Dáil debates

Wednesday, 11 October 2006

1:00 pm

Photo of Micheál MartinMicheál Martin (Cork South Central, Fianna Fail)

Subsequent to the European Parliament's vote last February, the Competitiveness Council adopted a Common Position on the draft directive on services in the Internal Market at its meeting on 24 July. The text was adopted as an A item at the council with only two member states abstaining. It was supported by Ireland. This followed intensive discussions on the proposal at the Competitiveness Council on 29 May at which political agreement was reached.

The Common Position was substantially based on the compromise text that was brokered by the European Parliament on 16 February 2006 and carried through in the amended Commission proposal of 4 April. The Commission's amended proposal was supported by Ireland although we secured some technical amendments in areas of concern to us.

Ireland would have preferred a more ambitious proposal, in particular the inclusion of temporary employment agencies in the scope of the proposal. There are about 90 agencies involved in this important sector in Ireland with an annual turnover of €1.3 billion. There is a worldwide shortage of skilled people in the aviation industry as well as in the medical, financial and IT industries and the recruitment industry finds them.

Ireland is the largest provider of personnel to the aviation industry worldwide but much of the business is done outside the EU because of barriers to trade within it. This effectively means that skilled personnel that the EU needs to improve its competitiveness are frequently placed in third countries rather than the EU because of the difficulties the recruitment industry has in operating in the Internal Market.

Total employment in the Irish services sector is approximately 1.3 million, compared with 912,000 in 1997. Forfás estimated that the original Commission proposal would have benefited Ireland to the tune of about €400 million annually. The indications are that the amended proposal would be worth about half that to Ireland. The enterprise policy group report, the O'Driscoll report, identified the services sector as having significant potential for development in a freed-up Internal Market. While traditional industries have been under pressure it should be noted that in the last five or six years 440,000 jobs have been created in the services sector and 150,000 in high end manufacturing. These figures come from Forfás following research on manufacturing and internationally traded services.

The current status of the draft directive is that it is undergoing a Second Reading in the European Parliament.

Comments

No comments

Log in or join to post a public comment.