Oireachtas Joint and Select Committees

Tuesday, 21 May 2013

Joint Oireachtas Committee on Jobs, Enterprise and Innovation

Effects of Black Economy: Discussion with Construction Industry Federation

1:50 pm

Photo of Peadar TóibínPeadar Tóibín (Meath West, Sinn Fein)
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It is clear that the experience of the industry is still pro-cyclical. In other words, pro-cyclical policies brought it to a production output of €38 billion annually but the flip side of those policies are to blame for its current output of €8 billion. Unfortunately the policies have not changed. It is interesting that we are discussing the black economy on a day that a number of multinational companies were found not to be paying taxes in this State. This is an important issue at the other end of the spectrum even if it does not directly relate to the federation. Gaps in compliance and enforcement seem to be the crux of the problem. There are regulations and standards but businesses appear to shirk their responsibilities to comply with VAT and other taxes, as well as on the pay and conditions of workers. Clearly this is a challenge for those good companies which do their best by their staff.

One of my fears with regard to the changes to REAs is that international companies will be able to tender for Irish construction projects without being required to pay at REA levels. What sort of disadvantages will that pose to the federation's members? All-Ireland harmonisation is also important in this regard. Many of the federation's members feel disadvantaged in competing with operators from the North of Ireland for tenders in the South. What advice would the witnesses give to the Government in working with the Executive in the North on equalising excise and other tax levels in order to provide a fairer playing field? In the context of enforcement and compliance, the OPW has considerable influence over the tendering process. How could it improve its services?