Tony Killeen (Clare, Fianna Fail)

I thank Deputies for their contributions on this important issue. The Taoiseach is attending a summit of EU Heads of State and Government and the Minister for Finance is attending a meeting of EU Finance Ministers in Brussels.

I pointed out in my opening statement that good progress has been made in the BMW region in recent years. Notwithstanding this performance, there is wide acceptance that efforts must be made to close the gap in investment under the national development plan. The Minister for Finance has already stated that he will seek to prioritise expenditure in the BMW region in 2005-06.

I mentioned already the positive and welcome announcement by the Minister for Transport on the national road investment programme for 2005. Four of ten major projects completed last year were in the BMW region and of the 19 to begin this year, eight are in the BMW region.

Overall, progress on the national development plan is impressive and we are currently spending 5% of GNP on capital investment, double the European average. All structural funds allocated to the BMW region must be spent in that region and cannot be used elsewhere, which is the impression some Deputies have. The employment growth rate in the BMW region was double that of the south and east region over the past five years and the unemployment rate is 4.5%, only marginally above that of the south and east region.

In the last few days I have had reason to note regional disparity in areas as far apart as Wales and New York state. In both areas, people were hugely impressed by our relative success in regional development, particularly in job creation. In some of those regions, 80% of people who became unemployed ten years ago have failed to get a job in the interim.

I should point out to Deputy Ring that County Clare is not in the BMW region and that Knock Airport has enjoyed a massive increase in passenger numbers in the last two years and is making enormous progress. Also, sites are being acquired for decentralisation and Departments are working on staff relocation, with several BMW sites in the first tranche.

Investment in education is paying dividends. I strongly support reduced class sizes, particularly at primary level which bring enormous benefits to the BMW and other regions. The programme for research in third level colleges is moving apace with third level campuses in NUIG, the GMIT dual campus, Athlone, Sligo and Dundalk institutes of technology and the fledgling Cavan campus. The BMW region is doing well in this regard.

Deputy Burton referred to the Forfás competitiveness report on infrastructure. We should remind ourselves that in 1987 our GDP to debt ratio was 125% and in 2004 it was 30%. Then, 1 million people were employed and there are now 1.9 million in work. Employment has increased by 33% in the last six years in the BMW region, with 120,000 more people employed in the area in 2004 than in 1998, an extraordinary performance.

The cumulative national development plan expenditure until the end of June 2004 is €31 million, representing 87% of the total forecast national development plan expenditure of the period. Over €8 billion was spent on the BMW region, with €23 billion spent on the south and east region. For the period 2000 until June 2004, over €16 billion, 62% of the national development plan spend, was spent on economic and social infrastructure measures, including national roads, public transport, health facilities, social and affordable housing and environmental infrastructure. Almost €9 billion of national development plan expenditure has been spent in the employment and human resource programme in areas such as adult education, initiatives for early school leavers, literacy and numeracy programmes, training for employment across a range of sectors, investment in lifelong learning and apprenticeship schemes.

Our economic conditions are not as buoyant as when the national development plan was prepared and we must be careful in our management of the transition to lower rates of growth if we are to sustain our economic progress and continue to invest. We must keep our labour costs competitive and ensure the employment growth achieved can be maintained. That is the challenge we face and we are taking action through a number of initiatives to ensure we continue to achieve outstanding growth. We note the Lisbon strategy and recent developments focusing on the need for improved growth and employment rates. Challenges exist for other European states as they do for us and our colleagues across the EU are envious of the enormous strides we have made, particularly in employment.

Investment will be prioritised where the best economic return can be gained while taking account of overall Government policy objectives. I am confident the BMW region will benefit greatly from the refocus of investment for the remainder of the national development plan.

See this speech in context