The Government and all of us share the aim of creating more jobs and resolving the unemployment crisis. It is the collective aim of the Deputies from every party in this House and the Independent Deputies. In the 2011 mini-budget, the Minister, Deputy Noonan, announced a reduction in the VAT rate from 13.5% to 9% as part of an initiative aimed at creating jobs in the hospitality industry. Various figures point to the success of this initiative. According to the Restaurants Association of Ireland, up to 9,000 new jobs have been created in that sector alone. The Central Statistics Office has confirmed that the level of employment in the employment, accommodation and food services sectors has increased by 13.3% since the introduction of the initiative. This equates to a net increase of 15,200 jobs in the overall hospitality and tourism industry. Everybody acknowledges that this initiative has worked. It has provided opportunities to 15,200 people who might otherwise still be on the live register or might have left the country like so many others. It has led to substantial savings in the social welfare bill and in other areas.

It is hard to believe in terms of this successful initiative that the rug is about to pulled from under an industry that is creating employment. Why would the Government consider reversing an initiative that has created so many jobs? As late as yesterday evening in this House, the Minister for Finance gave a very strong indication that he was considering its reversal. Somewhat bizarrely, he said that when he reduced the VAT rate, he had not received one representation calling on him to do so. He said it was all his own idea. I remind the House that the Government has promised to create 100,000 new jobs over its five year lifetime. During yesterday's debate, the Minister described the reduction in the VAT rate as a "pump-priming exercise". He went on to explain that notion:

The idea of pump-priming is that where something is weak, one gives it a break to make it stronger. However, when it is strong it should fend for itself.

The tourism and hospitality sector depends on the domestic economy as well as on visitors. While there are some very early green shoots, we know our domestic economy cannot be described as strong. I am asking the Minister for Public Expenditure and Reform why the Government is considering the reversal of an initiative that has created more than 15,000 extra jobs. If the Government increases the VAT rate, it will do serious damage to the value perception of our tourism industry, which is an area in which there can be further job creation.

I thank Deputy Calleary for his acknowledgement of the success of the initiative taken by the Government. We made the decision to reduce the VAT rate in this area within 100 days of coming to office, when we were facing an extraordinary financial situation with no flexibility at all. We determined that we would put together a €500 million stimulus package. As we did not want to dissipate that package at the time, we decided to focus the €500 million on the hospitality sector as it could have an immediate impact on job creation. The Deputy is right when he suggests that it has been a success. We now need to focus on many other sectors. It is clear from what is going on at this week's ploughing championships that there is a sense of positivity in the agriculture sector. Other sectors of the economy are also feeling an uplift because of Government policies. There is a certain irony in the Deputy's demand for this initiative to be prolonged now, given that he and his party denounced it at the time.

Yes.

Not only did they denounce the jobs stimulus plan that was announced before this Government had been in place for 100 days, but they also denounced the funding mechanism. Deputies will recall that it was funded by means of a levy on pension funds. One cannot welcome the result while denying the means.

It is a bit like the Government cutting child benefit.

I presume Deputy Calleary is belatedly acknowledging that the decision taken by the Government within 100 days of coming to office to focus on a sectoral job creation effort that has demonstrably created at least 15,000 additional jobs, as the Deputy has admitted, was the correct policy decision at that time. Obviously everything is on the agenda in the context of the forthcoming budget. We will make the right decisions in budget 2014, as we did within 100 days of coming to office. I have no doubt that Deputy Calleary will denounce those decisions, as he did at the start of our term.

That was a pitiful response.

I thank the Minister for not answering the question. We denounced the method of funding because the pension levy was imposed not only on rich pensioners, but also on small pensioners such as those in Tara Mines in Navan.

Hear, hear.

The very lowest paid pensioners had to pay. We did not denounce the initiative. Any initiative that creates jobs is welcome. I will not take a lecture from any Labour Party Minister on denouncing, given that party's record in opposition.

Ouch.

In August, Fáilte Ireland published a study for the Minister, Deputy Varadkar, and the Minister of State, Deputy Ring, which said that the jobs created by the measure equated "to a benefit to the Exchequer of circa €55 million" and further estimated "that the Exchequer’s tax take on the growth in spending by overseas visitors in 2012 was worth €40 million". The study also pointed out that "the tax foregone through the implementation of the rate reduction is below" what the Minister for Finance has been saying. The Minister for Finance has suggested that this initiative has cost more than he said it would. The Minister for Transport, Tourism and Sport has suggested that it has cost less than the Minister for Finance said it would. What is the Minister for Public Expenditure and Reform, who will be responsible for introducing the budget side of things, saying?

Is the Deputy in favour of the extension of this measure or against it?

I acknowledge that it has created jobs. We want to keep the jobs that have been created in domestically owned businesses in local communities throughout the country.

We are trying to make up for the 250,000 jobs that the Deputy's party got rid of.

Perhaps the Government will keep one promise.

This matter was brought to the floor of the House yesterday by Deputies Ann Phelan and Derek Nolan of the Labour Party and Deputy Brendan Griffin of Fine Gael because they wanted to maintain these 15,000 jobs. The Minister has an opportunity to make a similar commitment, as his backbenchers did last night.

The Minister for Finance did not take much notice of them.

Is the Government going to stick with the policy?

I ask the chorus to remain quiet while people are speaking.

We are being provoked, a Cheann Comhairle.

I assume the Chair is referring particularly to the Labour Party Deputy from Clare, who is getting nervous ahead of the match on Saturday night.

I thank Deputy Calleary for praising us more forcefully and convincingly than we could. He underscored the success of this Government's sectoral strategy, which he denounced early on in our term of office.

I did not denounce it.

Is the Government going to stick with it?

We are pursuing the creation and maintenance of jobs as the first priority of the Government, the first priority of the forthcoming budget-----

That means they are going to get rid of it.

-----and the first priority in all the decisions we will make for the remaining two and a half years of our term.

What about the 60 jobs in the Seanad?

We will focus on that as we have done. The success that Deputy Calleary has outlined, in relation to the tourism sector, will be continued. While I appreciate that the Deputy does not want to take lectures, the unavoidable truth is that the last two years of his party's term of office saw the collapse of 250,000 private sector jobs.

We are now creating 3,000 new private sector jobs net per month.

It is about to destroy the industry creating them.

The previous Government's strategy, which it pushed through this House, of cutting the minimum wage was the wrong one. Our strategy is not to have a low wage economy, to rush to the bottom and to think we can create jobs by pushing down people's basic wage. In the most difficult of economic times, we undid the damaging economic decision the previous Government took.

The Minister is over time.

In thanking the Deputy for his belated acknowledgment of the successful strategy being pursued by this Government, I can assure him that in the next budget we will continue to ensure that jobs continue to be created.