Mr. Seamus Coffey:

The Deputy has raised a number of points. In terms of the regional employment issue, while we are seeing an increased dispersal of employment, I would caution that it is measured on where the person lives rather than where the job is created. A person could be living in one region but working in another. The increases in employment around the country, from the south west to the west, the Border and the south east regions would suggest that we are seeing a spread. However, if we have a large amount of employment being created in regions close to Dublin, it could simply be an issue of commuting. That said, I take the point that there has been an improvement in the regional spread of employment in recent years.

On the issue of sustainability and the presence of companies in Ireland, the fear is not so much that the companies will leave. I agree with Deputy Bailey that many of them are embedded here. The real issue relates to the tax base and the amount of tax being collected, which increased very rapidly in 2015 without an accompanying increase in substance or employment. We saw a huge rise in gross profits, to which Deputy Richard Boyd Barrett referred; that seemed to happen very rapidly. That element of it could be subject to a reversal but the employment itself does seem to be quite embedded. We are talking about industries which spend substantial amounts on their plant and their operations in Ireland. Some of them, like Google, may be somewhat footloose in that their staff may require no more than a good computer and a desk but in the manufacturing sector, companies are spending hundreds of millions, if not billions of euro on plant that simply will not be moved.

The contribution of US companies to Ireland is significant. We strongly outperform our EU partners in attracting investment from US companies. In terms of their contribution here, US companies pay their staff €6 billion a year and spend another €4 billion on indirect employees who supply goods and services to them. The tangible investment they make in terms of building things in Ireland, rather than the intangible investment from which we do not really benefit, amounts to between €3 billion and €3.5 billion per annum. On top of that, we have the corporation taxes they pay which look like topping between €4.5 and €4 billion per year. Apart from corporation taxes, as Deputy Lahart mentioned, they also pay rates, the national employment levy and other taxes that arise from their presence here. All told, we are looking at a figure that is not far off €20 billion every year, which is a huge contribution to the Irish economy. It is a risk to be so dependent on a small group of companies but I am not sure that it is a risk I would be seeking to mitigate. Rather, I would be looking to develop other sectors. Long may we receive €20 billion a year from a group of companies that are choosing to operate in Ireland. While it does bring concerns that they might leave, the primary concern would be about the tax base, which is mobile. If proposals at EU level to shift the tax base from the country of production to the country of consumption through the Common Consolidated Corporate Tax Base, CCCTB, were implemented, the tax contributions of these companies would drop quite dramatically although the employment would not move as quickly.

We have built up a reputation over 30 or 40 years of delivering on large projects for these companies and other countries cannot replicate that reputation overnight. The risk to companies leaving is probably over the medium to long term; I do not see that arising.

On the investments we are making and the choices, as mentioned earlier I think housing is a significant issue. If these companies are going to choose to come to Ireland they need somewhere for their staff to live. We have not got this right in decades. We either have too much activity going on or, as in recent years, too little activity. We hope to get that back to a happy medium and see a pickup in activity over the coming years. That is obviously an issue that arises on the list. Tax is not enough to get a company to move investment to a country. It is probably in the top ten. It might not even be in the top five, but it is there. Companies need the infrastructure and the available staff. If the staff have nowhere to live the companies will not come.

Education is a key issue. Coming from that sector, I recognise that we have done well in developing Irish talent for companies in the manufacturing sector. The ICT sector has been successful in attracting staff in from abroad. There may be a disconnect between what is happening in those two sectors. Given the employment here, that money is working through the economy.

It is hard to make predictions. I think the investment is reasonably solid. There were risks with the US tax changes, particularly some that were mooted 18 months or two years ago. There was talk about a destination-based cashflow tax, an import duty, whereby if a company makes something in Ireland and sells it back into the US, a tax would be due on that product going back into the US. We are a huge supplier of pharmaceuticals, medical devices, soft drink concentrate and a wide range of other products that are manufactured in Ireland for export back to the US. If that destination-based cashflow tax had been introduced, it would have had severe implications for those companies' operations in Ireland. It would have become much more attractive for them to make those products in the US and avoid that import duty. That did not materialise when the tax reforms landed on us in December and most of the changes seem to have been relatively benign from an Irish perspective.

I see the CT holding up for a while. We seem to be a in a sweet spot when it comes to investment, employment and tax. We cannot expect it to continue forever. We seem to have tailwinds at our back in a wide variety of areas and we should be prepared that those winds will not always be pushing us along. That is not to say I expect things to crash or fall. However, the improvements have been so large in the past couple of years that we cannot expect those improvements to continue and we should be cautions in that regard. An outright reversal of many of these factors is unlikely, but we cannot bank on these continuing to increase.