Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context

Question 54: To ask the Minister for Finance if he has satisfied himself that economic policy is adequately focused to attract investment and retain existing jobs; if he has observed any indicators to the contrary; if he proposes any action in response; and if he will make a statement on the matter. [13425/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

The Government's economic and budgetary strategy is based on pursuing economic growth and full employment as the basis of continued prosperity and enhanced living standards for all. In this regard maintaining and improving Ireland's competitive position is imperative to ensure Ireland continues to grow strongly and remains an attractive location for inward foreign direct investment.

We have no control over some of the factors influencing competitiveness, such as the exchange rate. However, we must always seek to ensure that our domestic cost base does not undermine competitiveness. In this context, it is important to maintain low inflation, pursue sensible incomes policy and keep public spending growth at sustainable levels in the medium term. This will allow us to keep the burden of taxation low to protect competitiveness and maximise our economic potential.

Irish inflation was below the euro area average in March. The Government's anti-inflation strategy has contributed to this favourable development and my decision not to increase excise duties in budget 2005 has helped the inflation performance this year. In terms of wage costs, the Government remains focused, through the partnership process, on securing a responsible approach to earnings growth in the economy.

I am confident that Ireland remains well placed to maintain our position as an attractive location for overseas investors. The taxation system has been reformed, our workforce is highly skilled and infrastructural development has been prioritised. These key policy orientations equip Ireland with the skills, infrastructure, facilities and overall operating environment that will allow us to compete effectively for projects at the upper end of the high skill/high wage spectrum, which is where our competitive advantage now lies.