Irish media sustains distorting politics of jobs spin
Fine Gael this week effectively acknowledged that Enda Kenny, taoiseach, lied in January 2015 when he reported a false total for recession job losses (see below). On Wednesday the Government's jobs publicity machine generated 30 reports in the Irish media on announcements of up to 1,500 jobs that maybe created in 5 years (no company will guarantee what payroll it would have in 5 years) while also Wednesday in the Dáil, two Opposition spokespersons put questions to Richard Bruton, jobs and enterprise minister, on jobs targets and the politics of jobs spin. The proceedings in which Bruton trashed the credibility of Department of Finance economists, generated 1 media report (same report in 2 outlets).
Score: Government's pre-election jobs publicity machine 30 media reports online; Dáil discussion on jobs 1.
The Journal reports that Alan Kelly, environment minister, described Wednesday as a “red-letter day” and “game-changer” for Nenagh. RTÉ in a 700-word piece on the government announcements, said US firm First Data, which is to open what is termed a 300-job ' research and development centre' in Nenagh, was "the most significant day for the town in 30 years," according to Kelly — God bless America for their ready-made jobs that requires little vision from Irish politicians.
'Cork wakes up to news that cloud player Netigate is to create 45 jobs' was a Wednesday headline in Silicon Republic; 'Swedish online survey firm Netigate to create 45 jobs in Cork' reported the Irish Times; 'New year cheer as more than 1000 jobs to be created' was the headline in the Irish Independent.
'Cork wakes up to...45 jobs' — this is news?
Newstalk, the radio broadcaster, posted a 140 word report on Wednesday's Dáil questions on jobs to Richard Bruton and the same post is on the website of Kfm radio.
Bruton in the Dáil in effect suggested as in the times of Bertie Ahern, ministers have their own targets and it's irrelevant that the Department of Finance is forecasting higher levels of unemployment. After all in 2012, "the Department of Finance forecasted that unemployment this year would be 11.6%. We have comfortably beaten that because of the ambition we have set and the implementation that we have delivered."
Some 135,000 jobs have been added in 3 years because of Bruton's "ambition" and what he calls "the implementation that we have delivered."
70,000 people "who we now believe can be attracted to come home" are included in his guesses.
From the Dáil transcript below of answers to questions from Peadar Tóibín TD of Sinn Féin and Dara Calleary of Fianna Fáil, using data recently highlighted by Finfacts, Bruton responds:
"We have not changed the job targets in any way" — Kenny, January 2015: “Our goal is that all of the 250,000 jobs that were lost during the recession will be able to be restored and that’s why, at the suggestion of both myself and the Tánaiste, Cabinet agreed to bring forward plans from 2020 to be implemented by 2018 to achieve full employment” — the 250,000 total was bogus as the Department of the Taoiseach acknowledged to Finfacts in January 2015 (see copy email below) and Fine Gael also acknowledges that 55,000 jobs were ignored to produce a dodgy target (see image below). Kenny restored the full-employment target to 2020 in December 2015, presumably after discussing the issue with Bruton. The Department of Finance's forecasted unemployment rate published on the announcement of Budget 2016 in October 2015 was an unemployment rate of 7.2% in 2018 (see Page 19 here) while the Kenny/ Bruton rate for 2018 was a rate of 6% as full-employment (compared with actual full-employment in Germany at 4.5%). Changing the year for a target is not changing the target in any way? — Richard Bruton should find George Orwell's celebrated 1946 essay, 'Politics and the English Language,' interesting.
"The Deputy again refuses to recognise what every international publication has recognised — that Ireland has improved its competitive position consistently. Forbes magazine recently listed Ireland as the best place to do business in the world, at No. 1 globally" — this is a lie: 'Doing Business 2016,' the World Bank's flagship comparisons of 189 economies shows Ireland at 17 rank in its latest assessment, down from 8 in 2008. Several other leading international competitiveness rankings put Ireland below the ranking in 2008:
The struggling Forbes magazine listed Ireland at no. 4 in 2015 but it's best countries for business ranking are not widely reported or taken seriously.
"The Deputy is simply wrong about activation schemes. Many of these schemes have nothing to do with the CSO's record of people at work. Some of them do, such as back-to-work enterprise" — Wrong again: At end of November, there were 81,000 in such schemes — 58,000 unemployed are in the employment figures and 23,000 unemployed in education courses.
"Ireland's performance in our export markets has exceeded that of any other European state" — this is a spurious statistic as about half the headline value of exports is fake: Double Irish exports (Google books about 40% of its global revenues in Ireland); overseas contract manufacturing booked as Irish exports and profit-shifting via transfer pricing. However, as regards jobs, exporting jobs are down:
Jobs lost during the recession were either 250,000 or over 300,000!
Jan 2015: Kenny says 250,000 jobs lost in 3 years; Jan 2016: Fine Gael says 300,000
The obsession of Richard Bruton with publicity on jobs means that his record on policy making is very poor. There is no long-term vision and Ireland is as dependent on American exporting jobs as it was in 1990. The indigenous exporting record is as bad as Greece's and last month Bruton's Department published what it called an "innovation strategy" but it was in reality a wish-list with no reference to Ireland's poor patenting record.
The OECD says the skills of much of the Irish workforce is poor (lower part of page) and two years ago the organisation recommended sunset clauses for Irish enterprise and innovation supports — Bruton wants 70,000 Irish emigrants to return to fill the skills gap and the failures of public training policies from AnCo, FÁS, and now SOLUS, will endure.
Pic on top: Taoiseach, tánaiste and ministers Bruton, English and Nash at a Kerry Group building, 18, Jan, 2016
Deputy Peadar Tóibín asked the Minister for Jobs, Enterprise and Innovation given the high level of job activation and high levels of unemployment, the steps he will take to create more jobs in the economy.
Deputy Peadar Tóibín: Every job that is created is good news, and we welcome the improved figures. However, we must examine the situation honestly. Ireland is still suffering from an unemployment crisis, with 81,000 people on job activation schemes, 106,000 people who are under-employed and 147,000 people having emigrated. If one looks at all of the figures, the truth is that the Government has not yet made a dent in the unemployment crisis in this country.
Minister for Jobs, Enterprise and Innovation (Deputy Richard Bruton): Deputy Tóibin fails to recognise what the Central Statistics Office, CSO, has confirmed on each occasion it has published statistics in this area.
Unemployment, which peaked at 15.1%, is now down to 8.8% and is falling continuously. Under-employment has fallen by 33% in the last two years and is reducing rapidly. From the outset, our goal has been to shift an economy that became too reliant on the construction sector, which collapsed in a property bubble, by rebuilding it based on a solid foundation of sectors across all areas of enterprise based on innovation and exporting. That has been highly successful.
There are 135,800 people back at work. In the first three quarters of last year 43,400 new jobs were created, which is well ahead of our ambitious target of 40,000 for the entire year. The rate of growth of employment in the Irish economy is 2.9% on an annual basis. That is far faster than the rate in any other European country. We are making progress but I am the first to recognise that we must make more progress in reducing further the rate of unemployment and the rate of migration and in seeing people returning to work in Ireland. The Action Plan for Jobs 2016 is focused on that. It is a decisive shift from the first phase, which was recovery from a crisis economy. We set a target of 100,000 people back at work and we have comfortably exceeded that before the 2016 deadline. We are now entering a new phase where we have doubled the target by setting a target of 200,000 extra people back at work. This phase is all about implementing the medium-term plan that we set out in Enterprise 2025 and Innovation 2020. We have a strong record built on entrepreneurship, the regional enterprise plans and the innovation strategy. We will continue to work on delivering that.
Deputy Peadar Tóibín: Let us look at the figures more closely. The Minister says 135,000 jobs have been created, but he takes the base year as 2012. The Government took office in 2011. In that period, supposedly 120,000 jobs have been created. In the same period of time, the number on activation courses has jumped from 50,000 to 80,000. Of the 120,000 is it safe to assume that 30,000 are activation jobs or schemes, in other words not fully waged jobs? That brings the figure down to 90,000 in that period of time. The truth is that, thankfully, there are strong external tail-winds helping this country along at present. Quantitative easing, exchange rates, interest rates, oil prices and so forth are all helping this economy. However, the internal competitive advantages which the Government should be putting in place to ensure there is a sustainable economy into the future have not been put in place, unfortunately. The truth is that the singular competitive advantage that this Government seeks is a bargain basement corporation tax.
Deputy Richard Bruton: The Deputy again refuses to recognise what every international publication has recognised - that Ireland has improved its competitive position consistently. Forbes magazine recently listed Ireland as the best place to do business in the world, at No. 1 globally. All of the various competition rankings show Ireland consistently improving its placing and, importantly, in areas that matter, such as skills, innovation and technology, where we have targeted improvements. The Deputy is correct that we cannot take recovery for granted and that there are international pressures which could change it. That is the reason our focus is relentlessly on building a strong enterprise base, strengthening our innovation and expanding the number of countries to which we export and the range of goods and services we export. That is what builds a robust base to be strong in the face of any changes.
The Deputy is simply wrong about activation schemes. Many of these schemes have nothing to do with the CSO's record of people at work. Some of them do, such as back-to-work enterprise. There has been an increase in the number of people who are setting up their own enterprises on returning from the social welfare code. That is to be welcomed. Overall, however, with regard to the number of extra people who might be on schemes, there are 8,500 more people on schemes than when we launched the Action Plan for Jobs. Over 93% of the jobs are real jobs in the private sector. The vast majority are full-time jobs with good conditions.
Deputy Peadar Tóibín: The waters are muddied to a certain extent with regard to these figures and much of the truth is hidden. However, if one adds the numbers of people who are under-employed, on activation schemes and who have been forced to emigrate, the total amounts to approximately 334,000. If one then adds the number of people who are on the live register, one reaches a total of 662,000 people. Those 662,000 people are the collateral damage of this Government's economic policy with regard to jobs. That is a very large section of the population. It is approximately a quarter of the labour force in the State. I urge the Government, in the dying days of its term of office, to put down real competitive advantages. That means investing in roads and rail so people can move around the country or move products around it. It should invest in telecommunications and broadband, the transportation system and in education and health, which have been divested from massively by this Government. However, the Government's plan, according to the spring budget, is to reduce Government investment from 1.8% of GDP to 1.5%, which is the lowest rate in Europe. This Government's ambition is to have the lowest investment in Europe. It is considered that 4% is necessary just to maintain the capital stock from depreciation. How will we have competitive infrastructure in the State at that level of Government divestment?
Deputy Richard Bruton: Ireland's performance in our export markets has exceeded that of any other European state.
Deputy Peadar Tóibín: Take out foreign direct investment.
Deputy Richard Bruton: We are growing more rapidly than any other European state. Net migration, which was mentioned by the Deputy, is down by 66%. Involuntary under-employment is down by 34% while unemployment is down by 40%.
Deputy Peadar Tóibín: That is since 2011.
Deputy Richard Bruton: These figures are all consistently going in the right direction. We have published the 2016 Action Plan for Jobs and a medium-term strategy that will ensure we copperfasten those competitive advantages and build on them for the future to have 200,000 extra people at work. That is the impact we will make if we stick to the policies we are pursuing. They have a track record which is there to be seen if one is fair-minded in one's evaluation of them.
Deputy Dara Calleary asked the Minister for Jobs, Enterprise and Innovation why the Government’s timeline for job targets has been extended to 2020 from what was previously declared by the Taoiseach in January 2015; and if he will make a statement on the matter.
Deputy Dara Calleary: When it comes to facts the Taoiseach is about as reliable as the Irish weather. He changed completely the goalposts in regard to job creation targets conveniently enough during the Christmas break, in the hope that nobody would notice. He says that full employment, which the Minister defines at 6%, will be achieved by 2020 instead of 2018. Will the Minister outline the background to that change? Will he also clarify why the Government agreed that 6% would be regarded as full employment?
Deputy Richard Bruton: This week we launched the fifth Action Plan for Jobs. A key objective of the Action Plan for Jobs process has been to rebuild our economy based on enterprise and entrepreneurship, talent, innovation and exports and provide a solid foundation for future growth. The Action Plan is a to-do list for the economy - a to-do list for the whole of Government. Most importantly it publically commits to exact timetables for delivery with the Department of the Taoiseach together with my Department overseeing and driving implementation and publishing a delivery record each quarter for all to see. It is because of these structures and this approach that the OECD in its review of the APJ in 2014 said it: "marks an important innovation in Irish governance." When we launched the first Action Plan for Jobs in 2012, we set ourselves the target of creating 100,000 extra jobs by 2016, which we surpassed a year and a half ahead of schedule. Therefore, when we launched the 2015 action plan last January, we set a new target to have 2.1 million people in employment by 2018. That target has not changed and is one of the five strategic ambitions we have committed to in the 2016 plan.
In November 2015, we published Enterprise 2025, the ten-year jobs and enterprise strategy which provides the roadmap to build a sustainable economy and have 2.18 million people at work by 2020, an additional 80,000. This would mean more people at work than at any time in the history of the State. We now have the ambition of bringing home 70,000 of the emigrants who were forced to leave due to the crash caused by the policies pursued by the last Government.
The Action Plan for Jobs complements the Government’s Pathways to Work which sets out actions to be taken in support of those who are currently unemployed to help them access the labour market and new job opportunities. Last week, the Tánaiste and Minister for Social Protection published the new Pathways to Work strategy for the period to 2020. Our Departments will continue to build on the progress to date through the Action Plan for Jobs and Pathways to Work to ensure that more employment opportunities are available to those who are seeking work and, therefore, reducing unemployment.
Deputy Dara Calleary: The Taoiseach said that the 6% would be achieved by 2018.
Why is it that in other economies, such as Germany, 4.5% is regarded as full employment whereas we are going for the higher rate?
The Minister has not outlined the reason for the change or why the targets are being pushed back. The Department of Finance indicated in October that we would not achieve a 6.4% rate in 2020 or a 6.2% rate in 2021. The Minister can talk about action plans for jobs and targets and everything the OECD says but this represents a serious shift in the goalposts.
It is true that emigration happened. The amount of emigration that happened is equivalent to another 6% on top of the unemployment rate. Even bringing those people back and giving them the opportunity to come back into employment does not account for the shift in the goalposts that has occurred.
Deputy Richard Bruton: The Deputy should understand that what we can influence is the number of jobs that are created. That is the central target we have always set ourselves. It was a target of 100,000 and it is now a 200,000 target. Obviously, projecting the impact that has on the number of unemployed will depend on a number of factors that are less easy for a government to predict exactly because they include the flow of inward and outward migration, a natural increase in the labour force and so on. Essentially, we are predicting and building our targets around a growth of 10% in the total number at work. We envisage that a significant part of that will impact on those who are out of work and that has been the record in recent years. That ten points will be spread between reducing the 8.8% rate below 6% as well as accommodating 70,000 people who we now believe can be attracted to come home.
We have not changed the job targets in any way but I suppose we are being a little more conservative in terms of when the 6% rate will be reached. That is part of official forecasting.
I remind the Deputy that when I launched the Action Plan for Jobs and forecasted 100,000 extra jobs, the Department of Finance forecasted that unemployment this year would be 11.6%. We have comfortably beaten that because of the ambition we have set and the implementation that we have delivered.
Deputy Dara Calleary: I welcome that the Minister's ambition is better than that of the Department of Finance. However, can the Minister explain why he is focusing on 6% versus 4.5% in Germany? As Deputy Tóibín has said, the reality is that we still have 88,000 people on activation schemes. We still have another 100,000 part-time workers who are seeking full-time employment and who are in receipt of a payment. We have many people abroad but if they were here, they would be part of that figure. The Minister has dismissed the activation schemes somewhat as not forming part of the jobs plan but most of those 88,000 people are looking for full-time employment. If they are not feeding in to the labour market or providing opportunities for the labour market, then it is an issue the Tánaiste needs to address. As long as the Government continues to exclude them from the overall figures, there is something seriously flawed with our unemployment model.
Deputy Richard Bruton: Let us consider the Irish economy other than in the period when it was overheating. Full employment was in the range of 5% to 6%. That is where we aim to get to by 2020. However, one of our key ambitions is that it will be a sustainable level of full employment and that the economy will not be subject to the buffeting that happened when we were reliant on the construction sector to get to those low rates.
We want to build a strong economy. The Minister for Social Protection set out a number of successful programmes that have delivered more people from the unemployment numbers. Let us consider the fall in the unemployment rate. It has consistently outperformed forecasts because we have been successful in getting people from the live register onto work schemes. In 2015, the year gone by, 135,000 people left the live register to take up work. That is a strong performance. As a proportion of those unemployed, that is the highest in five years, with some 42% leaving the live register to take up work. Strategies such as Pathways to Work are impacting on the live register and we aim to continue and improve them.