Written answers

Thursday, 24 November 2016

Department of Jobs, Enterprise and Innovation

Departmental Strategies

Photo of Niall CollinsNiall Collins (Limerick County, Fianna Fail)
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257. To ask the Minister for Jobs, Enterprise and Innovation further to Parliamentary Question No. 282 of 17 November 2016, the way in which the view that Enterprise 2025 provides a robust framework that remains valid and sets out an ambitious policy approach can remain valid considering there was no allowance in forecasts in this strategy for the impact of Brexit on Ireland with regard to employment levels and export targets based on the various UK trading scenarios that may emerge post-Brexit; and if she will make a statement on the matter. [36787/16]

Photo of Mary Mitchell O'ConnorMary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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As a small open economy, Ireland operates in an environment of continuous and fast-paced change globally. There are many external factors over which Ireland has no control. Nevertheless, we have put in place policies that ensure we are anticipatory and responsive and build resilience in our enterprise base. These policies are working. Based on the latest CSO data released earlier this week, 189,500 additional people are at work since the start of the Action Plan for Jobs Process in 2012. Over the last twelve months, an additional 56,500 are at work. The unemployment rate is now down to 7.9%, from over 15.1% in 2012. Over 72% of the additional jobs created were outside Dublin.

To sustain the progress being made on job creation in the context of the UK decision to leave the EU, we have taken a number of policy and expenditure decisions, including those outlined in Budget 2017, to ameliorate the impact on Irish based enterprises and to ensure we remain on track to achieve the ambitions set out in the Programme for Government and in Enterprise 2025. The Government will outline a full suite of measures in the forthcoming Action Plan for Jobs 2017.

As a policy framework, Enterprise 2025 does indeed remain relevant, in particular in the context of the events unfolding over recent months. Enterprise 2025 sets out a framework to ensure that we have coherence across relevant government departments and complementary policies – this coherence and cross government commitment to job creation and sustainable growth remains crucial. The actions set out in Enterprise 2025 focus on three main aspects:

One: we are focused on achieving a significant uplift in the performance of enterprises based here in terms of innovation, export potential and productivity, and in attracting further investment;

Two: we aim to focus investments in areas where Ireland can differentiate itself internationally – specifically education & skills; place-making; innovation and connectedness including trade & investment. DJEI is working closely with DFAT in the development of a successor to our Trade, Tourism and Investment Strategy and is engaged in the development of the successor National Planning Framework from the perspective of enterprise current and future needs;

Three: excelling on getting the fundamentals right in terms of finance, cost competitiveness, tax environment and economic infrastructures. The Government is confident that appropriate fiscal policies are in place that will help us to adjust to the economic effects of the UK’s negotiated withdrawal from the EU over a period of two years or more.

We are not blind to the potential implications arising from Brexit. I secured additional resources in the recent Budget to support our enterprise agencies in their increased efforts to work with Irish and foreign owned companies in the context of Brexit. In addition Budget 2017 introduced a suite of measures for agri-food, maintained strong support for the tourism sector with 9 percent VAT rate, and new schemes are under development relating to working capital. One response may have been to reduce our ambition and the potential set out in Enterprise 2025, or to reduce the targets I set for our agencies over the coming year. I do not believe that this would be the right response at this time.

We will continue to focus on taking action in the right areas to support enterprise as set out in Enterprise 2025 – this does not change because of Brexit. However, enabled by additional resources, the agencies will redouble their efforts in:

- working with our Irish owned companies to grow scale and to compete effectively on international markets;

- helping more Irish owned companies to export for the first time, and work with exporting companies to expand their international footprint beyond UK markets;

- attracting FDI from a wider range of source markets – FDI that adds value to our economy;

- helping a greater number of companies to invest in RD&I for the first time and support already R&D active companies to invest more in developing innovative products and services; and

- helping locally trading companies to increase productivity, to innovate and to invest in management and skills development through the LEO network.

As I have stated previously we can expect that many fluctuating macro-economic, trade and employment forecasts will be produced between now and the UK leaving the European Union. It remains to be seen precisely what the impact on the UK economy will be and much will depend on the new arrangements, including trade, to be agreed with the EU.

Meanwhile, we will remain focused across Government in responding to the challenges posed by Brexit and we will not be distracted from achieving our longer term ambition for sustainable employment growth in the medium term.

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