Bernard Durkan (Kildare North, Fine Gael)
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Question 95: To ask the Minister for Finance if Ireland will maintain its economic position as an investment location in view of the ever increasing costs which affect economic confidence; and if he will make a statement on the matter. [18429/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Maintaining the attractiveness of Ireland as a location for mobile investment is essential for continued economic progress. It must be recognised, however, that external factors such as the exchange rate will have an impact on domestic costs and confidence, but that we cannot influence them.

In these circumstances, we must seek to control those costs which we can influence. It is important that wage pressures do not add to the domestic cost base. Therefore, the moderate pay increases agreed in Sustaining Progress should be adhered to. The moderate rate of consumer price inflation in Ireland over the last year will also help to improve the attractiveness of Ireland as an investment location. My decision not to increase excise rates in the budget will help support low inflation this year.

It is also important to maintain public spending growth at levels that are sustainable over the medium term. This will help to maintain the low burden of taxation, which in turn will protect competitiveness and maximise our economic potential.

We are maintaining capital expenditure at the current high levels relative to GNP in order to reduce the existing infrastructural deficit. This will support future competitiveness and ensure that Ireland creates the right environment for inward investment.