Oireachtas Joint and Select Committees
Thursday, 8 March 2018
Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach
Economic Survey of Ireland 2018: OECD
I welcome the witnesses to the meeting. I know they have had a busy day of engagements and I hope it all went well and was productive. There is a vote in the Seanad and some of our colleagues are detained at other meetings but may join us later.
Mr. Angel Gurría:
Thank you. We are presenting today the Economic Survey of Ireland 2018. We joined the Minister, Deputy Donohoe, this morning and presented the main conclusions. This is the PowerPoint presentation of the full document and it is for very busy chairs of committees. This is a three-pager and all three are meant to have to have the same messages and substance.
It is a pleasure to be back in Ireland to share the main conclusions from our economic survey. Ireland could be said to be at the origin of modern economic surveys. Back in the 17th century, William Petty’s efforts to collect and collate data put Ireland at the forefront of what we now call evidence-based policy making, even if the policy was made elsewhere. What evidence would he find today? He would probably find that Ireland is doing well and the recovery in economic output since the crisis has been stronger than in any other OECD country. That is an important fact of which Ireland should be proud. The unemployment rate has dropped from over 15% in early 2012 to approximately 6% today, which is below the OECD average. Domestic demand is growing at around 5% while inflation is still only 0.2%. Some of us, especially when we were finance Ministers, have spent our lives trying to bring inflation down but it is only now, paradoxically, that we are trying to put up inflation, which is proving difficult.
The overall growth outlook is good too and we expect Ireland’s gross domestic product, GDP, to expand strongly, albeit at a more sustainable pace, by around 3% this year and 2.5% next year. The economic successes of recent years owe much to the Government’s efforts to address the legacy of the crisis. The fiscal deficit declined from 11.5% of GDP in 2009 to only 1% five years later and the reforms of the banking sector are starting to bear fruit. There was a relatively high cost of having cleansed the banks and made them functional again. The country bit the bullet when it was necessary and it would have been very destabilising not to do that at the time. Eventually, the country has received the benefits of a more stable and stronger banking sector.
Parliament played a role in this. Three years ago we produced a report with some ambitious recommendations about how the Parliament scrutinises and influences the annual budget. Many of these recommendations have now been implemented. Today, in addition to the work of the Committee on Finance, Public Expenditure and Reform, and Taoiseach, the new budgetary oversight committee has been established, with an intensive work schedule that includes reviewing the fiscal position of the Government and examining the expenditure policy proposed by the Government. In addition, a new Irish parliamentary budget office is up and running. I know of the Chairman's insistence throughout his career on the question of delivery of bang for the buck and getting public servants to deliver their commitments.
Mr. Angel Gurría:
The tax and transfer system continues to be highly redistributive. I mentioned this morning that this was something that was slowly disappearing from the taxation systems of other countries, including all the OECD countries. Like all other countries, Ireland initially had uneven and unequal income distribution but after the taxes and social security contributions, as well as the delivery of social security services, the country ends up with a much fairer society and much less inequality. That is a very desirable result and it allows the benefits of growth to be shared more widely.
The Irish people report a high level of satisfaction with their work-life balance, and social indicators such as number of social connections are also favourable. A parliament’s work is never done, as members know, and it still has to tackle some of the legacies of the crisis and build resilience to future shocks. That means reducing debt or continuing to reduce debt. Ireland’s gross public debt was around 75% of GDP in 2016 and it has continued to reduce in 2017. In per capitaterms, it is high compared with the OECD average and reducing public debt would create scope for budgetary policy to support the economy in the event of a negative shock, such as a disorderly Brexit. This could be achieved through broadening the tax base in a growth-friendly manner. For example, VAT preferential rates and exemptions should be phased out and the property tax yield raised through more regular revaluations of the tax base.
I welcome the Deputy. It is nice to see her again.
Mr. Angel Gurría:
She is a frequent visitor and has worked a lot with us. Financial sector vulnerabilities also need to be further addressed. While non-performing loans on bank balance sheets have declined by approximately 60% since their peak, the stock remains high. It is still in the double digits and it should be addressed.
The OECD Economic Survey has a special chapter on productivity.
It paints a contrasting picture, showing that foreign-owned companies outperform local businesses by a wide margin and that this margin is getting wider. The labour productivity index of locally-owned firms has remained practically flat over the past ten years, while for foreign-owned firms with a baseline of 100 in 2006, it has risen to almost 400 in manufacturing and, almost eight times, to 800 in services, such that in ten to 12 years it has multiplied. Regional disparities are large too. Data from the Central Statistics Office show that the gap in disposable income per capitabetween the Border, midlands and western region and the rest of the State has not been reduced since the early 2000s and is still approximately 10%.
The resilience of the Irish economy and the fight to make growth inclusive hinge on boosting the productivity of local businesses and equipping workers with the skills to improve their outcomes. Only approximately 6% of the population aged 25 to 64 participated in education and training in 2015 compared with over 15% in Britain and almost 30% in Sweden. Irish-owned companies in most sectors have reduced employee training since 2000, when they should have been doing the opposite. The Government could allocate a greater share of funding under the national training fund for training for those already in employment. Online education could help but some workers and jobseekers may be caught in a vicious circle because, according to the survey, only 48% of Irish individuals had basic or above basic digital skills in 2017, which is 9% below the EU average. Therefore, if attempts to upskill are online based only, at least half of them would not be in a position to access it simply because they do not have the basic skills to do so.
Obstacles to entrepreneurship which could be addressed include high regulatory barriers that make it hard for innovative new firms to gain a foothold and reinforce the position of incumbents. There are costly regulations relating to commercial property and legal services. The cost of business failure is too high. Modern entrepreneurship means being able to learn from experimentation and this sometimes means being allowed to fail and learn from mistakes and to get back up again. The firms have to make an effort too to improve their management skills and invest more in research and development but, again, Government can help by creating an enabling environment. It can also help citizens through reforms focused on housing, health and getting back into employment.
Ten years ago, when I was last in Ireland, ghost estates and unsellable property were making the headlines. Today, housing affordability is the issue for many people. I note that one of the national policy objectives of the Project Ireland 2040 is to prioritise the provision of new homes at sustainable locations and at an appropriate scale relative to location. While the latter is the preferable problem to have, it is still a problem and it needs to be addressed. The Government has implemented several policy measures to improve affordability but any long-term solution must focus on increased housing supply. Abolition of unnecessary housing regulations that raise costs and reduce the potential for greater density is a priority. So too is pushing the market to put well located but underutilised swathes of land to good use. To achieve this, the introduction of a broad based land tax would be a useful weapon.
The health system is another area of concern. There are worrying trends in terms of cost, patient satisfaction and waiting times. There is a graph in the study on waiting times, which shows that waiting times here are a multiple of those in New Zealand, Spain, Germany, France and other countries. In Ireland, waiting times for some treatments range from two to three weeks to six months. While there is scope for further improvements in health spending efficiency, a path to providing universal coverage should be laid out, keeping in mind the likely impacts of population ageing. There is a video game in which a little face known as the Pac-Man eats everything. Ageing does this with budgets. Ireland has a demographic window of opportunity in that its population is still younger than the populations of most of its peers in Europe. It must use this time to prepare for a time when ageing will catch up with Irish society and it will experience vast increases in health expenses.
Apart from housing and health, employment is a concern. This might sound surprising given that unemployment rates have been falling, but some groups, such as young, low educated individuals and women, must be encouraged to further participate in the labour market. They are under-represented. One way to do this is to change those aspects of the social welfare system that make people worse off when they take up a job.
Ladies and gentleman, the financial crisis is now behind Ireland, due in no small part to its dedication to promote better policies for better lives. The OECD looks forward to working with Ireland and for it in fulfilling this mission and in showing how, in the words of William Petty, "a small Country and few People, by its Situation, Trade, and Policy, may be equivalent in Wealth and Strength, to a far greater People and Territory."
I welcome Mr. Gurría and his colleagues. My first question is related not to the economic survey of Ireland but the OECD's work on digital taxation. We know that the European Commission is working on proposals for changes in how tech companies are taxed across Europe. I understand that the OECD is also doing work on this issue. Can Mr. Gurría confirm what work is being done and if proposals on the issue will be brought forward at OECD level?
Mr. Angel Gurría:
The OECD is currently working on the issue. It will be discussed at the upcoming meeting of the Committee on Fiscal Affairs on 14 and 15 March. On 16 March, we will discuss with the EU Commissioner for Economic and Financial Affairs, Taxation and Customs, Mr. Moscovici, what the EU proposes to do. Apparently, it is to announce a proposal on 21 March.
We will probably produce our own ideas before that. A G20 meeting will take place in Buenos Aires from 18 to 20 March. We will discuss this report and present it to the meetings of the IMF, World Bank and G20 in Washington in April. The Deputy asked what will be the substance.
Mr. Angel Gurría:
The substance is that this matter is too important to be urgent. One does not need to come up with some short-term solutions if they are not well thought out or consensus based and they do not take a longer-term approach. We must not do anything today that will make it difficult to have a long-term solution. If one feels compelled to do something because one needs to come up with something politically, let us talk about it and be very careful because many countries, including Ireland, are saying we should do something after we have thought about it very carefully, consulted and talked among ourselves. After all, according to the schedule, we should produce a final proposal in 2020, which means there is no need to deliver a proposal now.
The only issue is that there seems to be political urgency, an emergency almost, about being able to say digital companies are being taxed. The issue is not about digital companies but about the digital economy. We have an increasingly digitalised economy, with everything becoming digitalised, and the question is how to deal with this in terms of taxation. Imagine that the tax base is reducing dramatically because everything is digital and digital is not being taxed. How do we come up with a means of taxing a modern economy, period? The issue is not about taxing Google, Apple or Amazon but about taking a very hard look at the whole of the new economy.
For a number of European countries, the issue is about taxing these companies and generating more tax revenue from this source. Is the OECD seeking to move in the same direction as some European countries, at least the larger countries, in moving to a turnover based tax for these companies, whereby the tax would be levied based on the users of the companies' services are located, rather than where the companies are resident from a tax point of view?
Mr. Angel Gurría:
No, we do not support the short-term solution or approach that would consider turnover only because that is only one part of the problem, would leave out many of the activities and would be very uneven in its application. This may be a reflex or an intuitive way to address the issue but intuition and reflexes do not offer good guidance.
Ireland has been highly successful in attracting foreign direct investment. One of the tables in the survey shows that corporation tax receipts in 2011 accounted for 10% of all tax collected in Ireland and this figure had increased to 16% in 2017. In addition, 80% of corporation tax collected in Ireland is paid by multinational companies and the top ten companies or groups pay approximately 40% of all corporation tax. Does the OECD have any concerns regarding the growing level of dependence on corporation tax and the concentration of corporation tax receipts among a very small number of companies?
Mr. Angel Gurría:
Concentration is a result of success because Ireland has been able to attract many large companies. It is not a problem if the companies pay their fair share and should not be a problem if everybody is dealt with in the same way. If Irish small and medium enterprises and large corporations know they are being charged 12.5% on their profits, the country will have a level playing field. The problem arose when there was a perception that while Ireland was taxing companies 20% and subsequently 2.5%, some companies were paying 2% or 0% tax under sweetheart deals. The clear view of the OECD is that we do not take a position on countries' overall tax number or level provided it is applied to everybody. If a country can make its economy work and make ends meet by applying a corporation tax rate of 0% or 9%, as some eastern European countries do, or 12.5%, as Ireland does, that is fine. Our threshold is that everyone must be treated the same. We do not believe a country that can make its economy work with 12.5% taxes is doing anything wrong or intrinsically taking competitive advantage.
We have been advocating that a number of the highest taxed countries reduce their taxes. The global trend is to lower corporate taxation, which is hovering around an average of between 20% and 25%, with few countries still applying a rate of 30% or more. Taxes on wages and labour, known as the tax wedge, are also reducing, although the wedge in some European countries is still higher than 50%. We also advocate compensating for the losses arising from the reductions in these typical taxes through better collection - the Deputy just referred to a figure of 16% - but also through property and green taxes.
Mr. Gurría referred to non-performing loans in the Irish financial system, which is also noted in the survey. While the level of non-performing loans is falling, it continues to be elevated compared with European levels. The OECD has referred to the need to reduce these loans. Does Mr. Gurría have a view on the different ways in which this type of loan can be reduced, for example, through more aggressive provisioning, write-offs, enforcement actions, more loan restructures or the option of portfolio sales. Controversy surrounds portfolio sales to private equity funds for a number of reasons, including that these so-called vulture funds are not regulated directly in Ireland and some good loans are finding their way into the portfolios being sold on. I am referring to restructured loans that comply with the terms of the restructure but are still deemed to be non-performing loans under the Single Supervisory Mechanism and European Central Bank rules. What is the OECD's position on the way in which non-performing loan levels should be reduced? Does it have preferred options?
Mr. Angel Gurría:
I would say they should be reduced using all of the options simply because they are techniques. There is a recognised new lower value than the nominal value to the mortgages that are on the books. We should remember how the crisis started. Millions of mortgages were placed in very nice boxes tied with a ribbon and a triple A sign was attached by the rating agencies which sold the goods as triple A goods. However, they were not triple A goods and when non-payment started, they unravelled and the crisis unfolded. The first thing to do is to recognise that these are substandard loans. From the point of view exclusively of the banks and bank regulators - those checking whether the banks are stable - they do not want to pay for another bank crisis. Ireland paid a harsh price for the bank crisis. They also want to ensure the banking system is stable, transparent and reporting correctly.
Second, they want the judicial system to be able to process cases quickly whenever a borrower is not paying and the lender wants to take action. Again, judges should not be asked to formulate social policy. It is not for them to do this work. Third, if in its collective wisdom Irish society wishes to take the political decision to support some of the mortgage holders who may be unable to continue to pay their mortgages for whatever reason, not because it wants to salvage the banks or make the vultures better off but because it wants to help such people because they are especially vulnerable or a small group, it should do so transparently. The system and the banks should be made to cleanse their balance sheets. The judges should be made to adjudicate and move quickly. Then, for those whom society really wants to help, this support should be made transparent through the budget. It would be a line item of expenditure that the Government should choose. The Government should let those affected know it is doing this but also let all taxpayers know because they would actually be helping those whom the Government chooses to help. They would be contributing to help them, so the way it is done should be transparent.
Mr. Gurría is very welcome again to Ireland, and it is very nice to meet him. I will outline one or two points concerning a number of areas. The OECD gave Ireland a lot of very valuable assistance during the crisis on trying to get people back to work, in particular in areas such as youth unemployment and long-term unemployment, both of which are referred to in the OECD's report. I certainly recommend that the Government consider commissioning a further report from the OECD, as independent experts in this area, specifically on the failure to create enough apprenticeships, particularly in housing and construction, because this area collapsed. The agency which provided the training in the old days, FÁS, collapsed as well, and a new agency was formed, but much of its attention is devoted to analysis. Regarding supply problems in the housing market, one of the key problems is that smaller and medium-sized firms cannot really take on apprentices because the format of the market has changed. It would be very helpful to have an independent set of eyes such as the OECD's look at this area because it may have examples from other OECD member states which might be useful for us to adapt.
Another issue is jobless households. I note Mr. Gurría said Irish employers are putting less into training than any other OECD country. Regarding the future of work, on which I know the OECD has done some work, it is really important that employers and government continue to invest in workers to raise their skills levels. I also wish to raise the issue of inequality of income and inequality in respect of the indices on well-being. I do not know whether the OECD has a policy per seon this, but we in Ireland need to move to a living wage. Wages have been very flat, notwithstanding the fact that, as Mr. Gurría said, the worst of the crisis has passed. This means that it has become extremely difficult for a person or a couple on a modest income to purchase or rent a house at a reasonable price. In certain areas, including in some of the professions such as teaching, many people are now going abroad because they are finding the traditional lifestyle expectancy they had of being able to begin to buy a house through a mortgage or rent is no longer realistic for them.
My other question concerns taxation, on which I know Mr. Pascal Saint-Amans has done a lot of work. How do the witnesses feel Ireland is performing? We have got quite a bad reputation in this regard, as they know, with certain countries almost seeming to target Ireland, as it were, as being responsible for all corporate tax inequality in the world, which is rather unfair. What are their observations on this? One of the attractions for foreign direct investment into Ireland is the calibre of the workforce here, both young graduates and young people from countries such as Italy, Spain and Greece who are willing to come here and work. Again, in many cases they are very highly educated young people from different countries. I ask the witnesses to comment on that.
Mr. Angel Gurría:
Regarding getting people back to work, particularly youth unemployment, we would be very honoured, and we are certainly ready, to work with Ireland and for Ireland in doing an analysis or an update of the analysis we did a few years ago of jobs. What the Deputy is suggesting is that certain sectors in particular - she mentioned the construction sector specifically - have both an institutional and a market failure, the institutional one being the agencies that were set up in order to provide special training and which did not fly. The market is not working, evidently, because it is producing price bubbles. Ireland is not alone in this regard but this is no consolation. Australia, Canada, Sweden, the Netherlands - all these countries contain certain cities in which housing has become unaffordable. It is not an issue throughout the entire countries affected. An example of this problem is Stockholm, Sweden, which has a waiting list of 600,000 who want access to rentals because the rental market there is not very well developed. Therefore, even in the best social democracies, the welfare states, housing in certain parts of the capitals are becoming unaffordable either to rent or to buy. This requires public policies. In our chapter on housing in Ireland, we say, among other things, that supply needs to increase. There are financing issues but there are also land use issues. We recommend possible modifications in order that Ireland can have better land rezoning. I ask my colleagues to feel free to chip in if they think something needs to be said. This is a very difficult problem and goes all the way from China to Australia, passing through Ireland and the UK, which is in a very bad way. The UK has a very specific zoning and land use problem. The rigidity or lack of flexibility there sometimes produces these distortions and then housing is suddenly made impossible, which is an issue. This tends to exacerbate inequality - or rather inequalities. There is inequality of income, inequality of accumulated wealth and inequality of opportunity. Of course, to the extent that housing is unaffordable, this also provides for a rigidity. It is not easy for someone who knows there is a job waiting here for him or her to move because the problem is that he or she must live somewhere. If the living is impossible, this becomes very difficult.
The Deputy mentioned a living wage. There are different ways to take this on. In the case of Ireland, it used to have 15% unemployment and it is now 6%. As we have documented, wages are recovering - not from 2008 and 2009 and the big crisis, but from 2011 when they dropped further again. What does this mean? That means that the scarcity of labour, talent and skills is producing a recovery in the wages simply because supply and demand is acting. The country has more demand, investment is coming in and it needs more skilled labour. Wages are actually increasing. It is more than just providing money to people, although in some cases that must be done for the vulnerable. It is a question of providing skills, upskilling and reskilling.
Ireland presided over economic revitalisation in a way and it knows how important it is. However, it has this paradox. There is a bunch of people saying they cannot find a job and a bunch of companies claiming they cannot find the talent. The two cannot be matched because people's skills are not consistent with what the companies need. We need to be better at getting the Government, the private sector, the productive sector, the trade unions, the individuals and the universities to produce the right kinds of skills so that they match. We would then be better able to address the question of inequality.
Last, but not least, I come to the reputation of Ireland in terms of taxation. The former Taoiseach, Deputy Enda Kenny, went to the OECD and basically offered to dismantle the double-Irish system. Ireland did so and three years later it was no longer there. Today the big issue is the Apple case and the €13 billion. This would no longer be possible because the mechanisms that made it possible are no longer in place. It is something from the past that has to be addressed, but it could not be repeated today. People do not know this. People do not generally know that Ireland has dismantled the system that made it possible to have such a situation in the past.
We took Ireland's solution to the Dutch and we said: "Double-Irish is no more; how about dealing with the double-Dutch?" and they did. Then we took this to the UK and they did. Eventually we now have more of a level playing field by dismantling these special systems where basically all companies are treated the same, but not with the same level of taxation. Each country has a different level of corporate taxation as long as it treats them all the same.
I have been to the OECD a number of times and it is good to see the ambassador here as well. Deputies Michael McGrath and Burton have touched on almost all the points. Mr. Gurría has outlined the progress that Ireland has made in adopting country-by-country reporting, engaging with the BEPS process and so on. I am concerned that one or two US companies contribute a huge chunk of our corporation tax, which in one way, as Mr. Gurría acknowledges, is good because we are good at it, but if any of those companies were to move or the US decided to work differently with those companies, we could have a problem. It would create a very big hole in our budget if one, two or three of those companies were to disappear or the tax generated by those companies was gone. How vulnerable is Ireland being that focused on a very small number of companies contributing a large proportion of tax?
I ask Mr. Gurría to outline his attitude towards property tax. People in this country are not very willing to embrace the concept. They feel it is a tax on something they have had to earn money to buy and then they are being taxed on already owning it, whereas if they did not own it in the first place, they would have no tax to pay. There is considerable resistance to it. I know the OECD report proposed more revenue from property tax.
After Japan, Ireland has the second highest indebted public debt in the world. I ask Mr. Gurría to comment on that.
Mr. Angel Gurría:
Ireland is on board with BEPS and with the automatic exchange of information. It has already received a few hundred million euro in unplanned extra revenue simply because the taxpayer reached the conclusion that his name would end up on the taxman's desk. People have asked: "Mr. Taxman, what could we do in a hypothetical case?" Taxmen all over the world have provided special windows to normalise. They do not want to put people in jail; they want people to pay taxes. We have provided that incentive and now everybody is on board. Some €85 billion in extra taxes were paid before we started the work. Now it is ongoing; we have started; the train has left the station. With BEPS, Ireland is on board and working actively.
Do I think Ireland is vulnerable? No, I think Ireland is being very successful in attracting the companies. It is very simple. Ireland has a set of rules by which it taxes the companies that operate here. That includes everyone who comes. Ireland applies the rule. The golden rule is: a company pays taxes where it generates the profits. It is that simple. We need to keep it like that. If the company generates them elsewhere, it pays elsewhere. If it generates them in Ireland, it pays in Ireland. Of course, there are also some intellectual property payments. It needs to be reasonable and companies should just pay taxes where they generate the profits. I would recommend keeping it like that and keeping it simple. It is a message that everybody understands. The tax reform in the United States is going in that direction.
The Senator is worried because there may be a tariff problem on steel, etc., and there is concern that it might bring about a trade war. However, basically the tax reform moves more in the direction of what the Senator is saying, rather than against it. I think we are generally moving in the right direction.
On property tax, what is the trend in the world? It is less tax on companies; less tax on labour; more tax on property; and more taxes on carbon emissions. There is more tax on consumption, such as VAT. This is the trend in the world. Not everybody is moving at the same speed and not everybody uses the same tax mix, but this is the mix. This means making it more attractive to make a new investment or to create a new job, rather than making it more expensive.
The Senator asked about Japan and its debt. Japan has 240% debt to GDP. The OECD average is 100%. Italy has 130% and Greece has 170%, moving to 180%. Ireland has 75%. Does that mean it has to use that other 25%? No way. It should keep it coming down. As I have said repeatedly, Ireland belongs to the Avis club.
Remember when one wanted to rent a car from Avis, the employee at the counter had a sign around his neck saying: "We are No. 2; we try harder". We have to try harder, those of us in countries which are in second place. That includes everybody, except the USA and perhaps Japan and Germany. The threshold of tolerance of rating agencies and banks is very low and we cannot make too many mistakes. It is not the absolute number, but the trend. Frankly, there is a good story here. Ireland has said it wants to go to 45% and the Taoiseach mentioned that if 15% infrastructure were added, that could go to 60%. That is more like an investment than just a debt and it is going to be recovered. Around those levels, one is safe but it should always be coming down because one may need it again for a rainy day. Rather than to put a lot of money in a rainy day fund, albeit that is a good idea, Ireland should pay down the debt to the greatest extent possible because that is its best umbrella.
Before Mr. Gurría goes, I note that we have had a number of EU Commissioners here over the last week or so. Like Mr. Gurría, they referred to the financial crisis and how well we are doing. They talk up the story of Ireland, which is fair enough. However, while the financial crisis may be over, the effect it has had on our individual citizens and businesses in this country is far from over. The banking system brought us to this place and was partly the cause of austerity but it was the people who bore the burden of that austerity and helped us back. While there were some policies from Government, the people carried the can at the end of the day. These very same banks - Mr. Gurría refers to some of this in his report today - have still not learned their lesson. They still need the extreme regulation, which is called for, because their culture has not changed. The indebtedness of businesses to the banks is such that if they do not begin properly to write down debt and allow businesses to be freed up to trade and provide employment, the country will suffer for even longer than it has suffered already. This will continue for longer than we expected.
When the IMF came in, the country responded by saying it would bring about the reform of local government, central government and administration. We said we will comply and we will be great. We have not seen the reform of local and national government that places the citizen at the centre of our work. That is regrettable. Therefore, I place what Mr. Gurría said in the context of the Ireland we live in. While the boats in the bigger centres have risen and people are moving on, there is a very large part of rural Ireland which still finds it extremely difficult to respond. That is due mainly to debt and poor policy implementation in rural Ireland. I am delighted we have had the opportunity to have this exchange and I appreciate Mr. Gurría's visit. I wish him well on his journey. I thank his officials also.