Dara Calleary (Mayo, Fianna Fail)
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4. To ask the Minister for Jobs, Enterprise and Innovation his views on whether a target of 20,000 additional manufacturing jobs can be achieved by 2016; the measures necessary to achieve this; and if he will make a statement on the matter. [24405/13]

Richard Bruton (Dublin North Central, Fine Gael)
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The potential of the manufacturing sector has been neglected in recent years. In consequence, as part of the Action Plan for Jobs 2012, I established a manufacturing forum chaired by Patrick Miskelly and supported by an analysis team in Forfás to develop a detailed strategy for manufacturing, which I launched last month along with a separate strategy on the skill needs of manufacturing prepared by the expert group on future skill needs. More than 205,00 people are now employed in manufacturing, which makes a very substantial contribution to the economy in terms of exports, purchase of materials and services, regional spread and innovation. The report makes clear that a do-nothing strategy could lead to continuing job losses in the sector and sets out a strategy which the authors believe to have the potential to create 20,000 jobs by 2016. This is an ambitious target. The report identifies four areas of opportunity including sectors with potential, adapting and responding to changing global supply chains, developing and adapting new technologies and materials and developing the indigenous potential for start-up companies and scaling. Key actions are proposed across a range of areas, including access to new funding, management training and support, cost reduction, technology adoption, extending international reach, improving innovation capacity, developing skills bases and the implementation of a national step change initiative.

The policy sets out eight distinct policy areas involving 63 actions in all. These actions include new start-up and capability funds to be run by Enterprise Ireland specifically to target supports for new manufacturing start-ups and to support capital investment by manufacturing companies. Enterprise Ireland and the IDA are to target additional financial supports for research and development investments specifically at engineering firms. Also included is a new national step change initiative available to all Enterprise Ireland and IDA client companies which will systematically support manufacturing companies to expand their client bases through staff training and peer learning, improve their adoption of new technologies, embrace research and development and accelerate collaboration between companies in similar sectors to generate greater efficiencies in areas like global sourcing.

Dara Calleary (Mayo, Fianna Fail)
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We have placed a great deal of attention in recent years on the service and pharmaceutical industries but it is important to remember that approximately 206,000 people are employed in manufacturing. In 2012, manufacturing companies exported €79 billion of merchandise and sourced €14 billion of produce from within the island. It is a hugely important sector and I welcome the focus the Minister has put on it. The challenge now is to put substance behind that focus.

The Forfás recommendations include a start-up fund for manufacturing enterprises and financial support for capital investment by manufacturing enterprises. Does the Minister intend to prioritise those recommendations within his own budget campaign, which is under way ahead of the October budget? Will there be a funding allocation and will Enterprise Ireland receive an extra allocation in 2014 specifically intended for the manufacturing sector to ensure that the recommendations from the excellent Forfás report are implemented? Is the Minister still confident that he will reach the target of 20,000 extra manufacturing jobs by 2016?

Richard Bruton (Dublin North Central, Fine Gael)
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There will be specific directed measures as I have outlined for start-up and capability funds directly targeted at the manufacturing sector. In addition, we will be using the funds we have launched, including the seed fund, small and medium enterprise fund, innovation fund and the development capital fund, to target manufacturing companies. Taken together, those funds come to €2 billion of funding supported by the State with private partnerships. Using those funds to address access to finance problems within manufacturing will be important.

I am very motivated to see the national step change initiative rolled out. It is about getting companies to step up their ambitions. Enterprise Ireland companies are really performing well, diversifying the direction of their exports, moving into new markets and improving their technology. While I am confident that we can deliver on the target, it will depend on the international environment, etc. Ours is a small and open trading economy. We have set an ambitious path with the strategy group which remains together to help us implement it. I am confident that we will make an impact.

Dara Calleary (Mayo, Fianna Fail)
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I welcome the Minister's confidence. Has he given the increase in labour costs in what were previously developing economies to which a great deal of manufacturing was outsourced in the middle part of the last decade and identified any competitive advantage that may be derived from that labour cost increase and quality issues in those countries that may assist him in reaching the target? Does the Minister think 20,000 is perhaps an unambitious target and could he force it up to 30,000 given the amount of money being invested in the sector at the moment?

Richard Bruton (Dublin North Central, Fine Gael)
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The target was set on the basis of the analysis carried out by Forfás supported by active industrialists in the sector. The strategy shows that the changing nature of globalisation is opening up opportunities. We are moving to a more personalised, customised form of manufacturing, which creates opportunities. This year, we are setting a target within the action plan of €500 million in additional global sourcing from within the supply chains of companies that are already in Ireland. There is a rich vein for us to develop here.

The target set is ambitious and we will work towards it. As the Deputy rightly says, it is about the implementation and rolling out of change. Lifting our companies is what we are seeking to do. I am fully committed to making this work.