Dáil debates

Thursday, 20 November 2008

4:00 pm

Photo of Seán BarrettSeán Barrett (Dún Laoghaire, Fine Gael)
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Question 6: To ask the Tánaiste and Minister for Enterprise, Trade and Employment if she is satisfied that sufficient action is being taken to stem the tide of rising unemployment; and if she will make a statement on the matter. [41860/08]

Photo of Pat RabbittePat Rabbitte (Dublin South West, Labour)
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Question 14: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the latest estimates available to her Department from FÁS regarding the potential number of job losses in the construction sector up to the end of 2009; and if she will make a statement on the matter. [41764/08]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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Question 15: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which she has made provision or will make such provision for the retraining of persons who may have lost their jobs in the course of the economic downturn; if the resources available to her Department are sufficient to meet the full anticipated cost of such requirements; and if she will make a statement on the matter. [41849/08]

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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I propose to take Questions Nos. 6, 14 and 15 together. The rise in unemployment, while regrettable, must be seen in the light of the unprecedented growth in the economy and in employment in the past number of years. Overall employment growth was driven by significant growth in employment in the construction sector. Such levels of growth could not last indefinitely. The resultant rise in unemployment is now compounded by the downturn in the global economy and a general slowdown in employment in all sectors. Ireland is not alone in finding itself it this position; many countries throughout Europe and around the world are experiencing similar difficulties in their labour markets.

FÁS, as the national training and employment authority, is providing a range of proactive job-related services, supports and programmes, to assist individuals to return to the labour market. Last month's budget contained an additional €9.5 million allocation to FÁS specifically to fund additional initiatives to help those who have been made redundant. FÁS and the Department of Social and Family Affairs are working together so they can respond quickly to the increase in unemployment.

FÁS has, with the local employment services provided by area-based partnerships, geared up its employment services further to provide increased capacity for expected increased referrals from the live register and will be providing a range of certified, short, flexible, modular programmes in construction sector activities which are expected to remain buoyant despite the slowdown in construction, including, for example, in sustainable energy and environmental and related activities. These programmes are designed to activate the unemployed to re-enter the labour market in another job role. A number of programmes are already in place and the frequency and range of these will be expanded over the coming months.

In 2009 FÁS will open evening classes to people who are unemployed without payment of a fee. This intervention is aimed at meeting the needs of those who were recently active in the workforce and who now find themselves unemployed. FÁS and the Department of Social and Family Affairs have agreed that redundant apprentices will be referred immediately to FÁS rather than wait for three months on the live register. FÁS has also established a training fund to enable a speedy response to identified re-training needs for low skilled and redundant craft workers.

FÁS has also put in place a series of actions to facilitate redundant apprentices in completing their studies. These include redundant apprentices being allowed to progress to their next off-the-job phase of training without having to do the next on-the-job phase. A register of redundant apprentices has been established to identify these people at the earliest possible point in time and FÁS has prioritised the need to locate an employer to sponsor the completion of the apprentices' off-the-job training.

In addressing the issue of redundancies, FÁS liaises with other relevant stakeholders such as Enterprise Ireland, IDA Ireland, the city and county enterprise boards and the Department of Social and Family Affairs. It also works closely with the agencies to identify and support individuals who wish to start their own business.

The enterprise development agencies of my Department, including IDA Ireland and Enterprise Ireland, are working to ensure we continue to grow the economy and jobs, even in the current more challenging environment. The pipeline of new business for which IDA Ireland is competing is as strong as at any time in recent years. To facilitate this, we need to ensure our competitiveness is sustained into the future.

There is uncertainty around the number of job losses that may occur in the construction sector, with various labour market projections available. The latest FÁS Quarterly Labour Market Commentary, for the third quarter of 2008, estimates that construction employment will fall by 11.2% this year and by a further 19.4% in 2009.

These are challenging times and Ireland, as a small open economy is particularly prone to the effects of a global economic downturn. However, we are continuing to develop the necessary policies and initiatives to tackle rising unemployment.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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We have asked many questions about unemployment at Question Time recently and I know there will be more over the coming year. However, the overriding impression I get from the Minister's office is that there does not seem to be any serious understanding of how bad the situation is. Does the Minister of State realise that since Deputy Coughlan took up her job as Minister, when Deputy Cowen became Taoiseach, 80,000 people have lost their jobs, enough people to fill Croke Park?

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Does the Deputy think we are stupid or something? We are not stupid.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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The Minister does not seem to appreciate that.

Photo of Charlie O'ConnorCharlie O'Connor (Dublin South West, Fianna Fail)
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The Deputy must make his remarks through the Chair.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Does the Government realise there are now more people signing on than when Fianna Fáil came to office in 1997?

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Is the Deputy blaming that on me being in the Department? That is just another sweeping remark.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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What I am saying is the situation is worse than it was when Fianna Fáil came to power. Take the standardised unemployment rate ——

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Is the Deputy so naive as to think that global economics have no impact on what is happening in the world?

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Do the Minister and Ministers of State opposite understand that what is happening in the world is not the same everywhere? In Ireland, the standardised unemployment rate is now 6.8%. We have overtaken seven or eight countries in the past few months, since the Minister took office, and we will overtake the European average by January or February. Do they realise how serious this is and that they cannot wash their hands of it?

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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Some companies in Poland are in recession also.

Photo of Charlie O'ConnorCharlie O'Connor (Dublin South West, Fianna Fail)
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Is Deputy Devins dealing with this question?

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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I remind Deputy Varadkar that some weeks ago he said Ireland was the only country in recession.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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That was the case at the time.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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Many European countries, including some that are much bigger and stronger than we have ever been, are officially in recession. The Deputy is very selective in what he says.

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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Deputy Varadkar obviously does not know what is happening in the world.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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Ministers and Deputies on this side of the House are very aware of the situation because we meet it every day in our clinics. We are attacking the problem with all our strength. It is a two-pronged attack. We are engaging with the people who have been made redundant and are upskilling and retraining them. We are also looking at foreign direct investment and development of our indigenous industries through Enterprise Ireland and the IDA. The amount of money that is being spent on both programmes is increasing dramatically. This is a challenge, but to imply the Government is totally unaware of the situation is to live in a never, never world.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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It seems the Department is unconcerned.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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The budget did not contain even one significant initiative to deal with unemployment. The only initiative taken on the issue of unemployment in the budget was to make it more difficult to qualify for jobseeker's benefit and restrict the period over which it is paid.

I have asked about county enterprise boards previously. Will the Minister agree to strengthen the role of the county enterprise boards by removing the limitation on the type of enterprise the boards can support and by raising the limit on the number of jobs an enterprise can create, which is currently set at ten? We must move from negativity to positivity. If an enterprise wants to create 11 jobs, it cannot do so and such enterprises fall between the cracks between the enterprise boards and Enterprise Ireland and the IDA. It is local jobs that will rescue us from the dire situation we are all in.

The Fianna Fáil Party has great connections with the building industry, but let me put a suggestion to it. The Labour Party has suggested that a major school building programme to move the 40,000 children from prefabs into proper classrooms and a national insulation scheme to make our houses more energy efficient and reduce carbon emissions and household energy costs be initiated. Does the Minister of State not agree this would create jobs? The job creation scheme in place is going nowhere.

Most people would agree that the poor person's bank is the credit union and like myself, most people started off in life by borrowing €3,000 or €4,000 there. When Deputy Pat Rabbitte was Minister, he widened the scope for lending by the credit unions, through the Credit Union Act, so they can now lend significant sums. The other day we heard of a lady who could not get an additional overdraft of €5,000 to help her protect jobs. Thankfully, credit unions can now lend sums of €50,000 or €60,000.

Will the Minister ensure the Financial Regulator, who operates under the aegis of the Central Bank, does not restrict the ability of the credit unions to lend such sums? Credit unions are liquid and are not in the same mess as the banks, because they maintained a rigid discipline. Most credit unions with savings such as €150 million would only lend €80 million of that. They can also pay 3% or 4% of a dividend. These are the poor person's bank.

Can we encourage credit unions to become part of the process of promoting jobs and get them to lend money for this? Should we not bring in the directors of the credit unions and other financial institutions and tell them this is a critical time for our economy and we need all hands on deck to ensure small enterprises are given the life blood they need — the oxygen of credit to maintain and create jobs? The issue for many small and medium enterprises is not profitability, but the availability of credit.

Photo of Finian McGrathFinian McGrath (Dublin North Central, Independent)
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Does the Minister of State agree that sometimes we must borrow to stimulate the economy and create jobs to tackle unemployment? Is he aware cutbacks on the current and capital sides may depress further economic activity? What new creative and radical proposals has he in mind to generate new jobs in our economy, particularly in disadvantaged areas?

Will the Minister of State condemn the outrageous attacks by some politicians, commentators and those on the right on our public service and public sector workers? Does he agree the public service has made a major contribution to employment and to delivering public services to people? Does he agree it is time to end these types of attack?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I welcome the move to provide a fast track for people to FÁS. However, when we say the Minister is unaware of what is going on, we are pointing out that there are things that could be done to prevent jobs being lost in the first place.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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What, for example?

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I tried to mention them earlier, but the Minister gave me a list of something else. The Minister could make cash available. That is what is needed. All the training in the world is no good without cash, but the Minister is doing nothing in that regard.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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The finance spokesperson for Fine Gael keeps telling us to cut expenditure.

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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He would cut it by more than we did, 5.5% in each Department.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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All I asked was that the Minister come up with some initiatives and comment on them.

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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The Labour Party wishes to spend more.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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The Minister simply read out a list of what had been done historically. That is irrelevant and I wish to hear of new measures that will work.

Photo of Charlie O'ConnorCharlie O'Connor (Dublin South West, Fianna Fail)
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The Deputy has made his point. I understand the Minister of State will deal with all these matters.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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Several points have been raised with which I will try to deal in the limited time available. Deputy Penrose made a good suggestion that Enterprise Ireland and the county and city enterprise boards should not be arbitrarily confined to ten jobs. This is a matter on which the Department is working actively.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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Hear, hear. I thank the Minister of State.

Photo of Jimmy DevinsJimmy Devins (Sligo-North Leitrim, Fianna Fail)
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While the point is being made to all Members on the ground, this issue is being worked on actively.

The Leader programmes constitute a source of a huge amount of money. The Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, recently announced a substantial increase in the funding for the Leader programmes over the next number of years. As for the schools building programme, I remind the Deputy that in the budget this year, funding for the school building programme has been increased from the allocation last year. From memory, I believe the allocation is slightly more than €340 million, which should stimulate some sections of the construction industry. Moreover, FÁS is actively involved in retaining and reskilling construction employees in the green homes and sustainable energy sectors.

Deputy Finian McGrath raised a couple of issues and referred to borrowing for capital expenditure, which the Government is already providing for. The research and development tax credits were increased in the budget from 20% to 25% and constitute an important measure both to attract foreign direct investment and to stimulate indigenous industries to engage in research and development. The Government is very aware that every company, be it a small enterprise with three to five employees, or a large multinational, should be actively considering research and development. As the Minister announced earlier, the innovation voucher, which is worth €5,000 to a small company, can be the lifeline to prevent it from going out of business.

As for the public sector, while the Government is aware of the huge number of great people who work in the public sector, it is also aware there must be public sector reform, which is ongoing at present.

Photo of Charlie O'ConnorCharlie O'Connor (Dublin South West, Fianna Fail)
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I thank the Minister of State. The Dáil is very calm.

Photo of Finian McGrathFinian McGrath (Dublin North Central, Independent)
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Next question.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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It is the Cathaoirleach's soothing voice.