Micheál Martin (Cork South Central, Fianna Fail)

Senator Ryan is keeping an eye on me. The number of unemployed people has fallen by almost 80,000 from 10.4% to 4.4% in 1997, which is half the average rate among the 25 member states. The number of long-term unemployed persons has dropped by nearly 60,000 from 5.5% to 1.4%, which is approximately 33.3% of the EU average.

While unemployment has remained consistently low, it remains necessary to provide for those who are unemployed and find it difficult to secure positions. Following my recent review of FÁS employment schemes, the Government has decided it will continue to operate and provide 25,000 places annually. Senator McDowell commented on the social economy programme and the jobs initiative. We have given certain opinions on the matter and we are in discussions with the Department of Community, Rural and Gaeltacht Affairs to see how we can transfer social economy into a proper community context in order to give a satisfactory underpinning and guarantee, particularly in areas which have experienced difficulties.

I recently visited Northside Partnership as part of the Tesco and FÁS initiative which provides retail skills for people who have left education and the workforce. I presented awards to the young women and men involved, which was an uplifting experience. Tribute is particularly due to Northside Partnership and to Senator White's husband, Padraig White, who, together with Senator McDowell and others, provides a first class model of social partnership, making a difference in an area with high unemployment and low skills, etc. The social economy figures were quite high and it made no sense to me to pull them out if we are to be focused and consistent in terms of our employment policy and trying to make a difference in areas which experience difficulties.

The emphasis in these schemes will be on developing the quality of intervention by introducing a greater training element with a view to ensuring greater progression to mainstream employment. Our end goal is to assist all those who are unemployed, as best suits their needs, so that they can move into employment.

The latest figures for last year show that there were 1,893,600 people in employment, which represents an increase of 57,200 or 3.1% on the previous year. Full-time employment accounted for the majority of the increase. The current employment rate of 67% compares very favourably to the EU 25 rate of 63%. This means a higher proportion of our people are actively involved in the workforce and we are steadily approaching the EU employment rate target of 70%.

The outlook is for a considerable expansion of employment and thus the demand for labour. This will mean both increasing the skill levels of our labour force as well as the numbers in it. Given the falling number of young people coming into the labour market, there will be a need to mobilise labour supply from other sources which will mean encouraging more Irish-based people into the labour market. Reference was made to child care initiatives which are an important factor in that regard. It will also mean the adjustment of economic migration policy in Ireland to address identified labour shortages and skills needs. In recent years, the work permit system has been mainly vacancy driven, reflecting demand from employers.

With the enlargement of the European Union, it is expected that employers in Ireland will be able to fill the majority of their labour needs from the European Economic Area. Consequently, work permits are now only being granted for non-EEA nationals, by and large, in respect of highly skilled and higher paid positions where no suitable personnel can be sourced within the EEA.

Legislation is currently in the final stages of drafting to put the existing employment permit schemes on a sound legislative footing. The proposed Employment Permits Bill 2005 will also include provision for a more managed economic migration policy, including a formal and continual assessment of skills and labour needs. Research carried out by FÁS and the expert group on future needs and skills will continue to inform Government policy in this area.

This legislation will also give stronger statutory protection to employees. It will empower those who come into the country, especially those who are highly skilled and needed in specific areas, such as research and development. Science Foundation Ireland places a considerably increased emphasis on attracting world-class researchers into the country. There are other sectors of the economy where, from time to time, we will need high skills, such as information and communication technologies. The legislation will enable the Minister of the day to be flexible and adaptable to emerging skills and respond quickly to those needs as they arise.

In addition to increasing the numbers at work, increasing the skills level of the workforce will also be crucial if the economy is to continue to grow. The pressure of globalisation means that Ireland must move up the value chain to become a knowledge-based, innovation driven economy. The emphasis in the past has been on those outside the workforce in terms of skilling and training. However, there is a clear need for a rebalancing of our efforts towards those at work. The report of the enterprise strategy group emphasised the importance of this, particularly for the low skilled.

The past 20 years have seen a dramatic acceleration in the growth in educational achievement in Ireland. There is a €27 million increase in this year's budget in company training in order to concentrate on those at work, especially in low skilled employment. There is a significant challenge ahead for business, Government and FÁS in terms of how this will be done. We must incentivise low skill employees to take up programmes of training and courses because they are vulnerable in terms of change. We must also encourage companies to buy into the upskilling of their own employees, which can be difficult because they might fear mobility of employees after the upskilling. However, it is essential for future economic performance and competitiveness.

In terms of educational achievements, the completion rate at second level has increased dramatically in the past 20 years, from approximately 60% to more than 80%. The national qualifications framework is important to facilitate the increase in completion and achieve a broader definition of completion. It is not just about getting one's leaving certificate, but about the completion of certified programmes in areas which enable people to take up employment in key sectors.

Third level participation has dramatically increased in the past decade. We ramped up the numbers quite considerably in the late 1990s, particularly in software engineering and technician training, etc, to meet the needs of industry and the economy. This is all necessary in terms of increasing the employability of Irish people and attracting investment into the country. On the other hand, the task force on lifelong learning reported that there were still approximately half a million people who had not reached leaving certificate level. This needs to be addressed in the context of in-company training to which I referred earlier.

People will need to upskill and re-skill throughout their working lives. Some 80% of people currently working will still be working in ten years' time. They cannot stand still and must therefore participate in the skills programme. We provided €27 million in the last budget, specifically for this area, which was additional funding from the national training fund. Particular emphasis will be placed on delivering a framework for the training of the employed and FÁS will be the main driver in that respect. We will work with companies to help them participate effectively in the programme.

Our overall economic development strategy is now aimed at developing a more dynamic, enterprising and innovation-based economy which can sustain higher living standards for all. This involves maintaining an attractive taxation regime and prioritising policies in the fields of research and innovation promotion, entrepreneurship, enhanced competition and consumer policies.

Regarding corporation tax, it is important to note the error in terms of the reference to low corporation tax.