Wednesday, 28 January 2009
Industrial Development Bill 2008: Second Stage (Resumed).
This is a welcome Bill. The need to tidy up the apparatus of industrial development has long been discussed and the legislation is an attempt to reshape that infrastructure. While it has been long necessary in administrative terms, in this period in which we must seek value for money in all aspects of Government, the Bill is doubly important. It also affords the Minister and her Department an opportunity to tidy up other areas. For example, the west and other areas require additional assistance from State industries to promote industrial development.
I especially welcome the changes in research and development grants. We heard from Senator Quinn about the importance of maintaining and encouraging foreign direct investment. It is clear, however, that the next phase of economic development will strongly depend on research and development which delivers a greater indigenous industrial base. I am optimistic we can achieve this objective, especially through green technology. More than 30 years ago we made the major mistake of declining to use our natural resources, specifically wind, for energy generation. Not only did other countries, such as Denmark, generate electricity through wind, they also developed new technology which they were able to export. Ireland is now availing of this technology as we catch up.
Ireland has natural advantages in alternative energies other than wind. We are starting to do things properly, particularly in the area of wave industry. I expect the west to achieve considerable success in research and development in this area. I am aware, for example, of work being done by a company known as Ocean Energy, which is in a third phase of research and development in Galway Bay. It has progressed from a pool size model of a turbine to a quarter size model through to a full size model.
In the new apparatus which exists in industrial development, it does not necessarily need to be legislated for, but perhaps the Minister might give a sense of political direction as to how other State agencies and non-governmental organisations can become involved in the process of economic development and renewal, particularly in the west.
There are State agencies such as the Western Development Commission, which makes regular recommendations on how we can improve both infrastructure and the quality of industrial development in the west of Ireland. We also have agencies such as the Council of the West which is run by the Catholic Church. It produces many interesting papers as to the direction we should go from here on in.
The Government is acutely aware that regarding industrial development, the real need in the west of Ireland and other disadvantaged areas of the country which needs to be met is the infrastructure deficit, particularly in transport and communications. These are difficult fiscal times but I am confident the commitment remains to appropriate capital investment, which has to be done in a widespread way across the country.
We must not repeat the mistakes of the past, where a capital city has 40% of the population and acts as a magnet for a disproportionate amount of development and investment which should be more widely and fairly distributed throughout the country. We also need to recognise the need to develop the less advantaged areas in the country and that this administrative change is necessary and welcome. The change which the Bill allows for research and development is to be especially welcomed and will have a greater effect on areas outside major urban centres than would otherwise be the case.
I welcome this Bill and look forward to its enactment.
I thank Senators for their support for this Bill. It is important it is accepted as quickly as possible in the context of the aggregate amounts I mentioned in the Bill. From a technical perspective, I do not anticipate any significant issues will arise. We will look forward to Committee and Remaining Stages in due course.
It is important to take a flavour of what was discussed this afternoon. I will not get into consensus politics, although on occasion it is appropriate. It is also appropriate to stand up for oneself. I will stick to consensus today. There is a consensus that a number of key issues must be addressed. I agree with Senator Quinn that the role of the Government is to create a situation within the economy whereby entrepreneurs can grow and flourish and we can attract foreign direct investment.
The way we can do that and make this country an attractive economic location, is in a number of key areas where we have a talent pool which we can continue to expand over the next number of years. Foreign direct investment is very important to this country and we must continue to be attractive to FDI.
We can do so by being competitive. It is important to say that we had a considerable number of new foreign direct investments last year and will have a number of new ones this year. I had an opportunity to travel to meet a number of these key companies.
One key message they gave me was that the flexibility and talent of our workforce is very important. Our tax incentives were also attractive, as were the flexibility of employment organisations which were in a position to come together very quickly and provide for the needs of a company. We have a key indication on support for research and development, and have a very significant investment programme over the coming years in this area and in collaborative work. These are the incentives we can use, and they are important and appreciated. On the basis of those incentives we will continue to be a very attractive location.
I met all of the indigenous agencies this morning. The key message concerned the price of energy, which was an issue across the board from both FDI groups and Enterprise Ireland. It is an issue we are grappling with and is one of which the Minister for Communications, Energy and Natural Resources, Deputy Eamon Ryan, is acutely aware. He is working with us to try and address this matter.
Another issue was the cost of local charges. I am sure all Senators are aware of the criticism whereby people find local charges are equal to grant aid given by an agency and, therefore, there is no benefit in investing in an enterprise. I know local elected representatives will deal with that issue, as we have to here. We must also ensure that we sustain employment and continue to have a talent pool.
All these matters are important. In building a smart economy we will find ourselves in a situation where our indigenous industries will provide FDI for other parts of the world, which is something we would all like to see. We will take our own talent pool and use it to expand further. There is no doubt that opportunities lie in the services sector. Manufacturing is still very important, as are all ancillary services.
Yesterday we had discussions with the retail trade, which is a very important part of the economy which employs almost 300,000 people. It is by creating the atmosphere and economic environment whereby we can encourage and support employment that we will move ourselves out of our current position. We must deal with the issue of our public finances and our banks and continue to invest in skills and people, and create support mechanisms for all of our companies.
The economic difficulties are almost like an economic war and that is the attitude we should all take. It is on that basis we can all come together and work together to address the serious economic issues. There will be further discussions on the economy and the policy framework which we are working on within the smart economy programme, and which will address these concerns. I reiterate the role the social partners will have, which will be pivotal in working towards what we would like to achieve, namely, an upturn in employment opportunities and supporting those in employment.
I thank Senators for their views and support on the Second Reading of this Bill. I am sure we will have further discussions on these issues in due course.