John Perry (Sligo-Leitrim, Fine Gael)

I compliment Deputy Durkan on tabling this important motion. This economy has moved from fifth most competitive to 89th in the world. That gives a clear indication of the stacked up costs of doing business. Regarding power, the stacked up costs are 9%, which is very high. While VAT can be reclaimed on commercial property, it is an injustice that it should be charged on domestic use. It is a huge taxation on those who can ill afford to pay, particularly the elderly.

During the past five years, more than 33,000 manufacturing jobs have relocated to more competitive economies. It is disappointing to hear the IDA acknowledge that we are seeking added value jobs which puts paid to the possibility of retaining jobs. We all hear about the boom in the economy, which is driven by the construction industry. Recent job announcements have been few and far between, bar high-tech jobs. All the graduates in the north west have to leave the region. That Ireland has moved from fifth place to 89th in terms of competitiveness indicates a problem.

The latest ESB price increases are 19.4% for residential consumers, 19.6% for SMEs and 21% for large industrial consumers. Such increases have a direct impact on large companies such as Abbott Laboratories in Sligo, which employes a large number of people. A gas price increase of 34% will add up to €300 to the average domestic annual bill. The net losers are the consumers but equally important are employers who create jobs. Given the enlarged Europe, one can relocate in a lower priced economy. That is the point made by my colleague, Deputy Hogan, who has the review of the State regulators. In respect of every job here, there is delegated responsibility. The Minister is not responsible; he passes the buck to somebody else who has been appointed.

The report of the National Competitiveness Council is a damning account of the Government's failure to address spiralling business costs and the decline in competitiveness of the economy. It shows that the Government has made little progress in addressing spiralling business costs in recent years. This has resulted in the collapse of certain export markets and the repatriation to America of €18 billion per year in profits. As we speak, interest charges, which were 6%, are being increased. All these increases are stacked up costs. For every €100 million borrowed from the banks, the State indirectly gets €30 million arising from tax on tax as this is very much a taxation economy.

That VAT on power supply in the UK is less than half the rate here is an indication of how wrong is our taxation system. The problem arises when trying to generate jobs, especially in small companies, and ultimately their survival. A new company, Mayo Power Plate, which will open shortly in Mayo and is backed by a consortium of investors, will be of major benefit to County Sligo. The plant should provide a major source of employment to farmers who will use the wood and other products as a major field source. This will be of substantial benefit to the region. A massive area of ground is under afforestation. It will take the thinnings of afforestation and wants to be backed as an alternative energy supplier in Mayo.

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