The Minister for Foreign Affairs, Mr Cowen, said Government economic policy over the coming years would be to continue to invest in infrastructure, health and education, spending about €34 billion between now and 2008.
In a keynote speech to the Construction Industry Federation, Mr Cowen, who has been widely tipped to replace Mr McCreevy as Minister for Finance in the forthcoming Cabinet reshuffle, also said future spending policy would target infrastructure and economic and social problems.
The Minister said the Government would remain committed to "substantial" investment in ending regional imbalances in transportation and housing but he warned the State would "expect value for money" from the construction industry which should he believed get ready to contribute more in terms of public private partnerships.
Describing the Irish economy as "resurgent and dynamic", the Minister said growth at 4.7 per cent of GDP this year would be higher in the Republic than the European average while unemployment would continue to be low, and the labour market would continue to expand.
Mr Cowen said the Government had been fortunate in concluding partnership deals with the unions and he paid tribute to SIPTU for "coming onside" and ensuring stability in labour relations. Government targets for the immediate future would be to end regional imbalances in infrastructure, he said, adding that the Government's spatial strategy would direct investment, particularly outside Dublin, which he noted was a key objective of the construction industry.
Referring to recent controversy over the cost and availability of social and affordable housing, Mr Cowen said 1,057 houses were in the course of being provided in the first six months of 2004, under Part V of the Planning and Development Act. While Mr Cowen said he was concerned that stability should be brought to bear on the housing market, he was pleased the rate of increase had eased in recent months.
The Minister also identified cross-Border trade which he said offered "high hopes" for Southern firms in the building industry. Overall the Government would continue to focus on competitiveness in the economy in the medium-term future and the danger signals which he could predict were oil-price rises and difficult exchange rates between the euro, the dollar and sterling.
Mr Gerry Purcell, the president of the Construction Industry Federation told the Minister the value of construction output this year would reach €23 billion and employment in the construction industry would number more than 200,000 people.
Mr Purcell said the Irish housing market was a textbook case illustrating how responsive supply could be to economic signals. He warned that the number of houses now being built would slip back to about 45,000 units from the current figure of almost 80,000 as supply meets demand.