Mary Coughlan (Donegal South West, Fianna Fail)

I do not know. However, the counties to which I refer are in the BMW region.

Under EU state aid law and the regional aid map for Ireland for the period 2007 to 2013, approved by the European Commission in 2006, the maximum grant rates for capital assets vary between 0% and 50%, depending on the size of a company and the region of a country in which its undertaking is situated. EU state aid rules permit capital grants for small companies in the BMW region of up to 50% of the cost of their assets. As a consequence, although EU rules would permit capital grants of up to 50% in these counties, national legislation limits the maximum grant to 45%. The proposed amendment is designed to deal with this anomaly and to ensure that small companies in these counties can obtain the same treatment as those in the remainder of the BMW region.

Achieving balanced regional development is central to my policy and that of the Government and is explicit in the core mission statements of Enterprise Ireland and IDA Ireland. It has been a guiding principle in the provision of agency supports to client companies and in the formulation of initiatives to improve business infrastructure in the regions. Obviously, an anomaly such as that which exists at present creates the undesirable situation where existing designated areas enjoy an advantage in the context of the level of grant assistance they can receive compared with other areas within the region. To remove this anomaly and provide equal treatment for all parts of the BMW region, it is proposed to extend the definition to include those counties in the region that are currently excluded.

Section 4 amends the Industrial Development Act 1993 by increasing the existing legislative limit on the aggregate amount of money that can be paid by the Minister for Enterprise, Trade and Employment to Forfás and its agencies for use in discharging their obligations and liabilities. This increase is necessary because expenditure to date is now nearing the existing statutory limit, which was set at €3.4 billion in 2003. It has been the practice that aggregate spending for these purposes is capped in legislation at a level which is raised from time to time in order to allow the agencies' operations to continue. The cap ensures that the Houses of the Oireachtas have an opportunity to review policy and spending on industrial promotion. There are, however, other legislative controls, such as the upper limits on individual grants to companies approved at agency level and these are addressed in section 3.

In addition, there are further Oireachtas controls, such as the annual Estimates process and the work of the Committee of Public Accounts. In the Estimates process, the Dáil takes decisions which determine the annual allocation of money to the agencies for the purposes covered by the longer term legislative aggregate limit set in this section. In setting this higher aggregate, there is no commitment that the money will actually be paid to the agencies. Legislative clearance for aggregate payments up to the level of €7 billion is proposed. However, the annual spending under these headings will still have to be agreed by the Government and voted by the Dáil. The aggregate grant limit currently in place is €3.4 billion and this will be reached in April. It is expected that the new ceiling would be reached in four to five years' time on the basis of the programmes contained in the NDP.

The 1993 Act also places a threshold on the amounts that can be paid by agencies in capital grants to companies. For payments above this threshold, Government approval is necessary. This limit was last increased in the 2003 Act to €5 million and it is proposed to increase this in line with the changes proposed in section 3 from the existing €7.5 million.

All of the changes proposed in the Bill are of a technical nature and are aimed at updating monetary limits in line with the policy already set for the period 2007 to 2013. They do not reflect a new policy direction. Principles and policy for the period are set out in the NDP and were discussed and approved at political level when the latter was being drawn up. They are also considered annually by the Joint Committee on Enterprise, Trade and Employment when it examines the annual estimate and by the Committee of Public Accounts in the context of the appropriation account. The agency programmes for the period are set out in the NDP and were thus adopted when it was approved. The amounts and thresholds proposed now will allow us to implement the principles and policy aims as set out in the NDP to the end of the 2007 to 2013 period.

While the provisions of the Bill are technical in nature, overall they will allow the development agencies to respond to the needs of industry and thereby support employment and, it is hoped, reduce unemployment. These provisions are extremely important in that they facilitate implementation of the national development plan and Building Ireland's Smart Economy — A Framework for Sustainable Economic Renewal.

I commend the Bill to the House.