of course ambition is good and I hope the target is exceeded. However, in the event that 35,000 or 38,000 new jobs are created, which would still be a tremendous achievement, my concern is that we will see headlines about the Government failing to meet its jobs target. There has been great progress in recent years on the job creation front, but the Minister will understand my concern in this regard.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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We see the regional enterprise strategy, like the Action Plan for Jobs, as being an annual event. The Minister for Communications, Energy and Natural Resources, Deputy Alex White, is working on the issue of broadband provision and a tender will be drawn up later in the year, but there is a lot that can be done with our existing resources. We are very much about looking to see what we can do today that will enhance the performance of a region in the next 12 months.

A year from now, we can consider what can be done afresh. We should not stop what we are doing just because the Leader programme might be postponed. At the end of March we will be calling on local enterprise offices and community enterprise centres to commence the process of encouraging people to consider how they might enhance the assets they already possess.

When we declared our ambition of creating 100,000 new jobs, people said we were overestimating what was possible. All the critics stated that if various Departments' statistics were taken into account, it was obvious that what we were seeking to do could not happen. However, it has happened. I am of the view that there is an opportunity to push on in this regard. IDA Ireland and Enterprise Ireland companies are performing strongly and the construction industry, although coming off a very low base, is moving again. Parts of the retail sector will struggle as a result of the switch to trading online, but other areas of it are showing a strong recovery. If we can put in place some of the things to which I refer, encourage entrepreneurship and make it easier to start up businesses, then we will deliver on those targets. I would not be disappointed if, ultimately, we were to hit 95% and fall slightly short. We have been in the businesses of setting stretched targets all through this process and we can stand over what we are delivering in this regard.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I congratulate the Minister and Ministers of State on the work they have done. A Government Deputy would almost be expected to say that but I genuinely mean it.

We are in a different place now than was the case four years ago in the context of what is available for SMEs. When one is driving to work, one regularly hears radio advertisements relating to the Credit Review Office, access to finance, etc. However, is a person who owns a shop in Phibsborough, which I might pass on my way home, aware of what is available to him or her? I accept that it is not possible to knock on the door of every SME throughout the country and spend an hour explaining to its owners the massive suite of options that exists and the fact that they may be able to avail of some of those options. The Minister referred to the actionplanforjobs.iewebsite and there is also the online tool for SMEs. These are great but what sort of checks are in place to ensure that the maximum number of people possible are using those tools? In the computer age in which we live, websites are windows and those windows require to be changed almost daily. I mean this in the most respectful way but I remain somewhat unconvinced with regard to this matter. As the Minister and Ministers of State will be aware because they meet them regularly, there are those in the SME sector who perform three jobs, for which they receive a single salary, and who work around the clock. Sometimes these people, when checking their post each day, might miss some material relating to that which we are discussing. That material could take the form of a very important document which might, for example, highlight some of the really good things being done by the Government to improve the SME platform in Ireland.

What checks are in place to monitor whether the tools which have been developed, particularly those available online, are being used by sufficient numbers of people to ensure that actionplanforjobs.ieis both reaching its target audience and paying for itself? Essentially, there is a job to be done in terms of monitoring the advertising of the various schemes to ensure that those schemes are working for us. I am a member of the Ballymun Civic Alliance, which replaced Ballymun Regeneration. The local enterprise office is represented on the alliance and one of the other members is an individual who runs a very successful business on Dublin's northside. People, SMEs and other organisations involved with the Ballymun Civic Alliance and bodies like it are all clued in to what is happening. I am concerned about those people who are not aware of what is going on because they are not involved in this way. I am sometimes of the view that I might know more than the owners of SMEs about the various services that are available to them.

This is not a criticism but a concern. We should always strive to ensure we are confident that everything we do trickles down to the person who owns the coffee shop on the corner. A scheme about which he or she does not know could make the difference with regard to employing somebody else. It is not a criticism but a question on what systems we use to ensure we have maximum penetration of all of the genuinely good initiatives which have been established since 2011.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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We are learning and applying metrics to the exercise we are running at present, including on the impact of our social media campaign. We have brought in our industry partners, the people who won the young entrepreneur competition and the main business organisations such as Chambers Ireland, the Irish Small and Medium Enterprises Association, ISME, and the Small Firms Association. Our spend is €250,000. If we just got 12 people back to work we would justify it. We use the local enterprise offices as first stop shops. We will also use the Companies Registration Office as many companies must make returns every year. We have already used the chambers of commerce to get out the information and we are trying to plug into any network we can. The reason we are doing this is according to the most recent survey 90% of people felt they were not properly aware of what was out there and 80% wanted more information. We are responding to this demand.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I recognise this is a difficult task.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Few people know of the existence of the seed capital scheme as only 63 claimed it. This scheme allows a PAYE worker who establishes a business to get a refund of the tax paid in the previous six years to offset against some of the investment being made. The 63 claimants are a drop in the ocean of the 12,000 businesses which have been established. The scheme should be more widely available.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I want to highlight that I am not making a criticism. I am only short of knocking on the doors of the 40,000 homes in my area to tell them about some of the services available in other walks of life.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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We would encourage the Deputy to do so.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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People often say they have never heard of schemes and I know we cannot please everybody. I just wanted to check that we are constantly ticking away at maximum penetration.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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At the beginning, the Minister mentioned my concerns about the National Competitiveness Council. I do not see a budget line for it. I am trying to find Forfás's budget line, whereby its staff has gone into the Department's general administration. To assuage my concerns, will the Minister consider including a budget line for the National Competitiveness Council so I can see where the money is?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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The National Competitiveness Council is a group of people serviced by the strategic policy unit of the Department. It is not a spending centre. It commissions consultancy reports and publishes reports, and is entirely independent. A new chairman has just been appointed. I strengthened the council by including industry partners who are actively engaged in key sectors and we have an effective body. It is not a question of a line in the budget; the real issue is to ensure our strategic policy unit is a real driver of new thinking in the Department, and at present it is working on enterprise 2025. Traditionally the Department has had strong agencies and a weak Department. Forfás was outsourced and largely run under the auspices of the agencies. The idea of bringing it in is to give the Department a stronger arm in being able to think afresh, which we are determined to do. We established a protocol at the very start to ensure Forfás would not be sucked into line management and would retain its independence and capacity to produce reports without fear or favour. It is not so much about Forfás being a line in the budget, but about giving it this independence. Already I can see the benefit for the Department of having an active policy arm.

I would like to see more of our officials having a more active interface with our client base. That is one of the weaknesses. The agencies have the front-of-house experience. We need to see that experience filter back into the Department. That is an area we should be examining in terms of how we can get more exposure to the marketplace for our senior line managers and policy people.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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Regarding subhead C5 covering the Health and Safety Authority, I have considerable sympathy for it because it does a very good job in regard to farm safety but it is a very difficult area. Is there any financial contribution from the Department Agriculture, Food and the Marine towards its work or has the Minister any idea what that Department invests in health and safety initiatives? Farm safety is a major problem and it is a difficult one to crack. The HSA has been trying to do so for many years but last year's figures were horrendous.

Photo of Gerald NashGerald Nash (Louth, Labour)
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The HSA is an area for which I am responsible. To the best of my knowledge, there is no direct financial contribution from the Department of Agriculture, Food and the Marine but our Department and that Department, as the Deputy will know, work closely together on initiatives. The Minister, Deputy Bruton, and the Minister, Deputy Coveney, had some public engagements last year in regard to raising awareness of farm safety. I intend to co-operate closely with the Department of Agriculture, Food and the Marine. As I said to Deputy Kyne while the Deputy had stepped out, the number of farm fatalities are worrying. The HSA will direct resources into the area of farm safety and walks, and also discussion groups. They are important to get to the harder-to-reach farmers and I believe that has to come from the community with the support of the HSA. That would be a progressive way of spending Health and Safety Authority resources. Obviously inspections are very important but they, of themselves, do not save enough lives. There is never an acceptable level of fatalities on farms.

The Irish Farmers' Association, IFA, the Irish Creamery Milk Suppliers Association, ICMSA, and other organisations work very well together. I was very impressed when I visited them at the National Ploughing Championships. Their level of commitment to this whole space is truly astonishing. They see the importance of it, as do we and as does the whole system. We must work hard to make sure we can get those numbers down. There is never an acceptable level of fatalities but the HSA continues to work co-operatively with the IFA, the ICMSA and others to try to address those issues.

Photo of Marcella Corcoran KennedyMarcella Corcoran Kennedy (Laois-Offaly, Fine Gael)
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I commend the Minister, Deputy Bruton, the Minister of State, Deputy English, and the Minister of State, Deputy Nash, and all their officials on the great leadership they have shown in this tremendously challenging economic period in which we found ourselves. It was a huge undertaking to try to stimulate job creation again in our very flagging economy when people's spirits were low, never mind the loss of jobs. We are beginning to see an energy from the people working in our State agencies and from the people with ideas now that there are supports in place that they can identify. It is tremendous to meet and engage with them and see their energy and hear their ideas and innovations. A key factor is that supports are now in place.

I was lucky enough yesterday to be invited to Offaly Local Development Company's business development programme certificate launch for a number of the people who participated in it. Word had not broken yet about the actionplanforjobs.ielaunch. They all spoke of how being able to access one portal to get all the information will be very beneficial. We all have a responsibility to get that message out.

Another aspect is encouraging young entrepreneurs. The programme in that respect led by Enterprise Ireland was fantastic and the final of it was held in Google Foundry. It was fabulous to see all those young dynamic people energised by that experience. People are waiting with great anticipation for the announcement of the pilot plan for the midlands and also how the regional plans will be rolled out nationally. It is timely that is happening and it will be very welcome.

With regard to the entrepreneurship policy statement before Christmas, we are doing a report on women entrepreneurs so the witnesses can look forward to receiving that from us when we have completed our hearings on it in the coming weeks.

In my area in Offaly the local enterprise office has taken on a new energy in terms of it moving in under the local authority. It has always been successful but in terms of the challenges being brought to bear on it, there is nothing like a crisis to get people to sit up and take note. Under the Minister's leadership it has proven to be very successful, and an innovation hub will be opened there very soon. If we can see all of that being replicated across the country it will be welcome.

I very much welcome the acknowledgement that broadband provision is a cross-departmental issue because if we are serious about encouraging community enterprises we must remember that all the young people graduating from wonderful institutions such as the one in Ballyfermot can create a business on their own, almost in their own bedrooms, and all they need is a computer. However, if they do not have broadband, they cannot do that. That is critical for certain areas, and particularly those that have enterprise parks. If we could put particular pressure on that it would be tremendous.

I thank all the witnesses for attending today's meeting of the select committee.