Thomas Pringle (Donegal South West, Independent)

The jobs initiative announced yesterday must be a considerable source of disappointment to the Members on the other side of the House given what was promised a few short weeks ago. During the election campaign they were talking up the five point plan under which 100,000 jobs were to be created. The Taoiseach told people to read his lips and that the Government would create 100,000 jobs without ever explaining how. We had a jobs budget in the programme for Government that quickly became a jobs initiative after our so-called partners in the Troika had got hold of it and told the Government, "No way." Most of the jobs initiative could have been announced in a couple of press releases from the relevant Departments. There was no need to take up a week of the Dáil's time to hear statements on the minor adjustments contained in the plan. In the announcement the Minister made much of the return to growth, but he failed to mention the projected growth figure of 0.5% for this year. He played up the figures for next year and beyond. I hope these will come to pass, but, given how far out the figures for this year have been, it remains to be seen what will happen.

The plan has some positive elements. The reduction in the rate of VAT for tourism-related industries will be of benefit. I hope it will lead to greater spending as a result of increased tourist numbers. It is difficult to see how the reduction in the rate of VAT applying to vending machines will make any contribution. It will contribute to reductions in the cost of junk food in our schools, all of which seem to have vending machines, and increased spending by our young people.

The removal of the travel tax is also welcome, as it made no sense in the first instance. Unfortunately, airlines such as Ryanair will probably find ways to levy the tax in extra hidden charges that will increase their profitability.

As outlined in the House, rather than tax the pension funds of hard pressed private sector workers, a tax on the massive fees charged by and the hidden charges of pension companies would be fairer and possibly raise as much revenue. It remains to be seen if the Taoiseach will seriously take this suggestion on board and tax companies rather than savers. It will grate with the people who are constantly being told about the pensions time bomb and encouraged to contribute more and more to their pension funds to have the State levy these funds even at a rate as low as 2.5% for the lifetime of the tax.

The plan includes measures to allow the universities to hire researchers who will not be covered by the embargo. It is doubtful if there is any direct commercialisation of research that will contribute significantly to our economic recovery. In the United States the income from intellectual property only accounts for 4% of the universities' income. Encouraging universities to provide research and support for SMEs which could contribute to, for example, the food industry would be a more worthwhile development. The food industry has real growth potential, including export-led growth. This could also be the case in the SME sector. It is interesting that in Estonia and Slovenia more than 23% and 21% of SMEs, respectively, are exporters, while in Ireland only 11% of such enterprises export, with just 4.2% of revenue coming from these exports. If we want export-led growth, we should be targeting the creation of export-led SMEs and the food sector is where growth can be achieved. In the United Kingdom more than 30% of jobs are in the SME sector, yet our focus has been almost exclusively on foreign direct investment to grow exports. A real jobs initiative would focus on changing that while still encouraging foreign direct investment.

There are revenue-neutral stimulus plans that could have been included in this plan if the Government were so inclined. I raised the issue of business plans for fishery harbour centres in this House a few weeks ago, particularly with regard to my own town of Killybegs, where the Department of Agriculture, Fisheries and Food has large blocks of land lying idle. Without any cost to the Government, these tracts of land could be utilised for investment purposes and contribute to job creation in unemployment black spots.

There is no mention in the plan of the upward only rent reviews that are crippling small businesses and closing many of them down. The State as a landlord also operates upward-only reviews. Changing this policy would have real benefits for businesses and ensure they can survive and grow. It would also mean this plan would have a real impact.

Another area in which real jobs could be created is in the development of an indigenous wood-for-fuel industry. We already produce enough wood to heat the entire country, in fact we produce five times more wood than is necessary for this. Utilising our forests to develop an indigenous industry and incentivising homes and buildings to change over to wood for heat would in the long run offset over €2 billion in imports of home heating oil. The existing delivery systems could be changed over and adapted to the new fuel. This would create large numbers of jobs in rural areas harvesting wood. Instead of being sold off, Coillte's forests could be used to support this new industry. This could also eventually stimulate the development of an indigenous industry in the provision of home heating equipment.

The jobs initiative that the Government has outlined is a modest plan. It should provide some benefit in the tourism sector. The internship programme should give much-needed experience to educated graduates that will help them on the road to a career but strong measures must be in place to ensure that employers do not use it as a cheap form of labour and that it does not displace real jobs. It is a modest plan and apart from the tourism changes it is really much ado about nothing.

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