Maria Byrne (Fine Gael) | Oireachtas source

I thank Senator Carrigy for sharing time. The Minister is so welcome here. I congratulate him on his appointment and look forward to working with him from here on in on the plight of small and medium businesses.

Some 43% of employees are in businesses of under 50 employees. The Small Firms Association is looking for a PRSI rebate. That was discussed before and brought forward by the Minister’s Department in the past. In addition to high energy costs, initiatives like auto-enrolment, the move towards a living wage and the increased cost of the minimum wage - although very welcome, especially for those on lower incomes - are leading to significant costs for small and medium-sized businesses. A report commissioned by the Minister’s Department shows those most impacted are small and medium-sized businesses, especially in the tourism and hospitality industry. Senator Carrigy referred to the possibility of splitting the 9% VAT rate. It is something I have called for in the past because it needs to be looked at. In November 2023 there were 50 restaurants and cafés closed, but nationwide there were 280 of them in the second half of 2023. Those are quite stark figures. I welcome the fact most businesses in the category are going to receive up to €5,000, but it still is not enough when we take into account the increased costs of insurance and energy. Even though the energy companies are passing on, or allegedly passing on, reductions to businesses, the businesses have not yet seen that in their bills.

Commercial rates also need to be looked at. In some counties there have been rates reviews, but some businesses are unfairly treated due to the size of their buildings. Many of them are not filling their buildings anymore, so there needs to be some degree of flexibility anymore. The insurance companies need to be met. I will be speaking to the Minister of State, Deputy Richmond, who has taken over from the Minister of State, Deputy Carroll MacNeill. When she was in that role she met the VFI and a number of industries across the tourism sector on the increased cost of insurance, because it is very prohibitive.

I wish to pay tribute to the Minister’s predecessor, Deputy Coveney. About a month ago we met small businesses in Limerick. Some 40 businesses were represented there, including everything from the hairdresser to the café, the butcher and somebody who owned a small shopping centre. There was a bookseller and a small grocery shop. These businesses are feeling pain. The Limerick City Business Association put a proposal to the Minister on dereliction, which we have a lot of in Limerick. Many operators of small, niche businesses retired or closed them during Covid and have not reopened. A proposal was put forward that they would love to be part of a pilot scheme to see how we can support small business. I will be sending the Minister an invitation to come and engage with these businesses because it is really important we send out the message to small businesses that the Government is interested in supporting them and working with them. I am aware of the grants available for small business from the Minister’s Department, but for the smaller businesses that cannot absorb the costs the €5,000 is not enough.

I look forward to working with the Minister into the future on how we can support and work with these businesses to keep them open. I think there are 280,000 people employed in the tourism sector nationwide. The additional costs from PRSI and the whole lot have added up for small and medium-sized businesses and I am concerned we will see more closures if we do not act quickly. A key thing that needs to be looked at straight away is the splitting of the VAT. In 2020 the 9% VAT rate was reintroduced and that needs to be looked at again.