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Fianna Fail Party Meeting Press Release
Monday, 15th September 2008

A Chairde, I would like to welcome you all to this year's Parliamentary Party Conference. Most of you will know Galway for its strong Fianna Fáil tradition and for the welcome which is always extended to us here in the City of the Tribes. The next two days allow us an opportunity to focus our energies and renew our vigour on planning the Dail session ahead and to Charting Ireland's Future in the years ahead. We've identified key challenges and opportunities - there's no great shortage of them at the moment and we've a strong panel of speakers to join us in our discussions. This morning we'll focus on the economy. It's important, when things are as difficult as they are and when the reasons are as numerous and as complex as they are, that we do everything possible to maintain confidence and sustain investment at this difficult time. This afternoon we will look at our place in Europe in the aftermath of the rejection of the Lisbon Treaty. It is increasingly obvious to me that our economic difficulties and the political dilemma posed by the Lisbon Treaty are linked. We failed to address some people's genuinely held concerns and we failed to get the message through that a rejection of the Treaty could exacerbate the already tough economic situation we find ourselves in. We need to address these failings in getting more of the people to see the imperative for Ireland to be fully engaged with our partners in the European Union. Tomorrow we will talk about the health service and we will review our preparations for the Local and European elections next year. There have been many changes since we met last year. We send our best wishes to Bertie Ahern. His leadership of this party has won massive recognition from political friend and foe alike and from most sections of the media - no small feat in today's Ireland. It is poignant that we're in Galway having suffered the loss of Seamus Brennan, one of this city's most distinguished native sons. From this annual gathering of his parliamentary family we send our best wishes to his wife Ann and her family. As a General Secretary of the Party, a public representative, and a Minister, he played a massive role in making the modern Fianna Fáil party what it is today. As we head into the next Parliamentary term, I want to say how much I appreciate everyone in the Party working together to address the challenges we now face. I want to give emphasis to this point because we cannot allow anything to shift our focus away from providing the Irish people with the best, the strongest and the clearest leadership possible as our society faces into great challenges in the months and years ahead. Economy The greatest challenge right now is to manage the economy through the international downturn we are already experiencing and which is likely to continue for some time yet. There has been a rapid slowdown in the global economy arising from turbulence in global financial markets and the credit squeeze, faltering economic growth in the major economies, exchange rate shifts and the sharp rise in oil prices. No one yet knows what the full extent of these adverse developments will be or how quickly stability can be restored to the financial and equity markets worldwide. As we've seen only this morning, the continuing crisis in the global banking sector adds greatly to the complexity of the problems we face. These are unprecedented times in that respect. The facts are simple. We're an open economy. We depend on exports as a major driver of our economic success. This inevitably means that our exposure to these international factors is greater than for a good number of other countries. Some domestic factors are also at play. At home, we've had a rapid slowdown in the housing market. House prices and rents are becoming lower and more affordable. However, the abrupt nature of the slow-down has had a dramatic effect on tax revenues such that Government has considerably less to spend. There is no doubt - in keeping with most in the western world - that our economy faces much tougher times. Regrettably, but not surprisingly given the overall situation, unemployment is rising as well, although from a lower base than was the case in previous times of economic difficulty. The current outlook must be seen in the context of what we have built in Ireland over the past 20 years. The Irish people have, through their talent, their flair and their application, established an economic platform which would have been unimaginable two decades ago. Some argue that we have not made enough of this success. I disagree and more importantly I believe most Irish people disagree. Through the strong political leadership of Fianna Fáil led governments, the benefits of that national effort and the economic value realized from those better times has, in large measure, been put to excellent use in building a country with a modern infrastructure that is well equipped to meet the more difficult times ahead. What I'm acknowledging here is the success of the people of Ireland. What the Irish people have done by their own efforts, has set us up for whatever the future will hold. We provided the political stewardship. I believe that the people will respond through the more challenging economic and general societal times that lie ahead. I am also sure that the people want us to navigate these choppy waters over the months and years ahead. As a nation we have invested wisely in schools, roads, public transport, communications and housing, giving us one of the highest rates of public investment in Europe. We have dramatically increased the State pension for our elderly, child benefit for our families with young children and we have significantly reduced the tax burden, particularly for the lower paid and those on average incomes. We have increased the number of Gardaí, teachers, doctors and nurses serving our people. At the same time, we halved the national debt since 1997 and there are now more than two million people working in the country despite a sharp rise in unemployment during the past year. Our first priority must be to protect that progress - which was hard won by the citizens through their efforts - to the greatest extent possible. While the current circumstances are very difficult, I want a clear message going out from this conference - that we're determined to chart Ireland's future through these uncertain economic times and we'll take any and all decisive action necessary in the period ahead. No one should underestimate the scale of the challenge that faces us. We are in new economic territory. No one should think that it will be easy to overcome and no one should think that any politician, any economist or any leading figure in business has the easy solution. This is far too serious to simply be a political challenge, a political battle to be won. Our job is to plot the right course and to recommend and encourage the active participation of all stakeholders in our society in pursuing that course in order to restore a positive economic climate. In recent months we have been analysing the new economic situation that has emerged. We have been hit by a confluence of significant economic woes, some local and some international, and we needed to understand them and assess what they mean for Ireland. Facile analysis won't provide any good solutions. The credit crisis continues to unleash havoc in industries and countries right the way across the world. The very existence of some of the biggest names in global financial services is now under threat. This is a storm beyond the initial expectations of policymakers everywhere and its effects are being felt in homes and businesses the world over. Hindsight is a wonderful gift but it is a mythical one. You can only make choices on the basis of the best information available to you at a point in time. The government will have to take tough decisions because of the economic slowdown. No politician likes doing so but we are not going to try to buy short-term popularity and put at risk all the gains of the past decade. By taking the right decisions, we will actively protect the interests of all the people of Ireland now and also be ready to benefit from any economic upturn when it comes. The economic rationale for the decision to bring forward the Budget to October 14th was to provide confidence to both investors and the taxpayer with a view to providing a solid basis for economic recovery whenever world economic conditions improve. There are three major elements to the work being undertaken in preparing the Budget for the situation that we now face:- 1. All Ministers are undertaking a careful and detailed assessment of all expenditure within the Estimates process to ensure that we spend the public money that we do have, effectively and efficiently. Put simply, we don't have as much money coming in as we had before and we must spend less. It's imperative that we spend it to absolutely best effect in the context of the slowdown and prioritise what needs to be done in order to help fuel better economic growth in the future. That work will continue in the coming weeks. 2. We are reviewing our capital investment programmes in areas such as schools, housing, roads and public transport projects and we will be prioritizing those projects that will help make the economy more competitive and will help us to grow. This will help provide employment, assist industry and enhance the competitiveness of the economy. There is an opportunity in more difficult times to get better value for money through more competitive tendering for state projects. We must get more for less. 3. We will seek to assist Irish businesses in the more difficult economic climate in which they are operating. We need to do so in the interest of maintaining the maximum number of jobs possible in the present circumstances. There is continuing investor confidence but it is not as robust as in the past and we have to ensure that interest is maintained by making the right decisions and actively promoting the country. In the last few weeks, I have met with the Chairman and CEO of IDA Ireland. I was pleased to hear that, last year, 114 investment projects were approved which represents a total of more than 2.3 billion euro of future capital investment secured. One-third of the investment came from non-US corporations and 45 of the new projects were research and development investments. IDA Ireland expect to secure an even higher number of projects this year. Among those already announced to date are global brands such as Coca Cola, Pfizer, IBM, Citibank and Vistakon who collectively are investing almost half a billion euro in projects that will create hundreds of jobs. This clearly puts the lie to those who would have us believe that there is no investment happening currently. However, it is an ongoing challenge to remain competitive and win jobs when companies with mobile investment can choose between competing locations internationally where lower costs and skills availability are key factors in their decision making process.Where there have been job losses in the past, areas affected have bounced back over time because we stuck with the right strategies in promoting Ireland as a good investment location. Now, more than ever, we must ensure that we have the right mix of policies and supports to convince those in the boardrooms of the biggest and best international firms that Ireland is still a stable, competitive and profitable location in which to invest. And I want to assure you that we are being proactive on that front. Ministers are developing specific initiatives which will serve to protect Irish jobs by encouraging investment and economic activity and strengthening Ireland's competitiveness. In the indigenous sector also, there are tens of thousands of people around the country who are responding to the present economic challenge by seeking to contain their costs and protect their market share in the months ahead. People are fighting hard to maintain their position in the market placeâ" they are rolling up their sleeves and they are getting on with it. And that is exactly what the Government is engaged in as well. Developing a strong economy capable of sustained economic growth will be our objective and this is not simply a task of balancing the books. Government has a responsibility to use the next few weeks of the Budget process productively. It is not the purpose of today to outline what will be in the Budget. That is a matter for discussion and decision by the Government in the month ahead. But what I can say is that we will not countenance expanding public expenditure at a rate which the economy cannot afford. We will be mindful of the need to help businesses compete. It is also clear that if we want to maintain and improve people's incomes, the only sustainable way to do this is by increasing productivity. We acknowledge the sharp downturn in construction particularly in house building. However, the role of Government is not to artificially inflate house prices and we will not do so. The Government will help those eligible people who have negotiated a good price and wish to purchase a home but are being prevented from doing so due to unreasonable restriction of credit. The Government will consider a proposal in this regard at the cabinet meeting this week from the Minister for the Environment and Local Government, John Gormley TD. It is important to point out that the construction sector itself must act - like all other sectors of the economy - and it must do whatever it has to do in order to get the market moving again. We will help with the restructuring of the construction sector so that those who have difficulty finding work can re-skill and move into areas where there is a demand for services such as in large scale infrastructure projects but also in important niche areas such as improving household energy efficiency. Under the direction of the Tanaiste, Enterprise Ireland will provide a construction sector export service to assist companies and professionals to market their services abroad. In framing our economic strategy, we will pay attention to those who are most vulnerable and most dependent on public spending programmes, consistent with bringing forward a responsible budgetary framework and an assessment of what is sustainable in the current circumstances. As regards public sector reform, I expect to receive a series of action-points in respect of the OECD Review by the end of the month from a Task Force that I set up for that purpose - and Government will act on those recommendations. In summary, our task now is to focus on initiatives that will involve improving competitiveness and the attraction of inward investment, cuts in public expenditure, proceeding with public sector reform and measures to address up-skilling within the construction sector, as well as the removal of barriers to effective competition. These will assist in the adjustment that is taking place in the Irish economy and will increase productivity, which is the surest foundation for maintaining economic prosperity and providing the conditions for growth into the future. I do not want to mislead anyone by suggesting there will be no impact on individuals and groups arising from these necessary adjustments. I want to reiterate an earlier point. The achievements of the nineties and the first half of this decade came under the political stewardship of Fianna Fáil led governments. They are not, however, our achievements. They are the achievements of the nation; of men and women; young and old; citizens of long established Irish heritage and those who are new to our shores. They represent the achievements of a people who value education, innovation and hard work. People still believe in those things and that positive attitude and the spirit of enterprise and resilience are very important attributes that we have to demonstrate again in this present set of circumstances. Our job in Fianna Fáil is to provide the people with the necessary framework within which they can deliver success again, while contending with the challenges of the immediate couple of years ahead. This Party will pursue the establishment of the right context for economic recovery with the same determination in government that we gave in the past to tackling emigration, increasing employment and facilitating peace in Northern Ireland. We will work with our partners in Government to achieve that. The situation that has now emerged should be seen as bringing about a necessary turning point in the life of the nation. This phase in the economic cycle is temporary and will pass. We must remain confident and optimistic about our future. The present problems create the impetus for the creative destruction of wasteful and outmoded products and processes and their replacement with better alternatives. The opportunities presented now can create the basis for future prosperity. It is clear that we are witnessing extraordinary volatile times in the world capital markets and the exact extent of the impact of this volatility has yet to fully emerge. We will have to deal with whatever new issues come our way with determination and purpose. And we will do so in a considered fashion and to the very best of our ability. I can assure the Irish people that the action we will take and the process we are now engaged in represents the best way to set about protecting the country's achievements to date. We must do our duty as a Government in the long-term interests of the Irish people, whom we have the privilege to serve in these challenging times. Ends.

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