Bernard Durkan (Kildare North, Fine Gael)
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Question 90: To ask the Minister for Enterprise, Trade and Employment the action he proposes to take to address the increasingly serious issue of the rapidly rising cost base for both manufacturing and service industry here; if he has examined the various contributory factors with a view to remedial action at an early date to avert job losses or relocation to other jurisdictions arising from a lack of competitiveness; and if he will make a statement on the matter. [37853/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 290: To ask the Minister for Enterprise, Trade and Employment if he has been informed of the concerns in the manufacturing industry arising from an increased cost base which is affecting competitiveness; if he has offered any solution; and if he will make a statement on the matter. [38215/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 294: To ask the Minister for Enterprise, Trade and Employment if his attention has been drawn to the fact that the manufacturing and service industry here is becoming less competitive due to an ever increasing cost base; if the situation will be evaluated with a view to identifying the main contributory factors and setting out proposals for resolution; and if he will make a statement on the matter. [38220/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 295: To ask the Minister for Enterprise, Trade and Employment if he has had discussions with industry with a view to identifying the main contributory causes to an increased cost base with particular reference to the need for competitiveness on world markets; and if he will make a statement on the matter. [38221/05]

Micheál Martin (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 90, 290, 294 and 295 together.

Maintaining Ireland's attractiveness as a competitive and profitable location from which to do business is a key priority of the Government. Ireland's economy is undergoing fundamental change and we are no longer in the business of competing as a low cost location for basic manufacturing investment. We are now a modern, advanced European economy, typified by all the associated advantages of high incomes, living standards, employment growth and social services.

Given the continuing transformation of our economy, high value added services and related activities have increasingly become the wealth and employment drivers in the economy. With this evolution, it is inevitable that some low technology and labour intensive activities will be replaced by alternative higher value added and more sophisticated activities. This is the nature of a flexible market economy where well-executed and supportive enterprise policies enable structural adjustments to take place without significant economic or social disruption. This has been a feature of our economy particularly over the past ten years.

Despite increasing global competitive pressures, the latest quarterly national household survey shows that the number of persons in employment grew by 96,200 in the year to reach almost 1.99 million in the third quarter of 2005. Moreover, we have seen employment increase in most sectors of the economy, not only construction, with financial and business services showing strong growth. The latest data also point to a slight upturn in the numbers employed in industry. 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.

Sustaining national competitiveness is a priority for Government. To give effect to this in my Department I have assigned more resources and given more powers to the Competition Authority. We abolished the groceries order and have undertaken a comprehensive reform programme of the insurance sector. This led to the establishment of both the Motor Insurance Advisory Board and the Personal Injuries Assessment Board, PIAB. The PIAB has been particularly successful in reducing the cost of litigation and decreasing insurers' premiums. In relation to research and development, I am pleased to say that all elements of the new co-ordination and governance system for Science Technology Ireland, STI, are now in place and fully operational. Over the lifetime of the current national development plan we will have invested €2.5 billion in research, technological development and innovation.

At wider Government level public capital investment in infrastructure is being prioritised through the rolling five-year multi-annual capital envelopes introduced in budget 2004 under which public capital investment is maintained at around 5% of GNP. This level of investment is currently about twice the EU average. The Minister for Finance also recently announced a 12 point plan to ensure value for money to build on existing initiatives that are already in place such as administrative budgets, the expenditure review initiative and the new capital appraisal guidelines.