Bernard Durkan (Kildare North, Fine Gael)
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Question 688: To ask the Minister for Enterprise, Trade and Employment if he has satisfied himself that Irish-based manufacturers are in a position to compete with all others, both in Europe and worldwide; and if he will make a statement on the matter. [25986/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 689: To ask the Minister for Enterprise, Trade and Employment the extent to which he has addressed or proposes to address industrial costs; the main factors in this regard; the action he proposes to take to improve the situation with a view to sharpening this country's competitiveness; and if he will make a statement on the matter. [25987/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 690: To ask the Minister for Enterprise, Trade and Employment if he has undertaken any investigation into the lack of competitiveness in the economy here (details supplied); if any scientific evaluation can or will be undertaken on these issues; and if he will make a statement on the matter. [25988/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 691: To ask the Minister for Enterprise, Trade and Employment the extent to which he has taken action to improve the competitiveness of the economy here in the past 12 months; and if he will make a statement on the matter. [25989/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 694: To ask the Minister for Enterprise, Trade and Employment the ten items, goods or services which have recorded price increases most in excess of inflation in the past two years, thereby negatively affecting competitiveness of the economy; if he has any proposals to deal with the issue; and if he will make a statement on the matter. [25995/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 697: To ask the Minister for Enterprise, Trade and Employment if he has satisfied himself that this country is well placed to compete internationally for investment in job creation in both manufacturing and services; his plans in this regard for the future, keeping in mind international trends and developments and the competitiveness of this economy; and if he will make a statement on the matter. [25998/05]

Micheál Martin (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 688 to 691, inclusive, 694 and 697 together.

Ireland is undergoing a positive transformation in how we earn our living from international trade and investment, which is affecting all sectors of the economy. We can no longer be seen as a low cost location for investment but to compensate have developed other strong competitive strengths and advantages. Judicious enterprise policy changes have enabled the economy to move into the higher league of developed economies, one typified by higher value output, productivity and high returns to labour in the form of wages, salaries and better living standards. We have become a more prosperous and wealthy economy, converging with the broad income and prosperity levels of other member states of the European Union, while expanding employment and job prospects for our citizens.

The National Competitiveness Council, NCC, reports annually on our competitiveness and this year's annual report noted our competitive position over 170 indicators against 15 important competitor economies. The council's latest annual report was published earlier this month and while highlighting a number of areas where our performance could be improved it confirmed that Ireland is experiencing a strong and robust economic performance. From 1997 to 2004, Irish GDP grew by an average of over 7.5%, compared with an average of just over 2% in the EU 15. The indicators reflect that living standards in Ireland both in terms of GDP, where we are first out of 15, and GNP, where we are sixth out of 16, have grown significantly. GDP is expected to grow by 5.3% this year compared with an OECD average of 2.6%.

Of the 16 countries benchmarked by the NCC, Ireland is the most attractive for foreign direct investment. US companies, for example, earn the highest rate of return on their investments in Ireland as compared with other investment locations, and in 2003 accounted for about 6% of all US foreign direct investment coming into Europe. Uncompromising investment decisions are not made in favour of uncompetitive and lowly rated economies.

The economy is also generating a relatively high rate of indigenous entrepreneurial activity. The NCC's analysis shows that Ireland is ranked second in the EU and seventh among the OECD countries on this measure. Pro-enterprise policies and the obvious success and reward from business activity are changing the climate for indigenous investment and entrepreneurship.

Our continued international competitiveness underpins the high levels of job creation we are experiencing right across the economy. The latest quarterly national household survey shows the number of persons in employment grew by 93,000 in the year to reach almost 1.93 million in the second quarter of 2005. This is the highest annual growth rate, +5.1%, recorded since the second quarter of 2000. These facts demonstrate that we remain a competitive economy for both foreign and indigenous enterprise and retain a strong capacity to generate and sustain employment while managing the transition to a more knowledge and services oriented economy. While the low value added, basic manufacturing sector is facing competitive problems, the enterprise support agencies are helping companies counteract this by improving levels of innovation, research and development and product development. Furthermore we are winning new important and sophisticated foreign investment to replace employment in older manufacturing sectors.

However, despite these successes I am not complacent. To reinforce our competitiveness agenda I have mandated policy changes within enterprise support agencies such as the restructuring of Enterprise Ireland, the launch of its productivity improvement fund and the steady progression in implementing recommendations of the enterprise strategy group. Furthermore, the NCC's annual report will guide further analysis of our competitive position that will shape policy conclusions to be contained in the council's competitiveness challenge report. This will be published later in the year and I look forward to bringing it to Cabinet with a view to discussing what further changes we need to make to strengthen our competitive position.

Regarding price increases for goods and services in excess of inflation, these data are not held by my Department and might be obtainable from the Central Statistics Office. However, I note that in its annual report the NCC has some good news in that Irish prices and costs are no longer increasing at a rate faster than elsewhere in the EU, where we are just eighth out of 15 countries on this indicator. This stability will help in maintaining cost competitiveness but it is worthwhile noting that costs are just one aspect of competitiveness. Of more importance is the rate at which we innovate, increase productivity and provide market driven products and services faster than our competitors.

Bernard Durkan (Kildare North, Fine Gael)
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Question 692: To ask the Minister for Enterprise, Trade and Employment the steps he has taken or proposes to take to control industrial costs with particular reference to insurance; andif he will make a statement on the matter. [25990/05]

Micheál Martin (Cork South Central, Fianna Fail)
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In a small open economy it is not the role of Government to have direct control of all industrial costs. Ideally, market forces should determine the vast majority of these. The priority for Government has been to provide the framework conditions for the creation of competitive markets including a benign business environment in which businesses can prosper and create sustained employment. Maintaining a stable macro economic climate is also a big priority for Government.

In An Agreed Programme for Government, the Government outlines its commitment to keeping down personal and business taxes to strengthen and maintain the competitive position of the Irish economy. The Government is also committed to ensuring, as far as it can, that inflationary pressures are limited. According to the annual review and outlook published by the Department of Finance, inflation continued to moderate in 2004 with the consumer price index falling to 2.2% last year from 3.5% in 2003.

Regarding insurance, the annual competitiveness report 2005 recently published by the National Competitiveness Council, NCC, found that of the 16 countries benchmarked, Irish expenditure on non-life insurance was the fourth highest. However, the NCC also found that the rate of growth in the cost of insurance has slowed down substantially in recent years. This can be attributed to the series of initiatives the Government has pushed through to reform the insurance sector. The caution taken by Government to ensure healthy competition in the insurance sector had already seen benefits for consumers.

The Personal Injuries Assessment Board, PIAB, is one of the key initiatives of the Government's insurance reform programme. The PIAB's first annual report shows that the cost of delivering €2.7 million in compensation under the PIAB system amounted to €185,000. Under the old litigation system the cost of delivering this compensation would have been approximately €1.2 million, representing an actual PIAB saving of €1.1 million. The report also shows that PIAB assessments to date have been delivered approximately three times faster and at a delivery charge four times cheaper than under the litigation system.

The Motor Insurance Advisory Board, MIAB, another of the cornerstones of the Government's insurance reform programme, has also ensured considerable savings since its inception. In the last 12 months alone the cost of motor insurance has decreased by over 12%.