Pat Gallagher (Donegal South West, Fianna Fail)

While this will be done in a way that requires all to act, it will not be done, as some would do, in a manner that would undermine Irish employment. Progress on meeting our Kyoto obligations involves a range of measures. For example, our major industries were one of the first to become part of the EU emissions trading scheme. The greener homes grants scheme has been an outstanding success and the purchase of carbon credits is also an instrument recognised in the Kyoto Treaty. It is a strategy followed by many of our EU partners and it brings real benefits to the developing world through investment in environmental projects.

Although Ireland is making progress on decoupling economic growth from emissions locally, the pace of climate change globally has increased very significantly. In response, the EU is ready to commit to deeper reductions in emissions and one proposal is for the EU to agree unilaterally to a 20% reduction in the 1990 level of carbon emissions by 2020. Regardless of the final target to emerge, Ireland will play its part in meeting the obligations to be agreed nationally with each member state.

The publication of the bio-energy action plan by the Minister for Communications, Marine and Natural Resources is one example of the greater emphasis on emissions reduction and the imminent publication of the White Paper on Renewable Energy will demonstrate how we will move Ireland to a low carbon economy. The growth in emissions from the transport sector reflects the growth in the economy, a larger population and a below average rate of car ownership.

In all developed countries the reduction in emissions from the transport sector is seen as a particularly complex challenge without a single easy solution. The Government has already taken steps to reduce emissions from the transport sector. These include a national bio-fuels obligation on fuel suppliers of 5% by 2009, generous tax breaks for hybrid and bio-fuel cars, a tax system through VRT and motor tax that is already heavily biased towards smaller engine cars that emit fewer emissions, a commitment announced in December's budget that VRT and motor tax will be further refined to reward more efficient cars in the future and fiscal supports to encourage the growing of crops for bio-fuels.

The investment in Transport 21, which I outlined, will make a significant contribution to a more sustainable transportation system. Overall, €18.5 billion will be invested in the national roads programme, which will upgrade national roads, remove bottlenecks, reduce congestion, improve journey times and, consequently, improve competitiveness. Furthermore, €15.8 billion will be provided for public transport projects, in a significant rebalancing of public expenditure, which will encourage commuters to switch to public transport.

The transport sector has a key contribution to make in meeting our Kyoto obligations and I already announced the preparation of a sustainable transport action plan to address this contribution. This action plan must consider a range of innovative measures and policies, which will guide the transport sector to 2020. It will affirm our support for EU proposals to reduce carbon emissions of new passenger cars to reach an average level of 130 grammes per kilometre by 2012.

I recognise the preparation of this sustainable transport action plan will take some time and will necessitate full consultation with stakeholders and the public. As an indication of our commitment to this policy we took a number of recent initiatives to demonstrate practical steps which can be taken to improve sustainability.

The Minister for Transport, Deputy Cullen, asked Dr. Lynch, the chairman of CIE, to move the Bus Éireann and Dublin Bus existing fleets to a 5% bio-diesel blend and to plan to achieve a 30% bio-diesel blend in all new buses. It is intended the projects will demonstrate a viable, reputable green transport module for Ireland. The project represents a further commitment by the Government to fulfilling its obligations under the bio-fuels directive through encouraging the indigenous bio-fuels industry and providing market incentives.

I stress these new incentives are a further demonstration of commitment to sustainable transport. The proposed sustainable transport action plan is intended to go further and offer a vision and framework to ensure sustainability in transport is mainstreamed across all areas of Government.

This is a time of great opportunity for transport change. More clearly than ever we identified what needs to be done. Unlike the opposition, we have clear policy and funding frameworks to guide us in achieving our objective of a state-of-the-art transport system which will be sustainable in economic, social and environmental terms.

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