Dáil debates

Thursday, 26 March 2015

Ceisteanna - Questions - Priority Questions

Regional Enterprise Strategy

10:00 am

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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5. To ask the Minister for Jobs, Enterprise and Innovation if his Department has provided any additional investment for the development of regional enterprise strategies framework; the job creation and investment targets for each of the eight strategic planning areas; the way the strategies for the west and south west will address the fall in employment in both regions, and the stagnation of employment in the border region. [12181/15]

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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Ireland's economic recovery, slow as it is, is almost exclusively located in Dublin and its hinterland while stagnation and decline persist in other parts of the country. The conclusions of the Nevin Economic Research Institute have been discussed. Its last quarterly bulletin basically stated that 94% of the 29,000 new jobs created in the economy last year were in the greater Dublin area. We could argue all day long that my statistics are better than another's statistics but the fact is that people from outside of the Dublin area looking in on this debate will know in their own experience that the recovery is not in their reach. It is important that the Government orientates to make that happen.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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First, I welcome the Deputy's question. It is important to state, as I outlined to Deputy Pringle, that the 90,000 extra jobs have been spread throughout the country. Dublin has higher growth. The mid-east, which is Deputy Tóibín's area, is not one of the higher growth areas but the other two areas of high growth are the midlands and the south east. The Deputy correctly pointed out that the west and the south west are areas that need attention. As Deputy Tóibín is aware, we have adopted a policy of introducing regional enterprise strategies. We have already taken action. We are identifying advance facilities that we will put in place in key areas. Where regions are not doing as well as they could we will put in advance facilities, align them to other strengths of the region such as institutes of technology or clusters of a sector in order to attract inward investment.

We are also making available €100 million from Enterprise Ireland which will be allocated by means of competitive calls. It will be designed to encourage regions to come forward with plans for what they could do with the particular competitive strengths they have. There is very much an emphasis on start-ups. We want to see a higher rate of start-up companies, less failure among the start-up community and more scaling. We also want to see individual sub-sectors that have the capacity to grow, identified by the stakeholders within the region and actions put in place to drive those opportunities. Competitive funds will be available to bring those opportunities to fruition.

In terms of setting targets, the overall context within which I operate is that we have set a target of full employment by 2018. That is in or around 160,000 additional people at work. We will seek to get regional balance in the spread of that. We will look at all of the regions. As I indicated to Deputy Thomas Pringle, we must recognise strengths as well as weaknesses. The Opposition will always focus on weaknesses. That may be its job. There have been some very good regional performances by IDA and Enterprise Ireland companies, in particular in the south west, one of the regions Deputy Tóibín identified. The IDA has also performed very strongly in the west, another region the Deputy identified. We have a baseline on which to build. The idea underlying the bottom-up regional strategies is for everyone to get in behind certain strategic objectives for those regions and make them happen.

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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The Government's objective for full employment is 6.5% unemployment. Given that Iceland has an unemployment rate of 4% and it is 4% also in Germany, the question arises as to whether they are super full-employment countries. A rate of 6.5% does not seem like-----

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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No. It is between 5% and 6%. Roughly speaking, it is 5.5%.

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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The previous response I had on the matter indicated that full employment was 6.5%.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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No. That is not the case.

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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I do not wish to get diverted into a discussion in that regard. We have lopsided development in this country at the moment. That has not happened by accident. In 2011 a total of 27% foreign direct investment went into the regions. Regional FDI investment was worse in 2012 and we have only seen slightly improved figures in recent years. In the third year of the Government's term of office a regional enterprise strategy emerged, which we welcome, but the problem is that we were told it would be rolled out by June 2014. The reality is that it was intended to be only trialled in one region by the specified time. We are already a year late in that regard. My major concern is that the necessary funds are not available to properly implement the strategy.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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What we committed to do last year was to develop a framework within which the strategy could happen and we are rolling it out this year. We have committed funds of €150 million from the IDA as part of its five-year strategy, which is specifically for property solutions. Most attention has been devoted to the 12 advance facilities we have planned for the next three years.

That only uses up 30% of those solutions. There will be many other IDA Ireland property-based investments to help regions attract inward investment. Up to €100 million has been set aside by Enterprise Ireland for these competitive calls. We are now moving into the implementation phase and doing it in a way with which the Deputies opposite will agree. We must sit down with the stakeholders in each region, get the best ideas and work with the agencies at local level to bring those ideas to fruition. We have ambitious targets in this regard.

There is always the trick of finding a figure that looks the worst possible. I can understand why the Deputy might be tempted to do that. If one looks at it in a balanced way, however, one will see all the regions are growing. Some strong Enterprise Ireland performances are occurring in many regions which were weaker. Some are not doing as well and those are the ones at which we need to look. Why in some areas are our own Irish companies faced with the same opportunities not growing so strongly? I expect Enterprise Ireland to do an audit on those companies and examine the range of policies that could help them grow. That is the benefit of a regional bottom-up approach.

10:10 am

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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There is no doubt that there are examples that buck the trend in each of the regions trending generally in a negative fashion. We have to measure the trends in those areas to be able to create the proper policies and develop the resources to solve the problems. It is not a case of looking for the worst figure. Anyone with two ears on them who steps outside of the M50 into the rest of the State will tell the Minister that it is not happening outside of the Dublin region. While the Minister referred to IDA Ireland development funds and the competitive calls fund, we are seeking to develop a regional enterprise strategy framework. This will put pressure on those organisations to come up with the goods without them getting the necessary funding to do so. As I said a week ago to the Minister, there are local enterprise offices, LEOs, which are understaffed and finding the transition from county enterprise board to LEO difficult without the necessary resources. If the Minister means business with regional enterprise and development, he needs to put his money where his mouth is.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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Will the Deputy look at the numbers? For example, there are 17,000 extra people at work in Enterprise Ireland companies. Of these, 5,600 are based in the south west, 3,000 in the mid-east area, 3,000 in Dublin, 1,700 in the Border areas and 1,400 in the midlands region. That is a good spread.

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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The minority of jobs are outside Dublin.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I accept with IDA Ireland jobs that more are peaking around the cities. All the cities are doing well and it is harder in some of the regions. That is why we are investing €150 million in property solutions in those other regions to build advanced facilities and strengthen them. The LEOs will have a very important role to play but there will be a specific competitive call targeted at them as to how they can be more innovative in the region and draw down additional resources for new ideas. They are very much included in these competitive calls.

The €100 million fund will be used to develop the assets we have in the regions, whether it is enterprise centres, LEOs, or, hopefully, uniform clusters to grow opportunities in food production or medical devices, for example. There will be money available but it will be competitive. We are not saying there is a little for everyone. We want to see competitive calls and really good projects being brought forward with the best ones getting funding. At the enterprise committee, the Deputy has asked me to show him the results with the KPIs, key performance indicators and so forth. That is the approach we are taking. This is what Deputies have said to me in the committee and I am implementing the approach that they are asking of me.