Brian Lenihan Jnr (Dublin West, Fianna Fail)

The Government is fully aware of the importance of investment for Ireland's future economic well-being. The goal must be to maintain our position as an attractive destination for investment. This is why the Framework for Sustainable Economic Renewal published in December shows our determination to meet the severe short-term challenges we face and to introduce the changes which will ensure that Ireland emerges from the global downturn in a position to benefit strongly from revived international growth.

This document sets out clearly the measures we are taking to support a return to sustainable growth and jobs in the medium term, with specific steps to do the following: maximise the potential for growth by building on our strengths in innovation and research and development; address the huge market for environmental and energy-related products, services and innovation; invest in critical infrastructure and support more employment-intensive activity; and reform the Government's programme to have a more efficient and effective public service supported by good regulation.

We have already taken steps to implement these measures with increases in tax credits which will increase Ireland's attractiveness as a location for research and development activity.

Protecting jobs and supporting those who become unemployed is of fundamental importance. The Government will continue to work to help minimise the impact of the credit crisis and the severe downturn in global markets on employment prospects. Access for unemployed persons to search for job opportunities, training and employment programmes is vital to this task. The relevant Ministers and their Departments are working with all relevant parties to ensure people will have more options when new job opportunities arise. We will bring forward other measures in these areas to ensure we will obtain the maximum impact from resources available and that innovative approaches are used to maintain people in employment in addition to assisting those who have lost their jobs.

It must also be pointed that the Government is maintaining the largest capital investment programme in Europe. Our spending on capital is over 5% of GNP. That is the appropriate stimulus package for a country facing the difficulties it is experiencing. We are determined we will continue to invest in roads, public transport, schools and social housing. This is a major investment to support future development and it provides a necessary stimulus for the economy.

There is no doubt that the pension-related deduction in public service pay is difficult. I can assure Deputies that the Government did not take the decision to introduce this measure lightly. We know it calls for a measure of sacrifice but it is worth calling for it so as to avoid a worse fate. The pensions-related deduction is not seeking to single out the public service. The deduction is a reasonable and reasoned measure to deal with the serious imbalances which have emerged in the public finances. There was simply no alternative but to make savings in the pay and pensions bill given its relative size. The Government believes the fairest way to do that is to ask public servants to make a higher contribution towards the cost of their pensions, which, in the current economic climate, have become a very valuable asset. Public servants enjoy significantly better pensions than the majority of workers in the private sector.

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