Willie Penrose (Longford-Westmeath, Labour)

When one takes into account costs relating to housing, accommodation, transport and child care, many public servants are of the opinion that they would be better off on social welfare payments. I must make clear that the Labour Party cannot support that part of the motion, as drafted by Fine Gael.

I wish to comment on privatisation. We should look at Great Britain, where there was a headlong rush to privatise everything. A granny's cat was not safe over there because someone would have privatised it. Of course the odd Labour Party person was in Tory clothes, which was part of the problem. I said that in this House and it did not go down too well. Privatisation of water services and train services in Britain left a trail of destruction. We had the botched privatisation of Eircom and that is why we are lagging behind in broadband roll-out. If we had some control of Eircom when it started out, things might have been different. There were inefficiencies and we must address those in any utility. However, we have no control over privatised companies, which then rush to the huge urban centres to provide a service while saying goodbye to rural areas.

Broadband is so important to e-commerce. Many years ago I attended an IRD in Kiltimagh and I felt very humbled among the high-powered people there. One man from Mayo was communicating with Moscow and selling his wares there, in Japan and elsewhere. He had created eight or ten jobs through the telecottaging industry. That is where the future lies. Small and medium enterprises in rural areas will save this country. We must throw down the red carpet before those people. The IDA does a good job, but it puts the red carpet before the multinational companies. They are very important, but we must not forget the individual entrepreneur. The people living in the back of beyonds who provide six to eight jobs are absolutely crucial in keeping this country alive and in ensuring the sustainability of many rural centres. We do not want to have anymore to do with this privatisation agenda, which has seen us suffer in the past few years.

The total number of jobs created is important, as is the quality of those jobs. Since 2000, about 65% of new jobs created were in construction and the public sector. There is a decline in the construction industry and the Government states the public sector wage bill is spiralling. However, I think it is not. Some people in the public sector earn decent money, but most are only doing okay. It is not sustainable. The SME sector is generating 500,000 jobs, which is critically important, but it is clear from declining tax revenues that the jobs currently being created are low-wage, part-time jobs that fall out of the tax net. Every year the Minister of Finance tells us that many more are out of the tax net. The reason that is happening is more people are in low-wage, low-skilled jobs.

The future of competitiveness for Ireland does not lie in these low-cost jobs, but in building a platform of competitive advantage that will create and sustain higher quality jobs. We need a quantum leap in skills and training for our workforce. The leaving certificate cannot be the finishing line. It must be a springboard to further education. The Minister has acknowledged that in some of his policies, but it is important. I appreciate there must be a job for everyone, because most of my brothers and sisters did not go beyond the leaving certificate. However, in a competitive environment we must look at it like that from now on. It is important for equity, but also to attract investment from high-tech industry and services.

According to the expert group on future needs and skills, a continuation of the existing skills policy will result in the demand for labour outstripping supply by 310,000 by 2010. Within that figure, we will have a significant shortage of people in further and higher education and a surplus of low-skilled workers. That is the challenge. This dire forecast is presumably why the Government commissioned the national skills strategy in the first place. It is a pity there is no real co-operation between the Department of Enterprise, Trade and Employment and the Department of Education and Science in implementing its recommendations.

We need to invest in further and higher education, but also in access to that education. We need to develop a national framework of qualifications that makes it easy for individuals and employers to see how to build on skills and transfer training. We need to support people to take annual paid training leave and work with employers to incentivise work-place training, particularly with low-skilled workers. We need to stop the waste of human talent and the potential lost through poverty and disadvantage, and wage a war on educational inequality. This should start with universal preschooling, which is proven to give children the skills to get more from subsequent education.

We need to get creative about how we fund and develop Ireland's research capabilities. It is essential that we move from manufacturing and exporting products invented elsewhere to inventing the products and services for the future ourselves. We need an era of indigenous industrial innovation, driven by Irish entrepreneurs. We need to switch tax incentives from bricks and mortar to high-tech start-ups that will create jobs in the future. As well as creating a climate that fosters private investment in domestic innovation, we need to ensure our universities have the resources and capability to compete in the global market for research, investment and talent.

Employer PRSI is a burden. Wages of €50,000 cost the employer €56,000. Energy costs are taxed at 3 cent per litre higher than elsewhere. Regulation is another bugbear of mine and I could talk all night about it. The Government has contributed to cost inflation in a number of areas and this must be addressed to ensure we remain competitive.

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