Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

Our aim is to have a strong economy and a fairer society. The small-to-medium sector is a critical part of that. There are a number of elements to the motion that need to be broken down. In the case of retail, there is no doubt that a different type of competition is now going on with so much happening online. That competition is causing problems for those business owners who have to provide a building, pay rent and rates, heat the building, provide car parking and do everything else that goes with running a business. There are issues that need to be looked at distinctly and that is one of them.

The cost of energy is a critical issue. I have a memory of the awfulness of the inflationary spikes in 1975 and early the 1980s. Inflation went as high as 21% at it peak. There were two spikes, both of which were preceded by an oil crisis. That tells us something about the importance of a sustainable and affordable energy supply. One of the causes of inflation, which was a knock-on consequence of Russia's war on Ukraine, was having to find new energy sources. That is one of the drivers of costs. The fallout from the very high inflationary environment in the 1970s and early 1980s was the awfulness of the 1980s, with dole queues, no jobs and people emigrating en masse. It is important to appreciate that there is a tail that goes after these kinds of shocks. That has to be managed.

Looking at retail, restaurants and other customer-facing businesses bring a vibrancy to our communities, whether in cities, towns or villages. They give us something distinct. The one thing we do not want is to have a lot of redundant buildings because that degrades our towns and villages. The passive security of having a vibrant town or village centre is undermined by such closures. We must pay serious attention to those sectors.

I have spoken to businesses owners employing good numbers who say the cost of energy and insurance is a particular challenge. I was shocked to hear the difference in what they were paying prior to the war in Ukraine and what they are paying now and how difficult it is for them to keep going. Most of our industrial focus has been on FDI. There needs to be a renewed focus on the small-to-medium sector. If we neglect it, we will see job losses. We must be conscious of the fallout from the previous and much more radical problem with inflation. It was very difficult to get that under control.

On wages and the minimum wage, there was an exodus of staff during the Covid period. Good employers are having a real problem retaining staff, with many of them paying more than the minimum wage, for which I am very glad. However, anyone who thinks the minimum wage is a living wage is not paying attention to the work that has been done on that. According to the Parliamentary Budget Office, between 2016 and 2022, increases in the national minimum wage did not keep pace with increases in average hourly earnings. The minimum wage might have gone up by 15% but earnings in the rest of the economy went up by 22%. It is really important to appreciate that people on the minimum wage spend all their money. They do not have any residual money to save; all of it is spent on necessities.

Other factors are driving the cost of living for people on low incomes. One of those, and a critical one, is the cost of accommodation. Costs in the economy, particularly the cost of housing and energy, are driving wage demands and are a major issue for almost everyone. There is a perception that the insurance issue is dealt with but it most certainly is not. Some of the increases in premiums we are seeing are closing down businesses. This situation cannot be allowed to elongate. It must be dealt with in a timely way. There is a real issue there that is driving up costs. There is no doubt in my mind that price gouging is going on in the insurance sector and it is having an impact on some businesses.

We are in a time of full employment. We should be looking at the areas where there can be a real impact on costs. The focus of attention should be on energy, insurance and the kind of competitive disadvantage we are seeing for other businesses versus the companies such as Amazon. We are not collecting commercial rates from the latter and they do not have to pay the kinds of rents being asked in our towns and villages. We must get to grips with this issue because it is impacting hugely on the retail sector.

That has to be dealt with as a matter of urgency. We need some equalisation on that. I will leave it at that.

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