Monday, February 14, 2011

Keeping jobs, giving new opportunities and stopping emigration

In 2010, unemployment peaked at almost 460,000. There are 439,000 people on the Live Register. The country has also seen a return to high levels of emigration with the ESRI recently predicting that 100,000 people, mainly young people, would leave Ireland over the next two years. This level of emigration exceeds anything seen during the worst days of the 1980s. Unemployment is the only figure that matters for those of us concerned with economic recovery.

Employment, not percentage increases in GNP/GDP, is a true reflection of meaningful economic growth. High rates of unemployment don’t just spell bad news for the economy now – structural unemployment into the future will have a devastating impact on any hope of restoring the Irish economy.

The relationship between jobs and the deficit is a clear one – more people in work produce higher levels of spending activity and tax revenues, as well as lower welfare payments. In 2008, employment in this State fell by 84,000. This was associated with a decrease in tax revenues of €6.5billion and an increase in social welfare payments of at least €2.5billion, a total deterioration in Government finances of €9billion.

Sinn Féin’s employment and financial stimulus package costs €7.595billion and will create 160,000 jobs directly over the medium-term, tens of thousands more jobs indirectly and also save thousands of jobs. The full cost of our employment stimulus amounts to €7billion. The financial stimulus of €595million is accounted for in our tax and saving measures. The multiplier effect on GDP of creating 160,000 jobs would amount to 1.8%, according to ESRI figures. And this would be real GDP growth – not growth based on the profits of multinational companies based here.

Our stimulus is about providing immediate and direct employment in key sectors such as infrastructure in the immediate term. But in the longer term the impact of our stimulus plan would see the State’s competitiveness increase as we become a world leader in green energy, IT and research and development, in addition to having world-class infrastructure to attract Foreign Direct Investment and support indigenous enterprise for longer-term employment creation.

Furthermore, the completion of key strategic infrastructure projects, such as the National Broadband scheme, and the improvements in the education and health services, will make Ireland more competitive and put us in a better position for economic recovery in the years ahead. In addition to these proposals, Sinn Féin has a strategy to boost the tourism sector including developing tourist attractions and amenities and a plan to create a new generation of co-operatives. This sustainable, long-term employment would broaden the tax base and secure it.

The 10-point plan

1. A jobs stimulus. Sinn Féin is advocating the transfer of €7billion from the National Pension Reserve Fund (NPRF) for a State-wide investment programme (stimulus). We are calling for a transfer from the fund of €7billion –– for a jobs stimulus package. This money should be administered out of the NPRF over the next 3.5 years, with the Department of Finance signing off on proposals as they are submitted from the departments. All proposals would have to have ‘value for money’ clauses and total number of people that would be employed under the proposal. €2billion would be spent on the employment stimulus in 2011.

2. Growing the agri-food sector. Deploy funding of €500million to set up and support central production hubs for SMEs involved in the agri-food sector so that they have access to advice, support and, most importantly, infrastructure and equipment perhaps not available to early- stage start-ups. We envisage existing agencies such as Enterprise Ireland and An Bord Bia to come together with Government to drive this project. This would create 5,000 direct jobs and 2,000 indirect jobs.

Coupled with regional networking, partnerships and branding across the whole country, this measure alone has even greater potential for job creation. Investment in agriculture and the agri-food sector provides high returns for the Irish economy. The multiplier for agriculture on GDP is 1.73 and 1.76 for the food and drink manufacturing industry (if you invest €1million in these sectors, the wider economy sees a return of €1.73 million). Funding required = €500m.

Creating jobs through the construction of essential infrastructure

3. Health infrastructure. We would build 100 new primary healthcare centres throughout the State at a cost of €500million. This would alleviate the strain on our main hospitals. It would provide local healthcare for a variety of medical conditions and an excellent resource for communities. The building of these centres would create in the region of 5,000 jobs and 2,000 indirect jobs. Our pre-Budget submission provides for the lifting of the current recruitment embargo, which would allow all these centres to be staffed in the years following their construction. Funding required = €500m.

4. School buildings and refurbishment. An increased school-building and refurbishment programme for 2011 to take at least 125 schools through the construction stage. A 16-classroom generic repeat design project costs approximately €3million in current market conditions. This would cost €375million in total and create approximately 4,000 jobs directly and 1,600 indirect jobs. A minimum of 150 school-building projects should enter the architectural and planning stage each year so that school projects are ready to proceed as quickly as possible to the construction phases. Funding required = €375m.

5. Crèches. Build 100 crèches State-wide for state childcare provision at a cost of €200million, creating 2,000 jobs directly and 800 jobs indirectly. Funding required = €200m.

Assisting businesses and entrepreneurs

6. Improving communications infrastructure. Augment the current National Broadband Scheme to provide a fibre-optic island-wide network. Fast-track the €435million spend so that it is delivered beginning in 2011 instead of 2013. This will provide in the region of 4,500 jobs directly and 1,700 jobs indirectly. Funding required = €435m.

7. Assistance for those starting a business. Change the PRSI system to create a safety-net for those who attempt to establish their own business. Provide a one-stop-shop virtual helpdesk for business start-ups with legal, HR, patents, accountancy and funding advice. In addition, create an innovation website where budding entrepreneurs can pitch their business and invention ideas to investors at home and abroad. Funding required = €2 million.

8. Helping businesses to export. Create a ‘Sales Ireland’ strategy to help Irish firms access export markets outside the US and Britain and to help Irish firms looking to set up manufacturing businesses with the potential to compete with out largest imports, including R&D funding. Currently, almost 90% of exports come from foreign-owned multinationals and foreign-owned firms import over 86% of the materials they use, bypassing Irish firms.

9. Maximising employment on public projects. Rethink local authority and public sector construction, service and procurement contracts to create a level pitch for small businesses to tender. Breaking tenders into smaller pieces allows contractors with less significant turnover to efficiently tender for work. Make the employment of a set amount of apprentices a condition on which public contracts are awarded to contractors building public infrastructure.

10. Initiate a ‘Frontline Services Aides Scheme’ where people are employed to take on specific work from overworked frontline workers (e.g. civilianising administrative work that is currently done by Gardaí). Funding required = €250m.

1 comment:

  1. Points well made An Giorra but what is the purpose if as Mellows says nobody is going to believe the party?