Sean Barrett (Independent) | Oireachtas source

I welcome the Minister. I should congratulate him on his award as Minister for Finance
I should congratulate the Minister on being European Finance Minister of 2013. As the Minister will be aware, in today's Irish Examiner, Oliver Mangan notes that there are 61,000 additional people at work in Ireland, which is a 3.3% increase in total employment, a 3.9% increase in full-time employment, and a 4.5% increase in private sector employment. Given that the GDP was only up by 0.1% or much less, that shows we have implemented a section in the Minister's contribution, namely, achieving reductions in our cost base. Those figures explain that. Economists used to try to explain jobless growth. Now we almost have growth-less jobs, but we are a small part of a world economy and if we can achieve those reductions in the cost base we get the good results that are evident.

There is one problem, however. Page 6 of the briefing document we got from the Oireachtas service states:

Up to 2013, the cumulative decline in youth employment in Ireland was almost 60%. That represented a drop of over 350 of 7,000 employed youth in the summer of 2007 to 148,000 at the beginning of 2013. While there has been a modest increase in overall employment figures recently [the 61,000 was welcome] it has not materialised in the youth category.

That is something we have to examine. Employment programmes should get employers involved. There should be a work element involved also, perhaps involving interning. In that way we may get a better dividend on those programmes.

The big ticket increases in employment have been in accommodation and hospitality, which is up 12.8% since 2011, and the professional, scientific and technical area, which is up 19.7%. Irish tourism became bad value, and we discussed this with the Minister, Deputy Varadkar, during the boom period. That area must be continuously monitored. In some of the surveys Killarney is emerging as the high cost area for tourism bed nights. If we are only just into a revival in tourism, we cannot neglect offering good value.

On the travel tax, the Minister mentioned the extra 1 million passengers promised. That was a very worthwhile project, and also the lower VAT rates for the sector.

In regard to the professional, scientific and technical area, it has been my privilege over some decades to work with young people aged 18 to 22 years. They are a splendid generation. If we can organise the economy well in this country they will work here but they will be snapped up in Canada, New Zealand, the United States and the United Kingdom. We owe it to that generation, therefore, to increase the number of places at second level, as the Minister for Education and Skills is doing, and perhaps at third level because that generation is increasing faster in numbers than we had expected. The problems in mathematics and foreign languages are being tackled. The Teaching Council, by having a professional teaching profession, will help to get more trained teachers and fewer untrained teachers in the system.

We must keep order in the public finances because disorder made the economy uncompetitive. Unattractive features included a very high cost construction sector that increased house prices in Ireland more than in any other country in the OECD - we got the unwanted gold, and Spain got the silver; a dysfunctional banking system and a bubble economy; an accountancy profession that signed for these banks; problems in pension funds; problems in credit unions; and problems in insurance.

One of the ways the economy will recover is by having a strong financial reform agenda. We cannot operate without banks. We have some Bills on the agenda on that area, and we have had discussions with the Minister's officials but I would opt for an 80% loan to value and two and a half times the income ratio. We must get banking away from the mad era of massive multiples of people's incomes and massive multiples of the value of the property being loaned.

On project appraisal in the public sector mentioned by Senator Michael D'Arcy and Senator Byrne, it is a pity the Comptroller and Auditor General brings his wisdom to bear only after the project has crashed. We need to do that at the outset. I would have the project appraisals done first and published for a year, and not published by the promoters of projects. We will then see if they are good value for money.

The Department of Finance is getting back into mainstream economics. Two of the Minister's officials are reading a paper at the statistical society on Thursday night. A gap did occur in that regard and it is important that the links between academic economics and the Minister's Department are as strong as they were in the days of Ken Whitaker and Louden Ryan, one of my previous bosses.

We need to reform many of the financial services. I am not satisfied that many of the banks we bought for €64 billion had their accounts validated by senior people in the Irish accountancy profession. We must tackle that as well as banking reform.

Senator Byrne mentioned competition and the sheltered sector. We had a measure to open up the general practitioners lists, which I believe was done in the early days of the troika. Some time ago we asked the Minister of State at the Department of Health, Deputy White, if there had been any opening up of those general practice licences and the answer given was "hardly any". Fewer than 100 new doctors joined the general medical service. There was a very interesting section in the relevant legislation which provided that in looking at an application to provide that service, the Government would not take into account first, whether it was financially viable on the person making the application and, second, whether it was financially viable in its effects on other people who did not like the application being accepted. In a market economy we must keep that emphasis on reducing the cost base and making it competitive.

In 2016, after 84 years of preventing competition in bus services, we deregulate 10% of the market. That is, it has taken 84 years to get competitive bus services. The strict regulation of taxis, including ruling out the use of GPS, means we have approximately 5,000 fewer people driving taxis now than when those regulations were introduced in 2009, and that was after the courts had deregulated the business. We must keep the emphasis on competition.

We need much greater quantification of policies. We must cease to have an economy based on assets. That is the reason I was happy to second Senator Quinn's motion on upward only rent reviews. Everybody must be flexible and competitive and to have an interpretation of the Constitution that there is a duty on the courts to defend asset prices when wages, prices and welfare payments were falling does not help competitiveness. We need to keep an eye on the sheltered sectors mentioned by Senator Byrne.

I welcome the recent report on our ports. People having long leases over wharfage prevents competition in ports because people are secure in their leases for 25 years or, in some cases, as many as 100 years. That means they can block off the competitors. We need competitive ports.

There are many comments I could make on this area. We need regulatory impact analysis with legislation. There was no financial memorandum with the water Bill. We also need a central office of project evaluation.

I ask the Minister not to relent on the reform agenda. Tús maith leath na hoibre. We have a lot to do to make the economy as efficient as the Minister would want it to be in the next two years. I ask him not to relent to pressure groups who do not like competition because the cost will be borne by very many unemployed young people. Nobody wants that. To convert 0.1% GDP growth into 4.5% growth in private sector employment is a major achievement.

I compliment all those concerned with it. However, it is only the start of a task we have inherited from the collapse of banking, accountancy, financial services and pension funds, all of which still need reform.