Cabinet to discuss fall in competitiveness

Taoiseach's determination to 'tackle powerful vested interests' will also beon the agenda

Anxiety over the economy's dwindling competitiveness has prompted the Government to call a Cabinet meeting next month.

Ministers will debate the risk high inflation poses to direct investment and indigenous business on May 3rd, the Tánaiste, Ms Harney, said yesterday. The Cabinet will hear a number of ideas to cut the cost of building roads, tunnels, bridges and other elements of the National Development Plan.

The meeting, which is one of a series, will review all major economic issues, a Government spokesperson said last night.

However, sources told The Irish Times that the Taoiseach's determination, voiced at the Irish Management Institute in Killarney last weekend, to tackle powerful vested interests, will be progressed during the meeting.

"There are a number of ideas knocking around," said one source.

Ms Harney warned yesterday that the boom of the past decade is not self-sustaining but must be nurtured through affirmative action and constant vigilance.

Her comments came shortly after the Central Bank intervened in the competitiveness debate, warning that the prolonged period of high inflation was seriously threatening prospects for employment and growth.

Inflation surged past 5 per cent in February, defying analyst predictions.

Ms Harney was addressing an Enterprise Ireland showcase, where it was predicted domestic start-ups are set to create 1,600 jobs over the next three years.

Fifty-one "high growth-potential" start-ups went into business in 2002 with backing from the agency. Another 13 have been set up since the start of the year.

"This number of start-ups during a time of difficult global markets is clear evidence of a strong level of serious entrepreneurial activity.

"Despite the continuing tough global environment, the rate of new start-ups continues to be strong, running at approximately one every week," said Ms Harney.

But she despaired at the small number of female entrepreneurs.

Women were behind only two of start-ups supported by Enterprise Ireland last year. The low rate of female participation raises uncomfortable questions for State agencies, for the Government and for Irish business culture in general, Ms Harney said.

Nevertheless, the emergence of viable start-ups bodes positively for the future.

"We have arrived at a point where the culture of entrepreneurship has taken firm root in Ireland," she said.