Aodhán Ó Ríordáin (Dublin Bay North, Labour) | Oireachtas source

I join others in congratulating the Minister of State on his recent appointment. We look forward to working closely with him in the coming period.

This Bill is about protection of the security or public order of the State. In a globalised world with complex technologies and equally complex supply chains it is clear that our day-to-day lives are acutely vulnerable to the malign actions of state or non-state actors which could seek to disrupt our lives for their own political, economic or simply criminal purposes. The true scale of our vulnerability was brought home by the hack of the HSE's data systems, which was an act of malice conducted by a group with evidence of informal links to Russian security services.

The current energy crisis exposes the vulnerability of the EU for its overreliance on entities that believe their strategic interests are fundamentally different from ours. Unfortunately, the world is still haunted by the spectre of totalitarianism. The hostility to the EU from authoritarian regimes and their supporters both inside and outside the EU poses a significant long-term threat to our economic well-being. It is in this strategic context that it is clear we need to pay more attention to who owns or controls key components of our societal infrastructure. We must acknowledge we are an open trading country where FDI is and has been the cornerstone of our industrial policy and we are uniquely dependent on external companies for our economic well-being. There is no doubt that any mechanism to scrutinise external transactions has the potential to place a comparatively larger burden on our economy than on others in Europe.

The purpose of the Bill is to put in place a legal mechanism to enable a Minister to review business deals and transactions to ensure they do not put the security or public order of the State at risk. It is being brought about as a direct result of the need for Ireland to implement Regulation (EU) 2019/452. In commentary on the Bill the Tánaiste has stated:

This new law is to give us the power to intervene if a non-EU actor is seeking to make an investment which would threaten our security or public order. I think it's an important safeguard, which I hope we never have to use.

I agree with him that this is an important safeguard. However, I am a little concerned that there may be some reluctance apparent on the Minister's part to use this legislation. I would be concerned if we ended up with a mechanism essentially rendered toothless by the political reluctance of Ministers to face down vested private interests. We should have no doubt that for every transaction sent for examination, there will undoubtedly be vested interests of business lobbying strongly for even the worst transaction to go through smoothly on the basis of their own economic interest. Therefore, it is just not good enough for a Minister for Enterprise, Trade and Employment to have the power; he or she must be prepared to use it, even in the face of political pressure from many sources for a deal to go through.

Ultimately though, this legislation alone will not be sufficient. It is increasingly clear to me and the Labour Party that one of the outcomes of the current energy crisis and the pandemic has been to restore the economic role of the democratic state as an actor in our economy, and this has vindicated many economists. The growth in public spending in Ireland is likely to result in a permanently higher level of public spending. We need a more prominent role for the State in the economy and this goes beyond just implementation of a single EU regulation. We need that more prominent role to protect ourselves from externally created security risks but we also need it in other areas. The cost and availability of housing, for example, are a chronic danger to our competitiveness but also fundamentally to almost all aspects of the functioning of our economic model. To address that high cost the existing developer-driven housing model needs to be radically disrupted.

The Labour Party supports the aims of this Bill. However, the challenge for everyone is to balance on one hand the risks of having essentially inactive or useless legislation and, on the other, the potential damage to FDI if the process becomes a disincentive or a drag on ordinary transactions. Ultimately, we need a complete review of our industrial strategy. To build a more robust domestic economy we must overcome the challenge of growing an internationally-traded sector comprised of medium and large Irish companies as well as a strong State sector to protect our strategic assets, while all the time standing up to the external threats, private and public. We look forward to working with the Minister of State on the progress of this Bill.

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