7 November 2002 Edition
Job creation costs - coalition don't care
Minister favours "prestigious jobs" over Irish ones
BY ROBBIE MacGABHANN
Nineteen task forces on jobs since 1997, but what did they cost? What did they achieve? What were the benefits? Well if you ask the Fianna Fáil/Progressive Democrat coalition the answer is 'we don't know and really don't care'.
€161 million was spent last year on job creation, but the cost of creating a new IDA job is nearly three times the cost of a new job created by one of the 35 County Enterprise boards in the 26 Counties. This might seem like cause for concern but not with this coalition government.
You would assume too that when it came to job creation it was in everyone's interest to ensure the best possible use of public money. Well think again. Questions raised by Sinn Féin in Leinster House this week by Arthur Morgan show no accountability as to how well public money is spent.
GOVERNMENT DON'T KNOW
Dealing with the 19 task forces created since 1997 by Mary Harney as minister for Enterprise, Trade and Employment, Morgan asked how much did these task forces cost and had any evaluation been done as to their effectiveness. The answer was that the government don't know how much they cost and have not undertaken any cost benefit evaluation but still believed that "they provided an effective co-ordinated response to major company closures".
Morgan also asked how much was spent on the IDA, Enterprise Ireland and the County Enterprise Boards by the Department of Enterprise Trade and Employment last year. In total, €161 million was spent: €74.4 million on the IDA, €69.4 million on Enterprise Ireland and over €14 million on the 35 enterprise boards.
The cost per new job in an IDA backed company was €13,375 in 2001. However, the cost of an Enterprise Ireland job was €8,977, over €4,000 cheaper but still way more costly than the €4,500 it took a County Enterprise Board to create a job.
Morgan said: "Surely now is the time to create a level playing pitch", calling for more funding to be directed towards the agencies that can clearly create jobs more cheaply.
Not so, according to Minister of State at the Department of Enterprise, Trade and Employment Frank Fahey, who did concede that "it is a fact, as the figures show, that the cost of job creation through IDA Ireland is more expensive than through Enterprise Ireland. That is because foreign investment is more expensive to attract. However, a significant number of prestigious jobs have been created".
Speaking to An Phoblacht, Morgan describes this as an incredible admission by Fahey. "How can the coalition justify spending millions on "prestigious jobs" while small firms are ignored when it comes to grants and expertise from government agencies?" he saked.
"Minister Fahey is clearly wearing blinkers, because he is failing to recognise the very significant contribution that indigenous industry is offering our economy. He is also being offensive and insulting to the people whose taxes pay his salary."
Morgan said "we need also to face up to the fact that the development agencies funded through the minister's department are only representative of a small fraction of total business in Ireland and that thousands of businesses employing over a million people are being overlooked when it comes to allocating funds".
Enterprise Ireland clients provide total employment of 148,116 people, while the IDA employment stands at 138,000 jobs. There are over 1.7 million people at work in the 26 Counties.
NEW JOB STRATEGY
Morgan believes that we need a new development strategy that includes all elements of the economy, not just the larger businesses. There is a pressing need, he believes, for a job creation strategy that will really tackle the government's erratic job creation record and provide more focused support for small businesses, especially those in the embryonic stage.
Morgan says that "the focus of activity needs to be on developing brands and funding the co-ordination of joint ventures to develop, produce and market products outside of Ireland. And at a time when thousands of CE jobs are being cut by the minister there is an urgent need for supporting social economy enterprises that play a vital role in local economies".
Morgan also pointed to figures released by Forfas earlier this year that show international investment fell by 60% in the 26 Counties in 2001, compared to an international average of 56%. He said: "It is clear then that despite the plaudits being given to the IDA's job creation strategies, they are actually performing below average internationally when it comes to job creation."
This issue will not end here and Morgan, Sinn Féin's spokesperson on Enterprise, Trade and Employment, has promised to hound the coalition to get a more efficient and effective job creation strategy. "This week we laid down a marker and showed our intent," he said.