Frank O'Rourke (Kildare North, Fianna Fail)
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288. To ask the Minister for Jobs, Enterprise and Innovation the steps being taken to address Ireland's reducing competitiveness; the measures or initiatives planned to reduce the cost of doing business here; and if she will make a statement on the matter. [27910/18]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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Ireland’s competitiveness ranking, as benchmarked by the Institute for Management Development in its 2018 Yearbook, declined from 6th to 12th most competitive economy in the world. After several years of improvement, the decline in Ireland's overall ranking is disappointing. Despite the fall in competitiveness, Ireland’s competitiveness performance remains positive. The IMD Report shows that Ireland is the 3rd most competitive economy in the Euro area and the World Bank’s most recent “Doing Business 2018” report ranks Ireland the 17th most competitive economy out of 190 countries.

The IMD report is a timely reminder of the importance of remaining competitive in a global environment. It is important to continuously implement policies to improve our performance further considering significant challenges in the external environment, particularly Brexit. That is why we are continually examining how we can improve on factors that are crucial to improving our competitiveness, including our cost base, infrastructure and the availability of talent and innovation.

Enterprise 2025 Renewed - which I launched in March - placed an increased emphasis on enhancing our competitiveness position by developing our Irish owned enterprises. There is a strong focus on taking action that will embed resilience in our enterprise base. We are placing a spotlight on innovation and on skills. Enterprise Ireland also places a strong emphasis on competitiveness. It supports exporting enterprises with initiatives in Lean, RD&I, and management development. The Agency helps enterprises to take a strategic approach to understanding and responding to potential implications arising from Brexit and assists them to enter into new markets and diversify their export base. The Local Enterprise Offices offer a suite of supports to enhance the competitiveness of small and micro enterprises. Initiatives include mentoring, innovation vouchers, Lean Start and access to a Brexit diagnostic and guidance.

Addressing Ireland’s cost competitiveness remains a key economic priority for Government and we continue to monitor Ireland's cost competitiveness on a regular basis. The Costs of Doing Business in Ireland 2018 Report, published by the National Competitiveness Council on 1st June, found that the cost base for enterprise is internationally competitive across a range of metrics (e.g. the cost of starting a business, communications costs and average income taxes). Despite these improvements, Ireland remains a relatively high cost location and cost pressures are evident in property, credit, labour and business service costs.

Government is committed to taking action to address unnecessarily high costs (i.e. cost and price levels not justified by productivity) wherever they arise. A range of initiatives set out in the Action Plan for Jobs are in train across Government Departments to improve the ease of doing business, reduce the administrative burden, enhance our cost competitiveness and productivity, and drive greater efficiencies across the enterprise base. Through the Action Plan for Education and Pathways to Work the Government is working to ensure the pipeline of talent can meet the demand for labour to reduce labour cost pressure. The ongoing work of the Personal Injuries Commission, the implementation of the Report on the Cost of Motor Insurance and the complementary work of the Cost of Insurance Working Group should help to reduce insurance costs for businesses. In March, I launched the Brexit Loan Scheme which will make €300 million available to eligible businesses with up to 499 employees at an interest rate of 4% or less. Rebuilding Ireland Plan presents a wide-ranging set of commitments to address housing supply, and while many of these will take time, the Government is implementing and driving change.

In terms of ensuring our cost competitiveness, there is a role for both the public and private sectors alike to proactively manage the controllable portion of their respective cost bases, drive efficiency and continue to take action to address unnecessarily high costs. Such actions will ensure that improvements in relative cost competitiveness are more sustainable, leaving Ireland better positioned to cope with external shocks.