Ms Patricia Callan:

Specifically on the topic of job creation, a survey of our members showed 46% thought the biggest barrier to job creation was not enough business and 33% said it was cost. These are the top issues for people thinking about whether to create jobs. In the context of the budget, we need to move it out of peak business cycles and have uncertainty squashed fairly fast. One of our five key messages is not only to have an annual budget but to know what will hit us over the coming three years. Uncertainty kills decision making. If it is bad news and people know about it, they can decide to invest and plan accordingly. It is critical to the restoration of confidence.

With regard to cost, people are struggling to pay wages at the end of the week so anything that increases costs will militate against their decisions to hire people. One particular example concerns the redundancy rebate reducing from 60% to 15%. If someone with 20 years service was eligible for the maximum of €600 per week, the overall redundancy payment amounts to €24,600 and, under current rules, the company must come up with an additional €11,070. For every person the company was going to make redundant, it must now get rid of two people because the bank will not supply money to fund redundancies. There is no incentive for people on the margin to continue to trade or to sell a business. It makes people go into the insolvency fund. It is nonsense and was not thought through. The approach of the Department of Social Protection concerns its own budget. We need a whole of Government perspective. There is no point in the Department of Jobs, Enterprise and Innovation writing an action plan for jobs with 200 good ideas when, in one fell swoop, negative decisions wipe out that good. That is why we need consensus.

I have never taken so many calls and e-mails from our members about any single issue as about the sick pay issue. They cannot understand it. In the case of our nearest neighbours, Northern Ireland, people are paid at half the rate here. Employers there pay the sum in the first instance but reclaim the amount through the income tax system. It will also put us at a competitive disadvantage. Across Europe, there is no consistency in systems in terms of clarity, despite the Minister's comments. The briefing arranged by the Minister had experts flown in from the UK who spent two years analysing this, including consultation, examining medical issues, the problem of certification, and systems and cost problems, and they decided not to change the system because of the recession and the dramatic negative impact it would have on businesses and growth. Ireland has done no analysis, despite the Minister's promise of a cost-benefit analysis. The Minister promised she would exempt small companies up to 100 employees, which was promptly revoked by her officials. In this malaise of uncertainty, people are making decisions and have stopped creating jobs because they are worried about what will happen.