Paschal Donohoe (Fine Gael)

Like some other Members, I am new to Leinster House and to the practice of politics on a national stage. When I come into the House I am struck by the portraits of great politicians and figures from history. They all grappled with a particular national issue. The issue they spent their time debating and working on was how they would create our national sovereignty and independence as a country in the face of very strong external forces. The issue on which this generation of politicians will be judged is very different. We have moved from a national issue to a global one.

What has happened in the interim is that consciously and unconsciously, politicians of all creeds and colours have opened up this economy to global forces more than any other economy in the world. The issue with which we will have to deal is how we protect our economic prosperity and our social solidarity given that our country, more than any other in the world, is open to forces beyond our control.

I refer to the factors which have led to our economic growth over the past number of years. We could look at our low rate of corporation tax, the economic boom which we have been surrounded by, what has happened in North America and in many parts of western Europe, our currency position vis-À-vis our large trading partners and the amazing educational success our country and workforce have enjoyed. The question we now need to face is, what is the path for our country moving forward given that so many of those factors have changed?

As has been touched on by other speakers, occasionally when these points are raised here, we are told we are shrill, ill-informed, are trying to talk the market down and so on. Nothing could be further from the truth. I strongly believe my role as a Member of the Oireachtas and of the Opposition is to ask what issues the country faces in the future, to hold the Government to account in respect of them and to do what I can to make a contribution to what we want to do differently.

If we look at two of the factors I have outlined, we will see how they have changed the challenges that face our economy and how they most impact on the pre-budget outlook. If we look at what is happening to our currency position, since 2000 our competitiveness in respect of the US dollar has deteriorated by 57%. Our exports to America are 57% more expensive than they were seven years ago.

The second factor is corporation tax. Many of the countries with which we compete have learned from what we have done. Corporation tax in Estonia, for example, is 0%. In some of its neighbouring countries, such as Lithuania and Poland, corporation tax is as at least as low as ours, if not lower, and they have wage rates which are far lower than ours.

The pre-budget outlook shows that net receipts to the Exchequer from exports are beginning to decline substantially. The housing market has been the subject of much comment in the media and in these Houses. It is undoubtedly a significant factor but it is being commented upon to the virtual exclusion of discussion of other factors which are significant. It is telling that today, the World Economic Forum has published its competitiveness league. For the second year in a row, Ireland's position in the league has slipped, this time from 24th to 26th place in the world. Two factors which have contributed to this deterioration are the level of innovation and standards of transport and infrastructure in particular. These issues deserve at least as much attention and probably more than the ongoing discussion on the property market and its impact on Exchequer returns.

We need to identify new goals and new peer countries by which to measure progress. We must find ways of being competitive in a globalised economy. We must begin to measure our progress against countries such as Poland, Lithuania and east Asian countries and no longer against the larger countries of western Europe as was the case in the past.

The budget should prioritise education and infrastructure. A recent FÁS report outlined that Ireland will probably need to re-skill between 500,000 and 600,000 current workers in our economy as we deal with the transition to a global economy. I question whether we are suitably set up to do this.

We need to change how budgets are discussed. Time is spent talking about how much money we spend but not enough time is spent talking about the outputs of that expenditure. We need to examine how more choice can be introduced into the delivery of services and empower consumers to ensure they are getting best value for money from either the private or public sector. We must create the competition needed to ensure taxpayers' money is being well spent.

I will end with a question. The national debt is half the EU average. We have significant infrastructure and skills deficits. Should we consider changing our debt position to address these challenges so that in the longer run we can enjoy the economic results of prosperity?