Timmy Dooley (Clare, Fianna Fail) | Oireachtas source

I welcome the opportunity to contribute to this debate. In recent years we have had regular debates in the House about the economy but unfortunately we may not have been as frank as we should have been. If one looks to the projections made by the Government and various different support agencies in recent months it is clear we are not reaching the targets that were set. As to past predictions, the Minister for Finance stated he expected the economy would take off like a rocket. Nobody today would say that is the case. At best, the economy could be described as bouncing along the bottom, as others have indicated.

We can look at the economy in terms of the statistics that are provided on a daily basis but people often get immersed and buried in those. In my view, the first thing we must look at is the lack of employment, the size and scale of the numbers of people who are out of work - the figure is heading for 15%. Until we are serious about tackling that we will not have a sufficient level of economic activity to bring about the recovery that is required.

The Minister for Finance and the Minister of State, Deputy Perry, have great interest and knowledge of small business. The Government has had made three or four announcements on job creation. Last year there was much talk of a jobs budget. By the time it came around, however, it was a jobs initiative and, eventually, a jobs statement. The Government introduced some measures that were helpful, for example, the reduction of VAT for the tourism sector. Now, however, it talks of increasing costs for business. Last night there was a debate in this House in which speakers reacted to the spin that comes from the Department of Social Protection. The intention of the Minister, Deputy Burton, is to seek to make employers pay for the sick leave of their workers. The standard mantra of Governments in the past ten years is "You don't tax work", because it is a disincentive for people to take up employment. The same applies if the cost of providing a job is increased. That is a disincentive to the employer and to those who would create or retain work. Some of the communications we have had from employers in recent weeks would certainly support that case. Until the Government focuses on real measures that assist business, first, to retain jobs and, second, to create them, much of this commentary is foolhardy.

The Minister of State is well aware of the issue of rates, and the size and scale of how they are computed. That was fine when we had a strong economy. Sadly, businesses that are based on floor area, such as furniture outlets or any other kind that requires a large display area, are being absolutely hammered in terms of the rates they must pay, even though they may not have much turnover in the current climate. It is incumbent on Government to find a solution to the redistribution of the rate base in a manner that recognises the true turnover, the profitability or otherwise of the enterprise, rather than operating by the crude methodology that existed and worked in the past. It is no longer fit for the level of activity in the economy and until we deal with that issue, we have a long way to go towards economic recovery.

The Government heads to Europe on a regular basis and tells its counterparts how well it is doing, while at home things are going the other way. The domestic economy continues to contract and retail sales are in a really bad state as a consequence of the way in which the Government levies charges and taxes. I do not suggest there is an easy way out of this but if the Government focused on job protection and job creation and took those as its starting point there would be a chance to understand the real scale of the problem and find the solution. Unless and until that happens, we have some real problems. Unemployment will remain high according to projections such as the latest ESRI figures which show it remaining at approximately 14.8% this year. However, according to the Government's growth and stability programme, the figure is 13.6%. In any case, it continues to ratchet up.

One in eight people currently in receipt of unemployment benefit is better off staying on welfare than moving to paid employment. These are the kinds of issue the Government should be finding solutions for rather than taking the macro-approach all the time, hoping those issues will resolve themselves. In a booming economy they do, but now is the time for micro-management of issues that can assist.

There is another issue the House discusses almost on a daily basis, namely, the lack of availability of credit. To be fair, at long last Bank of Ireland and AIB are beginning to show some level of support. It is not enough but they are starting by putting in place the kind of systems that will at least empower them to make decisions on lending to people who have come through a difficult period. In recent years, if people had a difficulty in regard to their accounts or credit rating they were just pushed away and left to wither on the vine. From the interactions I have had with constituents in recent months there seems to be a softening, a realisation that the only way we will achieve economic recovery is to assist those people who had worked hard but because of the way in which the economy faltered in recent years had found themselves in very difficult financial positions. Although the banks would not have wanted to deal with these people in the past they now realise this is the only way they will recover business and get matters back on track.

I appeal to the Minister of State, with his business experience and acumen and his understanding of the sector, to focus almost exclusively over the coming period on ensuring that small to medium enterprises, the bedrock of our economy, are given a break. The Labour Party took a very disingenuous position in the run-up to the last election and promised, to the retail sector in particular, it would change the upward-only rent provision in legacy leases.

At the time, I thought this was cynical and all the legal advice suggested that it could not be done. Again, however, it was a case of trying to win the election. In that context, hard-pressed people and businesses were taken by the nose and led to the cliff edge. As soon as the Labour Party entered government, it left those to whom I refer to their own devices. As the Minister of State is aware, many of them have since fallen off the cliff. The position taken by the Labour Party in this regard was outrageously cynical.

I recall the Public Gallery being full on one evening when the Labour Party introduced a Private Members' motion in which it excoriated the previous Government for accepting the legal advice of the then Attorney General. Labour Deputies waved the reams of legal advice they had obtained about the place and stated that there was nothing to preclude the abolition of upward-only rent clauses in existing leases. Labour has been in government for almost two years now. When he introduced his first budget last December, the Minister for Finance quietly stated that the Government would not be in a position to proceed with what had previously been proposed in this regard. That left Labour off the hook. Many small businesses are suffering as a result of what happened in this instance. Those businesses took a gamble on the basis that when the Labour Party entered government, this matter would be resolved. Sadly, that has not proven to be the case. What Labour did was particularly cynical. I have yet to hear any member of the Labour Party apologise for-----

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