Jan O'Sullivan (Limerick City, Labour)
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14. To ask the Minister for Jobs, Enterprise and Innovation her plans to support the retail sector in advance of Brexit; and if she will make a statement on the matter. [43028/17]

Frances Fitzgerald (Dublin Mid West, Fine Gael)
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I recognise that the impact of Brexit is one of the most immediate concerns facing the retail sector.

As a result, my Department has ensured that Retail representatives have been included in all relevant stakeholder engagements on Brexit, including the Enterprise Forum on Brexit and Global Challenges.

Brexit has also become a standing item on the agenda at meetings of the Retail Consultation Forum, which was set up in 2014 to provide a platform for engagement between the sector and Government.

Membership of this Forum includes retail associations such as RGDATA, Retail Ireland, Retail Excellence, other bodies such as ISME, SFA and Chambers Ireland, a number of retailers, the City and County Managers Association, and relevant Government Departments.

The Forum meets 3-4 times per year, with working groups meeting more often to progress the work programme. The current work programme is driven by the key concerns of the Forum members, which include developing skills in the sector, reducing business costs, town centre renewal, and the impacts of Brexit.

The Forum will meet next on the 20th of November. At each of the last four meetings, since the announcement of the UK’s decision to leave the European Union, Forum members have been briefed on the Government’s approach to Brexit and work undertaken to date, and have had the opportunity to voice their concerns.

At its last meeting on 12th June, the Forum discussed the progress of its working groups on Retail Skills, Town Centre Renewal, and Reducing Energy Costs. Members were also briefed on research being undertaken by my Department into the firm-level impacts of Brexit in Ireland’s most exposed enterprise sectors, which will be completed by year end. This research is looking at the impact of the UK being outside of the European Single Market and Customs Union on firms, the associated implications for investment, and how this informs our approach to negotiations. A pilot of this research was undertaken from January to March in three sectors: wholesale/retail, food/drink, and computer consultancy.

Participants in the pilot identified the following areas as being the top three areas of particular concern post-Brexit to the Wholesale / Retail Sector: tariffs and rules of origin, physical border and free movement of labour.

Announcements made in Budget 2018 in addition to a number of initiatives developed by the Retail Consultation Forum, my Department and other Government Departments will strengthen the capability, competitiveness, and resilience of the retail sector to meet the challenges resulting from Brexit.

For example, my Department has secured Budget funding for a new Brexit Loan Scheme which will provide affordable financing to Irish businesses that are either currently impacted by Brexit or will be in the future. The new Scheme will be delivered by the Strategic Corporation of Ireland (SBCI) through commercial lenders to get much needed working capital into Irish businesses.

The new Brexit Loan Scheme aims to make up to €300 million available to businesses with up to 499 employees at a proposed interest rate of 4%. Retail businesses that are adversely affected by or will be affected by Brexit are eligible under this scheme as long as they submit a business sustainability plan which demonstrates how they plan to adapt, innovate or change in response to Brexit. I expect this scheme to be up and running by March 2018.

The retail sector will also benefit from the increase in disposable income through taxation and social welfare measures. Another welcome announcement for the retail sector, among others, is the retention of the 9% VAT rate for the tourism and hospitality sector. I am keenly aware that this has knock-on benefits to retailers, in particular in the regions.

Through the Retail Consultation Forum we are also focusing on building online capability. Through initiatives like the Trading Online Voucher scheme and work being done by the Retail and Skills Working Group, retailers will be supported in addressing digital skills gaps and moving into online trading. In line with this, under the Action Plan for Jobs, my Department is exploring the development of a pilot programme to support retailers to scale up their domestic and international online trading activity.

We are providing stakeholders with the tools to address the demise of the high street through “A Framework for Town Centre Renewal”, launched in April this year.

We are also assisting retailers to improve competitiveness by reducing their energy costs, through a pilot efficiency programme delivered through the Sustainable Energy Authority of Ireland.

Retailers also have access to supports such as the Enterprise Ireland Brexit SME Scorecard to assist with planning and preparation for Brexit; the business advice, training and capability building services provided by the LEOs and to Intertrade Ireland “Brexit readiness workshops” that are held around the country. 

I also recognise that retailers are concerned about the impact of sterling fluctuations on Irish consumer sentiment; however the volume of retail sales is growing at a faster rate than the value of sales growth, which demonstrates that there continues to be heavy discounting by retailers and promotional activities to drive footfall and sales.

Engagement with the sector will continue through the Retail Consultation Forum, bilateral engagements with sector representatives, and Brexit-focused stakeholder engagement.