Dáil Éireann Debate, Tuesday - 21 May 2024
268. Deputy Brendan Smith asked the Minister for Enterprise, Trade and Employment if additional measures will be implemented to assist small-scale manufacturing, small-scale hospitality and small-scale retail to meet increased business costs that have occurred over recent years; and if he will make a statement on the matter. [22748/24]
Amharc ar fhreagra269. Deputy Brendan Smith asked the Minister for Enterprise, Trade and Employment if additional measures will be implemented to assist small and medium enterprises to meet increased business costs that have occurred over recent years; and if he will make a statement on the matter. [22747/24]
Amharc ar fhreagraI propose to take Questions Nos. 268 and 269 together.
Over the last number of years, we have seen a significant increase in inflationary pressures, most pointedly in the form of energy price inflation – which is a significant input cost for firms across a range of sectors. However, I welcome the latest data from the CSO’s Wholesale Price Index, which continues to show a moderation in input prices. For March 2024, the index for wholesale electricity prices was 40.3% lower than in March 2023, while producer prices for food products were 9.1% lower, and wholesale prices for construction products were 0.3% lower.
This Government has adopted an active approach in supporting the SME sector throughout the period of increased costs. Over the two-year period 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 (most significantly, the Temporary Business Energy Support Scheme). Budget 2024 also saw the announcement of several further measures, including a €257 million package for the Increased Cost of Business Scheme, the extension of the 9% VAT reduction for gas and electricity until the 31st of October 2024, the extension of the temporary excise rate reductions applying to auto diesel, petrol and marked gas oil until the 31st of March 2024, and an increase in VAT registration thresholds for SMEs to €40,000 for services and €80,000 for goods.
My Department, in collaboration with the Department of Social Protection, has also assessed the cumulative impact of recent and forthcoming changes to working conditions. Reflecting the findings of this assessment, a range of measures are being brought forward to assist businesses in adjusting to the costs associated with these changes, as well as more generally to improve the cost competitiveness of firms. These include:
• Ensuring that the employer PRSI threshold is explicitly considered as part of the Low Pay Commission deliberations and is reviewed on each occasion that the minimum wage is increased;
• Increasing the employer PRSI threshold from €441 to €496 with effect from 1 October 2024, which will ensure that employers with employees earning the weekly equivalent of the national minimum wage will pay the lower rate of employer PRSI rate of 8.8%;
• Reopening the Increased Cost of Business Scheme for another 14 days and launching a second phase of the Scheme targeted at businesses in the retail and hospitality sectors;
• Doubling the Innovation Grant Scheme from €5,000 to €10,000;
• Increasing the maximum amount available under the Energy Efficiency Grant Scheme to €10,000 and reducing the business contribution rate from 50% to 25%;
• Widening the eligibility for the Trading Online Voucher, extending it to all sectors up to 50 employees, modernise eligible expenditure and doubling the grant to €5,000;
• Increasing the lending limit for Microfinance Ireland loans to €50,000 from €25,000;
• Widening the eligibility for the Digital for Business Consultancy Scheme and extending it to all sectors with up to 50 employees;
• Launching a new ‘Ireland’s Best Entrepreneur Programme’ to encourage entrepreneurship and start-ups in under-represented groups;
• Launching the new online National Enterprise Hub for SMEs to access information on the wide range of Government business supports;
• Implementing an enhanced ‘SME Test’ by the Department of Enterprise, Trade and Employment in conjunction with the Department of An Taoiseach;
• Reviewing ESRI research on the impact of Statutory Sick Leave before deciding on any further increase; and,
• Reviewing the proposed Roadmap for Increasing Minimum Annual Remuneration Thresholds for Employment Permits.
Aside from these newly announced measures, I would also emphasise the continued support my Department and its agencies provides to the SME sector, with a full range of programmes aimed at aiding those firms to develop and grow. As set out in the White Paper on Enterprise 2022-2030, ‘our vision is for Irish-based enterprise to succeed through competitive advantage founded on sustainability, innovation and productivity, delivering rewarding jobs and livelihoods – the recently announced measures reflect this.
