Richard Bruton (Dublin Bay North, Fine Gael)
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62. To ask the Minister for Enterprise, Trade and Employment if he has analysed to the main sources of pressure on business costs at present, and how he believes these might best be addressed. [5742/24]

Aindrias Moynihan (Cork North West, Fianna Fail)
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64. To ask the Minister for Enterprise, Trade and Employment for consideration with current financial operating difficulties experienced by SMEs to expand and provide direct financial supports to domestically focused retail, personal services, professional services and construction services; and if he will make a statement on the matter. [5698/24]

Simon Coveney (Cork South Central, Fine Gael)
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I propose to take Questions Nos. 62, 64 and 75 together.

Although not unique to Ireland, it is understandable that businesses are concerned about the impact of rising costs. It is also important to acknowledge that SMEs, and in particular the retail and hospitality sectors, are key employment generators for Ireland, particularly in more rural areas.

While input costs have gone up for many businesses since 2021, wholesale price inflation has levelled off across a number of areas in recent months. Although the Wholesale Price Index – which measures changes in the price of wholesale inputs – is up by 2.1 per cent in the year to December 2023, electricity prices were 67.8% lower than in December 2022, while wholesale food prices were 8.5% lower.

The Government has provided significant support to enterprise throughout the period of increasing costs and has been proactive in this regard. However, it is not possible to insulate every business from the total impact of rising costs.

Over the two years prior to Budget 2024, a total of €12 billion was provided in cost of living and doing business supports, comprising a mix of permanent and one-off measures, including the Temporary Business Energy Support Scheme (TBESS). Budget 2024 also contained several measures to support businesses facing increased costs. For example:

The 9% VAT reduction for gas and electricity was extended for an additional 12 months, until the 31st of October 2024;

The temporary excise rate reductions applying to auto diesel, petrol and marked gas oil were extended, until the 31st of March 2024; and,

There was an increase in VAT registration thresholds for SMEs to €40,000 for services and €80,000 for goods.

The Increased Cost of Business Scheme (ICOB) was also announced as part of Budget 2024 and will provide a grant to benefit a significant number of small and medium businesses at a cost of €257 million. The ICOB Grant will be available to up to 143,000 businesses, or 95% of all commercially trading business, operating from a rateable businesses in all corners of Ireland. The administration of the ICOB will be carried out by Local Authorities and it is intended that the grant will be provided to qualifying premises in the first quarter of this year.

My Department, in collaboration with the Department of Social Protection, is also assessing the cumulative impact of recent and forthcoming changes to working conditions, including the Auto-Enrolment Retirement Savings Scheme, Parent’s Leave and Benefit, Statutory Sick Pay, the Additional Public Holiday, the Living Wage, and Remote Working. The report is currently being finalised and will inform public policy in this area.

This Government has adopted an active approach in supporting Irish businesses across multiple crises over the last number of years, including the introduction of unemployment supports during the COVID-19 pandemic, the provision of financial supports to firms facing the implications of Brexit, and more recently, through the period of increasing overhead costs. My Department is fully committed to serving the SME, hospitality and retail sectors, and the measures included in Budget 2024 reflect this.