Brendan Ryan (Labour)

If we pretend that Ireland is a low-cost economy, business people who come here will last for a couple of days before they disappear when they realise they have been conned. They will head for Taiwan, Singapore, Hong Kong or the free trade zones in China where they can access as much cheap labour and low costs as they want. Regardless of whether the website mentioned by Senator Leyden continues to exist, we will continue to have a free media. I think the term "rip-off Ireland" derives from the term "rip-off Britain", which was coined in that country a number of years ago. I am sure many people in Sweden and Denmark would say the same about their countries. We should ignore the peripheral nonsense of those who want to pretend this is not happening.

That Ireland is now an expensive country in many ways is the inevitable consequence of giving our people a decent standard of living. Only in those countries with governments which have conspired to facilitate the exploitation of working people have prices been maintained at a low level as a high standard of economic performance has been enjoyed. The minimum wage in the United States, for example, is equivalent to approximately €4 per hour, although it varies from state to state. It can be as low as €2 per hour in the catering and related industries because tips are regarded as part of normal income. If people want to live in a society with profound inequalities, they are welcome to do so. The engine of economic growth in such societies is essentially a vast number of poorly paid people who live in mobile homes because they are unable to afford proper housing and who do not enjoy job security or benefit from a proper health service.

I prefer the European model, based on enterprising economies which are vigorous and innovative and an environment in which workers who are adequately rewarded and properly protected enjoy a reasonable level of security of employment. This country needs to develop such a model, which involves the identification of anomalies and peculiarities. It is astonishing that Grafton Street, which is approximately 200 yd. from Leinster House, is the fourth most expensive place in the world in which to rent retail property. The cost of renting property on the street does not reflect the type of business being conducted there or any sort of historical accrued value. The market is being distorted. The Minister should examine how Grafton Street has become so outrageously expensive that a company that was tempted to sell two attractive and historical buildings on the street to capitalise on their value now has to close two of its restaurants because the rent they are paying to the owners of the buildings reflects the commercial value of the properties. That does not make sense. It does not seem to be a model of a functioning market economy.

Many of those who speak loudest about the need for competition and free markets usually want them for other people. The legal and accountancy professions, which are the most eloquent in the defence of the free market, run very effective closed shops — they do not use that term — to ensure that something as demeaning as price competition does not arise in their cases, whatever about other sectors. They restrict numbers and control entry to the profession, although who would ever suggest that they would restrict entry to the profession? Many people in this country who are keen for others to get involved in a competitive market economy are keeping themselves out if it.

If we are to make a serious effort to deal with rip-off prices in a rapidly growing economy, the first thing we should do is ensure there is serious competition in the market. In a civilised society, such competition should not focus on determining who can pay workers the least. I do not want that model, which has been successful in other countries, to be pursued in this country. I am sure most Irish people agree with me in that regard. One of the best modern economists, Dr. Paul Krugman, has argued that the idea of "national competitiveness" is a nonsense. He claims that while sectors within countries can be competitive, that has nothing to do with the nation or the state. From what I have read, I think he makes a valid point when he says there is no such concept as "national competitiveness".

If this country is to facilitate the sectors of activity and enterprise it is good at, it has to be able to access its markets which, in turn, have to be able to access it. One of Ireland's natural advantages in such sectors is that it can access an enormous market of 600 million people. Regardless of the type of business in which we are engaged we have to have a national and international transport infrastructure, within this country and serving this country, that does not put us at a disadvantage. It should be repeated that Ireland's national roads infrastructure is approximately 25 years out of date and its rail infrastructure is approximately 40 years out of date. I travel occasionally in carriages which were old when I started to come to the House 25 years ago. I am sure many other people have the same experience. I do not know which of our many Governments lost the plot in that regard.

We allowed our railway system to deteriorate almost to the point of collapse.

Our road infrastructure is primitive and worse than what one would find in a country such as Hungary, which I have visited within the past 12 months. Its motorway network is considerably better than that of this country. Members should go and look at the rail and road infrastructure of countries such as Italy that we are inclined to see as perhaps a little off the wall in comparison with our great economic achievements.

This country has a problem. It is a wonderful one to have, but we have not yet addressed it: how we can guarantee that we remain at this level of prosperity that the work of successive Governments has generated. Perhaps I might respond to something. No Government in the history of the State ever inherited a better set of economic conditions than that which came to power in 1997. At the time, the country was generating 1,000 jobs a week and had a significant trade surplus. The Exchequer had a substantial revenue surplus, and the beginnings of a spectacular period of economic growth were handed on a plate to the incoming Government. My party leader, Deputy Rabbitte, says that one of the things that will keep academic students of this country's politics going for 50 years is the question of how the coalition Government lost the 1997 election in the teeth of the best economic conditions that the country had ever had. The election was handed to the incoming Government on a plate, and the wrong decisions have been made since.

It was obvious from the 1980s that the country needed transport and telecommunications infrastructure. I have no interest in whether our infrastructure is provided by the private or public sector or by an efficient combination of the two. My interest is in what works efficiently regarding prices, delivery and time. Now we have a disaster in telecommunications. A company set up by taxpayers was privatised so that, ironically, people were paying twice for something. It went off on a tangential operation of asset-stripping on a scale that would have horrified us if attempted by anyone else. It sold off property and its biggest asset, which was its mobile telephone operation. Then it decided that it had to pay off the new investors, with the result that our telecommunications infrastructure is rapidly becoming as out of date as our rail infrastructure. How many people have been denied access to broadband because the last part of the telephone network is out of date and old? There are split and divided lines — things that were never known before. There has not been even the suggestion of investment to change that, with the result that there is now the ridiculous situation that a parallel telecommunications infrastructure is having to be constructed to deal with the ineptitude of a privatised monopoly. If we have learnt anything in this country it is that if one privatises monopolies, they will get worse without the kind of vigorous regulations so singularly missing here.

Ireland is slipping backwards on the World Economic Forum's competitiveness index. I do not have the report with me, but we are barely among the top 30 countries. Those countries in Europe with which we should compare ourselves are not large, powerful economies such as the United Kingdom, Germany and Italy but the small economies. The well-established ones, such as Denmark, Sweden, the Netherlands, Norway and Finland are all nearly 20 places ahead of us.

It is trite and simplistic to suggest that our competitiveness and achievements are all because of our low-tax regime. Such a regime does not even exist, since 55% of those paying income tax are now doing so at the top rate. Having said that, I admit that we made an attempt to reduce taxes. We inevitably discovered that, in a civilised, modern society, if one tries to reduce public expenditure or taxation revenue excessively, one ends up having to pay for things somewhere else because of the need for basic services. That is why we have such high waste charges, which may double within the next four or five years. This morning the abolition of waivers for people on limited incomes to pay for waste charges was mentioned. There are also extraordinarily expensive line rental charges to pay for the greed of those who now own Eircom.

We have charges all over the place and matters are getting out of hand, since one cannot do it on a low tax base. Countries in northern Europe have demonstrated how to construct civilised societies that function within extraordinarily efficient economies. That is what we should be considering. If we blink, we ignore it. Half of us look to the neighbouring island, which is no great model for anything, while the other half looks 3,000 miles away at an even less appropriate one. There are good models on our doorstep for how successful economies can match compassionate societies, but we do not attempt it.

The time is overdue for the Minister to examine the agencies supposed to facilitate and encourage competition, the Office of the Director of Consumer Affairs and the Competition Authority. As I said, the Competition Authority has singularly failed to get our banks and legal and accountancy professions to compete. It recently had a spectacular achievement in the courts when it managed to catch the credit unions. What good will that do for any consumer in Ireland? If the Competition Authority makes that system unviable, the credit unions will close down, and hundreds of thousands in this country will discover that no bank will lend them a penny, making them much worse off.

The other matter concerns the Director of Consumer Affairs. I have no idea what that office does; all that I ever see from it are warnings to petrol stations about their not displaying the correct price. That is not what the country needs. I would seek reliable comparable data on costs and prices. I would like to know how a publican in this city can have a margin of 200% or 300% on a soft drink. Why does that not apply in other countries? Why are things like that? Why are groceries in this country 25% more expensive than in Northern Ireland? Perhaps there are cost issues. I would like to know, and a Director of Consumer Affairs should be finding out and telling us what is wrong.

On the question of price competition, which, as I have tried to explain, is only a very small part of competitiveness, the ultimate solution is to tell the public as much as possible. For instance, any advertisement for a second-hand car should name a price. It is a deliberate deception to try to draw someone into one's premises by not telling the person the price before he or she gets there. Consumers are entitled to know clearly what is on offer, including the price.

There should be more publicity on prices, more analysis and reflection, and a greater willingness not to pull punches. The Food Safety Authority of Ireland is a model for an agency that has begun to do its job properly. One can see the improvement in standards regarding food services and hygiene because it is prepared to name and shame. We need the same vigorous activity from the Director of Consumer Affairs. I have never believed in price controls, since the best control on prices is vigorous competition policed by agencies that see themselves as exclusively on the side of the consumer.