Kieran O'Donnell (Limerick East, Fine Gael)
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Question 114: To ask the Tánaiste and Minister for Enterprise, Trade and Employment her views on whether there should be a freeze on all Government charges as a first step in developing a competitiveness action plan followed by setting targets for reductions in public and private sector prices when scope exists for greater price competitiveness. [45168/09]

Mary Coughlan (Donegal South West, Fianna Fail)
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The Government's strategy to support businesses, improve competitiveness and sustain employment is aimed at a return to export-led growth. In order to move towards a lower cost environment, a number of issues are being tackled together. These include incomes policy, government controlled prices and costs, regulatory burden and the level of competition in our economy. The Government is acting in a concerted way and with urgency to address all of these areas.

At the moment, Ireland is undergoing a sharp price correction. Prices and rents are dropping. As measured by the HICP, Ireland's inflation rate during 2009 fell by an estimated 1.7%, compared with an increase of 0.3% in the eurozone as a whole. We have also seen a decline in unit labour costs, which has a direct effect on competitiveness. A further relative improvement in price levels is expected this year – again improving Ireland's competitive position.

In respect of local authority administered charges, the Central Statistics Office figures show that there has been no overall increase in water, refuse or other services over the past twelve months - there has actually been a marginal decline. It should also be noted that there has been no increase in planning fees in nearly a decade.

In addition, a number of local authorities are introducing reductions in commercial rates for this year, or leaving their rates unchanged. The Government have also stepped in to prohibit upward only rent reviews and is helping to drive down the cost of professional fees by imposing an 8% reduction for professional services to the public sector.

Energy costs have fallen over the past year. The drop in industrial energy prices in Ireland in the twelve-month period to June 2009 was the third largest in the EU. Elsewhere, 22 out of 27 EU countries experienced increases on industrial energy prices over the same period. In fact, the rate of decline in gas prices for industrial users fell by almost 16%, double the European average. A report by Sustainable Energy Ireland (SEI) published on 24th January showed that gas prices are now 7 per cent to 10 per cent below the EU average in the two main consumption bands for business.

A key pillar of our Competitiveness agenda is the programme of Better Regulation initiatives being pursued across Government. The High Level Action Group on Better Regulation published its first report in August last year and had already identified more than €20 million of administrative cost savings for business. The Group has a strong work-programme for this year, and welcomes any concrete, workable ideas that can be used to reduce red tape costs for business.

The Government will continue to exert downward pressure on prices in all relevant areas and build on the significant progress made in the past year.