asked the Minister for Industry and Commerce if he will make a statement on the achievement of job creation targets as set out in the Programme for National Recovery, in so far as they affect the agencies under his control; in particular, whether the announcement that the IDA expect 20,000 new jobs to be created this year refers only to net new jobs; if not, the number of offsetting job losses expected in 1988; and if he will make a statement on the matter.

22.

asked the Minister for Industry and Commerce the number of new jobs created during 1987 with the assistance of the IDA and SFADCo; the number of jobs expected to be created with the assistance of these agencies during 1988; and if he will make a statement on the matter.

I propose to take Questions Nos. 34 and 22 together. I understand that, on the basis of information provided by the State industrial promotion agencies, a total of approximately 16,000 jobs were created in manufacturing industry, including international services, in 1987.

The Programme for National Recovery specifies as an objective of policy for the manufacturing and international services sectors the creation of 20,000 extra jobs on average per year over the next ten years, the actual provision accelerating as the programme's policies take effect. In relation to job losses, the programme clearly says that the offsetting trend in job losses in these sectors cannot be foreseen accurately but the more competitive economic climate and the greater attention given to the indigenous sector will make existing jobs more secure.

In the joint Government-ICTU statement on job creation developments under the Programme for National Recovery released last Friday, comprehensive details were provided of the progress achieved to date. As regards the State industrial promotion agencies operating under my aegis, surveys carried out by them estimate that of the order of 4,000 new jobs were created during the first quarter of 1988. Some 240 project start-ups have been recorded across the overseas, indigenous and small industry sectors during the first quarter of the year and some examples are listed in the joint statement.

There was a good build-up in the overseas company pipeline in the later part of 1987 and this momentum has been maintained since. This reflects the new marketing strategy put in place in the Far East, a pick-up in the electronics sector and international services activity in North America and the impact of the new Financial Services Programme. The IDA have targeted a 20 per cent increase in new job creation by overseas firms over the period of the programme and are confident based on current trends of their ability to achieve this.

The industrial job creation position has been helped by improved investment confidence as a result of the economic and fiscal measures taken by the Government under the programme and the associated dramatic fall in interest rates and inflation.

I am satisfied that the overall job creation targets for the manufacturing and international services sectors specified in the programme can be realised.

Could I prevail on the Minister for a degree of clarity, if not a degree of honesty, in relation to the responses he is giving on this topic? While the Minister says that 16,000 jobs were created in 1987, surely he must also recognise that 12,000 redundancies took place in the manufacturing sector? Even if the Government are 100 per cent successful in 1988 in relation to their 20,000 job target, will the Minister accept the figures given recently by the ESRI that at least 13,000 jobs will go this year so that even if they are 100 per cent successful we are only talking about a net job creation of 7,000?

The problem in regard to job losses was to get to the root of the cause of the jobs being lost. One of the basic reasons was the uncompetitiveness of Irish industry, the high cost of money, inflation rates and various other factors. The objective of Government policy was to reduce interest rates which it has done by approximately 6.5 percentage points since we came to office. If one takes into account that the borrowing of the whole business sector in Ireland is approximately £6 billion, for every 1 per cent reduction in interest rates there is a corresponding relief to the whole business sector and the whole investment sector of £60 million. In effect, we are talking about £360 million and the other half, when it finds its way through, makes it £390 million in relief. That, in turn, has to make industry more competitive and will provide opportunities for investment.

In the manufacturing sector alone the borrowings were £1.5 million. Therefore, any relief in interest rates is a definite improvement which will give people confidence to invest again. The negative factors that were there and were causing job losses are being gradually taken out of the way. Already the inflation rate in Ireland is below the average of the EC and that restores a competitive advantage to Irish exports in relation to the UK market, the traditional market for quite a number of Irish companies. In that regard we can see a slow return back to competitiveness for Irish industry which is a firmer foundation on which to build our industry for the future.

I wish I could accept what the Minister is saying in that bold statement about being back to creating a climate, but even with the climate creation which is going on at present, with the massive deflation taking place and the massive reduction in the public capital programme, how does the Minister reconcile all the statements he is making with the fact that at least 13,000 jobs will be vanishing out of the Irish economy in the manufacturing sector this year?

I have carried out a survey for the first quarter of this year, and just in excess of 4,000 jobs are created on the ground. I compare that with the notification of redundancies to the Department of Labour.

At 7,000.

Seven thousand across all sectors. I am talking about the manufacturing sector.

It is 5,000 in manufacturing.

Compare like with like. It is 7,000 across all sectors of business. In relation to the manufacturing sector it is just on 3,000 which means in effect that for the first quarter this year we are 1,000 ahead.

There are two remaining questions nominated for priority which I am anxious to dispose of within the prescribed time.