Brian Cowen (Laois-Offaly, Fianna Fail)

One takes no pleasure whatever in anyone's losing his or her job, but it is important to point out the trend. It is clear from the strategies outlined and the models that have been projected for Ireland's economy based on the current world situation that unemployment will continue to rise, unfortunately, before things get better. We must do everything we can in terms of short-term measures to help people who find themselves unemployed, but we must also fix the economy, and this means dealing with the situation through NAMA, as we are doing, to fix the banking system so we can get credit flowing again. We need to strengthen the balance sheets of the banks, remove the stressed assets from those balance sheets, and make sure investment money flows into the country to get credit going. That is the most important way in which businesses will be able to withstand the pressures they are facing.

In addition, we must bring order to our public finances; without that, external and internal confidence cannot be restored. We must also continue improving competitiveness. Unit labour costs have dropped by 4% in this country compared to an average increase of 3% in other EU countries during the course of the year, which has improved the competitiveness of the Irish economy by 7%. This shows the flexibility in the Irish economy, with responses coming from the various sectors to get us back into a competitive position. These are the facts. There has been an average fall in exports of 20% in Germany, while in Ireland the reduction in output has been 5% or 6%. That is a good performance compared to our competitors. However, until growth returns to the economy we will not be in a position to create jobs on a sustainable basis. Those are the issues we must face.

Unfortunately, since September 2008 we have seen a steep increase in unemployment of 197,000. One takes no joy in that. However, to answer the Deputy's question, it is clear, based on the projections, that by the end of this year unemployment will be in the region of 15% or 15.5% and could rise again going into the following year. We must do everything we can to make sure that when the world economy picks up and demand improves, this small open economy, whose livelihood depends on the goods and services it exports, is in a position to take advantage of this in terms of competitiveness. That is the whole purpose and strategy of the Government. The most important aspects of our strategy are to put our public finances in order, proceed with the restructuring of the banking sector, which has received support, and improve our competitiveness.

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