On behalf of ISME, I thank the committee for giving us the opportunity to outline our views on whether Ireland should address daylight saving hours by moving the clocks forward by one hour all year long, which would currently being us in line with Central European Time.
I am head of research and information with ISME, the Irish Small and Medium Enterprises Association. With 8,500 members, ISME is the only independent representative organisation representing SMEs in the country. The association's membership is made up of owner managers, the true risk takers in the economy, who make up more than 99% of all enterprises and employ more than 60% of all employees in the private sector.
The debate on whether Ireland should advance the clocks forwards to Central European Time has been ongoing for several years. It has taken on an added focus in recent months due to the fact that our nearest neighbour, the UK, is debating the Daylight Savings Bill, a Private Members' Bill proposed by Ms Rebecca Harris, MP, which calls on the UK to analyse the potential benefits of advancing time by one hour on a trial basis for three years. If the Bill is passed, we in Ireland will have a decision to make, either remain as we are or to join in.
In Ireland and the UK, advocates for both sides have put forward several arguments to support their case. Those in favour outline a host of benefits, especially a reduction in road accidents and the positive impact on health, tourism and the environment. Those opposed are concerned about the effect of losing an hour of daylight, particularly on winter mornings. The main body of evidence on these arguments is centred in the UK, with little, if any, evidence on the impact a change would have on Ireland. It is, therefore, important that we start to seriously debate this issue, particularly if the UK decides to go ahead with the change.
The following is the likely impact from the perspective of business, and specifically SMEs. With little factual or scientific evidence in Ireland as to the advantages or otherwise of changing, one must look at available evidence on possible impacts, mainly from the UK and from taking the views of SME owner managers in Ireland. I will address these issues under a number of headings, the first of which is sport, leisure and recreation.
It is anticipated that a change in daylight saving time will assist companies involved in the sport, leisure and recreation sectors due to the fact that there will be an increase in leisure and sporting activities with individuals availing of the additional hour of daylight for recreational purposes, particularly in winter time. It is estimated, for example, in the UK that there would be on average an additional 300 hours sunlight, with more than half of these falling at the end of the working day. The down side could be felt by those businesses that rely on indoor entertainment, particularly in the wintertime, such as cinemas.
As mentioned by my colleague from the IFA, there is a significant impact on tourism. The tourism sector, so valuable to the economy, should also get a boost. First, there would be an additional hour of accessible daylight, which could extend the months during the spring and autumn allowing for a longer tourism period, with an increase in day trips and weekend breaks. The lighter evenings could accelerate the growing trend towards off-peak and short-break holidays and extend winter opening hours. It would also extend the summer tourist season.
Research in the UK indicates that the boost to the UK economy could be in the region of £3.5 billion pounds, creating up to 80,000 jobs. In Scotland, a country of similar size to Ireland with a similar tourism market, the evidence suggests that in the region of 7,000 additional jobs could be created. In Northern Ireland, it is estimated that there would be an increase in annual earnings of up to £100 million pounds and the creation of more than 2,000 jobs. The evidence would indicate that tourism in Ireland would see a similar benefit.
Tourism is an industry largely populated by indigenous enterprises. It is an industry that is deeply rooted in the fabric of Irish economic life, both urban and rural. Anything that would assist in growing Irish tourism is to be welcomed.
The retail sector would benefit from extended daylight hours, with more people, particularly in winter time, prepared to leave their houses and stay longer in shopping centres and retail outlets. Also, local trade is lost in winter as people go home from work, owing to darkness falling across Ireland relatively early.
There is evidence, also from the UK, that extending daylight hours would save on energy consumption, particularly on electricity, due to a fall in the need for artificial light.
A study by Cambridge University showed that during the winter months in the United Kingdom having brighter evenings would lead to a reduction in electricity consumption by more than 2%, with a corresponding reduction during the summer. While these figures relate to domestic households, it is not inconceivable that businesses could benefit also. The impact of advancing the clock by one hour may be mixed for businesses involved in outdoor activities, particularly construction, as the darker mornings might prove problematic, particularly where work needed to be started early in the day. This could be an issue in more northern and western counties where the sun rises later than in other parts. However, in some countries, particularly those in Scandinavia, people start outside work one hour later during the winter months. On the flip side, there would be more hours of daylight in the winter, which would give companies additional time.
The indications are that trade with most of Europe could be improved if Ireland was to align with Central European Time. Almost 60% of our total exports are to the European Union, with 40% to the eurozone. Communications would be made easier, as a change would result in our clocks being harmonised with those of most of our trading partners. The change would also assist in the overlap of office hours between Irish businesses and markets in the Far East. However, trade creates one of the biggest issues, especially if the United Kngdom refuses to change and we consider it. While a significant percentage of SME exports go to the rest of the European Union, the reality is that a far greater proportion of SME trade is with the United Kingdom. More than 50% of SME exports go to the United Kingdom; therefore, any changes to daylight saving time without a corresponding change in the United Kingdom would have a negative impact on trade, particularly if we were to change time zones with our biggest trading partner.
Cross-Border trade is another significant issue, particularly for companies along the Border. Besides the obvious inconvenience of operating in different time zones on a small Island, the trading environment would be made more difficult for companies operating on both sides of the Border. The relationship with the United Kingdom, particularly from a trade perspective, is one of the single biggest influencing factors on whether Irish SMEs would be fully in favour of making the change.
There would be many benefits from a business perspective in advancing the clocks by one hour. They include an increase in leisure and sporting activities, with a positive knock-on impact for companies involved in these areas; an increase in tourism; a reduction in energy usage, while the retail sector would benefit from individuals being more inclined to stay out instead of heading home on short winter evenings. There would be a positive impact for businesses through a reduction in crime levels, as the statistics show, and by having extended daylight working hours for companies which predominantly work outside. There would also be benefits resulting from improved trading relations with countries in Europe and the Far East.
The downsides would include the impact for outside employment by having less daylight on winter mornings and the concern that the United Kingdom might decide not to advance its clocks. This would create a disadvantage in trading with our largest trading partner, as well as impacting on cross-Border trade and tourism.
While the association is not averse to moving to Central European Time - generally the business advantages outweigh the disadvantages - a number of prime considerations need to be taken into account. First, we need to conduct more research from an Irish perspective, specifically to look at the socio-economic consequences. Second, we need to look at the impact on Ireland of whatever decision the United Kingdom makes. In other words, the association would caution against switching in the event that the United Kingdom does not. If the United Kingdom does decide to proceed and introduce a three year trial, the association would be in favour of Ireland doing likewise.
With the debate gathering pace in the United Kingdom, it is essential that we start to look at this issue seriously in Ireland. This should be done sooner rather than later, particularly in the light of the ongoing debate across the water. I thank the Chairman and the committee for giving us the opportunity to express the views of the association.