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State must grow to deliver housing, hospitals - Ibec

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Ibec chief executive Danny McCoy

Ibec chief executive Danny McCoy

Ibec chief executive Danny McCoy

The next Government must deliver "a surging demand for public infrastructure and public services" with more investment in public sector jobs and subsidised child care, Danny McCoy has told Ibec's annual business conference.

The Ibec chief executive said the State was too small to compete with the power of private global wealth, which was investing more than €2bn a week into the Irish economy - "an incredible sum".

Private firms, he said, were creating 25 times as many jobs as the Government and this imbalance could not continue. The next Government, he said, must spend and invest wisely to rebuild "the capacity of a State that is getting smaller before our eyes".

"The Government, because of its scale restrictions, will not be able to solve the problems that the electorate told them at the weekend they want solved: health and housing," Mr MCoy said. "Who here believes that the State can outcompete the private sector for scarce construction resources?"

The audience of several hundred State agency and corporate executives included senior figures in financial services, including Bank of Ireland chief executive Francesca McDonagh; drinks and energy chiefs, including John Teeling; and executives from firms involved in housing and road construction.

Mr McCoy said the growth of Ireland's labour force to a record 2.4 million looks impressive - until you see that nearly two out of five people aged 18 to 65 are not looking for paid employment.

"Those not working have many rational reasons for not doing so. Factors like caring costs, impact of transport or taxation come to mind," said, adding that others were retiring early, travelling abroad or staying in third-level education longer - "choices affluent societies can make".

He said the next Government must take steps to spur greater Irish participation in the labour force by developing "new solutions around childcare, congestion and flexible working".

Mr McCoy noted that the public sector was not notably bigger than a decade ago, reflecting the years of austerity before and during the EU-IMF bailout year. Its capacity to drive infrastructure and recruit talented staff could not keep pace in a society he said too often reflected John Kenneth Galbraith's maxim of "private affluence and public squalor".

"The key point is that we have allowed parts of the public service to become proportionately too small for business and society to continue to thrive," he said.

Online Editors