Marc MacSharry (Fianna Fail)

However, changes need to be made. We must always seek to improve efficiencies where possible and ensure the public service acts as a coherent unit. It is important we get numbers where they are most needed as quickly as possible. We need to introduce a level of agility in the public service that is more consistent with the private sector. That will be achieved through partnership.

In these difficult times, it is important we look after the most vulnerable in society. I am glad we are able to sustain an 8.4% increase in social welfare spending and there are some increases in health care spending despite the drop in tax revenue. It is also important we maintain our commitment to the national development plan. I am delighted the Minister alluded to that in his speech. We must prioritise those capital investments which would best position us to maximise the benefits and returns we can realise from the economic upturn when it comes. I am pleased the Government is seeking to do that.

We must do all we can to protect jobs. While one acknowledges new jobs are being created — there were welcome announcements in Cork yesterday — the level of losses are somewhat greater. This presents a major challenge to all of us. The Minister has outlined some of the measures being introduced such as enhancing the role of FÁS, making it easier for retraining and the completion of apprenticeships. We must continue to be innovative in job creation and be prepared to introduce further measures if necessary. We must do all we can to ensure the competitiveness of our goods and services, particularly with the challenges of the sterling exchange rate and the strength of the euro.

Small and medium-sized enterprises must be supported in every way possible. These are the backbone of the economy which helped to produce many of the successes in the past. It is important that our banking sector supports them in a greater way than it has done in recent months. I accept the sector has had its recent difficulties and its focus has been on survival. However, what has the cost been to the economy? Through the guarantee scheme, the Government has continued to try to change that. The nominees to the banks were announced this week and I welcome that. There is a good cross-section of experience and all have a proven track record of admirable public service. ISME issued a press release this morning criticising the fact that none had an SME background. I can testify, especially for one of the nominees, because his tradition came from the SME background. I have no doubt he and his colleagues will do all they can to ensure the public interest is best represented.

I welcome the initiative that some banks have announced. AIB announced the lending of €1 billion to the SME sector in the coming month. I ask that the banks be innovative to ensure that the businesses that could ordinarily survive and flourish in normal international trading conditions receive the fullest level of support and the lines of credit that are appropriate and needed by the business. I acknowledge the Government action of the guarantee scheme, the board appointees and the stated intention to examine the part-nationalisation or the encouragement of rationalisation of the banking sector in Ireland.

There have been some recent positive elements, such as the oil price reductions from $146 a barrel to below $50 this week. That puts an extra few euro into people's pockets in these difficult times. I welcome the interest rate cuts. It is good that the ECB is pursuing a line consistent with our economic situation. A potential flaw of a single currency is that we do not have absolute control over fiscal policy to bring down interest rates, as we could in the 1980s. That was difficult during some of the summer months. I call on institutions that have not yet passed the cut to consumers to do so without delay.

I express regret at the VHI increases. If anything can be done in that regard I ask the Minister to consider it because it is a significant increase for a married couple with two children on Plan B, for example.

I have a number of suggestions. It is well known in this House that I have views on the HSE. I most respectfully suggest that, with responsibility for 28% of the expenditure of the State, I would be more comfortable if that was under departmental control. An example relates to cancer services in the regional hospital in the north west, in Sligo. Costings have been made available to me showing that if that service, which was Government established and supported since 2001, was maintained it would save the Exchequer between €1 million and €1.2 million per year. In the overall scheme of things, that is very small, but if the executive was under departmental control I would be more confident that we could have enhanced savings throughout the health service, which costs €16 billion. We could come up with hundreds of millions of euro. That is a small suggestion.

We should maximise incentives, through taxation or otherwise, for research and development. Many exist but I ask the Minister and his colleagues to enhance that further. That can help to make Ireland the leading centre for research and development. With a foundation like that, our economy will have a better chance of recovery and at a faster pace.

As Members know, some weeks ago I suggested the establishment of a forum or commission on a fairer Ireland. All societal pillars and the social partners could be invited to this. It could be beneficial to have these people come together to discuss the challenges we face and plan the approach that should be best determined for the future. That is how it was done in 1987. Social partnership has served us exceptionally well and continues to do so. If we engage with them and the other society pillars it would be beneficial in determining our attitudes to pay, efficiency, pensions and a wide variety of issues. It could be independently chaired by Senator O'Toole or someone with similar experience.