Dáil debates

Wednesday, 3 November 2010

10:30 am

Photo of Enda KennyEnda Kenny (Mayo, Fine Gael)
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The Governor of the Central Bank has said that 50% of the fiscal crisis in the country is due to the jobs crisis. We know that since the Taoiseach took office the unemployment rate has gone up from 5.5% to 13.7%. Tomorrow we are to be told about the austerity programme and the extent of cuts being contemplated by the Government and the Minister for Finance. In view of the fact that the live register figures are out this morning, will the Taoiseach indicate to us what those figure are? They may be up or down depending on emigration or some other factors. Has the Taoiseach the figures for the live register to hand now?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The official statistical release for the October live register will be published at 11 a.m. this morning by the Central Statistics Office, CSO.

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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The Taoiseach should delay it a little.

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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The Taoiseach, without interruption.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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I understand from Department of Social Protection internal figures that the end of October figures will show a fall of more than 12,800 since September with a headline figure of 429,550. On a seasonally adjusted basis the live register is expected to fall by 6,600 in the month. This reflects the fact that the decrease is higher than normally expected in October; it is the second highest fall ever for the month of October. The standardised unemployment rate will be published by the CSO at 11 a.m. and, on the basis of the Department of Social Protection estimates, it will be 13.6%.

Photo of Enda KennyEnda Kenny (Mayo, Fine Gael)
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Does the Taoiseach have information to hand on the extent of the numbers who have emigrated because of the economic situation here in the period to which these figures relate?

While we are at it, the Taoiseach has castigated Opposition parties regularly because of their programmes for job creation not being acceptable to him. I point out three measures the Taoiseach could take now which would have a direct impact on employment and growth and which would provide hope and confidence. First, the Taoiseach could call in the airlines, Ryanair and Aer Lingus, and inform them he is prepared to abolish the travel tax if they meet a targeted increase in tourism and passenger figures into the country, with a direct impact on local employment and spend. Second, as Fine Gael has pointed out, the Taoiseach could introduce a work-share programme now that would take 10,000 off the live register in the short term. No real attempt has been made by Government to do this. Third, there are 80,000 small firms in the country. They employ 800,000 people. It would be possible for every one of those firms to take on one extra person if the Taoiseach releases the obstacles to their so doing, including a reduction in the level of employers' PRSI.

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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A question please, Deputy.

Photo of Enda KennyEnda Kenny (Mayo, Fine Gael)
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These people could then be paid the social welfare they receive and, together with the removal of those obstacles, this would have a direct impact on the live register in the short term. In its own way this would create some sense of hope, confidence and some sense that Government and politics can actually impact on their lives. As we speak, able-bodied men and women are totally frustrated, sitting at home and trying desperately to get jobs anywhere because they wish to contribute and do something. I have pointed out three measures that the Taoiseach could implement in the short term with a direct impact on the live register. Is he prepared to take on board any of these three suggestions?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The CSO will outline the situation regarding the live register figures. There is evidence the labour market is stabilising and this is reflected in the most recent employment figures from the quarterly national household survey. As I stated yesterday, the publication of the October Exchequer returns reinforces the key message of the stabilising of the economy since tax was slightly ahead of expectations.

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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The Taoiseach is doing well.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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Corporation tax is well up on profile. It is also important to point out that our fiscal adjustment and public finances remain on track in terms of our budgets for this year. Yesterday's Exchequer figures illustrate that tax revenues are slightly ahead of profile and public expenditure is below profile.

I point out to the Deputy that with regard to initiatives being prepared, what the Government has done, to find time and space to bolster domestic and international confidence, is to step out of the markets; to use the two months for the preparation of a four-year national plan; to provide a credible path to show people how we can manage our public finances, which we are required to do as a member of the euro area; and to bring forward a budget which will be the first step on that credible path. This is the important national imperative for the country.

All the issues must be considered, including cutting spending; increasing taxation; generating growth while bringing about this correction; front-loading, to some extent, the correction which must be made, which began in 2008, which we are half-way through and which will not be finished until 2014; the issue of growth and bringing forward every possibility of exploiting the potential of the economy, having stabilised it through our budgetary policies thus far; and bringing growth in the future dependent on the external environment, but also based on how we can continue with policies here which generate net employment. All of these issues are being examined in detail, including labour market activation policies, assistance for small indigenous businesses and ensuring the foreign direct investment flow to Ireland continues. Last week, it was important to point this out because we need to consider the positive news about the country in the context of the difficult challenges we face. Ireland is seen as the best place to come and invest. This is as a result of improvement in competitiveness, the reduction in unit labour costs against our European competitors of 8% last year, an increase in merchandise exports in the last quarter by 12% and an overall improvement in exports on last year of 9%. These are important indications of recovery-----

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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Which of the three points will the Taoiseach take up?

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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Deputy McCormack, please. One speaker at a time.

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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I am only helping him.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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What we must not do in the House as we have these discussions as constructively as possible, recognising our political differences, is to generate a mantra of negativity about the economy, which does not give any credit to the strengths of our economy. The fact that we have a foreign direct investment profile in Ireland, which is greater than all US investment in China, is not often acknowledged or recognised. The investment is 80 times what it is in Greece and 23 times what it is in Portugal. These are important strengths that the Irish economy needs to use as a platform for generating confidence.

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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So the Taoiseach does not need the suggestions.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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Let us have a critique but let us ensure the national interest of the country is best served.

Photo of Enda KennyEnda Kenny (Mayo, Fine Gael)
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We gave the Taoiseach three suggestions now.

Photo of Eamon GilmoreEamon Gilmore (Dún Laoghaire, Labour)
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Later today, there will be a major demonstration of students outside Leinster House. There is a commitment in the revised programme for Government that reads as follows: "Conscious of the economic pressures on parents today, this Government will not proceed with any new scheme of student contribution to Third Level education." That commitment has been interpreted by the partners in government, the Green Party, as meaning there will not be a reintroduction of third level tuition fees or an introduction of fees by the back door such as an increase in the student registration fee. At the weekend there was speculation that the Government was considering increasing the student registration fee from €1,500 to €2,500 or €3,000. By anyone's measure, this would be the introduction of a new scheme of student contribution for third level education. There was also speculation that the Government might introduce a new fee of €500 for post leaving certificate students. Will the Taoiseach confirm to the House that the interpretation of the commitments in the programme for Government given publicly by the Green Party over a period of time is correct and that there will not be a reintroduction of tuition fees, an increase in the student registration fee to €2,500 or €3,000 or the introduction of a fee for post leaving certificate students?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The Deputy is well aware that I am not in a position to divulge any discussions that take place at the Cabinet in respect of the various adjustments to be made and that must be made by governments in this country between now and 2014. All of the commitments in the programme for Government or in any programme for Government to which Deputy Gilmore subscribed are dependent on the maintenance of financial stability in the country. That is the major issue that must be addressed. We must examine all of these issues and discuss them in a way that ensures we get a contribution from all Departments towards the correction or adjustment that must be made. A strong case can be made for a range of issues where people would like to see a no policy change position.

The context in which these discussions take place means it is imperative that everything is considered. Decisions have not been taken and discussions are ongoing on a range of issues. In recent years we have seen an increase in the number of students attending third level institutions, which increased by 9% last year. Those involved in third level education inform us of the need to find a financial model for the funding of education that will ensure we have a competitive third level sector. It is fundamental to our overall enterprise strategy and industrial policy to provide graduates. One of the strong points about the Irish economy is that we have the highest per capita graduate population for people coming out of universities. We have over 32% of the population with a graduate level education. Clearly it is an important part of our education system.

Deputy Gilmore is aware that I cannot give specifics about the outcomes of ongoing discussions. I can only assure everyone that we are seeking to deal with these matters in an appropriate way and in as fair a way as possible, recognising all the issues. All of the commitments in any programme for Government have, as an overall context, the need to maintain financial stability. When Deputy Kenny rose to ask a question, we spoke about finding a sustainable growth strategy for the country. We must also find a sustainable expenditure policy for the country based on the resources available. To do so is not easy and presents challenges. While Deputy Gilmore is in a position to send positive signals to the students coming along, by suggesting he has an easier way, these issues must be examined carefully.

Photo of Eamon GilmoreEamon Gilmore (Dún Laoghaire, Labour)
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I agree there must be a sustainable strategy in respect of the public finances and growth. The Taoiseach seeks to suggest the commitment made in the programme for Government was made in a different economic environment. The commitment was made in the revised programme for Government, published on 10 October 2009. This does not date to before the banking crisis but was produced at a time when the level of unemployment was 412,000 people. I appreciate why the Taoiseach wants to see positive news in the reduction in the number of people out of work. That is welcome but the number of people out of work according to the live register decreases every October. This time last year it was 412,000; it is now 17,000 higher at 429,000. Nevertheless, the commitment is that there would not be any new scheme of student contribution for third level education. This commitment was not made by the Labour Party or Fine Gael; it was made by the Taoiseach and his partners in government this time last year. The Taoiseach now tells us that new schemes are being considered.

The Taoiseach did not distance himself from the speculation over the weekend that the student registration fee would be significantly increased and that there might be a new fee for post leaving certificate students. At a time when there are high levels of unemployment, does it make sense financially or socially to put new fee obstacles in the way of people entering education? Would someone out of work not be better off doing a post leaving certificate course or a third level college course rather than drawing the dole? Does it not make financial sense to say to someone who wants to do a post leaving certificate course that we will charge €500 and that if the person cannot or does not pay the €500 we must pay the person the dole in order to do nothing?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The effort by Deputy Gilmore to give credence to all speculation as fact is not something to which I can subscribe. I am in the business of leading-----

Photo of Eamon GilmoreEamon Gilmore (Dún Laoghaire, Labour)
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I am only asking about it.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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I wish to answer Deputy Gilmore. It will not stop him speculating whatever view he wants because thousands of students are coming to protest and march, as they are entitled to do, about their concerns in third level education.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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What about Deputy Gogarty's comments?

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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We know the game Deputy Gilmore is playing but the reality for the Government is that it must examine these issues carefully and bring forward a budgetary policy that is credible. I recall the decision that was made when the Labour Party was last in government, which was to eliminate all fees regardless of income.

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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Tuition fees.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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That was not the most socially progressive thing that ever happened-----

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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It certainly was.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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-----since it allowed those who were well capable of paying fees to pay nothing, thereby limiting the number of people from lower socio-economic backgrounds accessing education.

Photo of Brian HayesBrian Hayes (Dublin South West, Fine Gael)
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Fianna Fáil did not oppose it.

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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The Taoiseach should be allowed to speak without interruption please.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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That was not a sustainable model either.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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It was.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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But it was very popular at the time and the Labour Party thought it might hold on to its middle class vote but, unfortunately, the tide had gone out for the party. We all know what was behind that one. I am not in the business of playing games either. I am in the business-----

Photo of Seymour CrawfordSeymour Crawford (Cavan-Monaghan, Fine Gael)
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You have been here for too long.

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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Deputy Crawford.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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-----of trying to bring forward a budgetary strategy. All of us in government, taking into account everything that we are trying to achieve to find ways forward that will ensure we have a well-funded sector. Where one has a situation where 35% less revenue is available than was the case prior to this crisis, it is clear that one cannot continue to borrow for day-to-day expenses on an ongoing basis. One must close that gap, which can only be done on a sustainable basis by taking decisions in respect of areas which would one not normally contemplate considering. No decisions have yet been taken. A good discussion is ongoing on these matters. We are trying to find a way forward.

On the question of post-leaving certificate colleges and institutes of education, the places have been increased, unlike when the Labour Party was in government, which was to provide for a no-fee scenario for an existing number. What we have done is increased the number of people who can access education.

Photo of Ruairi QuinnRuairi Quinn (Dublin South East, Labour)
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The Government is making people pay fees.

Photo of Seán SherlockSeán Sherlock (Cork East, Labour)
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The Government should have done that anyway.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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That in turn has been a strong selling point for the country in terms of attracting investment and to facilitate entrepreneurs at home in finding people with the requisite skills to generate jobs in the future. All those issues must be examined. Deputy Gilmore is aware of the scale of the adjustment that must be provided so that we can continue to not alone reduce deficits but to fund them on an ongoing basis so that we can get back to a public finance balance. Where health, education and social welfare constitute more than 75% of the day-to-day spend of Government, as Deputy Gilmore is aware, those issues cannot be ring-fenced and allow one to come up with a credible policy that will get one to the point where one can go back to the markets and obtain funds at reasonable rates. Deputy Gilmore knows that.

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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Seven per cent.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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It is very easy for the Opposition to come to the House and say, as it has been doing in public, that it agrees with the targets and the 3% but that it has no costing on the proposal, that it does not believe it will be €15 billion or that one should cut this or that.

(Interruptions).

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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The Taoiseach should be allowed to speak without interruption.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The Opposition can play that game but it is not very credible. The more it does so the fewer believe it.

(Interruptions).

Photo of Séamus KirkSéamus Kirk (Louth, Ceann Comhairle)
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The Taoiseach should be allowed to speak without interruption.

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The more the Opposition's argument is exposed to scrutiny the more holes appear in it.