Ms Hazel Ahern-Flynn:

Issues around labour shortages are something about which we have been hearing for a while now in feedback from our members. We came out of Covid with a much stronger labour market and much stronger employment figures than we would have expected even a few years ago. As for what is driving those labour shortages, there are two issues. One has already been touched on, that is, labour force participation. The main indigenous source of additional labour will just come from supporting and encouraging more workers into the labour force, which involves dealing urgently with a lot of those capacity issues around childcare and housing. The other piece is how to attract international workers, in particular high-skill, highly mobile workers and again, that ties back into capacity issues. Something we have heard from some of our engagements with the multinationals are questions around capacity, in that the fundamental prospect for continued foreign direct investment in this country is very strong but the question is whether we have the capacity to allow for it, simply in terms of housing an additional workforce. We would need to start seeing movement in those areas fairly urgently to provide for that.

On the second point around greening the VAT rules, under EU rules there is provision to provide a more favourable rate of VAT to energy-efficient technologies and that ranges through everything from bikes to solar panels to heating pumps. Very simply, what we are calling for in our budget submission is to make full use of the greening of the VAT rules to make sure they are a preferable option.