Richard Bruton (Dublin North Central, Fine Gael) | Oireachtas source

Thank you, Acting Chairman. I will keep my opening statement brief to allow time to respond to issues raised by Senators. The central challenge we have as a nation is to address the employment situation. The crash saw the wiping out of some 20% of all jobs in the private sector in the space of three and a half years. It was an extraordinary degree of attrition which put the country on its back. The impact on people's lives was enormous and there was a range of knock-on effects on our public finances. It left us unable to raise money to fund services.

It had an impact on our banking system and filtered right through the economy. It has been a huge challenge to fix many elements destroyed by the crash.
Central to this was employment. The idea behind the Action Plan for Jobs was that every Department and Government agency had a shared responsibility in addressing the challenge. There was no element of Government that could not look at some element of its work and change it to make it easier for enterprise to create employment and for people to get jobs. This was the central focus of the plan. It was also determined that this was not to be a grandiose strategy; it was to be very much action oriented. Actions were to be delivered quarter by quarter, with timelines and benchmarks for delivery. It was not a grandiose plan in which we hoped to be somewhere or other in five years time and then we would forget about it and see how things played out. It was going to be driven quarter by quarter and Department by Department.
The other innovative element, apart from, if one likes, working across the silos of Government, was that the delivery of those targets was to be monitored from the Taoiseach's office, with a name and shame approach where there was a failure to deliver. It created an environment where there was real pressure to deliver on changes that were believed possible of making a difference and to deliver on them in time.
In simple terms, it boiled down to two clear ambitions. One was to create 100,000 additional jobs, the other to become the best small country in which to do business, both by 2016. We were very clear on what it was we were about. It is worth reflecting on how much progress has been made on those central targets. We have about 80,000 net additional people at work since the Action Plan for Jobs was launched. It started with a very strong performance by IDA and Enterprise Ireland companies building in the export market, improving competitiveness, going further afield, doubling the number of trade missions and really going after those markets. Now it has extended into other sectors.The construction and retail sectors, which are the bread basket of a lot of employment, are now also recovering. We are well within reach of hitting, and exceeding, the 100,000 figure by 2016. If one nets out the fact that the public sector has been shrinking in recent years, the private sector has probably already hit 100,000 additional people at work. The plan in terms of employment is delivering.
On the second indicator, becoming the best small country in which to do business, we closely track various competitiveness indicators. We have improved on all of them. Our ranking has gone from 24th to 15th place in terms of world competitiveness. It has improved four places to 13th, out of 189 countries, in terms of ease of doing business. Fortune magazine has indicated we have the best business environment for foreign investment. We are making real progress built on changes which have been introduced, improved competitiveness in certain sectors and reforms in the way we deliver across a range of services, whether it be work permits, skills, or the many other things which make up the business environment. That is why the Action Plan for Jobs, with the breadth of its ambition and the number of Departments participating in it, has been so important.
In terms of how we structure the plan each year, it looks at key areas, including skills, tax, access to finance and measures in which Government influences the environment for doing business, whether it be wage-setting mechanisms, the employment permit systems or licensing arrangements. The plan looks at research and development and the extent to which our research and development is oriented towards business and getting business engagement. It looks at infrastructures.
It also looks at sectors where we have real opportunity to drive change. Entrepreneurship is a very significant theme this year. Two thirds of all new jobs come from businesses in the first five years of their existence. A good environment is now emerging for start-ups, but they took a huge pounding in the recession. The number of start-ups collapsed by approximately 30%. We need to drive that rate back up but we also need to drive up the survivorship rate. Although they created 100,000 jobs, half of the companies formed during the crash years failed. If we can improve the start-up flow, reduce the number of them falling by the wayside and see more of them grow to scale, we can dramatically transform the employment environment. That is the ambition.
We are also looking at sectors such as manufacturing which got squeezed out during the building boom. Costs went awry and manufacturing was put to one side as a sector in which we could not compete. It is very much a sector in which we can compete. We have to be innovative to compete in it but it has huge advantages in terms of its regional spread. It is spread throughout the country and it is much easier to drive employment in it. Some of our best exemplars of manufacturing innovation are companies like Dairymaster in County Kerry, Combilift in County Monaghan and Ribworld in County Tipperary. These are businesses in regional and sometimes rural locations which are delivering global standards from an enterprise base. We need to nurture these as well as focus on the ICT sector and other sectors that are clearly going to shape the business environment in the future. We have looked at areas such as the food sector, financial services and tourism and have tried to make changes that would help these sectors grow.
We have also looked at what we call disruptive reforms. These are changes that will impact across numerous sectors. Energy usage and efficiency, use of renewables, smart buildings and smart use of resources are already important and will become increasingly so in the coming years with the pressure on climate change and so on.
Senator Quinn will know more than most that retail is changing dramatically and that more and more business is migrating online. A relatively small share of the Irish business done online is actually done in Ireland. Someone else is going to eat our lunch if we do not see more businesses move online and have trading platforms online which can win new business for them.
Big data is another area which is going to change the environment and the sort of business models that succeed. Increasingly, with the Internet of things, our capacity to have smart equipment that can be monitored remotely and collect a myriad of data on performance is going to transform manufacturing and homes and so forth. The sort of businesses that will thrive in that sort of environment will be different from traditional ones. We need to move rapidly to understand what big data will do for enterprise and how we position ourselves to take advantage of those opportunities.
That is the backdrop. We are trying to do a number of things at the same time, some of them very short-term. Some are things we can fix in the next 12 months. Some look to the medium term and, for instance, the changes needed in our skills environment. Even in the area of health, and I see Senator Crown is here, we are looking at how an innovation hub can be created in the health sector so that innovative companies can get a chance to test technologies within our health system. One of the best ways of growing companies is for them to get a reference sale from an Irish multinational or an Irish public service body. That is a huge reference sale if a business is trying to go overseas.
Last week we had our first trade mission in Ireland. For the first time, we brought 150 Irish sub-supply companies to meet 75 multinationals based in Ireland to try to improve access to their supply chains. It is a regular thing to take high-performing companies to China, India or elsewhere, but a lot of procurement possibilities are available here on our doorstep. If we can get into the supply chains here, there is a chance to get into global supply chains and to build those companies.
That is the concept behind it. We are currently preparing the action plan for 2015. We engaged in a consultative process with various sectors, representative groups, trade unions and so forth and we are now moving to pull together the sort of changes we can make in 2015 that will make a difference. Some of them have been flagged in the budget. Others will be flagged in the action plan when it is published early in the new year.
I am very eager to hear suggestions from Senators on areas in which they feel the Government could do better, opportunities that the Government is missing, areas where the boot is pinching, businesses which are trying to create employment, or opportunities where people who have been out of work could be brought in. The Pathways to Work strategy is very much at the core of this.

We have tested many new approaches. Some of them get public criticism, but I would strongly defend programmes like JobBridge because they give work experience to people who have no such experience, they have a high job placement ratio and they are helping to reverse one of the big problems caused by the crash. Younger workers were most affected by the crash, by and large. Most people in the older age categories did relatively well. There was a sort of last in, first out policy. The impact on the younger age cohorts was enormous. We have to do things to help younger people back into the workforce. That is a very clear target in some of these programmes. I will leave it at that. I welcome any contributions Senators might wish to make.