Brian Cowen (Laois-Offaly, Fianna Fail)

There is nothing self-congratulatory about this or any other Government amendment. It acknowledges that unemployment has increased from 4.5% to 6.3% this year. The Central Bank and others, as the Deputy points out, indicate that next year we will have great difficulty in creating growth in the economy, that there is a wider downturn in the world economy and that this open economy is not immune from those developments. It is acknowledged that they are hitting us hard.

In the meantime we must provide for investment and continue with significant investment in the Irish economy. In the coming year, despite the difficult budgetary situation we face, we will continue to prioritise the areas that will give an economic return more quickly than other projects, such as major investment in a public capital programme, which is very significant. We have seen that significant investment in the past seven or eight years. A sum of €2.3 billion was spent in schools between 2000 and 2006. There is a commitment for €4.5 billion in the current development plan. Some 40,000 people are in new primary schools that were built in this period in developing areas, with 45,000 in schools that were refurbished or had classrooms added. That can continue and therefore there will be a certain degree of offset from the public capital programme for the decline in private sector activity, particularly in the construction business. That will not totally offset it but we will do all we can, within the resources available to the State, to continue with the capital investment programme that will, in large proportions, remain even with prioritisation that will be necessary in view of the fact that by the end of this year tax revenues will be down by an estimated €6.5 billion compared to last year. That involves difficulties.

We must examine our capital programmes, expenditure programmes and tax base to see how we can chart a way forward in the new situation in which we find ourselves. So long as the global financial and equity markets are in turbulence, we are seeing — everyone acknowledges and understands it — the impact it is having on the real economy in terms of business sentiment and business confidence. These are issues that every country must deal with, including this one, and we intend to do so to the best of our ability.

It is not a question of business as usual, it is a question of using enterprise supports to identify companies in Ireland that can grow jobs — some are doing this. IDA Ireland has been successful in getting investment of over €2.3 billion in the first nine months of 2008, ahead of where it was this time last year. That is a fair achievement but that is not to say that it will continue unless we continue to work at it and bring forward policies to show that Ireland is open for business, that there is another story to tell in addition to the very difficult situation on the operational day to day side.

We will begin to address all those issues in the budget as announced by the Minister for Finance when he sets out the budgetary framework. We will seek, in the first instance, to stabilise the situation and then, in coming years, to see the ways we can address expenditure and grow revenue. In the meantime we will continue with a significant investment in our public capital programme that will build up the country when the upturn comes. We will make investments to ensure Ireland is better placed then than now in terms of capital infrastructure and taking up the opportunities that will arise. That is the challenge and no one suggests it is easy, that there is a quick solution or that anyone has a monopoly on wisdom on how to do it. Those significant realities must be faced by the Government and the Oireachtas as we consider the budget and the Finance Bill. In that way, and in no other way, we will chart a way forward.

See this speech in context