There is a future to be fought for - Cowen

I realize tonight as I talk to you that many of you here in this hall and around the country have worries for yourselves, your families and your future. We are living in uncertain times and people are concerned about their jobs, their businesses and their homes. Right across the globe there are people in the same situation. The world has changed. We are in a new era, never faced by anybody of our generation before. This is the worst financial crisis to hit the world since 1929. The choices we make now as a society will have a profound affect on our country, and the generations of Irish people to come. How did we get here? Recessions are tough. They hurt people. They create anxiety. They say that the pain of losing something is greater than the joy of gaining it. So here in Ireland, where we have just seen the greatest period of growth in our history, this recession is hurting badly. I first entered Dail Eireann 25 years ago. In that time, I have been privileged to witness the transformation of our country. I have seen us achieve full employment, become a modern and confident Republic, and resolve the conflict in the North. We have all seen great days together. Now as Taoiseach, I am tasked with guiding this nation through one of the biggest challenges of her history. It is the greatest honour of my life to lead this Republic, but like you, I wish these were better days. But this is the situation we are in. And it is my job now, to work with all of you to make things better, for all of us. And for our country. There are two key challenges facing us now. First, how do we cope with the short term crisis we are in? And the second is how do we plan for the best possible future for our country. My Government and I are determined to get this country back on track. Banks If any market economy is to function properly, and if enterprise is to prosper, we need a fully functioning banking system that works. People need mortgages, business needs credit, and cash must flow again. There is huge anger and disgust out there at the way some of our bankers behaved. What they did was wrong, it was selfish and it caused a lot of pain and hardship to Irish people. They will not be forgiven easily. There is little return however, in wasting anger slamming the banks. The Fraud Squad and the Director of Corporate Enforcement will look after that. They have my full support. What we need to do now is fix the damage they have caused. In the weeks ahead, I will introduce new standards of banking regulation and new standards of corporate governance, which will restore our reputation and move us to the forefront of best international practice. Central Banking Commission I will create a new Central Banking Commission. This will incorporate both the responsibilities of the Central Bank and the supervision and regulatory functions of the Financial Regulator. This will build on best international practice similar to the Canadian model. And it will provide a seamless powerful organisation with independent responsibility. There will be radical reform of the system and methods of financial supervision and regulation. There will be caps on salaries of Bank Chief Executives receiving government aid. The requirements on banks to support small businesses and enterprise lending and to assist people with mortgage repayment difficulties will be enforced. Public Finance The second step in our recovery is to sort out our public finances. I want to make sure tonight that people realize the scale of the challenge we are facing. This year we budgeted for €55bn in spending. The maximum amount we expect to raise from taxes is 37bn euro. This leaves a gap of €18bn in the day to day costs of running our country. We must close this gap. We have decided to do this over the next 5 years and we have submitted our targets and proposals for this to the European Commission. And they have accepted them. But now we must achieve those targets. And the only way to do this is through an appropriate combination of cutting spending and raising taxes. Public Spending The fact is, we are now spending too much on the day to day running of the country. During the good times we could afford it, during the bad times we just can"t. It"s as simple as that. At the moment, across every department of Government, every item of expenditure is being examined and reviewed. Every programme is being measured for value and those that are not performing or not necessary will be cut. Tax The scale of the deficit means that we also have to raise taxes to close the gap. Our tax system needs to change. During the good times, we developed a fairer and more progressive tax system that allowed people to keep more of their own money. Everyone had a better standard of living. That tax model was based on continuing growth. It works best when we have high employment and a thriving economy. Unfortunately, we are not a thriving economy for now, and we need to adapt our tax system to fit our new circumstances. Everyone will need to pay more. And while no one can be insulated from this reality we will seek to do it in a fair way that is based on ability to pay. Jobs There is a more human face to this recession. Every week now we are hearing of more people becoming unemployed. They mount up, and they become statistics. A thousand here, hundreds there. But they are not mere statistics. There are people and families behind each and every one of those jobs. So, while I know that more jobs will go, we are going to do everything to hold on to as many as we can. We need to protect our native businesses to the greatest extent possible. That is why, at our next Cabinet meeting we will set up an Enterprise Stabilisation Fund with initial funding of €100m to be run by Enterprise Ireland. The aim of the fund is to support viable but vulnerable exporting companies who, but for this recession, would be thriving. Competitiveness But the world is not an easy place to sell in now. The countries we sell to are in recession as well. Orders have fallen. There is more competition out there and we must regain our competitive edge. So we have to reduce our costs, especially our energy costs, if we are to continue to win back the investment and the customers we need to recover. We also must increase our productivity. The bottom line is we have to work harder and work smarter, producing more for less, if we are to survive and thrive in the future. Ireland Will Rise Again So yes, the next three years will be tough. But this time will pass. Confidence will return. The world will recover. And Ireland will rise again. We are a small and agile nation. We can use our size to our advantage, but we must adapt quickly and radically. And if we stick with the right strategy, and stay on the right path, we can be ahead of the pack when the tide turns. We"ve done this before. And we can do it again. Foundation for Recovery But this time, we are starting from a stronger position than before. The collective effort and hard work of the Irish people over the past 20 years has left us a strong legacy to build on. We have 1.9m people at work, and the most highly skilled workforce in the history of the State. We have five and a half thousand Irish companies competing for us on international markets. They are employing 150,000 people as we speak. We have one thousand multi national companies here, employing another 150,000 people. And we have a confidence, which must now reassert itself. A confidence that was earned, by competing and succeeding at the highest level. This is the strong foundation on which we will build our future. The Values that Make Unique When John F Kennedy visited Ireland many years ago, he spoke some words in our Dáil that still ring true today, He said: 'It is that quality of the Irish, the remarkable quality of hope, confidence and imagination, that is needed more than ever today.' As any country develops and changes, so too does its values and priorities. But, as we grow, let us not throw out all the qualities and values that got us to where we are today. Let us hold on to the best of ourselves and shed the rest. We need to build on those values that make us unique. Values that let the world know who we are. The value of neighbourliness that bonds communities and gives identity to every village, town and city in the country. The value of respect for our elders, care for our weakest and welcome for the stranger. Pulling Together I want to see an Ireland that backs herself. Sometimes we are too quick to condemn and criticise in this country. There are cynics who will always say we can"t do it, that there is no hope. Well, the Irish people don"t need that now. It"s a time for pulling together. No individual Irish person, should underestimate their capacity to improve the world around them. Whether they be at home, in the workplace, or in the community. Believe me; we will get through this tough time by everyone taking personal responsibility to contribute to the common good. And the common good must now be everyone"s priority. In all of my career as a politician, I have aspired to be true to that basic tenet of our Republican philosophy. And as your Taoiseach, I will always seek to live up to it. I know the challenges I face. But I am so empowered by the respect I have for this country, her flag, and you her people that I will do everything I can to manage us through this crisis. There is a future to be fought for and I will lead that fight.