Bernard Durkan (Kildare North, Fine Gael)
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Question 341: To ask the Minister for Finance his proposals to combat the issue of rising costs in the manufacturing sector; and if he will make a statement on the matter. [10560/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Maintaining a moderate rate of inflation remains a key priority of economic policy because of its importance in restoring competitiveness to all sectors, including the manufacturing sector. The Government is focusing on areas it can control and taking positive actions to contain inflation by implementing responsible fiscal policies. For example, we have not increased excise duties for the last three years, apart from tobacco excise, which was done for sound health policy reasons.

We are promoting greater price competition through various measures. We are also investing in public infrastructure, as evidenced by the recently announced National Development Plan, which will enhance our ability to produce more goods and services and, by improving the economy's efficiency, keep inflation down. In addition, we recognise that services sector inflation is a cause for concern and this highlights the need for more competition in the economy as well as for pay and profit restraint in all sectors in order to keep our cost base down. We must ensure that the wage increases granted under the Social Partnership agreement, Towards 2016, are reflected in productivity gains.

Bernard Durkan (Kildare North, Fine Gael)
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Question 342: To ask the Minister for Finance the extent to which he has identified the inflation that has caused relocation of manufacturing jobs to other economies; his plans to address this issue in the short, medium and long term; and if he will make a statement on the matter. [10561/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Some of the high profile job losses recently seem to be due to the fortunes of individual companies rather than national competitiveness. However, we will of course remain vigilant and are committed to maintaining our competitiveness.

Employment growth has been extremely strong in recent years, and over 2 million people are now employed in Ireland. Unemployment has remained consistently low at below 4.5 per cent — essentially full employment. While the numbers employed in industries fell during the first half of 2006, employment in this sector increased significantly during the second half of the year. In this context, it is expected that jobs in this sector will be created to replace those that have been lost.