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Competitiveness report highlights Government's failures and 'crazy privatisation fetish' - Morgan

11 October, 2006


Sinn Féin's Enterprise and Employment spokesperson Arthur Morgan TD commenting on the National Competitiveness Council's annual report Benchmarking Ireland's Performance said that the report highlighted a number of significant government failures that were damaging the state's competitiveness. He went on to say the report once again highlighted the unsustainable dependence of the economy on the construction sector.

The Louth TD said: "The National Competitiveness Council's' annual report Benchmarking Ireland's Performance published yesterday highlights some worrying economic developments and a number of significant government failures.

"In particular it highlights the ongoing decline of the manufacturing sector, a shift to consumption and construction as the drivers of the economy and a sharp rise in business and household indebtedness. The ESRI and the IMF have also warned in recent times of the reliance of the economy on the construction sector.

"The Government relies very heavily on revenue from taxes both on consumption and construction. The tax base has narrowed through various changes to the tax system over recent years --in the event of a slowdown in construction and/or consumption the Government will face a severe contraction in revenue flowing into the exchequer and will not be able to address the many infrastructural and public service deficiencies highlighted by this report.

"The Government has demonstrated a failure to understand the wide variety of factors that impact upon state competitiveness and has relied on an unsustainable and inadequate short term strategy of lowering corporation tax.

"This report again highlights particular failures including infrastructure deficiencies, low levels of research and development, low ratios of computers to students in secondary schools and underdeveloped pre-primary, post-graduate and adult education systems.

"The Competitiveness Council's report notes that the state has experienced a loss of international price competitiveness. The Government has played a role in this. In another example of the Government's crazy privatisation fetish ESB electricity prices have been pushed up to make that sector attractive to competitors which the Government is seeking to bring in. The madness of pushing up prices to bring in competition to reduce prices is self evident."

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