Tom Sheahan (Kerry South, Fine Gael)

The consumer is hit by everything that impinges on the retailer and the severity of the hits over the past number of years that retailers have had to take from the Government have impinged on the consumer. For example, County Kerry has the second highest local authority rate in the country, which is hard to believe, given we have probably the second worst infrastructure. When I was young, my family had a small shop for which my parents paid a rate that covered water, sewerage and refuse services provided by the local authority. A rate was not struck by Kerry County Council this year. Councillors have had several budget meetings but they have been unable to strike a rate. However, for a peripheral county such as Kerry to have the second highest valuation rate in the State is absolutely crazy. I support the county manager, who is trying to keep the rate as low as he can as he tries to balance the books while facing a reduction of between 8% and 10% in the amount he will receive from the local authority fund this year. However, he is well aware that next February councillors expect up to 100 small businesses to go to the wall in the county because of charges that are passed on to the consumer.

As Deputy McGinley said, it is difficult to fault people travelling across the Border to shop but the Government has played a major role in this because the Northern Ireland authorities have not had to promote or advertise their businesses because we have done it for them. Print and broadcast media highlight the queues into Newry every day and people's natural instinct is to want to visit Newry to see what is happening.

Small businesses are suffering because of the rate. While VAT is not applied to food, it is applied to luxury items. I tabled a parliamentary question to the Minister for Finance asking him whether in his wisdom he believed a telephone was a necessity or a luxury for doing business. I also asked separately whether he believed Internet access and broadband were necessities or luxuries in the context of business. He replied that he did not understand both questions. Businesses must pay VAT on the use of telephones and Internet access. This is detrimental to the expansion of indigenous industry and this impacts negatively on foreign direct investment.

The tourism, hospitality and food sectors, which include restaurants, hotels, delicatessens and butcher shops, are being destroyed by over regulation. They are being hammered by environmental health officers, EHOs, week in, week out. When such regulation was needed over the past few months to save the pig industry, it did not happen. Farmers and ancillary businesses were hit by over regulation by EHOs but they did not do their job to save the industry.

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