A Jobless Recovery is not a Real Recovery

Speaking in the Dáil on Fine Gael’s Private Members’ Motion on the economy this evening (Wednesday), Party Communications Spokesman, Leo Varadkar TD, said, that as seen in the 1980s, a jobless recovery is not a real recovery and that semi-State companies must be re-tooled into engines for economic growth.

Making his speech, Deputy Varadkar said:

“Cathaoirleach, I rise to speak in favour of the Fine Gael Motion tonight. First of all, please allow me to thank Deputy Noonan for his Motion and for allowing us to debate the economy before the Dáil rises for the summer recess.

“Last week, Ireland officially came out of recession recording positive GDP growth in the first quarter of 2010. However, this is merely a statistical recovery and a statistical recovery is no good to the Irish people. For real people, the recession will only be over when unemployment falls and incomes begin to rise again. This could be a long way off. Members of this House who were here during the last recession will recall that the recession of the 1980s ended in 1983. However, the public finances were not stabilised until 1987 and there were no jobs until the 1990s. I am concerned that history is repeating itself and that we are facing into a prolonged period of jobless, anaemic economic growth, a period of stagnation or another lost decade.
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FG Bill would force Govt to implement key McCarthy recommendations

Government Ministers would be given a four week deadline to cut prices of vital State items like TV licences, State exam fees, A&E charges and passports under plans being debated tonight (Tuesday) in the Dáil. Regulators would be given three months to do the same for their areas like ESB, gas, bus and train fares, tolls and airport charges.

Fine Gael Enterprise Spokesman Leo Varadkar TD has prepared emergency legislation which would force the Government to impose 5% cuts on its own prices, and for Regulators to reduce their own charges. This would save the average family around €400 a year.

“Thanks to this Government, people have seen their incomes and benefits cut, and their taxes hiked upwards. Many have lost their jobs. The crisis in the real economy stems from unemployment and declining competitiveness. This crisis is doing the most damage to our society, but is being ignored by the Government. If Fianna Fáil and the Greens can use emergency financial legislation to cut pay and benefits, surely it can use the same mechanism to cut its own charges?

“Last year the Government actually increased its own charges by 6.7%, while prices across the economy fell by 5%. It’s easy to forget the extent to which the Government controls prices in the economy through direct charges, indirect taxes and through it regulators:

 

• TV licence (€160);
• Driving licence (€25);
• Passport (€80);
• A+E charge (€100);
• Inpatient charge (€75);
• Junior/Leaving Cert (roughly €100); and
• Third level registration (€1,500).

“The price of petrol, diesel and home-heating oil prices consists mainly of taxes levied by the Government including excise, VAT and the carbon tax. And the Government’s regulators set most bus and train fares, most motorway tolls, electricity and gas, telephone charges and postage, and airport charges. Despite recent reductions, our household electricity prices are above average in the Eurozone and are among the highest for medium-sized industry.

“Fine Gael’s Bill requires all Government Ministers to present to the Dáil within four weeks a plan to reduce all charges set by them by 5%. And with regard to prices set by the government’s regulators, this Bill requires that Ministers require regulators to publish their own proposals within three months.”

Oireachtas Business hears final report on lending to business

Leo Varadkar TD, who will be speaking at the Economic & Regulatory Affairs Committee today (Tuesday), has called for the remit of John Trethowen’s Credit Review Office to be extended to existing SME loans and working capital.

“As Fine Gael Spokesman on Enterprise, Trade & Employment, I meet business people almost every day. They tell me that the Government and the banks have got it all wrong. The problem with SME credit isn’t simply about new lending. The real problem is with existing loans, with banks squeezing their customers by increasing interest rates, cutting overdrafts and turning overdrafts into loans.

“John Trethowen’s Credit Review Office is currently reviewing bank lending practices to the small business sector. The CRO currently only hears complaints about unsuccessful applications for new loans.

“The CRO’s remit should now be extended to hear complaints about banks increasing interest rate margins, withholding working capital and squeezing overdrafts.”

Fine Gael Enterprise Spokesperson Leo Varadkar TD has published new laws to slash Government costs by 5%, saving the average household around €400 a year.

Deputy Varadkar has drafted the Financial Emergency Measures in the Public Interest Bill 2010 which requires the Government to reduce all of its charges to businesses and consumers by 5% within three weeks. In 2009, private sector prices fell by 2.5% but Government prices went up 6.7%.

The Bill also calls on Regulators to come up with plans to reduce prices they set and present them to the Dáil within four months. Assuming these further price cuts are also 5% across the board, the average household would stand to save a total of €400 from this measure in a full year. The savings to business would be greater still.

Speaking at the launch, Deputy Varadkar said: ‘Last year, the Government introduced emergency legislation to cut pay, benefits and fees paid to professionals and contractors. Everyone has been squeezed by falling incomes and higher taxes. The very least the Government could do to help is reduce its own charges and the prices set by its Regulators. In 2009, private sector prices fell by 2.5% but Government prices went up 6.7%’.

“People don’t realise just how many prices are set by the Government:

• The TV licence and drivers’ licence;
• Passport renewal fees; A&E charges;
• Prescription charges (DPS);
• State exam fees;
• And college registration fees, fees charged to companies for filing accounts, farm administration fees, and fees charged for making a freedom of information request.

“Through local government, agencies and Regulators the Government sets prices for electricity and gas, local authority refuse and water charges, some motorway tolls, bus and train fares, mobile telephone tariffs and airport landing fees.

“If Fianna Fáil and the Greens back this measure from Fine Gael, it will save Irish families and consumers hundreds of euros, and soften the blow of recent pay cuts, benefit cuts and tax hikes. It will also reduce the cost of doing business, improve our competitiveness and save jobs. I think it’s a no-brainer. I urge the Government parties will support it when it is debated in the Dáil.”

The Bill and Explanatory Memorandum can be accessed here.

FG to question Coughlan on commercial rents in Minister’s Questions today

Speaking in the Dáil during Enterprise Questions this afternoon, Fine Gael Enterprise Spokesman Leo Varadkar TD will call on the Government to bring in new measures to level the playing field between commercial landlords and their business tenants.

“Ireland is uncompetitive and costs are too high. This is driving businesses to the wall and costing us jobs. We all know that. The high costs facing businesses include high property costs. This is in spite of the fact that the cost of property has fallen dramatically since the recession began, and so have commercial rents. However, some landlords, particularly financial institutions are holding out and refusing to reduce rents.

“The landlord drove tenant farmers off the land during the great famine. The financial institutions are driving businesses to the wall during the great recession. Currently, the law favours landlords and Fine Gael is calling on the Government to level the playing field by supporting tonight’s Private Members’ Bill to abolish existing upward only rent reviews and to introduce a register of leases and side agreements, so that there is transparency about rents. …[more]

Govt pressure vital to make landlords cut rents

Ireland’s small business sector is being decimated by a ‘perfect storm’ of shrinking credit supplies and Government neglect according to Fine Gael Enterprise, Trade & Employment Spokesman Leo Varadkar TD.

Deputy Varadkar was speaking after reports showed that half of all construction jobs have gone, the number of Irish companies going under has by jumped 33% in one month, and credit supplies are getting even tighter.

“Viable businesses are being wiped out, and small and medium enterprises (SME) are the hardest hit. Ireland will not see any economic recovery without a vibrant SME sector. But we are rapidly losing this important resource.

“The Fianna Fáil/Green Government should be doing far more to save viable businesses. This includes:

• A new National Recovery Bank to get lending going again to viable businesses, because NAMA clearly is not working;
• A National Competitiveness Action Plan to bring down costs controlled or regulated by the Government;
• As well as abolishing upward-only rent reviews on new contracts, the Government must also apply pressure on landlords to bring down costs on existing contracts in order to reflect true market value.”

Fine Gael will use its private members time this week to put forward its eight point plan to save jobs and to create tens of thousands of placement for the young unemployed, Spokesperson for Enterprise, Trade and Employment Leo Varadkar said today (Sunday). The motion will be debated in the Dáil on Tuesday culminating in a vote on Wednesday night.

“Fine Gael is horrified by the Governments ‘hands-off’ approach to job retention and job creation. Ireland now has the second highest unemployment rate in the Eurozone and over 85,000 people under the age of 25 are now drawing the dole. The sole focus of Government policy has been on the budget and the banks to the detriment of jobs and competitiveness. This needs to change. …[more]

Genuine fears over 2,000+ more Irish jobs with other banks

Fine Gael Enterprise Spokesman Leo Varadkar TD has today (Wednesday) challenged the Government and Financial Regulator to state whether they have had any indication from other international banks operating in Ireland that they are considering withdrawing from the Irish market.

Deputy Varadkar was speaking after former Bank of Ireland CEO Michael Soden raised fears about the future of National Irish Bank, owned by the Danish operation Danske Bank, and ACC Bank, which is owned by Rabo Bank of the Netherlands. This followed the announcement of 760 job losses at Ireland’s Halifax operations, owned by Bank of Scotland (Ireland).

“The loss of 760 jobs in Halifax has sent shockwaves through the financial sector and shattered hopes of a turnaround in Ireland’s unemployment crisis.

“Fine Gael Leader Enda Kenny TD raised Bank of Scotland (Ireland)’s plans to close its Irish retail operation with Brian Cowen in the Dáil today. But the Taoiseach, in an underwhelming response, suggested there has been little or no contact with Bank of Scotland (Ireland) about its Irish retail operation. …[more]

Speaking in the Dáil today (Tuesday) during Enterprise questions, Fine Gael Enterprise Spokesman Leo Varadkar re-iterated Fine Gael’s call for the introduction of a Government-backed loan guarantee for small & medium enterprises.

“Credit is the lifeblood of the economy but small & medium enterprises are being starved of credit by the banks. There are over 200,000 small and medium firms in the country supporting nearly a million jobs.

“There is some new lending but working capital such as overdrafts are being restricted and the banks are increasingly looking for personal guarantees from owner-directors. The reason is simple: the banks are bust and need to rebuild their balance sheets. As a result, they are unwilling to lend money to small businesses which are regarded as relatively high risk in a recessionary environment.
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Daft wage system needs reform

Minister Calleary’s reforms are a recipe for fudge

‘Daft’ laws which see hair stylists being paid 6c an hour more than barbers, which fix wage rates for hotel staff in Co. Dublin but not in the city centre, and which limit pay rates for beef butchers but not fishmongers, are being left intact as part of the Government’s much-hyped tinkering with minimum pay and condition orders, Fine Gael Enterprise Spokesman Leo Varadkar TD has warned.

Deputy Varadkar was speaking today in a Dáil debate on the Industrial Relations (Amendment) Bill.

“Junior Minister Dara Calleary has flunked the challenge to reform the Labour Court’s outdated and cumbersome wage-setting system. This system sets minimum rates, terms, conditions and benefits in the hospitality, grocery, agricultural and security sectors (among others). But it is currently a recipe for chaos. The whole system is outmoded, unrepresentative, cumbersome and restrictive.

“It is costing us jobs in hotels, restaurants and the retail sector. It penalises honest employers and often prevents employees from working when they are willing to do so. You could not make up some of the rulings, which are just plain daft:

• The Hotel Employment Regulation Order applies to Co. Dublin but not to Dublin City, to Co. Cork and Co. Kerry but not in Cork city;

• One set of rules applies to hair salons in Cork, with another for Dublin, Dun Laoghaire and Bray. But there are no rules at all for the rest of the country;

• The Retail Employment Regulation Order applies to any shop that sells food items, but not to those that sell only bread, cakes, buns or beef, unless the beef is pressed. It applies to tobacconists but not off-licences;

• The Catering Order applies to pubs in some parts of the country but not others and only to those that sell food as well alcohol;

• Tailors, dressmakers and shirtmakers have different rates of pay;

• The minimum rate for cutting a man’s hair is 6c an hour less than for cutting a woman’s hair, but a unisex hairdresser gets the male rate for all customers.

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