Dáil debates

Tuesday, 29 March 2011

3:00 pm

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)

The retail sector, like every other sector of the economy, has been affected by the global economic crisis and by the loss of competitiveness in our economy. While Ireland has regained some of its competitiveness in the past two years, for example through reductions in electricity and gas prices for business and the reduction or freezing of local authority rates in 2010, this Government is committed to doing more to reduce the cost base for business. Our programme for Government has a focus on helping the domestic economy while continuing to maintain a strategic focus on exports and investment.

As part of this focus on the domestic economy we will explore initiatives which will assist the retail sector. It is very labour intensive and, taken with the wholesale sector, employs approximately 267,000 people or roughly 15% of our workforce. In this context, the Government's commitment to halve employer's PRSI costs for those earning less than €356 per week is likely to assist the retail sector, particularly given the part-time nature of many jobs in that sector. With regard to other labour costs, as the Deputy is aware a review of the framework for registered employment agreements and employment regulation orders is under way. This review will be completed by April 2011.

To reduce anti-competitive behaviour in the sector, the programme for Government states our intention to enact a fair trade Act to ban a number of unfair trading practices in the retail sector. Rental costs are an important factor for high street retail businesses in particular. in recent years, upward-only rent reviews kept rents for many businesses at artificially high levels, despite the fall in property values and open market rental trends. Under the Land Conveyancing and Law Reform Act 2009, upward-only rent reviews were abolished for all new leases signed on or after 28 February 2010. The programme for Government expresses our intention to legislate to end upward-only rent reviews for existing leases. This is a matter for the Minister for Justice and Law Reform in the first instance, but there is also ongoing contact between officials of my Department and those of the Minister on the issue.

Additional information not given on the floor of the House.

I am also keen to ensure that Local Authority costs which impact on businesses are kept as low as possible. In this context, I intend to explore with the Minister for the Environment, Heritage and Local Government what measures can be taken in this regard.

While there have been significant reductions in Ireland's electricity and gas prices in recent years, retailers and other businesses can continue to reduce their energy bills by switching suppliers to get the best available value. We also intend to impose rigorous efficiency targets on the ESB, Bord Gáis and EirGrid to drive further efficiencies in the energy sector, leading to further cost reductions. The national energy efficiency action plan aims to achieve national energy savings of 20% by 2020, including measures to assist SMEs to lower electricity costs. Agencies such as the Sustainable Energy Authority of Ireland are helping individual businesses to identify actions they can take to improve their efficiency and reduce their energy costs.

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