Fergus O'Dowd (Louth, Fine Gael)

The only thing wrong with the arguments from the Deputies opposite is their failure to make sense. The alternative to selling these assets for the purposes that have been proposed is finding €18 billion to replace the bailout money we will receive this year. They can argue left, right or centre but the problem remains the same. The alternative to unbridled capitalism is not unbridled State capitalism for which the party opposite is arguing in claiming that the State is always right. We are saying that while of course the State has a very important part to play in our economy, it is also important that some of the assets that are not essential for the functioning of those State-run or State-owned institutions can be sold to provide what the people want, which is job creation. The sale of these assets will reduce some of our debt, which we need to do, and will also create new employment. From the proceeds of State assets will come at least €1 billion for the purpose of job creation and investment in the economy. We need that €1 billion to put into those job creation programmes.

The Government has been clear about its intentions for the sale of State assets from our very first day. The programme for Government signalled our goal to use proceeds from the sale of State assets for the purpose of job creation and investment in the Irish economy. We can all agree that this is needed now more than ever.

After much deliberation the Government has agreed with our external partners that some proceeds from the sale of State assets can be used for jobs and investment. This represents a very positive and significant amendment to the memorandum of understanding with our external partners and it should be welcomed. It should be clear to all that the Government is taking an entirely new approach in our management of State assets and companies. This is why the Government has successfully established NewERA, to manage better the assets in various commercial semi-State companies. It is a welcome innovation that will prove its worth in the years ahead.

Much has been said over the course of this debate about the dangers associated with the sale of State assets. However, I can assure the House that the Government is fully aware of these dangers. The asset disposal programme that has now been agreed has been carefully planned and thought through in order to ensure that such dangers are avoided. NewERA with its expertise in managing major transactions will play a central role in any sales process and ensure that the State's interest is well protected. The Government has been careful to safeguard the position of strategic infrastructure, such as the electricity and gas networks, which is considered to be vital to the optimal functioning of the economy. We have agreed to sell some of the ESB's non-strategic power generation capacity, but its strategic distribution network will be kept in State ownership. We look forward to the forthcoming International Energy Agency report on the functioning of the Irish electricity market which is due later in the year before deciding on any further structural and regulatory actions. We will sell BGE's energy business, but again BGE's strategic assets - the gas transmission and distribution systems, and the two gas interconnectors - will be retained in public ownership.

The sale of some assets of Coillte will be examined to see how best to raise revenue, which will focus primarily on the harvesting rights of Coillte's forests. However, I again make clear that Coillte's landholdings are not for sale and will not be included in the disposal programme. The Government's remaining shareholding in Aer Lingus will be sold. However, as already explained, it is now accepted that this is no longer a strategic asset since a 25% stake in the company is not sufficient to enable the Government to determine matters of policy in Aer Lingus, for example the use of the airline's landing slots at Heathrow Airport.

Taking all this into account the target remains €3 billion to be raised from disposals. The Government is committed to securing value for the Exchequer from any disposals and we will not be rushed into any sales. Sales will only occur when market conditions are right and when adequate regulatory structures have been established to protect consumer interests. In short there will be no fire sales. Assets will only be sold on acceptable terms and at a price that achieves fair value for the Exchequer, and if fair value can not be obtained for the assets, they will not be sold.

During the course of the debate it has been claimed that the sale of these assets is not in the national interest. However, this issue has been addressed and the opposite is true. The sale of these non-strategic assets offers the potential to generate €1 billion in funding that would be available to the Government for much needed reinvestment in the economy and in jobs. In the energy sector, the disposals offer the potential to improve the competitive dynamics of the single electricity market to the benefit of consumers and, ultimately, the economy. In addition to the receipts that will be generated from the sale of the assets, a change in ownership in the case of the energy assets and the Aer Lingus shareholding offers the prospect of access to significant new capital, which might not otherwise be available, from new investors in order to grow these businesses in Ireland.

Given the enormous economic challenges facing our country and the current state of the public finances, it is imperative that the Government considers all possibilities for generating additional resources to fund much needed investment in jobs and in our economic recovery. The possibility of releasing value from some of our non-strategic State assets, as now proposed, provides just such an opportunity, offering the prospect of €1 billion in funding being available for reinvestment in job creation and to help stimulate much needed economic growth. I commend the Government's programme of asset disposals to the House.

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