Dáil Éireann Debate, Thursday - 26 October 2023
173. Deputy Claire Kerrane asked the Minister for Enterprise, Trade and Employment if he has plans to support small and medium businesses with costs (details supplied); and if he will make a statement on the matter. [47132/23]
Amharc ar fhreagraThe Increased Cost of Business Grant (ICOB) was a measure announced as part of Budget 2024 for small and medium sized businesses who operate from a rateable premises. It is intended to be paid at a rate of up to half the enterprise’s commercial rates bill in 2023, subject to a prescribed limit. The grant is intended to aid firms but is not intended to directly compensate for all increases in wages, or other costs, for every business. It is also a grant – rather than a rates rebate or waiver – and firms should continue to pay their commercial rates as normal.
The technical details underpinning the ICOB scheme and the mechanism for delivering the payment are currently being developed. My officials will work together with officials from the Department of Housing, Local Government and Heritage will work together with the Local Authorities to finalise the details of the grant in the coming weeks.
It is important that I clarify that the scheme is a once-off grant provision and is not a form of commercial rates waiver, such as that present during the years 2020 to Q1 2022. In essence, the ICOB will have no bearing on the commercial rates paid by firms. It is also not intended to benefit multinational or larger firm. The grant will be paid through local authorities and will be paid in the first quarter of next year.
In line with the recommendation of the Low Pay Commission on the 2024 National Minimum Wage, the rate will increase by €1.40 from €11.30 to €12.70 on January 1st 2024. While I am cognisant that this will represent an increased cost for business, this is a positive measure for workers. This represents a significant increase in the National Minimum Wage and is designed to increase the pay of minimum wage workers, in line with the Government’s decision to introduce a National Living Wage by 2026 set at 60 per cent of the median hourly wages in the economy. It is estimated that the National Minimum Wage, relative to median wages across the whole economy, will increase from 51.8 per cent in 2023 to 55.1 per cent of the forecast median wage in 2024.
It is important to be clear that the ICOB scheme is not designed to be an offset for increases to the minimum wage. I am not planning any scheme specific to the National Minimum Wage increase.
