Brian Cowen (Laois-Offaly, Fianna Fail)

In any employment strategy the most important means by which we can maintain and create jobs in this time or any other time is to be a very competitive economy, acknowledge the changes that have taken place in the internationally traded environment and ensure we can provide quality goods and services at a competitive price to meet demand, albeit depleted demand in the context of the current global recession. Without sustainable public finances, to which we are committed, we cannot arrange for economic recovery. Without competitiveness in the economy, we cannot maintain 1.8 million people in work. We have lost the guts of 190,000 jobs in the past 12 months in terms of people coming on to the register. This is an indication of the seismic impact in real economic terms of the worldwide recession on Ireland as a small open economy.

The Deputy asked what short-term measures we can take. Obviously, we must take short-term measures which do not distort the existing market. We must ensure that a person in a traded sector that is not internationally traded does not get a subsidy at the expense of a person in another town down the road. He is telling me this is a distortion that does not benefit anybody.

The purpose of EU temporary aid schemes which allow for state aid in this area is to support viable businesses. It is important therefore, that criteria are met regarding viable but vulnerable enterprises and jobs that would otherwise go. The template in terms of the stabilisation fund is working well for people in the export business. It is true that the scheme does not apply in respect of domestic retailers because it aims to protect companies in the traded sector which are competing internationally and are doing what they can to maintain market share. That is the best means of ensuring value for taxpayers' money and complying with EU state aid rules, which set a limit of €500,000 per company. It is important that we work within the parameters.

While it is true that the measures are short-term, they are necessary. They work along similar lines to the stabilisation fund in terms of selecting vulnerable companies which will be able to survive the recession with some assistance and which are themselves doing all they can. We are not necessarily working from a blank sheet, therefore. Companies which are in that position will be able to apply for the new measures.

In regard to the financial mechanism by which they work, the intention for the remainder of this year is to use the moneys which are not at present used in the training fund for the purpose of financing the scheme. When we come to the end of the financial year, the training fund will be replenished by the moneys saved from the social welfare budget. If one takes X euro, the money is replenished at the end of the year and an Estimate provision is made next year. The question is how to transform passive income support in social welfare into an active employment subsidy payment in a way which avoids additionality of income because at the end of the day one cannot play with the same money twice.

See this speech in context