Seanad debates
Wednesday, 28 May 2025
Economic Competitiveness: Statements
2:00 am
Peter Burke (Longford-Westmeath, Fine Gael)
I thank all nine Senators for their contributions.
I appreciate the eight areas Senator Nelson Murray focused on in her contribution. She quite rightly pointed out we have a significant employment in our economy. At this point in time, we have put an additional 90,000 jobs into the economy in the past year. That is and additional 90,000 families with an income. We are trying to improve conditions to allow and give everyone the opportunity to realise their potential. Jobs are the best way forward, particularly high-value jobs in our economy, which we have done a huge amount of work on. Regarding broadband, I will raise the point with the Minister for communications. Much work has been done with our broadband plan. In many rural areas, there are better broadband speeds now than in the heart of Manhattan, but there are challenged areas. We appreciate that but I do believe the plan is on track and there is a huge amount of opportunity there to potentially accelerate it under the national development plan, which is currently up for negotiation.
The Senator raised vital issues regarding town centres and zoning relating to planning infrastructure which is very important. Those themes of housing, water, energy and competitiveness can be seen in the national development plan, are recurring themes and are important priorities for the Government. If everything is a priority, nothing gets done, but we need to focus on those key areas. I look forward to the Senator's Private Members' business on insurance. I imagine the Department of Finance will be responding to it but the Senator is quite right in that we must ensure we are getting delivery from the insurance sector. As a Government, we have done approximately 90% of the reforms at this point but we have not seen the response on the other side of the table, and this has been a significant challenge, as Senator Murray quite rightly pointed out. I have raised the rates issue with Minister of State, Deputy Cummins, and any additional cost in that regard is concerning.
The Senator quite rightly pointed out that one critical thing is getting people. We are an economy with 2.81 million people working right now. We are at full employment. The big challenge of the future will be upskilling people, ensuring we are future-proofing our economy and that skills keep pace with the changing nature of work practices. I thank the Senator for all her effort in those areas. I will do my best to make grants more user-friendly, because we know businesses' time is their most vital resource. Through our cost of doing business advisory forum but also, critically, through our small business unit in the Department, we will really focus on lowering the criteria for several grants for our SMEs. We see, whether it be sustainability or the energy efficiency grant, that there is independent data which shows you can reduce your energy bill by up to €1,500 per month through sustainability measures, such as refrigeration, LED lights and kitchen upgrades. This has an impact on businesses because you are not taking that money off them. That is going to be important for the future.
Senator McCarthy raised several important points on infrastructure. One thing I will point out is we are backing our SMEs and our indigenous economy. One thing people often forget when we talk about multinationals, especially if we look at semiconductors, is there are many big operators in this country. Analog Devices came to these shores in 1976, followed by Intel in 1989. We currently have 130 significant companies in operation in Ireland and half the global supply chain is here in Ireland, with some a generation ahead of our European counterpart.
On trying to apportion research, development and innovation grants from either the IDA or Enterprise Ireland for those particular companies, I know of one company that has approximately 840 SMEs on its books that it deals with every single year. That is from Banagher Precast Concrete to Kiernan Structural Steel in a very remote part of the country where these businesses are getting value. One thing we are trying to do is close the eco-cycle with multinationals and local small businesses. I also remember being in Ballinasloe at a local printing company where the owner - the managing director - told me he employed local people there and that he printed all the labelling that goes into the bottles of medication produced in the life science company down the road. This again shows how we are closing the cycle. This so important but we need to do a huge amount of work in that area. This is why I push the IDA and Enterprise Ireland to work closer together with supply chains which can really provide much value for our indigenous businesses.
Senator McCarthy also raised issues relating to insurance and energy. Energy is a common theme among many of the speakers today and, quite frankly, we need to invest more in the next decade in energy than we have since the inception of our grid. This is a very significant statement but that is what is going to be required. We have generation points but we do not have the infrastructure to get the energy around the country. We are going to treble our interconnectivity this year, through both interconnectors with the UK and the one to Brittany from Cork. For generation, we also need the arteries to be able to get that power around the country.
We are bringing forward a large energy user policy on behalf of the Department which gives certainty to the sector. Like many European capitals, we have pinch points at present but if we can say to businesses to work with us and we will get them there, we will have a period where there is tight capacity but a significant pipeline opening from 2029 to 2030 and beyond. We use approximately 6 GW as a country. Figures like 37 GW over the next two decades would be very significant. We have a huge opportunity to deliver those 5 GW by 2030 in offshore wind, 9 GW in onshore wind and 8 GW in solar energy, which will be very significant. We must ensure those five projects for offshore wind on the east coast get planning permission. I was involved in bringing forward the planning and consent regime in the previous Dáil which is there to support this, but we need to see them on the ground. This will be important for us. Senator McCarthy also raised tariffs and other issues which will be critical in getting a deal in that area.
Senator Keogan quite rightly pointed out infrastructure is going to be a key focus and we have the review of our development plan. As she said, IBEC said about €200 billion and I believe we will not be far off that figure in the next decade. This is the type of infrastructure we absolutely need because we must do things simpler, lighter and faster as a country and we need to be laser focused on that. If we do not, we will be left behind in the race for competing to have a strong value proposition as a country, and this will be critical in the time ahead. The review of the capital plan is ongoing. Ministers are having their bilaterals with the Department of public expenditure, which will be critical at this point. I share the Senator's views on judicial reviews and the public good. They are critical. We need to get the new planning Bill commenced and fast-tracked to ensure it can have its say. Trying to get statutory deadlines into An Bord Pleanála will be important in delivering infrastructure. We cannot have situations where people are waiting months or years for decisions. That is not acceptable in a modern, agile economy. We must ensure this does not happen.
As I said, regarding data centres, we will have our large energy user policy, which we discussed at our Cabinet committee on Monday and it is hoped it will be brought forward. We have more work to do on it but we will bring it forward in tandem with the national development plan review as well as the huge amount of infrastructure that will be required. The point about airport connectivity being significant is quite right. Again, as I mentioned, water, energy, housing and competitiveness are key areas of importance. With regard to alcohol labelling, the Senator raised the valid point that we need to move with Europe and that is the critical thing. When you go it alone, there are always risks to your competitiveness and this is a fair point.
Senator Fitzpatrick raised many issues relating to retail crime, which we are doing a huge amount of work on through the Minister of State, Deputy Dillon, and his Department is doing exceptional work on retail crime and bringing all our retailers together. We are working through the defamation Bill, which is on Committee Stage, and through capital allocations to support security allowance and infrastructure that is needed. Operation Target is bringing in data in the work it is doing but we need additional boots on the ground and more support. I addressed the Convenience Stores and Newsagents Association, CSNA last night and listened to its views on all the areas we need to improve on. We are working with all these areas to try to make inroads which will be important. The Senator also mentioned the key areas in Dublin in infrastructure, housing, water and energy, which are, again, the common themes that are coming across.
I thank Senator Murphy for his contribution and the key areas he raised surrounding trade, the Draghi report and the Letta report. These are two key areas we are trying to embark upon with the competitive compass in Europe and to improve our infrastructure. Critically, we are at the fourth omnibus piece of legislation through Europe. We have taken approximately 80% of small businesses out of CSRD and CSDDD, which will make a huge impact.We are doing the same work on digitalisation and all those areas. We will have a second review of the Chips Act. We need to be focused on how we can make it easier to access European funding and European support and hold the President of the Commission, Dr. Ursula von der Leyen, to account for her commitment at the start of the new Commission to "Simpler, lighter, faster." We need to try to improve on all those areas and ensure that regulation is proportionate and that it accelerates innovation, rather than doing the reverse. We need to ensure reports that regulators do not use and no one reads are not being compiled. That will be critical, in a European context, in the future.
On the talent issue, IDA Ireland is clear. Its mandate now is to upskill 40,000 people over the next five years of its strategy from its 300,000 base. That provides a challenge. As Minister, every week I get collective redundancy notices in. People might be surprised at that when we have full employment but there is a common thread to those notices. One can see jobs that are at risk through the dawn of digitalisation and artificial intelligence, AI. That is why we need to be able to capture and upskill for that next opportunity or next wave, and that is about having the infrastructure and energy. Generative AI, according to one estimate, takes up 2% of global power. That shows how much energy infrastructure is needed to absorb that huge digital ambition that is out there. It will be so important in the years ahead to work on that and ensure we capture it.
Senator Scahill spoke of the grid and energy. The Senator is absolutely right. He spoke of lowering the costs for small businesses. We have taken a number of decisions to do that. In my first month as Minister in the previous Dáil, in enterprise we brought in an SME package, trying to reduce PRSI and trying to ensure that we doubled the innovation voucher and provided more loan finance and working capital finance for SMEs. We had three rounds of the increased cost-of-business grant for retailers. Approximately, half a billion euro went into them, trying to help and assist them and trying to lower the cost base, bring down regulation and give them certainty. Businesses just want to be left alone, to be given certainty and not to have too much regulatory requirement and red tape pushed on them, and that is what we are trying to do. That is why we have changed the focus of the Department. We need to look at SMEs, smaller family businesses run by people who work around their kitchen table at night. They have no HR department or finance director; it is all on the kitchen table. We really want to support them. They employ two thirds of all workers in our economy and drive so much of that economic activity at the heart of our communities and we are focused on protecting them in the months and years ahead.
Senator O'Loughlin quite rightly raised energy as well and the cost of doing business. In addition to these key areas, the Senator raised some of the initiatives the Government needs to have in the public spending code to help our retailers. One is precluded in many areas by tender law. It can be difficult to ensure that local businesses get that opportunity but we will do everything we can in that area.
I thank Senator Kyne for his comments and wish him well as Leader of the House this term. The Senator quite rightly pointed out that businesses need certainty. We took a number of decisions in that way. It struck me that when wage growth in our economy was 3.5% or 4%, the Government was coming forward with minimum wage increases in excess of 10% or 11%. If the Government is cheerleading wage growth in our economy, that is not sustainable. It is a bad place to be in. We need to ensure wage growth is ahead of inflation. It is at present. It is more manageable if we act sustainably, keep businesses viable, keep growing employment and keep certainty for businesses and we have done that, in a fair manner, I believe, over the past number of weeks.
I will raise, obviously, the issue of the Galway Airport site, which is very important. We hope to have a very significant announcement for the constituency of the Senator with regard to one big area going to Cabinet in the coming weeks. There are many good areas that we can go after as a country. It is important that we get that regionalisation issue well and ensure that we are getting good, high-quality jobs in the west.
I thank Senator Dee Ryan for her comments. Obviously, I worked closely with the Senator in the chamber in Limerick when she was at the helm down there. I wish the Senator well in her term in the Seanad. She rightly focused on what the Minister, Deputy Chambers, has pointed out as housing, energy, water and competitiveness. Those are the areas that the national review of the capital plan will be focused on and it is critical that we deliver. What can be difficult for us all in politics is listing or naming every project in a capital plan. International tenderers will not take us seriously if we have hundreds of projects ongoing at the one time. We have to be clear on what we can deliver as a country. A critical question to ask will be what Ireland cannot do without in the medium term. What would we die in a ditch over if it is not delivered for our economy? What do we need but can manage without at this point in time? Those are difficult questions to answer but if we are to be taken seriously by those who tender, and in the context of delivering projects, we need to focus the resources we have in Departments on specifically addressing these deficits and going after the key projects that will make a difference and will attract the next big multinational here. That will support the growth in SMEs and close that cycle such that you can have both working hand in glove together, which will be so important. The Minister, Deputy O'Brien, made an announcement regarding trying to progress the designated maritime area plans, DMAPs. That is so important in terms of the trajectory - trying to get to the west coast and getting innovation that will deliver in a challenging environment on the west coast. There is huge opportunity but there are challenges in terms of getting the innovation and construction that can deliver that. That is what we had in our Department. Our role was to produce Powering Prosperity. It contains 50 actions, which are almost complete, to build up resilience in supply chains. Obviously, our ports will be challenged. I refer to Cork, Foynes and all those areas where we need to ensure we can bring in the infrastructure that will be required as we embark upon this exciting chapter of having a huge amount of green, clean energy which will be important for our future.
I thank all the Senators for their contributions and look forward to working with them. I look forward to hearing their views on the action plan for competitiveness and productivity when we publish it.
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