Billy Kelleher (Cork North Central, Fianna Fail)
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68. To ask the Minister for Jobs, Enterprise and Innovation the actions being taken to reduce the costs of doing business here and reverse Irish competitiveness deficiencies; and if she will make a statement on the matter. [30834/18]

Billy Kelleher (Cork North Central, Fianna Fail)
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What actions are being taken to reduce the cost of doing business in Ireland and to reverse Irish competitiveness deficiencies? I ask this question in light of the alarm bells being sounded in terms of how the economy is progressing and the inefficiencies creeping into the cost of doing business and the impact this is having on our competitiveness.

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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I thank the Deputy for his question. Ireland’s overall competitiveness performance remains positive. Our improved fiscal position and increased cost competitiveness have contributed to Ireland’s improved international competitiveness. This improvement is reflected in a range of metrics, notably economic growth, increased employment, falling unemployment and a strong trade performance. In particular, our overall strong competitive position is reflected in the strong performance of the labour market across sectors and regions. The results from the Labour Force Survey in respect of quarter 1 2018 shows employment totalled 2,220,500, up 2.9% or 62,100, from the same quarter in 2017 with employment increasing in 11 of 14 economic sectors over the year. Notwithstanding this strong position, addressing Ireland’s cost competitiveness remains a key economic priority for Government. We continue to monitor Ireland's cost base and to analyse the factors that are crucial to improving our cost competitiveness.

The Costs of Doing Business in Ireland 2018 report, published by the National Competitiveness Council on 1 June, found that the cost base for enterprise is internationally competitive across a range of metrics, including the cost of starting a business, communications costs and average income taxes. However, the council also highlighted that Ireland remains a relatively high cost location and cost pressures are evident in residential property, credit, labour and business service costs. 

A range of initiatives set out in the Action Plan for Jobs 2018 are in train across Departments to enhance our cost competitiveness and productivity, improve the ease of doing business, reduce the administrative burden and drive greater efficiencies across the enterprise base. Through the action plan for education and pathways to work the Government is working to ensure the pipeline of talent can meet the demand for labour to reduce labour cost pressure. The ongoing work of the Personal Injuries Commission, the implementation of the report on the cost of motor insurance and the complementary work of the cost of insurance working group should help to reduce insurance costs for businesses.

Rebuilding Ireland - action plan for housing and homelessness - presents a wide-ranging set of commitments to address housing supply and while many of these will take time, the Government is implementing and driving change.

Additional information not given on the floor of the House.

Enterprise 2025 Renewed, which I launched in March, placed an increased emphasis on enhancing our competitiveness position by developing our Irish-owned enterprises. We are placing a spotlight on innovation and on skills. Enterprise Ireland also places a strong emphasis on competitiveness.  It supports exporting enterprises with initiatives in Lean, research, development and innovation and management development. The agency helps enterprises to take a strategic approach to understanding and responding to potential implications arising from Brexit and assists them to enter into new markets and diversify their export base. The local enterprise offices offer a suite of supports to enhance the competitiveness of small and micro enterprises. Initiatives include mentoring, innovation vouchers, Lean Start and access to a Brexit diagnostic and guidance.

In terms of ensuring our cost competitiveness, there is a role for the public and private sectors alike to proactively manage the controllable portion of their respective cost bases, drive productivity and continue to take action to minimise costs.

Billy Kelleher (Cork North Central, Fianna Fail)
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There is no doubt that trade is improving and that we have increased growth, rising employment and decreasing unemployment but this is camouflaging major deficiencies within the broader economy. For example, insurance costs, childcare costs, housing costs, rental costs and so on are feeding into and underpinning uncompetitiveness in the broader economy. While we have a successful economy, we need to learn from previous times. Growth, a good trade surplus, rising employment and decreasing unemployment are key components of a good economy but if we allow uncompetitiveness to feed into the broader economy it will be undermined quickly. This can happen rapidly. Has it been brought to the Minister's attention that to attract foreign direct investment, FDI, and a skilled labour pool into the country we need to address the issue of housing and shortage of quality rental accommodation?

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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I am conscious of the issues relating to competitiveness. We are at full employment, the public finances are stabilised and Ireland is the fastest growing economy in Europe but we cannot become complacent. We need to ensure that companies are competitive and that their productivity levels are high. The foreign companies here invested in research and development and innovation and their productivity levels are probably a lot higher than those of indigenous companies. We need to focus on indigenous companies and to encourage them to invest in research and development. This work is being done the local employment offices, LEOs.

The issues surrounding competitiveness are problems of a fast growing economy. We know what happened in the past and I am conscious of the need to ensure it does not happen again. As a Government, we are taking action to address areas of concern. In the area of housing, we have the Rebuilding Ireland plan, which is taking time but it is working.

Billy Kelleher (Cork North Central, Fianna Fail)
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American Chamber of Commerce Ireland carried out a review of the housing shortage and found that there would be a requirement for 30,000 one and two-bedroom apartments in the greater Dublin area between now and 2022 to address the issue of facilitating accommodation for companies and FDI. Leaving aside indigenous housing need, we need to increase supply for FDI. Regardless of how one assesses the economy and the performance of the economy, if we do not have quality accommodation we will quickly find ourselves at a huge disadvantage of terms of our competitors not only in the European Union but in the UK when it leaves the EU on 29 March next year, and from other areas of the world as well. It would be a shameful indictment if we could not address the housing needs of our own people and, equally, if we undermine the broader economy we will not be able to assist anybody because of a housing shortage.

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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Rebuilding Ireland is working. The total number of new homes built in 2017 increased significantly to 14,500, an increase of 46% on the previous year. This figure continues to rise. The CSO confirms that 75% more homes came on the market at the end of 2017 than at the end of 2015. In the first quarter of 2018, approximately 3,500 homes were built. This report is in regard to Dublin but, as the Deputy will be aware, I am anxious of the need for regional spread. There is a huge opportunity for companies, multinationals and FDI to move outside of Dublin to the regions, where there is a great quality of life, more housing available and good education systems. We have a lot to offer in this country. While I accept that there are pressures on Dublin, there are huge opportunities in the regions. I am committed to ensuring that the regions get their fair share of any FDI coming into the country.