Rónán Mullen (Independent)

Cuirim fáilte roimh an Aire Stáit. Thanks to Senator Carty I will take home the phrase that one was never at a shop boy's funeral, and add that to the list of seanfhocail and phrases from a particular time and place in Ireland, which say so much.

Ireland is now facing one of the most challenging periods in its history. The global credit crunch, the collapse of the property bubble, the near collapse of our own banks, and the dramatic fall in the value of the currencies of our trading partners has created a perfect economic storm which has tested the competence of Government and the confidence of business.

Challenging times test leadership, and as Warren Buffett famously remarked, "When the tide goes out you get to see who has been swimming naked". The sad and embarrassing fact is that quite a number of our senior Ministers in recent years had been swimming in the nip, claiming economic competence but failing to display it. It is not a pretty sight but, more importantly, the failures of Government have contributed to the massive growth in unemployment and to creating a climate of fear for many young families who are unsure from where the next pay cheque or mortgage payment will come.

I fully agree with the view of the ESRI that we can blame 50% of our economic woes on the changed international economic environment. Even if had we been ruled by rulers with the wisdom of Solomon and the vision of Joseph we would still be facing challenging times. The truth, however, is that the unwise profligate policies of previous Administrations have contributed greatly to the challenges we now face. Had those Governments kept their eye on the ball we would now be in a far stronger position to face the storm we find ourselves in, with the resources to pump prime a return to growth rather than savagely cutting public spending at a time when we should by rights be increasing it.

Some time ago the economist and commentator, Marc Coleman, penned an analysis piece in which he said that the oldest economic advice on record had been given by Joseph to Pharaoh. Joseph, interpreting the Pharaoh's dream, recommended that Pharaoh store the grain from the years of plenty for use in the years of famine. However, I fear that the Fianna Fáil-Progressive Democrats Governments never read the Bible for in the years of plenty they increased Government spending, helping to turn a boom into an unsustainable bubble and leaving us with no resources with which to face the years of scarcity.

The increase in the cost of Government was one of the key driving factors in Ireland's loss of competitiveness. When we use the term "loss of competitiveness" there is a tendency in some quarters to see what has happened almost as an accident. We are led to believe Ireland lost competitiveness in the same way I lost one of my socks last week. It seems nobody was to blame, but the fact is that we did not just lose competitiveness. We threw it away.

In a recent report Forfás, the Government's industrial policy unit, demonstrated that it was 25% cheaper to operate a retail business in Belfast than in Dublin. That is a staggering differential to have as between ourselves and a neighbouring jurisdiction. It means that firms from the Republic have to be 25% cheaper just to compete on an equal basis. How did that position come about?

I fully accept that Ireland had a long boom and that during a boom, prices and costs will rise, but that is only part of the story. Detailed analysis by Jim Power of the drivers of inflation in Ireland has shown that the real drivers of inflation were in Government charges or the costs of goods and services regulated by Government. Between 2000 and 2006, the consumer price index rose by 27.5% but food prices rose by just 16.2%, well below the overall rate of inflation.

What was driving Ireland's high rate of inflation? Between January 2000 and October 2007, the cost of water supply, refuse and miscellaneous rose by a staggering 255%. Between 2002 and 2008, local authority rates increased by 42%, and I note what Senator Carty said about the recent downward direction of rates but that overall rise of 42% is staggering. Between 2002 and 2008, electricity prices rose by 85%. Ireland went from having one of the lowest costs of electricity for business users to having one of the highest. In saying this, I recognise the comments that have just been made to the effect that there has recently been a decrease in costs. However, I am merely outlining the facts. The reality is that the Government took its eye off the ball and Irish business and, more importantly, Irish workers are paying for this.

We are where we are, however, and there is no point crying over spilt milk. Mere wishing will not solve our problems. While I have condemned the Government for policy failures, it is only correct that I should commend it when it takes the correct course of action. In that context, I strongly support it in its attempts to position Ireland as a leader in the smart economy. I also commend the Department of Enterprise, Trade and Employment on its decision to convene the task force on the green economy.

Jargon is often a means of concealing the truth. It is used by eager but not particularly well informed spin doctors seeking to push the latest fad on an unsuspecting public. However, there are times when jargon describes something real and valuable. An example is the term "smart economy". The smart economy is real, not merely a piece of empty political rhetoric or part of the spin cycle. It describes something which is real and of critical importance to all our futures. It is shorthand for an economy which makes full use of information technology and communications to drive innovation, research and development in a world where economic growth must be environmentally sustainable.

Regardless of whether one buys into global warming, there is no doubt that the carbon age is passing. The advent of peak oil and the emergence of the new economic superpowers, namely, China, India and Brazil, mean that we are operating in an environment where sustainability is at a premium. The latter will give rise to a real opportunity for Irish firms. I fully agree with the Tánaiste's recent comment to the effect that the green economy has the potential to create 80,000 jobs. In that context, I urge the rapid implementation of the findings of the task force of the green economy. As the Tánaiste previously stated:

We have had significant success in sectors such as food, ICT, pharmaceuticals and biotechnology to date. The adoption and targeting of the environmental goods and services sector now allows us to capitalise and build on our existing skills base to capture for Ireland part of the global growth in this sector.

I firmly believe clean and green technology will be one of the key drivers of innovation in the high-tech sector for years to come and that it represents a major opportunity for the sector in Ireland. I also urge the Government to act swiftly to implement the green proposals relating to the IFSC in order to position the latter as a base for global green funds and carbon trading. The skills, capabilities and contacts are in place; all we need are very minor changes to the tax code which would be cost-neutral in nature and a major sales campaign to sell Dublin as a location for these funds.

If we are to seize any of the opportunities to which I refer, we must also build a really strong, world-class research and development capability in Ireland. Most people, including many politicians, believe Ireland's investment in research and development merely involves putting money into new product ideas. However, it has much more to do with building human capacity and capabilities. The recent Irish Research Council for Science, Engineering & Technology, IRCSET, conference on "Innovation fuelling the smart society" demonstrated not only the potential of the smart economy for researchers, it also highlighted some of the fantastic research talent in the country. There are more than 800 young researchers being funded by the IRCSET, many of whom are absolutely world class and their talents will help to secure all of our economic futures. I strongly endorse Government expenditure in education and the development of Ireland's brains trust. I suspect that we will get a far greater return from our investment in these young people than from our investment in NAMA.

I also strongly urge the Government to implement the findings of the most recent competitiveness report. While its past actions may have undermined Ireland's competitiveness, it must take action to restore it. All the vision and research in the world will not create jobs in Ireland if costs here are totally out of sync with those of our competitors. In the short term we need to slash business costs, particularly those relating to small business interests. The best thing we could do to help small business would be cut rates by 50% in order to protect existing jobs. We must restore competitiveness in order that there will be a strong and stable platform for renewed growth. This will assist us in seizing the opportunities presented by the smart economy.

Mar achoimre ar an méid atá ráite, ba mhaith liom a rá gur fíor gur chaitheamar amú é ar phointe áirithe leis na Rialtais roimhe seo, go háirithe i dtaobh na costais a bhain le seirbhísí an Stáit, seirbhísí mar leictreachas agus uisce. Ba léir gur sa réimse sin a chuaigh na costais thar cuimse. Mar cúiteamh anois, caithfimid díriú isteach ar ghach a bhaineann le caomhnú na timpeallachta agus caithfimid dul chun cinn a dhéanamh le seirbhísí agus cúrsaí a bhaineann le feabhsú na timpeallachta a fhorbairt agus a chur ar fáil, le gur féidir linn leas a bhaint as na hacmhainní atá againn. Freisin, caithfimid cloí leis an infheistíocht, mar atá déanta. Caithfimid infheistíocht a dhéanamh i ndaoine óga, daoine le scileanna ar leith a bhaineann le cúrsaí eolaíochta, le gur féidir linn teacht as an ghéarchéim ina bhfuilimid.

I take the opportunity to wish the Minister for Finance a speedy recovery. Following an understandably difficult start to his term of office, he swiftly and bravely rose to the challenge facing him and has provided the type of real leadership necessary to reassure international investors. He also shown courage to take very tough decisions. He has, in fact, set the standard for his colleagues in the Government. I hope the latter will also rise to the challenges we all face. I wish the Minister well in his personal battle. I believe I can assure him that he is in the prayers of all Irish people and that they offer him their best wishes. I have no doubt he will bring the same great courage to his current battle that he has shown in the service of the State and its people. I look forward to his return to full health and wish him all the best at this time. Ba mhaith liom buíochas a ghabháil leis.