Tuesday, February 14, 2012

Jobs Action Plan deeply flawed

At the start of the week the Taoiseach finally launched his ‘Jobs Action Plan’. Today this blog asked the Taoiseach to specify clearly the number of citizens he expects this plan will have taken off the live register by March, or June or September or by year’s end?

He couldn’t answer the question. Why? Because the Taoiseach’s ‘Plan’ contains no new money to create jobs, and no meaningful targets to judge it by or to aim for.

While I welcome the Governments renewed focus on the Jobs crisis and the Taoiseach’s decision to take personal responsibility for delivering on this plan, there is a serious flaw in the government’s approach to tackling the economic crisis and in particular the creation of jobs.

This is because the government is locked into an austerity programme that is about cutting jobs and funding from the public sector, and is driving down growth through stealth taxes.

Since the Government came to power a year ago there has been a consistent increase in the number of citizens on the live register in county Louth. In January this figure reached 17,775.

There has also been a slight increase in the number of under 25s on the live register in recent months.

This figure would have been much worse but for the 6,000 citizens, mainly young people, who are immigrating each month across the state, including from Louth.

Across the state there are 440,000 people on the Live Register. 200,000 people (an increase in 14.5% over the year) have been unemployed for a year or more.

Business insolvency has increased with over 1640 businesses going under in the last year. This an increase in 7% over the year. These companies leave behind €1.1 billion in debt.

The government’s response to this has been to cut, cut and cut. In 2009 Enterprise Ireland received €359.49 million. This year its budget has been reduced to €307.8 million - a reduction of 14.3% over four years.

In 2009 City and County Enterprise Boards received €21.67 million. This year they are set to receive €15 million - a reduction of 30% over four years.

The IDAs funding has been cut by €10 million from last years budget.

It should also be remembered that although Foreign Direct Investment is important, over 72% of our employment is in small and micro sized industries.

The total amount invested by the government in the IDA, Enterprise Ireland and Enterprise Boards for this year will be less than half a billion euro.

In stark contrast next month the Anglo Irish Promissory note will cost the people of this state €3.1 billion.

This is the contradiction at the heart of the government’s approach to this jobs crisis. You cannot stick to austerity policies, which are further depressing the economy, pushing down growth and restricting its ability to stimulate the economy, while also claiming to have a meaningful policy to create jobs! It won’t work.

The government is also engaging in smoke and mirrors by producing job plans that it has launched before – some of them several times. For example, the government has again launched a Micro Finance Loan Fund. This is a much needed initiative but it has been announced now on four occasions and is still not operational after a year.

It is worth noting that the EU PROGRESS MICRO ENTERPRISE Fund has been running since June and Business can avail of up to €25k. The overall programme is worth €200million. This programme needs a sponsor in this state i.e. bank or the credit union sector. The Government has yet to put this in place.

The same approach has been taken by the government to the ‘Temporary Partial Credit Guarantee Scheme’. This too has now been announced four times and is still not operational.

What is needed is a different economic strategy which puts citizens first and invests in jobs and growth. In our pre-budget submission Sinn Féin set out a €3.5 billion package of new measures to close the deficit in 2012. In addition we have proposed a €7billion jobs stimulus package and a €596 million household stimulus package.

It focussed on job creation, on non-deflationary taxes for those who can afford them, on slashing public spending waste instead of frontline services, and on placing the needs of the Irish people above the needs of banks and bondholders.

This is a costed route by which the economy of this state can be put back on track without imposing hardship on low and middle income families.”

1 comment:

Timothy Dougherty said...

Hello Gerry,
So good "What is needed is a different economic strategy which puts citizens first and invests in jobs and growth." That is the simple facts of life. You can't butcher the Cow to feed the banks, and still have milk to feed the family. I wonder what this government is doing, you can't just try to do a good job, you have to do a good job. You just do not throw away the future for so many people. I know Sinn Féin has it right, good to have a responsible voice now at the Taoiseach.