John Halligan (Waterford, Independent)

Last year, nearly 1,300 small and medium businesses went into insolvency. Many of these would tell us this was partly due to high rates, high rent and the downturn in the economy, but it was primarily due to the lack of spending power in the economy. Some 150,000 jobs were lost, with thousands more on the verge. Chambers of commerce and small businesses throughout the country would tell anybody who speaks to them that they are on the edge. I know of one small business run by a husband and wife who work 60 to 70 hours a week and come home with just €700 to €800 between the two of them. They cannot take a further increase in VAT without going over the edge. The Government will find after Christmas that many businesses will go over the edge.

What this says to people and small businesses, is that besides not doing anything for them with regard to rates or upward-only rent reviews, we are now going to force them to increase the cost of their products. This will mean that people will spend less. The statistics are there for the Government to see and the Tánaiste should check them out. Some 1,300 businesses have gone into insolvency and another 1,000 are hanging on by a thread. They cannot afford the smallest of increases at this stage. We talk about helping and supporting small businesses. If we walk through any town or city, we see the number of shops and small businesses that have closed down. They have closed for the reasons I have given: rates and rent, but primarily the lack of spending power in the economy. The cuts introduced in this budget will restrict spending and the VAT increase will restrict it even further. The Government can rest assured that by making this change, it will drive more small businesses under and drive more people onto unemployment benefit.

See this speech in context