Gerald Nash (Louth, Labour) | Oireachtas source

The Irish economy is in rude health, which is something we can all be very proud of. Anybody who is proud of this country will be proud of our economic performance and the fact that 2.7 million people are now in work. This is a record. There were 90,000 new net jobs in quarter 3 of 2023. That trend has continued into 2024. VAT receipts are up 6.3% so far this year. There are at least three interest rate cuts due that will benefit aggregate demand and businesses.

Business failures in 2023 were 27 per 10,000. The figure for 2019 was 36 per 10,000. Liquidations in the UK are twice the number in Ireland. The then Minister of State, Deputy Burke, said on 1 May on national radio that: "It is 10:1 the rate of businesses opening compared to closing." That is a good thing. The years of 2008 to 2011 these are not. It is quite the opposite. The low margin sectors of retail and hospitality, those locally traded services most exposed to payroll costs actually added a third of all new jobs, 90,000 in total, last year. There are significant challenges facing some businesses in those sectors. Nobody can deny that. I work, as many others do, day in and day out to support those businesses in our constituencies and across the country.

It has always been the case in times of normal and, indeed, sub-normal trading conditions where high churn has been a feature of the hospitality sector. This is not unique to Ireland. I know the Minister would agree, on foot of his professional background, that every business failure is a personal failure. It is a failure for the individual who owns the business, the people who run it and the people who work in it. Some of the businesspeople I admire and respect the most are hospitality entrepreneurs in my constituency. Those who survive and thrive are the innovators and are those who are always willing to change and adapt. It is very competitive and margins are tight. That is and always has been a real problem and difficulty for that sector.

The Labour Party has no difficulty whatsoever in the Government coming forward with support packages for viable businesses to assist them through demonstrable difficulties. Forms of corporate subsidies from the Exchequer have now been embedded into our politics by Fine Gael and Fianna Fáil in recent years. It would be better for all if such supports, if they are to continue, were evidence-based and properly targeted and had defined social and employment conditions and objectives attached. In nobody’s language is the package that was presented last week targeted. Neither is it time-limited. It is a pre-election package from Fine Gael designed to create the impression that it is the sole party of business.

It has been stated that the range and pace of the reforms under way have created real cost problems for business. There is no doubt that there is some truth in that. However, Fine Gael is solely responsible for that. It had possession of the ball between 2016 and 2020. That period of prosperity was a reform-free zone. There were limited moves on a minimum wage and moves towards a living wage and no moves towards modest sick pay rights. Auto-enrolment was parked. The list goes on. If Fine Gael had done all of this in a measured way over those four wasted years of prosperity, the situation for the businesses the party now says it is concerned with would have been very different. It is extraordinary that the Government is effectively doubling the value of the ICOB scheme when take-up has proven to be so low and nobody has tried to figure out why that was the case. The Government made a mess of the temporary business energy support scheme, TBESS, where take-up was also low and there were no lessons learned. There is no attempt in the package published last week to tackle the structural problems that indigenous Irish businesses have. Where is the reform of the anachronistic Victorian commercial rates system that hammers Main Street bricks-and-mortar businesses, and lets many others off scot-free? Where is the plan to take energy costs down? This is a failure of this Government and the regulator.

There is a €1.5 billion surplus in the National Training Fund. What does the Government plan to do with this to help businesses become more competitive and to upskill workers. That is where the magic should be in our economy. We have an innovation and productivity problem in Irish SMEs. Where is the actual plan to fix that?

Support for the far right does not happen in a vacuum. When over 20% of workers are on low pay, when the social wage is so poor, when access to secure housing is hard, when public services are not anywhere near where they should be in a rich country, when wealth inequality keeps growing, some people look for other, even poorer, people to blame. One cannot take on far-right populism by slowing wage increases for the lowest paid. This is politically and socially idiotic. The Government seems to think that by slowing down the rate of increase to the national minimum wage that this will help businesses to stay open, when all of the evidence actually shows, nationally and internationally, that incremental hikes to national minimum wages do not cost jobs.

The Government has effectively run its studs down the leg of the Low Pay Commission. It has instructed the latter to slow down moves towards a living wage. The Government knows full well that it is stated in the legislation I had passed in 2015, the commission has to take questions of competitiveness and other economic factors into account on its way to making evidence-based annual recommendations on the rate of the national minimum wage every July.

This is an expert, independent group set up by statute nine years ago, and it is working. Fine Gael has said and the Minister has, in his letter to this body of experts, issued a direct threat. That is what is. Where does this leave Ireland's obligation under the minimum wage directive to introduce a living wage of 60% of median hourly earnings over the next couple of years? This unprecedented intervention with the Low Pay Commission will be counterproductive. In time it will be considered to be notorious and infamous. I described it last week as Fine Gael's "We have had enough of experts" moment. Along with the disgraceful backsliding regarding the modest commitments made on the promises about sick pay, it is socially divisive and frankly ideological. I believe the Government will pay a price for it.

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