Brian Lenihan Jnr (Dublin West, Fianna Fail)

On behalf of the Minister for Finance, I am pleased to have this opportunity to open the debate in this House on the recently published OECD Economic Survey of Ireland 2003.

The OECD undertakes an examination of the economies of its 30 member countries at up to two yearly intervals. Such examinations involve a visit by a team from the OECD's economics department to the country being examined. During the visits to Dublin the OECD team met officials from a number of Departments and representatives from organisations in both the public and private sectors, for example, employers, unions, the banks and economists from academic institutions. The OECD team is well placed to obtain a thorough and comprehensive understanding of the state of the economy and how it is likely to perform in the short and medium term. More importantly, the OECD is in a position to see how similar issues are dealt with in different countries and weigh the advantages of various approaches. Members of the OECD team are also able to see how the global economic situation evolves and the economy of a particular country is likely to be affected by international developments.

The draft report by the OECD team is reviewed by the economic development and review committee which is made up of representatives from the 30 member countries. The OECD's analysis and advice are a very valuable contribution to the development of economic policy. It is not surprising that most of the coverage in the media of the OECD economic survey tends to highlight specific recommendations in one or two areas rather than the broad thrust of its analysis and recommendations. However, I hope the debate in this House today will focus on the central themes of the OECD's examination and its key recommendations.

The OECD notes that Ireland's remarkable growth performance, which began in the mid-1990s and continued into the start of the new millennium, has led to rapid convergence of productivity levels towards the EU average, while employment growth has also been exceptionally strong. Living standards have increased dramatically as a result. It goes on to note that the unemployment rate fell from as high as 15.7% in April 1993 to a low of 3.7% in the first half of 2001 which led to recruitment difficulties. In the view of the OECD, the above potential growth has resulted in growing infrastructural pressures as evidenced by rapid house price increases, congestion and longer commuting times.