John Deasy (Waterford, Fine Gael)

I will focus on key action 2.2, to do with the county enterprise boards. The plan refers to Enterprise Ireland working with local authorities to establish a new network of local enterprise offices in each local authority. The new LEOs will combine the enterprise service of the previous CEBs and the work of the business support units in the local authorities. This is a bad idea. It is a bad idea to let some local authorities anywhere near an enterprise support service. Why? Because in some cases local authorities are completely removed from the realities of the commercial world. I would go so far as to say that in some cases they represent the exact opposite of the mentality needed to create jobs right now. Senior officials in many local authorities have no business being involved in any new structure to replace the city and county enterprise boards because they do not have the skills.

I have limited experience of the private sector and for those who come from the private sector and end up serving on a county council, they quickly realise the mindset is very different. Senior managers in county councils in my experience have the "us versus them" attitude in many cases, with "them" being the business sector. They spend their careers squeezing rates out of businesses, they do not spend their careers facilitating business ideas. The concept of risk and reward does not thrive in the public sector. When it comes to senior management, it is more a case of safety first, of keeping the head down and not upsetting the manager. Local authorities are not organisations that have the ability to create wealth or drive growth right now. The concepts of commercial creativity, risk, the desire to make money, the basic elements of economic development, are not exactly found in the denizens of our local authority system and they should have little to do with any new structure when it comes to start-up businesses.

What did we find out this week? According to a report in the Irish Independent most local authorities are overdrawn or running a deficit. In many cases directives to reduce costs and borrowings are still being ignored. Effectively, many local authorities are incapable or unwilling to balance their budgets. Now we want to kick start indigenous growth and house it in local authorities. The Irish Independent reported that councils are haemorrhaging cash, while rules on public sector recruitment are being flouted, contracts are being awarded without being advertised and hundreds of millions of euro are owed in uncollected rates and taxes. We are now seriously contemplating abolishing some of the local authorities because they cannot run their finances.

If any new structure is enveloped into the local authority system, political influence and all that goes with it becomes involved. All new structures must be separated completely from local politics and the clientilism that goes with it. For the record, I expressed this opinion to the Minister for Jobs, Enterprise and Innovation's staff some months ago. I am led to believe this was not his idea or approach and I am glad to hear that because this is idiotic. It might not have been his approach but he made a mistake ceding this to the Department of the Environment, Community and Local Government and local authorities. It demonstrates a stunning lack of understanding on the part of central Government about how local government operates. This will set local business development back 20 years.

The Minister for Finance said earlier that one should not come down here if one does not have a solution. One of the solutions is not to do this and leave it alone. We would be better off doing so, frankly, rather than putting these structures into local authorities. By all means, we should assess the productivity of each of the enterprise boards and the people who work in them, and integrate this into Enterprise Ireland. However, local authorities - which in some cases are the least business-friendly structures in the country - should be kept away. This element needs to be stripped out of this plan as it was a mistake. The Minister has lost me on this plan. I will vote for the legislation that goes with it but if the plan is still in it, I will do so with major reservations.

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