Rose Conway Walsh (Sinn Fein) | Oireachtas source

I thank the Minister for coming to the House. I wish to share my time with Senator Pádraig Mac Lochlainn.

Before I begin my contribution, I wish to draw attention to the most recent economic announcement from the CSO this week. The 26% growth rate was mocked and derided around the world. There is a danger that economic announcements and forecasts such as those we are discussing today will become meaningless. Economic forecasts and statements from sovereign Governments should be a source of confidence. The statement read as though it was the premise for a round of tax cuts that may happen in the future.

It is the firm belief of Sinn Féin that tax cuts are not a stimulus for economic growth, rather they are a cumulative year-to-year cost on the Exchequer. As we know, it is very difficult to raise taxes after they have been cut. Capital spending can be adjusted year-to-year in light of external factors and, therefore, is a more fiscally responsible method of stimulating growth. Capital spending stimulates job creation and pays much more back into the economy than tax cuts. Last year, we saw a major increase in corporation tax which rose by 41% ahead of projections. Much like 2015, we are all at a loss to explain the spike.

We cannot build a sustainable recovery on such random fluctuations in Exchequer returns. Last year, ten companies accounted for 40% of corporation tax receipts. One of the strange facts to come out of the most recent GDP figures is that it appears that Ireland's industrial base has doubled in the past year. If we looked for the tonnage figures from Irish ports, would they correspond with the seemingly amazing expansion of Irish output? To put this plainly, I ask the Minister whether the figures represent actual physical exports from the island or merely reflect the number of companies using our country and island as a flag of convenience to process money.

Last February, the EU Commission flagged aircraft leasing and inversion deals as not being reliable variables for measuring GDP growth. Sinn Féin has also received replies to parliamentary questions from the Minister's Department which have stated specifically that aircraft leasing should be considered GDP neutral. It is, therefore, necessary that the Government issues a clear line on Ireland's forecasted growth in order to restore confidence. This statement is nothing more than an attempt by Fine Gael to squeeze its narrative into the fiscal space.

My party has never supported these rules in the first place, and it is great to see many organisations coming around to our position in opposing them, whereas the Government seems to be fixed on spinning its way around them. I also note the Minister has referenced the fiscal rules as an excuse for not spending more on capital investment and, therefore, splitting spending with tax cuts. He said he is constrained by them and almost has no choice in the matter. Yet, the Nevin Economic Research Institute in its recent quarterly review refuted this and stated that this was merely an excuse to promote tax cuts for the better off ahead of capital spending.

I note from the statement that higher levels of investment are crucial to support balanced regional growth, eliminating capacity constraints and enhancing the growth potential of the economy. Even with the proposed spend of €5.1 billion in capital investment, Ireland will still be among the countries with the lowest level of capital investment in the EU. The Minister has a choice. He can abandon the plan for major tax cuts and reliefs for the better off amounting to €331 million, and instead begin investment that could help to ease the neglect of the west.

I ask the Minister to consider designating the area around Knock Airport and other neglected and marginalised areas of the country, in particular the west, a zero-tax base in order to attract multinational companies that will provide employment. I was alarmed at the recent economic dialogue to hear the narrative that we were almost at full employment. How, then, can we explain how, when four or six jobs were recently advertised by Mayo County Council, 1,608 applications were received? Things do not add up, and rural Senators will back that up.The narrative being given from Dublin and the east of the country bears no resemblance to what is happening in the west. The CSO figures on emigration show that we got the figures wrong and underestimated the extent of emigration. Communities and counties are being left without their young people. They are being left marginalised and without jobs and I ask the Minister to use the fiscal instruments available to him to address this as a matter of urgency.

Since the summer economic statement was discussed in the Dáil, Britain has voted to leave the European Union. As a public representative from the west, I am particularly worried about the impact of Brexit on the agrifood industry. This industry has been one of the success stories of an all-Ireland approach to industry. I want to know what contingency plans the Minister's Department has put in place to deal with the fallout that will affect specific sectors of the economy. Many schemes in the west and Border region depend on cross-Border EU funding. Has his Department assessed the potential fallout from such funding being withdrawn? I hope in the years to come this statement and the Minister's agenda of tax cuts is not cited as one of the warning signs we should have spotted before repeating some of the mistakes made in the recent past.