Billy Kelleher (Cork North Central, Fianna Fail)

I am pleased to have the opportunity to speak on this motion as it provides the Government with an opportunity to set the record straight. There is no doubt we are in challenging times and the period ahead will be difficult. I will leave it to others to recite the rhetoric of doom and gloom used by commentators, mainly outside the House. We all know we are in choppy waters internationally, with a credit squeeze, jumpy financial markets, increasing oil and commodity prices and the declining value of the dollar placing additional pressures on the inflation rate. The Government, however, remains in control and all levers at our disposal are being used to steer us through the current difficulties. We have strong leadership, renewed vigour and cohesive economic and social policies.

The fundamentals of the economy remain solid. We have 2.1 million people at work and the general Government debt is forecast to be around 25%, one of the lowest ratios in the euro area. Overall, net debt is forecast to be approximately 14% at the end of 2008. Our economy is not a basket case. Many commentators would like to undermine our achievements and some of the commentary is not helpful in this challenging period. The Government is facing up to reality by ensuring we have policies in place to navigate choppy economic waters.

The assets on which we relied to produce the so-called Celtic tiger are still available to us. Our education system has not suddenly dipped in quality and continues to produce top class, well educated young people. We still have relative flexibility in our labour market and sound fiscal and tax policies. As a country of English speakers, Ireland remains one of the key entry points for foreign direct investment into European markets. Such investment remains a fundamental part of the economy. All these assets still exist and are being used productively by the Government.

Another key asset has been our system of social partnership. As a Minister of State in the Department of Enterprise, Trade and Employment, I am keenly aware of the challenges facing business and the labour market. Now, more than ever, it is important we achieve a balance in our policies governing labour force development and flexibility and the regulation of employment rights. I am confident social partnership, which has developed organically into a robust framework since 1987, can deliver a fair, balanced and reasonable agreement which takes account of the rights and entitlements of employees, while ensuring the labour market remains flexible and competitive.

Last week, I attended the Council of Ministers which brought the temporary agency worker directive to a successful conclusion. I was pleased, on behalf of the Government, to be able to negotiate and sign up to a text that took account of the Irish industrial relations system. Central to our concerns was that the directive would recognise our tradition of social partnership. This concern has been addressed and it will be possible, under the directive, to build in derogations and flexibilities if the social partners reach an agreement.

With this further empowerment of the social partners comes additional responsibilities. The social partners must continue to strive for a balance not only in the area of temporary agency workers, but on the overall range of issues facing the labour market and economy, including competitiveness. More than ever, consumers and markets need certainty and confidence. The social progress and cohesion we have achieved in the past decade or more must be maintained. I am sure the social partners will again step up to the plate and, in doing so, the question of achieving a fair deal must be foremost in everyone's mind.

Not everything on the partners' wish lists will be achieved and certain issues may have to be parked and revisited when the economic outlook improves. The Government, for its part, will do everything it can to facilitate a renewed consensus and my Department is playing an active role in that regard. Even if it does not prove possible in the short or medium term to achieve consensus, the Government will ensure the economy and labour market remain flexible, competitive and fair.

I will briefly address the issue of unemployment in the short time available to me. Naturally, as Minister of State with responsibility for labour affairs, I observe with concern the trends in unemployment, the number of redundancies and the general "churn" taking place in the labour market. Some of these developments can be ascribed to market readjustment, for example, people who have moved out of construction and not yet found alternative employment. Reskilling and adequate training supports will be essential for those affected and the Government has appropriate policies in place to this end. The Government will, in the context of the national development plan and funding under the various training programmes, including the one step up initiative, live up to our commitment to train and upskill people to respond to the evolving labour market.

As I indicated, the labour market is experiencing a "churn" as many construction workers move out of the sector. This group needs to be retrained and reskilled with a view to ensuring they can move into other areas of the economy.

The results of the referendum on the Lisbon treaty were raised. While the treaty was rejected in its current form, I believe the Irish people are committed to Europe, the concept of an open market, free trade and the free movement of goods, services and labour. I ask Deputies and others to emphasise in their public comments that Ireland, through the policies it pursues, remains a central player in Europe. When we are speaking to American colleagues in particular and, more importantly, globally, the message should be reinforced at every opportunity that Ireland is still central and at the heart of Europe when it comes to economic policies. We have been well received in previous times in terms of foreign direct investment because of the policies we pursued, such as a low corporation tax and a well educated and flexible labour market and workforce. I look forward to the debate in a couple of weeks' time on the economy in general.

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