Leo Varadkar: Before you distribute wealth you have to work to create it

I know many people are struggling with the cost of living. We’re very lucky that we are in a position to respond as a government. Last week, Ministers Paschal Donohoe and Michael McGrath announced that we had recorded a budget surplus of €4 billion so far this year, and we’ll be in a position to give €6.7 billion back to you next year in the form of increased public spending on pay, services and infrastructure, pensions, welfare and lower taxes.

This does not include one-off measures that can make a real difference in your pockets later this year. Due to the strength of our public finances, we can stave off recession in Ireland as the world economy slows down and other countries’ economies go into retreat and deficit.

Few countries in the world are in such a strong position. It’s pertinent to ask why.

It’s quite remarkable to think that, despite all that has hit us in recent years – the banking crisis and bailout, Brexit and Covid – we now have more people employed in the state than ever before. Our youth unemployment rate is the lowest in Europe. People’s average incomes have never been higher, notwithstanding inflation. Our international trade is breaking all records.

The trend is continuing into this year. Last week, we announced record foreign direct investment (FDI) for the first six months of the year, with investment up by 9 per cent on last year, itself a record year. And it’s not just the IDA-supported multinationals. Irish-owned exporting firms, clients of Enterprise Ireland, now employ almost as many people as FDI firms operating here. And Irish SMEs employ more people than all of the IDA and Enterprise Ireland client companies combined across a diverse range of sectors.

This success did not happen by accident. We’ve worked hard to make Ireland a welcoming environment for trade and multinational investment and one that helps Irish companies start up, scale and even go global themselves.

Our formula has been to invest in talent and to welcome talent to our shores; a stable and competitive tax offering; political stability; a track-record; a pro-business environment; and our position at the heart of the European Union, advocating for more integration not less as a founding member of the euro, the single market and the Permanent Structured Cooperation (Pesco) and supporters of enlargement.

However, the twin forces which threatened our economic prosperity over the past few years, Covid and Brexit, haven’t gone away and we have a further set of challenges to contend with, which have potentially devastating consequences.

The global inflation crisis, Vladimir Putin’s war on Ukraine, increased global competition for investment, unfinished Brexit, climate disruption, and digital technology creating the impetus for rapid and transformational change, all come with huge risks, opportunities and real implications for the lives and livelihoods of families all over the country.

So this is definitely not a moment for self-praise or complacency.

We want Ireland to continue to be a place where people can aspire to have the career they want in all parts of the country. A job for everyone who wants one. Work that pays more with greater flexibility, and better terms and conditions. These are our objectives and what we must fight to protect.

I believe there are some opportunities, too, which we need to prepare for now, to make the most of them. The need to wean ourselves off coal, oil and gas, for example, a move which will be utterly transformative globally, presents excellent opportunities for Ireland. We have a natural advantage in offshore wind and green hydrogen. We can become a net exporter of electricity and energy within two decades, achieving energy independence.

This will mean greater energy security and price stability and will create thousands of jobs in communities, especially coastal communities, across the country. We can embrace new digital technologies like artificial intelligence and robotics to automate and improve so much of what we do. We can develop the care and experience economy. We can grow more Irish companies into global ones.

To do this, we need to hold on to what we have, where possible, and make sure we catch the next wave of investment and job creation.

I plan to set out a course to achieving this in a new white paper on enterprise before the end of the year. We will consult widely including with a panel of international experts who will hold our feet to the fire. I’m seeking your views on it too. There’s a public consultation under way on which you can find more information on the Department of Enterprise, Trade and Employment’s website (enterprise.gov.ie) and I’d encourage anyone interested to put forward their thoughts..

Sadly, enterprise and industrial policy is rarely discussed in the Dáil. I seldom hear suggestions about how we can create new jobs, found new businesses, forge new wealth or secure new investments or markets. The focus of the opposition is almost always about how we divide the cake differently or more fairly. I know that wealth has to be created before it can be distributed. You have make the cake first and make it again every year. A smaller cake means less for everyone. A bigger one at least gives us choices.

We must never take our prosperity for granted. Once lost, it will take a long time to regain. I’m not willing to let that happen and that is why I am taking action now, to re-examine our policies, at a time when they are more successful than ever, to make sure we are doing the right things to make sure our economy continues to thrive.

As a country, we have faced many challenges which have seemed insurmountable. To quote Marcus Aurelius [the Roman emperor], “an obstacle on the road helps us on this road”. We have many obstacles ahead of us, and we need to turn these into whatever opportunities we can for Ireland.

Leo Varadkar is Tánaiste and Minister for Enterprise, Trade and Employment