Dáil debates

Tuesday, 28 February 2012

Private Members' Business

State Assets: Motion

7:00 pm

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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I move:

"That Dáil Éireann:

— accepts that the Review Group on State Assets and Liabilities, chaired by Mr. Colm

McCarthy, did not provide adequate analysis or evidence to support its recommendations to privatise State owned assets and enterprises;

— recognises that the sale of strategic successful self-financing commercial semi-State

assets is not in the public interest;

— further recognises that Bord Gáis and the ESB have invested heavily in first world energy infrastructure across the island of Ireland, having the effect of safeguarding the State's energy security, creating tens of thousands of sustainable jobs and benefitting hundreds of thousands of families over the decades;

— agrees that retaining the State's 25% share in Aer Lingus is vital to ensure Ireland's connectivity to Europe, the US, and the rest of the world, and that guaranteeing the future of the airline's Heathrow slots by this retention is of strategic importance; — further agrees that Coillte is an important rural employer, particularly at the current time, and that the sale of the company's harvesting rights and any failure by the State and the company to develop the massive potential of the forestry sector for timber production, biomass and eco-tourism will be detrimental to the public interest;

— accepts that using the proceeds from the sale of State assets for bank debt reduction will not relieve the State's national debt;

— further accepts that the sale of State assets is a short-term measure that will have detrimental long-term economic, social and environmental costs;

— notes the potential economic, social and environmental benefits of commercial semi-State companies have not yet been fully realised;

— further notes the avoidable damage to the economy and disruption in services for consumers arising from industrial unrest resultant solely from the unnecessary sale of strategic State assets;

— mandates the Government to replace NewERA with a Semi-State Strategy Group to include chief executive officers from each of the commercial semi-State companies, with responsibility for delivering a strategic job creation and training project, working directly with the Ministers for Jobs, Enterprise and Innovation, Deputy Richard Bruton, Social Protection, Deputy Joan Burton and Education and Skills, Deputy Ruairí Quinn and reporting directly to the Taoiseach and the Joint Committee on Jobs, Social Protection and Education;

— instructs that all annual dividends paid to the State by commercial semi-State companies must be reinvested into employment activation and training measures as identified by the Semi-State Strategy Group and approved by the Taoiseach, reporting to the Joint Committee on Jobs, Social Protection and Education; and

— rejects the Government's decision to sell State assets."

I propose to share time with Deputies Stanley, Crowe, Ó Caoláin, Colreavy and Ellis. As the text of our motion states, we do not accept that the proposed sale of State assets announced last week by the Minister for Public Expenditure and Reform, Deputy Howlin, is in the public interest, nor do we accept that selling off such assets in order to pay off the bank debt is justifiable. Apart from the fact that it involves selling off part of public companies that have been built over many decades, it represents a waste of that money, given that it will mainly be used not for any productive purpose but to pay off the gambling debts of people to whom we owe nothing or, rather, to whom we ought to owe nothing and would owe nothing had those massive debts not been foolishly taken on as part of the State's sovereign debt.

The fact that the vast bulk of the proceeds of the asset sales will go to pay that debt also exposes the spin that has been coming from the Government benches during and since the election. We were assured by one of the parties opposite during that election that there would be no sell-off of State assets at all. In fairness, Fine Gael said privatisation would be on the cards but denied it would be part of addressing the bank debt problem.

In the programme for Government, Labour swallowed its pride, not for the first time, and accepted a commitment to selling off €2 billion in value of State assets. We were assured that no strategic assets would be sold off and that all of the proceeds would go towards job creation through public investment. We now realise how much those commitments were worth. Some of those opposite who are now Labour Party Ministers had even spoken about Bord Gáis as the jewel in the crown of the State sector. Seemingly, that jewel is to be broken apart, with the shiniest part sold to privateers who will have the privilege of selling gas and electricity to the consumer without having any responsibility for the gas or electricity networks.

After the massive investment in Bord Gáis, companies that had no part of that will be able to come in and cherry pick the most profitable parts but leave the State with responsibility for the supply side. Someone likened this to a person arriving to a market gardener and offering him or her the price of the seeds planted months before in return for being able to sell the ripe produce at full price. Surely only a fool would agree to such a bargain and yet that is exactly what this Government is proposing to do. Perhaps that is worth the pat on the head it received yesterday from the IMF, which specifically referred to the proposed sell-off.

However, it is also clear that while the IMF has promoted privatisation in other states where it has intervened, including Greece, where it insisted on a higher target for asset sales than originally agreed, there is ideological support for privatisation within the Government. That was already clear from the Fine Gael manifesto and that party is happy to go along with the similarly ideologically motivated agenda driven by Mr. Colm McCarthy who, despite having been commissioned by the former Government, has seen his report by and large accepted by the current Government.

While Fine Gael is consistent in this, it raises enormous questions regarding the Labour Party and its long-standing alleged commitment to the public sector. There was universal condemnation last week of the proposed sell-off by the trade union movement. Jack O'Connor of SIPTU described it as a tragedy for the Labour Party. I am sure he will excuse some of us for not feeling that is the worse aspect of it. More than that, it is going to be a tragedy for the country.

I trust also, that in the light of the Labour Party's betrayal of one of its alleged core principles - there cannot be many left now other than self-preservation - that we will not have the new or old Liberty Hall festooned for the next election with Labour Party election propaganda, or the pages of Liberty given over to the promotion Labour Party candidates.

Perhaps the most telling aspect of the announcement last week by the Minister, Deputy Howlin, was the huge about-turn on the scale of the sale of State assets and the use of the proceeds of such a sale. A target of €2 billion was setin the programme for Government with a commitment to use it to finance a public jobs creation programme including the establishment of NewERA, the merger of Bord na Móna and Coillte. Now we have been informed that the target has increased to €3 billion and that only one third will go towards the promised public investment programme and €2 billion towards the payment of bank debt. It is a climb-down, to say the least.

Both parties have reneged on their firm commitment before, during and after the election last year not to sell off any part of the State forestry agency, Coillte . Now they have decided to sell as yet unspecified parts of Coillte although we were assured last week this will not include the land under Coillte's control. Given that we were previously told that no part of Coillte would be sold off, we may be pardoned for taking that with a grain of salt. Suffice it to say, selling the Coillte forestry or land would be a betrayal of a valuable national asset, albeit one that, in common with other natural resources, has been underdeveloped over the history of this State.

If the State harvests the crop, no grants are available for the State to reinvest. If forestry is sold to developers or outside interests, what happens the land afterwards? Do they take it for a term or continue to replant it? These questions must be answered. I highlight the clear interest of several major corporations in acquiring Coillte in whole or in part. Central to that was the former Taoiseach, Bertie Ahern, in his new role as chairperson of the International Forestry Fund and its relationship to Helvetia Wealth, which expressed an interest in Coillte. Mr. Ahern also visited China in that connection so perhaps, in responding, the Minister might indicate whether the sale of Coillte forestry or assets arose in discussions with members of the Chinese delegation that visited this country two weeks ago.

We know that the Chinese Investment Corporation had expressed an interest in acquiring Coillte assets. It would be interesting to know whether, when having time off from visiting castles and Croke Park, members of the delegation discussed with Irish officials the possible acquisition of the State assets the Government is planning to sell. Were the Chinese made aware of this and will the Minister indicate what discussions took place regarding the sale of State assets? It would surely be ironic if Irish State assets were to be sold to the Chinese state so I await the Minister's response with interest.

I urge Labour Party Members who are clearly dissatisfied with Government policy on this issue to vote in favour of the motion. Despite their pessimistic outlook on the decline in and composition of the working class support, there must surely be some left who expect Labour not to go along with the sale of the crown jewels. For Labour Party backbenchers to vote against this motion is a betrayal of workers in State companies, who had been promised so fervently in the past by current Labour Ministers and the Labour Party.

Photo of Brian StanleyBrian Stanley (Laois-Offaly, Sinn Fein)
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I welcome the opportunity to speak on this important topic. This debate comes at a time when the Government plans to sell off strategic State assets. We only have to look into the not too distant past to see history repeating itself. Eircom, the State communications company, was worth €8.4 billion at the time of its privatisation. It was hived off amid huge controversy and now the company has a net value of just €39 million. Between 1982 and 1986 it received huge State investment. The Minister's party was in power and I compliment him on what happened to Eircom in that period. One of the good things that happened in the Government of the middle 1980s was the development of the telecommunications system, which improved massively under the watch of that Government. Through this investment and the commitment of its employees, this State went from being 20 or 40 years behind our neighbours to being one of the leaders in telecommunications. Having sold off the State-owned Eircom, download speeds available in Ireland remain below the fastest speeds available to customers in other OECD countries.

While progress is being made in improving the cost and availability of basic broadband, Ireland is lagging three to five years behind competitor countries in terms of rolling out basic infrastructure capable of high speed next generation broadband. Yet, this Government is attempting to do the same thing again to several of the State's prized assets. The Government announced on 22 February, outside the Chamber, its proposal to sell off State assets worth in the region of €3 billion. This would occur despite the Labour Party's election manifesto which states: "Labour is opposed to short termist privatisation of key state assets, such as Coillte or the energy networks." Such a quick and brazen U-turn has not been seen for many a long year.

The pro-public enterprise manifesto of the Labour Party was the basis for its election victory just over a year ago and laid the basis for its negotiations with Fine Gael, which in turn led to the coalition in government today. It is a coalition that has overseen a catalogue of cuts. I expect a chorus of lectures from Labour Party Minsters and backbenchers about our position. They will be finger wagging at us, telling us to get real. It will explain in pompous tones about how the country was run into the ground by Fianna Fáil, it now has to pick up the pieces and how the whole show is really run by the troika. If it honestly believes all that is true then the Minister should resign. If he has no power to protect the best interests of the people who elected him, then he should call it a day and step down. Let people with real commitment and ambition for the country take over.

We are not alone in our opposition to the sale of State assets. SIPTU leader Jack O'Connor, who is a member of the Labour Party executive, I understand, said: "The announcement regarding the sale of some public enterprises is a sad day for the Irish people and a tragedy for the Labour Party." Jimmy Kelly, regional secretary for UNITE, which is affiliated to the Labour Party said: "As things stand today any sale will be opposed using every means at our disposal." Meanwhile, IMPACT has also added its voice to the opposition to the scandalous sale of Coillte and other semi-State companies. Far from being an isolated voice in the wilderness, Sinn Féin is very much in touch with the sentiment of working people and the Labour movement, and is in very good company in opposing the sale of State assets.

Despite the limited fiscal powers Sinn Féin has in the North and the fact it is one of four parties in government which obviously involves compromise, as we all recognise, it has delivered on a wide variety of socioeconomic commitments. These include the delivery of 8,000 social and affordable homes; aid for small and medium enterprises through a £50 million loan fund; providing £40 million to address dereliction and promote investment in deprived inner city areas; a £13 million package to tackle rural poverty and isolation; continuing to work with others, including an SDLP Minister, on a reduction in greenhouse gas emissions by at least 35% by 2025; an investment of £40 million to improve pathways to employment and improved community services; and implementing an integrated and affordable child care package with an additional £12 million. All of that is being done while the Tory Government reduces the block grant by £4 billion. This clearly shows there is a different and better way. It can only be led by people who have vision and courage.

Sinn Féin has a very different view from this Government on how the economy should be run. In our pre-budget submission we detailed how semi-State companies should be used as a driver for economic recovery. Coillte, the ESB and Bord Gáis, which this Government intends to sell off, paid a total of €1.97 billion to the State in dividends over the past ten years. This is a huge success, by any standards, not to mention the PRSI and tax paid by workers and companies. These dividends will be no more if Government proceeds with its proposals.

Our proposals are simple, clear and focused on benefiting the country and its people. Sinn Féin wants to see the replacement of NewERA with a semi-State strategy group. We are proposing alternatives. The Minister is fair-minded and might take some of our proposals on board. The group we propose would include CEOs from semi-State companies working directly with the Ministers for Jobs, Enterprise and Innovation, Social Protection and Education and Skills. It would report directly to the Taoiseach and would be responsible for the delivery of strategic job creation and training.

All annual dividends paid to the State by commercial semi-State companies must be reinvested into employment activation. We must have employment activation - this is a real opportunity to have it - and training measures, as identified by the semi-State strategy group and signed off on by the Taoiseach. We would cap the ridiculous salaries of CEOs in semi-State companies at €100,000, saving €3 million. We would reduce the cost of energy bills by running a cost efficiency drive in the energy providers and redirecting the savings.

On the sale of woods and trees, the land will not be sold. Some Labour Party Deputies have said we are only selling the trees. They have to be sold but they should be sold by Coillte. That is how it has been until now and the State has received the maximum benefit.

The semi-State sector has huge job potential. It has been in place throughout many recessions and when the Labour Party was in power in the 1980s. It has stopped the country from falling through the cracks and has provided a safety net for the economy. It has made up a huge part of the economy which has kept the country on its feet and has huge potential to continue doing so.

I appeal to the Government, in particular the Labour Party and Minister, to rethink this short-term strategy and stand up to the troika. If it feels it is being bullied it should stand up to it. I appeal to all those in the Labour Party to revisit its manifesto, support the motion and stop the giveaway of our vital State assets.

Photo of Seán CroweSeán Crowe (Dublin South West, Sinn Fein)
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Speaking in support of this motion it is important we are mindful that the sale of State assets is an integral part of Fine Gael policy. Now, unfortunately, we know that Labour Party is on the privatisation bandwagon, despite its election promises and commitments to keep State assets in public ownership. That is a sad position for the Labour Party to adapt.

We know the Government plans to dispose of €3 billion in State assets. We do not know who will see the rewards, if any, from the selling off of these assets. Will the workers or consumers benefit, or will venture capitalists be the real beneficiaries? We certainly do not know if the Government's strategy will do anything for the 70,000 young people who are forced to leave these shores on an annual basis.

For decades, companies like the ESB have played an important strategic role in the economic development of the Irish State. It has delivered a first class electricity network that is second to none throughout Europe. Over the past ten years, the company has paid €4.3 billion euro to the State in taxes and dividends and, along with Bord Gáis, has delivered a first class energy infrastructure that has created tens of thousands of skilled full-time jobs for generations of workers. Private interests will change this.

In 2009 when the housing market collapsed, ESB Networks, to its great credit, agreed a programme of on-the-job training with FÁS to take on 400 redundant electrical apprentices. This allowed unqualified apprentices to complete their qualifications at a time when the building industry collapsed and their prospects were very bleak. It is exactly this forward-looking kind of intervention by commercial semi-States that can assist in rebuilding the economy. Companies like the ESB are ideally placed to create employment and develop a new skills base that can compete in a 21st century market place.

Historically, semi-State companies drove Irish industry forward and broke new ground when the private sector was too cautious, unable or unwilling to invest or take risks when leadership and vision were needed. Surely now, when families are facing a deepening economic crisis, widespread unemployment, poverty and despair, what is needed more than ever is for social and political leaders and business leaders in the commercial semi-State sector to re-embrace that vision.

We know the Government's plan to dispose of up to €3 billion in State assets and companies over the next few years includes the possible sale of Coillte, to which my colleagues referred. Coillte's estate comprises 1.1 million acres, or 7% of Ireland's land area. Despite this, only 11,000 people are employed in the forestry sector compared with 120,000 in Switzerland, a country half the size.

The Woodland League is calling for an urgent re-evaluation of the State forestry model as part of a national public works programme, involving training for the unemployed and the creation of long-term forestry jobs as "the backbone of a national recovery plan". Will the Government consider the merit of these proposals, which could help stimulate employment?

Ireland's public forest estate has been built up over many years with public resources as a national asset and as an investment in Ireland's future. It makes no sense to sell parts of it off. There are people who need access to Coillte land but nobody seems to be talking about their fears.

The Irish Congress of Trade Unions is on record as saying the "sale of state assets threatens to transform companies like the ESB or Bord Gáis into another Eircom [debacle]." It states the Government is disingenuous when it says that it does not intend to sell strategic assets, because clearly the most valuable assets we own - energy transmission and distribution networks - are the most strategic.

Companies, such as the ESB and Bord Gáis, which are profitable and highly strategic, risk being asset-stripped, weakened and undermined by Government policy. I appeal to the Government to think again about the selling of assets.

8:00 pm

Photo of Caoimhghín Ó CaoláinCaoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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This is an extremely important motion. It provides one of the few opportunities, or perhaps the only one, the Dáil will be given to vote on the monstrous plan by the Government to sell off State assets. What is now proposed by the Fine Gael-Labour coalition is monumental in its long-term economic implications for the Irish people. One should make no mistake that what we are looking at is not only a direct continuation but an escalation of the socially destructive and economically futile policies of the Fianna Fáil Government that wrecked the Irish economy. A year ago this week, the electorate rejected that Government and elected what it believed was an alternative in the form of the Fine Gael-Labour coalition; yet, as we mark that anniversary, we are faced with a plan for the fire sale of State assets that far exceeds anything attempted by Fianna Fáil in its worst days in office.

The commercial semi-State companies - the ESB, Bord Gáis, Coillte and Aer Lingus – were built up over many years by the hard work of Irish people and have been key pillars of the economy. They have provided the essential infrastructure without which no economy can grow. Energy, natural resources and strategic transport links are all indispensable assets that should remain in public ownership.

The succession of Fianna Fáil-led Governments from 1997 began the process of privatisation of these assets. In the case of Eircom, they were responsible for a huge debacle which should have been a lesson to the present Government. When in opposition, both Fine Gael and the Labour Party repeatedly pointed to that reckless privatisation.

In May 2005 Sinn Féin tabled a Private Members' motion opposing the privatisation of Aer Lingus. Speaking at that time on behalf of the Labour Party, Deputy Róisín Shortall, the current Minister of State and the Minister's colleague, said:

The experience of the privatisation fiasco in Eircom should sound alarm bells for us all. We cannot prevent venture capitalists from repeating the devastation of Eircom by stripping Aer Lingus of its assets, reducing services, putting it into serious debt and walking off with the proceeds. We have to ask whether the Minister is incapable of learning from the mistakes of the past.

She was also correct when she told us then:

Privatisation really is the new religion... Privatisation puts such services and assets at long-term risk and we should not just abandon them at the ideological whim of the coalition partners.

Perhaps the Labour Deputies would care to tell us now if the same applies to the current coalition partners. It clearly did to Fianna Fáil, the Green Party et al.

I have not yet heard of any events to mark the centenary this year of the establishment of the Irish Labour Party – an important event in the party's history - but I wonder how the party will square its support in government for this fire sale of State assets to private profiteers with its claim to be the successor of James Connolly and Jim Larkin.

What of Fine Gael? The less said, the better. We should not be surprised at its stance as it is clearly a party of the right and has championed privatisation almost as much as the Progressive Democrats. The plan for the sale of State assets is an invitation for exploiters to reap the profits, potential profits and job-creation capacity of commercial semi-State companies.

In the case of Coillte, I find it especially reprehensible that the Government would even consider selling the company's harvesting rights. That is what is at stake. Coillte is the largest land-holder in the State and while it is not, at present, proposed that its land be sold, the Government is selling access to that land and its resources. If ever there were a strategic asset, it would be that comprising our forestry and forestry land, yet we have a plan to abandon them to private interests with very serious long-term consequences for rural areas and the whole island.

There is an alternative and it is in the wording of the Sinn Féin motion. The Government should retain the people's ownership in the companies. The full potential of the companies has yet to be realised. Instead of proceeding with its plan for wholesale privatisation, the Government should establish a semi-State strategy group with responsibility for delivering a strategic job creation and training project.

All annual dividends paid to the State by the commercial semi-State body could be ploughed into this jobs and training strategy, thus making a major contribution to economic recovery.

The path the Government is following with this privatisation plan and its other austerity measures is the road to deeper recession and long-term stagnation of the Irish economy. I am glad the people are going to have an opportunity, as announced today by the Taoiseach and Tánaiste, thankfully in this House, to give their verdict on the latest EU treaty which, if ratified, would lock this and all future Governments for many years into the austerity policies that are doing so much damage to our society and economy.

The people will have an opportunity very soon to stop this futile strategy in its tracks. We in Sinn Féin are determined to ensure they will do so. The people will have an opportunity and chance not only to consider what is proposed in regard to the EU treaty but also to consider the Government's stewardship of the interests of the Irish people in the context of the wider European experience, particularly in contemporary times.

The Sinn Féin motion is one that all Deputies, irrespective of political allegiance, should consider seriously with a view to supporting it tomorrow night. It is incumbent on Deputies, especially those of the Labour Party, to accept that what is now being proposed by the Government at the behest of the Fine Gael influence, is absolutely anathema to everything the Labour Party Deputies stand for, have spoken for and have campaigned for over many years. The position the Labour Party has articulated heretofore on the defence of State assets and what is ultimately the family silver of the people of the State and the whole island of Ireland has been more than sound. Why would it now do a complete volte-face and abandon a position it has fought for, championed and articulated in the House time and again in my earshot throughout my 15 years as a Member?

It is beyond comprehension and I appeal to Labour Party Deputies not to sell off our State assets. They should take a stand, be courageous and stand with the people's interests now and in future.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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The selling off of State assets is a grave mistake on the part of the Government. At a time when the Irish people need job security and the public needs a belief that the Government is fighting to protect people's jobs, the Government decides it is time to rid itself of some of our finest resources.

Irish forestry is just one area where there is much potential to develop jobs. This State has one of the lowest levels of forest coverage in Europe and it is an industry that could provide long-term sustainable jobs if the Government was willing to support its development and exploitation. Growing trees is a renewable resource. Timber and wood products are increasingly being specified ahead of other less environmentally friendly materials. Wood biomass is a renewable source of carbon neutral, green energy that can readily displace some of Ireland's 90% reliance on imported fossil fuels. Has any attempt ever been made to quantify the true job potential in wood processing?

It is not just in the planting and felling of trees that jobs can be created. Coillte has an open forest policy, which allows the public access to its forests. This has the potential to develop the tourism sector, aided by the natural beauty of the countryside. If the Government sells off the harvesting rights of these forests, can it guarantee that the public will be allowed to walk through those forests, as they can at the moment?

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Yes.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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Thank you, Minister. I hope that is on the record.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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It will be.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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Both Labour and Fine Gael gave pre-election commitments not to sell off Coillte. Prior to entering Government, the Minister of State, Deputy Sherlock, said:

Do we really want to end up in a situation where this for-profit company could turn around and do whatever it feels like with a natural resource that rightly belongs to the Irish people, including many of our forests, rivers and lakes?

Deputy Andrew Doyle said: "That amount of land with that potential has to be kept in State ownership." The selling of Coillte could have serious effects on areas of large forestry. The Coillte N2 district covers Sligo, Leitrim and parts of Cavan and Roscommon. Coillte owns 32,500 hectares in this district, 74% of which is planted. There has been much talk of hydraulic fracturing, or fracking, of late and I have raised the issue on several occasions in this House. Will this Government readily supply fracking companies with Coillte land and allow them to destroy not only the forests, but also the health and well-being of those living nearby?

If we consider gas a State asset, and it is, how can one Minister make a decision to sell off that asset, irrespective of the serious and well-founded concerns regarding the safety, sustainability and advisability of so doing? Surely any decision of such major importance should be agreed by Cabinet and voted on by the Oireachtas as a whole.

This is privatisation by any other name. How long will it be before we see the privatisation of our health services which are currently being slimmed down so as to appear attractive to national and international financiers? I nearly did a double take when I heard Deputy Micheál Martin speak earlier today of the Government's failure to restore cancer services to Sligo Regional Hospital. Can this be the same person who sat at the Cabinet table and collaborated with the decision to remove those services in the first place? I was deeply concerned that, in his response, the Taoiseach referred to Sligo Regional Hospital as being among a group of "smaller local hospitals".

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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I think the Deputy is moving away from the motion.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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It is a broad brush-stroke. The Deputy cannot see the wood for the trees.

Photo of Michael ColreavyMichael Colreavy (Sligo-North Leitrim, Sinn Fein)
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Is this how the Taoiseach, the Minister for Health and their Government colleagues regard Sligo Regional Hospital?

We have already given away our youth and our sovereignty. This Government is now prepared to give away our State assets. When the troika comes knocking at the door once again, what else will the Government give them?

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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Ba mhaith liom tacaíocht a thabhairt don rún seo ar Ghnó Comhaltaí Príobháideacha. Tá sé tábhachtach dul i gcoinne aon iarracht socmhainní an Stáit a dhíol le fiontar príobháideach. Tá an-seans ann go mbeidh daoine dífhostaithe agus go mbeidh na scuainí dóil níos faide mar gheall ar an bplean seo.

Once again we have been fed a line by this Government about what big problem is facing the Irish people. So far it has been regional hospitals, children with special needs, smalls schools, disadvantaged schools, third level students and people in training. The Government has repeatedly failed to address the biggest issue staring us in the face every day - that we have a jobless economy, we are losing our youngest and most talented people to emigration every day and, worst of all, we are doing nothing about it.

Today we have a new scapegoat - the State assets and enterprises which provide vital services of strategic importance to the economy and its ability to operate. They want to have a fire sale, or maybe a closing-down sale would be more appropriate, because it seems the Government has given up on creating jobs and is now intent on putting more people on the dole queue.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Deputy was not around for the job announcements yesterday.

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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Do not worry, I was around.

The usual suspects all line up to tell us that if only we could do with the ESB, Bord Gáis and others what we did with Telecom Éireann, the economy would be the envy of the world again. It is not true, however, and anyone not living in ideological cloud-cuckoo land should be able to see that. Telecom Éireann was worth €8.4 billion before it was sold off. It had started a State mobile telephone tariff which would today be a massive feather in Ireland's cap had it been maintained. Instead it was broken up and sold off so certain corrupting forces could make a lot of money. A few Fine Gaelers and Labour people did okay out of it.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Who are they?

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Name them.

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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A private company now owns the telecommunications network for the State and can disconnect people's lines on the basis that they will only reconnect them if they sign up with Eircom for 12 months. They do not provide a better service for people in any way. In addition, broadband roll-out was knocked back for many years and we still have not recovered to this day.

People are dying in their homes due to freezing conditions brought about by poverty. If private companies get their hands on these industries, one can only imagine where poor people will end up. As can be seen from the Eircom fiasco, private companies are about the bottom line, not about investment, the provision of essential services or value for money. They are quite obviously not about providing the best services or about Ireland's interests, but their own.

Privatisation is not an EU-IMF initiative; this is a decision by the Minister and his Government colleagues. They are making it and cannot blame Fianna Fáil or the former Progressive Democrats. Following the budget, we have seen what this Government has done to health and other public services in his country. There has been a drive towards privatisation for the benefit of private enterprise.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I wish to share time with Deputies Jerry Buttimer, John Lyons, Paudie Coffey and Colm Keaveney.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Is that agreed? Agreed.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I move amendment No. 2:

To delete all words after "Dáil Éireann" and substitute the following:

"notes:

- the contribution that semi-State companies have made to Ireland's economic growth;

- the fiscal crisis inherited by the current Government and the commitment by the previous Government to the EU-ECB-IMF funding partners to consult with the Commission on foot of the report of the review group on State assets and liabilities with a view to setting appropriate targets for the possible privatisation of State-owned assets;

- the conclusions and recommendations of the review group on State assets and liabilities; and

- the new approach adopted by the Government to managing State assets through the establishment of the NewERA unit;

accepts that it is necessary to release value from State assets to reduce debt and provide additional resources for reinvestment;

welcomes the agreement that one third of the proceeds from the sale of State assets can be made available for reinvestment in job creation initiatives to stimulate the economy, which represents a major achievement in the negotiations with the EU-ECB-IMF troika;

further notes:

- the intention to ensure that any assets sold are sold on acceptable terms and at a price that achieves fair value for the Exchequer; and

- that the State's 25% share in Aer Lingus is no longer a strategic asset, as it does not enable the Government to determine Aer Lingus policy on issues such as, inter alia, the airline's landing slots at Heathrow Airport;

commends the Government for:

- its commitment to delivering on national priorities, with a particular focus on the critical importance of ensuring the security of oil, gas and electricity supplies; and

- its commitment to retaining the electricity and gas networks and interconnectors in State ownership as national strategic energy infrastructure, which underpin economic growth and security of energy supply;

notes that the sale of Bord Gáis Energy, which has played a key role in developing competition in energy markets, as well as some of ESB's non-strategic power generation capacity, may further enhance the competitive landscape in the all-island market, for the benefit of the economy and energy consumers;

agrees that the forest land owned by Coillte is an important strategic asset, which will not be sold; and

endorses the approach of the Government, announced by the Minister for Public Expenditure and Reform, Deputy Brendan Howlin, on 22 February 2012, as offering the possibility of significant positive outcomes in terms of driving competition in the energy sector and facilitating much needed investment in our economic recovery."

If we could tap the hyperbole coming from Deputy Ellis and his cohort, we would be able to power the entire nation and would not need Bord Gáis Éireann. I love the idea though, that one never lets the truth get in the way of a good story. So we are selling our youth, people are dying and freezing in their homes.

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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There are such people.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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In addition, we are creating no jobs. The fact is that in the last week alone, 1,500 jobs were announced.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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How many jobs were lost?

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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How many people emigrated?

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Order, please.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I know it is very difficult but in a national crisis there is an obligation, even on Sinn Féin, to work towards the recovery of this country, as this Government is doing. Despite their best efforts, we are going to succeed. I welcome this opportunity to explain the rationale for the Government's decision announced last week to proceed with a programme of State asset disposals involving BGE Energy, some of ESB's non-strategic power generation capacity, some assets of Coillte and the State's remaining shareholding in Aer Lingus. Last week's announcement was the culmination of a long process which began before the current Government took office and must be seen against that background and considered in that context.

In their comments following last week's announcement - again tonight we heard the same trite comments - it is obvious Sinn Féin Members adhere to the flat-earth policy in respect of State assets.

Photo of Caoimhghín Ó CaoláinCaoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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The Minister could have done better than that.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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"There is to be no change" would appear to be the mantra. I suggest they look around them. All has changed, changed utterly.

Photo of Caoimhghín Ó CaoláinCaoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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Particularly the Labour Party.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Labour Party remains committed to significant State involvement in a modern dynamic economy. The State can play a direct role in fostering economic growth or help provide the skills and supports that foster private sector growth. Both are worthy of support. An asset is not strategic simply because it is owned by the State. Such an argument is worthy of Deputy Joe Higgins. The world has moved on.

I welcome Deputy O Caoláin's interest in my party's history tonight. We will be writing a history of the Labour Party to commemorate our centenary. It will be much more wholesome and more civilised reading than the history of his party.

Photo of Caoimhghín Ó CaoláinCaoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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Not so.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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This Government has adopted a dynamic attitude to the State sector. NewERA was established to ensure the State and the taxpayers derive best value from their investment in State companies. It must be remembered these companies exist to serve the taxpayer; it is not the other way around. That includes releasing capital back into a capital-starved economy, if that is in the people's interest.

We have been at pains to point out what the public interest is and to protect it. Unlike Fianna Fáil's privatisation of Eircom, properly criticised by the Deputies opposite, there is no sale proposed of strategic networks or assets. The ESB remains a vertically integrated utility free to compete in the soon-to-arrive European market place. The gas network will remain entirely in public ownership. So too will Dublin Port. We will not sell the Coillte land. Selling the crop of trees is not a catastrophe.

Photo of Dessie EllisDessie Ellis (Dublin North West, Sinn Fein)
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That was the same argument when they started with bin charges.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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That is why we grew the trees in the first place. Does Deputy Ellis want to throw sugar at them?

Photo of Seán CroweSeán Crowe (Dublin South West, Sinn Fein)
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No, we want to replace the Government.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Order, please.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I did not interrupt any Member from across there.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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The Minister without interruption.

Photo of Seán CroweSeán Crowe (Dublin South West, Sinn Fein)
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The Minister keeps on asking us questions.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Far from being hostile to State enterprise, the Government is setting up a State company, Irish Water, to run water services unlike the arrangements in our neighbouring jurisdiction.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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Is that why water charges will be introduced?

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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We continue to believe the State has an active role to play in the market place. We also recognise, however, the strategic interest of the State does not remain static or fixed over time. What was strategic when electricity was installed across the country in the 1930s is not necessarily strategic now in a competitive all-island market place.

When the current Government took office almost a year ago, it inherited a situation whereby the State was unable to fund itself but instead was dependent on funding from the EU-IMF under a programme negotiated by the previous Government. The work of the review group on State assets and liabilities, under the chairmanship of Colm McCarthy and commissioned by the previous Government, was still in train but was approaching finalisation.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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Which the Minister opposed at the time.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The McCarthy group subsequently reported in April 2011 and concluded the realisation of proceeds from the sale of State assets offered the potential to assist in tackling the fiscal crisis, both by reducing the debt burden on the State and also by supporting economic recovery through enhancing productive efficiency and competitiveness. It recommended a planned programme of non-strategic asset sales should be undertaken.

The original memorandum of understanding with the EU-ECB-IMF funding partners also addressed the issue of asset disposals. It required the Irish authorities to undertake an independent assessment of the electricity and gas sectors, building on the work of the review group, and to consult with the European Commission services with a view to setting appropriate targets for the privatisation of State-owned assets.

In negotiating a programme for Government, the two Government parties accepted a new approach to the management and use of State assets, in the interests of the economy, the people and job creation, was required as part of the mechanism to address the fiscal crisis. The programme for Government included a commitment to release value from the State's portfolio of assets with the intention of using these proceeds to fund investment in the productive capacity of the economy in the context of the NewERA entity which we propose to establish. A target of up to €2 billion from the sale of non-strategic assets was agreed, drawing from the recommendations of the review group but with the assets only to be sold when market conditions were right and when adequate regulatory structures had been established to protect consumers.

Since the Government took office last year, we have made significant progress in advancing the Government's plans with regard to making better use of our State assets.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Hear, hear.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Last year, the Government established NewERA to reform the manner in which the State's shareholding in semi-State companies is managed for the good of every citizen. NewERA is proactively overseeing corporative governance from a shareholder perspective of the commercial energy area semi-State companies, the ESB, EirGrid, Bord Gáis, Bord na Móna and Coillte. It is advising relevant Ministers on matters such as dividend policy, capital investment plans, approval of borrowings and so on.

The Government has also set up the strategic investment fund in the National Treasury Management Agency, NTMA, as the forerunner to the strategic investment bank. Drawing on resources from the National Pensions Reserve Fund, NPRF, in combination with matching commercial investment from private investors, the strategic investment fund will channel resources towards the productive sector in the economy. The €1 billion we can get from the sale of State assets will be one element of getting absolutely needed capital. We will also use the NPRF, the European Investment Bank and the Council of Europe Development Bank, as well as any other private sector funding we can leverage, to drive an agenda of growth and recovery. NewERA is working closely with the strategic investment fund and the NPRF to ensure commercial investment opportunities are developed.

Considerable progress has also been made over the past year in assessing the suitability of a range of State assets. Two working groups were established in 2011 - one to consider the best approach in progressing the proposed part-sale of the ESB, including energy policy, regulatory, legal, financial and economic considerations; and the other to undertake a similar analysis of several other State assets. Both of these groups completed their work in 2011 and reported to Ministers in December 2011.

NewERA was also centrally involved in this process, together with my Department, the Department of Communications, Energy and Natural Resources, the Department of Agriculture, Food and the Marine, the Department of Transport, Tourism and Sport and the Department of Finance. It was on the basis of the analysis undertaken by these two working groups that the Government last week agreed to the list of asset disposals announced on 22 February. It also agreed not to proceed with the minority stake in the vertically integrated ESB as had been previously decided as it was not the best way to advance. The analysis undertaken on the original proposed ESB transaction identified a range of complex regulatory, legislative and policy issues which would have to be addressed before a part-sale of the company as an integrated utility could proceed. Accordingly, it was not practical to continue to proceed with that proposal.

The Government has also achieved a significant breakthrough in our negotiations with the troika on the use of State assets. I thank our partners for the protracted engagement on this matter. Instead of the troika's original plan that a programme of asset sales of €5 billion be used exclusively to retire debt, we have now agreed that in return for committing to a target of up to €3 billion, the Government will be permitted to retain one third of the proceeds generated to invest in job creation initiatives to stimulate the economy which is so desperately needed and of which the Deputies opposite are right. Jobs are the focus, first and last, of the Government.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Hear, hear.

Photo of Paudie CoffeyPaudie Coffey (Waterford, Fine Gael)
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Hear, hear.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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There will be no fire sales. If we do not get a proper price, we will sell nothing.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Did Deputy Martin Ferris hear that bit?

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Was I clear enough?

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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It is the second jobs strategy so far.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Assets will be sold on acceptable terms and at a price that achieves fair value for the taxpayer. Key strategic assets, such as electricity and gas transmission and distribution systems will not be included in the disposal programme, but will be retained in State ownership. I believe the agreement reached with the troika represents real and significant progress.

I will turn now to the specific assets that are to be sold. In deciding on the programme that I announced last week, the Government has been careful to safeguard the position of strategic infrastructure such as the electricity and gas networks, which are considered to be vital to the functioning of the economy. The House will have noted that these assets are not part of the disposal programme and will remain under State control. What will be sold is the energy business of Bord Gáis Éireann, BGE, but not including BGE's gas transmission or distribution systems or the two gas interconnectors, which will remain in State ownership. I refer by and large to the wind energy and other soft energy options that BGE has built up over time. Nobody can argue that they must be held in State ownership from a strategic point of view.

The Minister for Communications Energy and Natural Resources will consult with the Commission for Energy Regulation and the ESB and advise the Government on the specific ESB assets that are to be sold, with the objective of materially improving the competitive dynamics of the single electricity market to the benefit of consumers, as well as realising the assets for the productive purposes I have outlined.

I ask the House to pay attention to the next point as it is a different decision. We have said on the first level of issues that we will sell them when the market conditions and regulatory issues are right, but on Coillte, consideration will be given to the sale of some of its assets. This will focus primarily on the harvesting rights of Coillte's forests, but I have already made it clear that Coillte's landholding is not for sale.

The Government now accepts that the State's remaining 25% shareholding in Aer Lingus is not a strategic asset, as it does not enable the Government to determine Aer Lingus policy on issues such as the use of the airline's landing slots at Heathrow Airport. Unfortunately, the previous Administration, in selling off 75% of the company already moved that out of State hands. Accordingly, the Government has decided that the State's remaining shareholding in Aer Lingus will be sold at an appropriate time, when market conditions are favourable and an acceptable price is agreed.

The policy that has been pursued by the Government that we set out and that has been carefully tacked over the past year in terms of reforming the manner in which State assets are managed for the benefit of the taxpayer and job creation to get the best value for the shareholders, namely, the people of this country, is the right thing to do. We have identified the optimal means of releasing value from some non-strategic State assets, in an appropriate way, which is the right thing to do given the fiscal and economic challenges facing the economy. I am confident that the asset disposal programme which I announced last week - for the information of Deputies opposite it was endorsed unanimously by Government - will have a significantly positive outcome by driving competition and driving down prices in the energy sector as well as generating desperately needed resources for investment in jobs and the recovery of the economy. On that basis, I commend the Government's amendment to the House.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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I commend the Minister on his speech, his approach and his amendment to the motion. Some Members on the benches opposite are content to rewrite history. The Government on the other hand has been active in renegotiating elements of the agreement with the troika and has correctly put jobs at the centre of its policies. I pose the question to Deputy Ferris and the Members opposite in the Sinn Féin Party of whether they want to see the country rise or fall. That is a question they must answer in their hearts. Do they want the country to rise or fall? Do they want people to prosper or to come to the House and whinge continually?

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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That is a very difficult question to ask.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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The initial version of the agreement required the Government to set appropriate targets for the possible privatisation of State-owned assets. It contained no commitment on investment in the economy. By co-operating and working with the troika, the Government delivered on its commitment to renegotiate the agreement. The Members opposite said it could not be done but it was done. When the Government took office it faced the restrictive agreement and it was told that renegotiation would not be possible but it was done.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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What renegotiation?

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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On the interest rates.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Agreement was reached with the troika on the sale of State assets and the reinvestment of the proceeds into the economy. That is another example of the Government's successful renegotiation.

The Minister has said there will be no fire sale of non-strategic assets. I welcome that and put it on the record of the House. As Deputy Ferris well knows, the McCarthy report recommended the sale of non-strategic assets. The programme for Government confirmed that the sale of State assets would be used to stimulate growth and create employment. The Minister's proposals meet both of those aims. I welcome the fact that he is not rushing into a fire sale of assets and that he is carefully assessing each asset to ensure that there will not be a fire sale. I commend him on his approach. As the Minister outlined in his speech, it is critical that we achieve the best value for the Exchequer and the taxpayer.

It is clear from the Government's approach that we are going to learn from the mistakes of the Eircom debacle. I hope the members of the Government that was in power such as the then Ministers, Mrs. O'Rourke and Deputy Martin, listen and learn from that. It was a debacle that risked the country's prosperity. As the Minister indicated, the Government will not sell the gas transmission and distribution system or the two gas interconnectors. Unlike Eircom, those two vital pieces of infrastructure will remain in State ownership. As the Minister indicated, when the Government considers the sale of Coillte, the land will not be included. Again, another lesson has been learned from the Eircom case.

Since the Government came to power 12 months ago it has consistently made job creation its focus. We have seen the jobs initiative working this week in my city and county of Cork.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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How many jobs were created?

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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There are many ways in the which the Government can facilitate jobs, either by direct investment or by private sector investment.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Deputy Ferris is talking down the country.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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No.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Order, please.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Sinn Féin is constantly talking down the country.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Order, please.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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The action plan on jobs is a set of measures to facilitate job creation. Today, despite the protests of the Members opposite we are seeing again a stimulus plan to get the economy and people back to work.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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There is no plan.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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The Members opposite have an answer to the question in their hearts and in their minds. Do they want people to prosper or do they want to come to the House cnáimhseáling every day? That is a question they must answer.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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Deputy Buttimer should tell people the truth.

Photo of Jerry ButtimerJerry Buttimer (Cork South Central, Fine Gael)
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Does Sinn Féin want to see people working or does it want to play petty party politics? Only its members can answer that.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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There is not much to say following the speech of the Minister, Deputy Howlin but I will use the four minutes allocated to me if Deputy Ferris does not interrupt me. I thank him for not interrupting.

The idea of selling any non-strategic State assets arose out of the collapse of the economy and the funding difficulty the State had then and now. As much as I hate to say it, the reality is that Fianna Fáil was responsible for it. We should not be criticised for reminding people of that as often as needs be. Fianna Fáil also set out the process we are discussing tonight with the McCarthy report, which commissioned a review of the sale of State assets. From the comments last week it is clear that Deputy Martin and the Fianna Fáil Party are now seeking to distance themselves from those remarks. When the McCarthy report was undertaken it was charged to consider the potential for asset disposals in the public sector, including commercial State bodies, in view of the indebtedness of the State. One could ask whether the party was aware of what was happening. The review proposed €5 billion worth of asset sales in May before the EU and IMF even came to town.

Whether we like it or not we are in a programme of support from the IMF and the EU. Raising State finances through asset sales is part of our agreement with them. That is the reality of where we are at, whether we like it or not. We are in a funding programme with other European countries and the IMF because we cannot pay our bills. A huge proportion of the bills are a result of the burden placed on us by the disastrous initial bank guarantee but either way, this is where we are at. As difficult as it is, the Government is dealing with the situation.

We can differ on whether the approach being taken is right or wrong but I believe this is the way to go. It would be easy to suggest that none of this is necessary. With no disrespect to anyone in the Sinn Féin Party, my firm belief is that is the easy option. The easy option is to say that what we are doing is wrong. It would be easy to say we do not have to sell anything and that we can easily find funds elsewhere to invest in jobs and reduce debt but that is simply not the case. Let us have a debate that recognises that this is where we are at, and that we must do what is being outlined.

Selling State assets that have been built up over generations gives me no satisfaction, nor does it give me satisfaction to discuss the matter in the House, but I am trying to deal with our situation. I have great admiration for the workers in ESB Networks and Bord Gáis who built up services and facilities. They should have a full say in the matter and their interests should be kept in mind when these assets are being sold.

However, I am mindful of people who are out of work and for whom we cannot provide jobs. That said, there have been some recent shoots. The Minister, Deputy Howlin, referred to an approximate 1,000 jobs. The unemployed must be at the heart of the Government's plan. That is the case in this instance. It is not about selling assets for the sake of it. The sale is to allow us to develop a climate in which the growth of more jobs can be encouraged. As a Government, we do not have many options in tackling unemployment while meeting the commitments of the EU-IMF deal. We must repay what we owe and create jobs.

The proposal to raise €3 billion through the sale of non-strategic State assets contains a carrot, given the prospect of re-investing €1 billion in the State so we can create jobs and, as is the case with Members, give people the dignity of doing a day's work. People call for this dignity daily, but we are not in a position to provide it. The State's main obligation is to scrub up €1 billion and create a climate that allows more mothers and fathers, brothers and sisters to live with dignity and to feel like valued citizens.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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I thank Deputy Lyons.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I did not believe that I was going to reach the four minute mark, but I assume I have.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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The Deputy has gone well over it.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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I thank the Leas-Cheann Comhairle for letting me continue. I believed I would be quick, so I apologise. The Minister summed it up. We did not need to say anything else.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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He is delighted with the phrase.

Photo of John LyonsJohn Lyons (Dublin North West, Labour)
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Credit where credit is due.

Photo of Paudie CoffeyPaudie Coffey (Waterford, Fine Gael)
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I welcome the opportunity to contribute on this important debate at a time when our country demands real leadership as we navigate our way through this crisis. There are no easy options for any Government or Deputy. When the Opposition makes reasonable and practical proposals, the Government will welcome them and give them due consideration. However, where proposals are unrealistic and many of the arguments make no economic sense, we must approach them differently.

I welcome the Government's reasonable, considered and pragmatic approach to this issue. Under an initial proposal, a minority stake in the ESB was to be sold. Having considered the idea in depth and examined the complexities involved, the Government has instead proposed alternatives whereby non-strategic assets, such as the ESB's power generation capacity, can be considered for sale.

As many Deputies have stated, lessons have been learned from the farcical sale of Eircom, the result of which has seen State development, agencies, businesses and our education system deprived of network access. Lessons have been learned and such mistakes will not be made again.

I welcome the fact that this will not be a fire sale. The markets will be approached reasonably so that value can be found. It is important to remember that the Government has renegotiated with the troika to ensure that one third of proceeds raised in excess of €1 billion will go directly towards economic stimulus and investment measures.

I am amazed that Sinn Féin, which continuously calls for stimulus and investment, is opposing a realistic mechanism that will deliver them and create jobs. Sinn Féin is the party of negativity. All it does is oppose everything and it does not offer realistic solutions. Sinn Féin takes a populist approach that the Irish people will see through. Of most concern is that Sinn Féin believes itself. I respect its members as elected Deputies, in that they also have mandates, but their rhetoric in the House is concerning. This week, the way their colleague managed printers and ink displayed how they might manage State assets if they got anywhere near power. This is not a cheap shot. It drives directly to the question of how responsible Sinn Féin would be in government. If this is Sinn Féin's type of responsibility, God help us all.

We need a responsible, considered approach to navigating our way through this crisis. The Government will sweat off some of our non-strategic assets and gain the capacity to introduce investment and create jobs, thereby helping the economy. I welcome this.

I listened to the Sinn Féin Deputies' contributions. What they stated about selling Coillte's lands was not true. The Government has gone to extreme lengths to point out that those lands will be retained in Coillte. However, we will consider the sale of the harvest on those lands, just as any productive farmer would. Our exports are as strong as they are because productivity and growth in the agricultural sector are strong. The Government is right to consider sweating that asset as much as possible to create a new revenue stream and to return the country to work.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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May I share time with Deputy Niall Collins?

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Is that agreed? Agreed.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I welcome the opportunity to discuss the sale of State assets. We discussed it briefly during Question Time, but this debate gives us more time to discuss it further. I disagree completely with the Government's proposal on using two thirds of the proceeds of the sale of any State asset to pay down our national debt. I reject it entirely.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Deputy's Government agreed to 100%.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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No, we did not. I will address the factual situation later. Some 100% of the sale of any State asset should be used for job creation, growth, economic development and investment. It is only through economic growth and investment that we can work our way out of our financial difficulties.

I have read the wording of the memorandum again. The Minister seems to believe some of the scripts being published in his name, he has read them out so often. The people believe what he is saying and the media seems to have accepted it. However, some of his comments on the contents of the memorandum of understanding have not been true. According to him, the original memorandum's only commitment was to address the issue through the McCarthy report. The programme's targets can and will be achieved without the proceeds of asset sales. The memorandum of understanding contained no figure on the sale of State assets.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Deputy knows that all assets were to be considered, as agreed with the troika. It is in the memorandum.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I will go through the facts and the exact sequence of events. Under the memorandum of understanding that the Fianna Fáil-Green Party Government signed in December 2010, we agreed to undertake an independent assessment of the electricity and gas sectors with a view towards enhancing their difficulties-----

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I would hope it was not meant to enhance difficulties.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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-----and "setting appropriate targets for the possible privatisation" of State assets. I am quoting the memorandum. This section of the memorandum dealt with raising Ireland's growth potential. It was not the section on safeguarding public finances, namely, paying our debt.

Changes occurred. Following the new Government entering into office 12 months ago, the memorandum read: "It is important that we make effective use of State assets and, where appropriate, dispose of them to help reduce our Government debt." This was the Government's decision and was not contained in the earlier commitment.

I will nail the most important point. The Minister and his colleagues in government claim they are tied by the memorandum of understanding to which we signed up. They are trying to convince the people they are tied by provisions that were not contained in the original memorandum of understanding. The Minister claims these were being discussed by someone somewhere in the ether.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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The Deputy is rewriting history.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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We accept responsibility for signing up to the original memorandum of understanding, but we will not accept the Minister's claims that the memorandum contained provisions on-----

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Why did the Deputy's Government set up the McCarthy group?

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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To review possible privatisation, not to reduce the national debt.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Was it an academic exercise?

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Order, please.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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The Minister stated: "In negotiating a programme for Government, the two Government parties accepted a new approach to the management and use of State assets in the interests of the economy, the people and job creation was required as part of the mechanism to address the fiscal crisis." The new approach was introduced in the programme for Government.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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In NewERA.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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State assets were to be sold to manage the financial crisis.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Read the next sentence.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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This has not been publicly acknowledged until now, although Fine Gael had wanted to do it for years. The sale of State assets is part of Fine Gael's agenda but part of the price was that the Labour Party would sacrifice its soul. In its rush to get into Government, the Labour Party signed up to anything Fine Gael wanted.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Is Deputy Fleming for it or against it?

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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We will come to that in a minute.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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We will deal with that. I am opposing the sale of State assets unless the proceeds are specifically used for job creation and investment.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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All of them.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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All of them.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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That is clear.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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We are very clear in that regard. If the Minister had announced that the proceeds from the sale were being invested in job creation, business development and enhancing growth, we would have supported him.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Paying down the debt does not count.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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The best way to clear a debt is by earning more money to pay it back. Everyone knows that we have to grow our way out of a recession. We cannot get out of it by selling off State assets in the absence of growth. That is where the process goes wrong. This policy is entirely the Government's because we never made a commitment to use the sale of State assets to write down debt.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Absolutely wrong.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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In July the Minister stated that he was committed to selling State assets and, more importantly, the agreement signed in the past few weeks commits the Government to an ambitious programme of State asset disposal designed to enhance the efficiency and competitiveness of the economy, reduce sovereign financing needs and provide additional resources for investment. Instead of claiming credit for getting an agreement on investing one third of the money in employment creation, he should admit that he lost the battle because the majority of money raised from this process will be used to pay down the debt. This was not in the original agreement.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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You are wrong.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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It was not. The Minister says it was in the ether.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I will explain it.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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He keeps saying the troika was battering down the door to demand billions of euro when his party entered Government.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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You know it.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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It was not in the agreement.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Ask the troika.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I will accept responsibility for what was in the agreement but I will not accept responsibility for this. The Minister keeps claiming it had been agreed and discussed. We never signed up to it and we are not responsible for the measures his Government agreed to if they were not in the original agreement.

I also believe the timing is wrong. The Government is jumping the gun because it would have been better to tell the troika that while Fine Gael might not have an ideological difficulty with selling State assets, now is not the time to even discuss the issue. The Minister published the McCarthy review of the sale of State assets last year but he will not publish the information that persuaded him to make this decision. He pulled the figure of €3 billion out of thin air. No evidence has been published to back it up. It is similar to the figure he published on 17 November 2011 when he claimed that public sector reform would lead to a payroll reduction of €2.5 billion. No evidence was produced to support that claim.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I sent the figures to the Deputy.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I have asked for the figure.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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You have the report.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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There is no figure in that report.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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There are none so blind as those who will not see.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I asked for figures on the reduction but the Minister stated that he can only provide figures on what has been achieved to date and cannot give figures regarding future projections.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I sent you the projections.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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The Minister would be better off working with the ESB, which paid €1.2 billion to the State in dividends over the past several years.

I accept that over the economic cycle State companies will be established, grow to maturity and be sold off or remain in State ownership for generations. My party has been involved in establishing a considerable number of semi-State companies over the years, as well as selling off some of them when it was appropriate to do to. It is a question of looking after the interests of the Irish people. In respect of strategic generation power plants, however, control must be maintained anywhere a hydroelectric generating station can control water levels, as is the case at Ardnacrusha, the Inniscarra dam on the River Lee and Turlough Hill. I welcome that the Minister appears to agree with me because I would not like the private sector to be able to decide the water levels on the River Shannon or the River Lee. From that point of view, strategic importance is based on more than the ability to generate electricity.

Problems also arise when there are too many private companies operating in the market. Approximately 300 different price packages are available in England but nobody can be sure they offer value for money. Furthermore, the questions of customers who must deal with difficult accounts and what happens to the staff of these companies have not been addressed sufficiently.

I acknowledge that the Government is not selling the freehold title to Coillte land but we need further details on the arrangement. The Minister told us that he cannot share commercially sensitive information but he expects to sign a blank cheque. We cannot agree to the proposal until we get adequate information. The Government proposes to sell the right to harvest the forests. In effect it will hand over these trees and the land on which they are growing for 30 years until the crop is mature. During that period the public will have no right to access the land because it will be a private sector work site. The health and safety rules will be quoted and the land will be treated as private property for 30 years. We will not even be able to exploit it for its tourism potential.

The question of carbon credits for forestry and power generation has not been addressed sufficiently. Will the purchasers be given carbon credits with the assets in order that they sell them at a profit without producing a megawatt of electricity? The Minister cannot expect us to provide a worked out response without this information.

If the Government does not intend to use all the proceeds from the sale of these State assets for job creation, investment and growth of the economy, it should not sell them.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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I welcome the opportunity to speak on this important debate on the future direction of our State assets. I have considerable respect for the Minister's honesty. I urge him to ask his Labour Party ministerial colleagues to desist from pinning his agenda of selling State assets on Fianna Fáil. The facts speak for themselves. The Minister for Finance admitted on many occasions in response to Deputy Michael McGrath on Question Time that this was not a route decided on by Fianna Fáil in Government. We did what any Government should do, namely, take stock of the State's assets. There is nothing wrong with that. The Government should stop misinforming the public on the facts and the chronological order in which they occurred. There is a trend in this country that if one says something twice on RTE it becomes fact. It ill behoves any Minister to mislead the Irish public.

The debate over ownership of State assets cannot be simplified into left and right positions. We will have to take a pragmatic view of what is right for the country in social and financial terms. The Government is right to take its time in considering these issues but if it decides to sell it should do so at the optimum time. Prior to selling semi-State companies, however, it needs to look after the employees who built them up and have become major stakeholders in them. When we speak about privatisation, we cannot avoid the subject of job losses. Significant issues arise in respect of jobs and livelihoods for the employees, their families and the communities in which they live. In his contribution the Minister made no mention of the pension funds associated with some of these State companies. We know there are large deficits in many of these pension funds, which needs to be considered thoroughly.

Before we go any further down the road of developing a policy on the disposal of our State assets we need to introduce other legislation that comes under the remit of the Minister for Public Expenditure and Reform, which is to establish a register of lobbyists. That is critical legislation in bringing the transparency we need. My party has published legislation in that regard and I know the Minister is working on it. I believe it would be agreed by all parties in this House. We all know the high-profile Ministers who were household names now engaged in the business of lobbying and there is nothing wrong with that. However, equally there is a coterie of people, including former civil servants who are not household names, who are attempting to influence public policy. They have ready access to top-level civil servants and to Government. It is only fair that the public should know who these people are.

We also need a serious debate on what State assets are strategic and what are non-strategic. In that regard, why is the remaining shareholding in Aer Lingus now being viewed as a non-strategic State asset? In my part of the country - the mid-west - we regard the potential loss of the Heathrow landing slots as critical.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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We have no control over them.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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We have a golden share in Aer Lingus-----

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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No, we do not.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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-----and we have a number of members on the board. We in the mid-west region need to retain the landing slots. In 2007 my part of the country went into a convulsion because we lost the Shannon to Heathrow route. The Minister's party colleague, the Minister of State, Deputy Jan O'Sullivan, stated at the time:

We have had enough of the flowery sympathetic speeches. We want the Government to use its clout on the Board of the Company and insist that the Shannon-Heathrow route is maintained.

I echo those sentiments. The Minister of State, Deputy Jan O'Sullivan, is now in government and I want to hold her, her party and the Fine Gael Party to their word. We need to maintain the Heathrow route for connectivity in the mid-west.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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We have no control.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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Why did the mid-west region lose out to County Louth for the PayPal investment? It is because the Government is not prioritising the mid-west. As a Deputy representing the mid-west, I feel the Government is resiling from its responsibility. In order to keep the mid-west's competitive edge, we need to keep the Shannon to Heathrow route and the only way to keep it is by maintaining our 25% shareholding in Aer Lingus.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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We have lost them.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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Why is the Minister rubbishing it now? A few years ago when his party was in opposition it nearly brought the House down over the Shannon to Heathrow route, with which I agreed because it was critical. I was glad the then Government worked hard and put in board members, when they did not have them previously, and restored the Shannon to Heathrow route. It is incumbent on the Minister to acknowledge that the Shannon to Heathrow route is a critical strategic State asset for the mid-west region.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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We have sold the control.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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I implore the Minister to use his common sense in that regard.

Photo of Maureen O'SullivanMaureen O'Sullivan (Dublin Central, Independent)
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I wish to share time with Deputy Mattie McGrath.

Photo of Michael KittMichael Kitt (Galway East, Fianna Fail)
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Is that agreed? Agreed.

Photo of Maureen O'SullivanMaureen O'Sullivan (Dublin Central, Independent)
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I am reminded of the cliché about marrying in haste and repenting at leisure. We have had decisions that were made rather hastily usually just based on figures and not considering the impact on lives. I am very glad about the repenting - the reversal on the proposed cuts to DEIS schools and today's announcement that the people will be given the chance to vote in a referendum on the fiscal compact.

The review group that analysed State assets did so purely from a financial perspective without considering the social or environmental costs, which need to be taken into account. Selling State assets seems to be part of the IMF solution to economic recovery which has been seen in other countries such as Argentina. Selling State assets means privatisation. We have had the debacle of the privatisation of waste services in Dublin recently whereby a very suspect auditing company got the decision to make. The contract was given to a company that had been prosecuted and found guilty of charges under the EPA and there was a very definite lack of accountability in the contract. The aim seems to be to raise €3 billion from the privatisation programme with €2 billion being used to pay down the debt and €1 billion to assist in boosting employment. However, if the debt burden is €119 billion, €2 billion will not make much difference and there could be a wiser investment for it.

In some of our State companies there is a culture of obscene salaries with dreadful expense accounts and allowances. Changing that is one aspect of privatisation I would welcome. At times State companies have been guilty of poor service with high prices. Even though these companies are being presented as being self-financing, they have been heavily developed through public funding, not with a view to selling them off to the highest bidder - an invisible bondholder, some offshore tax-evading tycoon or a foreign oligarch. There are examples in Portugal at the moment. While I know the Chinese are our best friends, there are issues with their investments in some developing countries.

The State assets need to be considered on more than their market and economic values. There are strategic elements attached to Bord Gáis Éireann and the ESB that are vital to our energy security, particularly in the development of alternative energy sources such as wind power. I share the Woodland League's concerns concerning our forests - the access, the carbon value of the trees and the possibilities for a national works programme. I hope selling off our shareholding in Aer Lingus will not prove to be short-sighted. If the privatised companies fail, who will bail them out? Will they come back to the Government again? Festina lente.

Photo of Mattie McGrathMattie McGrath (Tipperary South, Independent)
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I am glad to be able to speak on tonight's motion. I compliment the Minister on his efforts in many areas. He has a sobering ministerial role in a Government that seems to have gone for a slash and burn approach. The Labour Party was founded in Clonmel 100 year ago. The current mayor of the town is rightly looking forward to hosting the Labour Party in remembering its proud history.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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I am sure the Deputy will be out to welcome us.

Photo of Niall CollinsNiall Collins (Limerick, Fianna Fail)
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The Minister should be careful what he wishes for.

Photo of Mattie McGrathMattie McGrath (Tipperary South, Independent)
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I will be there. The Government is throwing the baby out with the bathwater in many areas. I have no hang-ups about selling some of our State assets, but I have a hang-up if they are to be sold to pay off our debt - a debt that is too high and which the ordinary working people did not incur. I welcome the referendum that was announced today and I also welcome the reversal in the cuts to the DEIS schools. However, I do not welcome that the rural schools will suffer as a result. I applaud anybody who acknowledges a mistake and tries to correct it. However, mistakes in that area also need to be corrected.

Selling off the timber in Coillte woods may be an ideal way to look at it. As someone said earlier, one needs to sweat them hard to make them pay like any crop. However, these crops have a 30 to 40-year cycle. Will the land be available for recreational purposes for people to take walks etc.? If we are going to sell it, it should be for the harvest time for a period of a few years before they are ready for harvesting and get a new crop in. What about the carbon credit issue? Will we lose them also? What about the employees? They should be paramount especially for Labour Party Ministers in the spirit of James Larkin and James Connolly. Many good employees gave their lives to and have worked very hard for the forest service and latterly Coillte. They had pride in their work and their forests. One used to see entrances to forests with stiles that were painted showing the respect they had. However, now it is laid waste under Coillte because it is all about making a fast buck and there is no pride in fencing off forests from farmlands.

Many people worked at Telecom Éireann and the sale of that company did not do any justice to the workers and resulted in us losing control over valuable infrastructure in that area. We should make haste slowly and examine what happened with Eircom and how many times it has been sold on since.

I do not want to see retired politicians, who may have made some contribution here, or former public servants who have been paid off with large pensions now working as lobbyists. A very senior former politician has been linked with the sale of Coillte, which is scandalous. For people leaving with large lump sums and pensions there should be a moratorium of at least ten years - if ever - before they can return as lobbyists.

The Dáil adjourned at 9 p.m. until 10.30 a.m. on Wednesday, 29 February 2012.