It's the economy, stupid. The de facto slogan for Bill Clinton's 1992 US presidential campaign is just as relevant for the general election campaign that kicked off this week. The big issue, the one that affects the State's capacity to address all others, is maintaining economic growth via a climate that allows businesses to prosper.
But what do businesses want from the upcoming election? Ibec, the broad-based employers’ lobby group, has published its “manifesto” for the election campaign. It includes 80 separate policy recommendations for the next government, centred around four key policy pillars:
to “make hard work less taxing”
to invest in infrastructure to make Ireland an attractive investment location
to create jobs, and
a plea to “help business win” by cutting regulation and fostering growth.
At an election event held last week by the lobby group at the Gibson Hotel in Dublin, 400 people listened as representatives of the main political parties debated policies designed to help business grow.
Danny McCoy, Ibec’s director general, also warned against narrowing the tax base by cutting the universal social charge, which most main parties have promised to pare back to appease a chippy electorate.
There were also suggestions that the tax system needs to be adjusted to be less punitive on entrepreneurs and the self-employed, who are perceived to be treated less favourably than their salaried colleagues and also fare badly compared to their peers in some other countries.
Those are the broad business priorities. But how do they compare to the views of those working on the ground for some of the more visible, everyday sectors of the economy?
Pubs
The long-running trend of rural bar closures continues but, according to official bar sales figures from the Central Statistics Office, the economic wellbeing of the sector as a whole has been improving consistently for months.
Despite this seemingly bright future, publicans have a lengthy wishlist from the next government. Oliver Hughes is the co-founder of the Porterhouse group of bars, and current chairman of the council of the Licensed Vintners' Association (LVA), the Dublin pubs lobby group that is merging with its country cousin, the Vintners' Federation of Ireland.
The first post-election priority, Hughes says, is the enactment of the new Public Health (Alcohol) Bill "with immediate effect". This is the law, proposed by current Minister for Health Leo Varadkar, to bring in minimum unit pricing and the "structural separation" of alcohol products from others in retail.
“Number two: bring forward the long-awaited Sale of Alcohol Bill to review trading hours, specifically Good Friday, and normalise Sunday hours,” said Hughes. What the industry sees as a frankly barmy requirement to close on Good Friday – originally a gesture of religious piety in a bygone era – particularly irks. Publicans made strong efforts to get it reversed before the election.
The sector is also seeking reductions on the €410-a-pop cost of late licences, a commitment to bring down the cost of alcohol excise duty and the maintenance of the 9 per cent special VAT rate for tourism-related products.
The 9 per cent VAT rate does not apply to alcohol, but it has been a boon for the tourism industry. Fuelled further by a weak euro, inbound tourism has rocketed in recent years, driving much of the pub industry out of the doldrums.
Hughes also called for any increases in the minimum wage to be kept below the rate of inflation, and for a measured response by government to calls for reform of the rules surrounding workers on low-hour contracts.
Retailing
Retail Excellence Ireland, the vocal industry lobbying group, also published an election wishlist. It included proposed measures to reduce consumption taxes, which would potentially spur a spending spree, and a plea to address the cost of employment by cutting employers’ PRSI.
The group also called for measures to stimulate economic activity in town centres, such as the provision of rent- and rate-controlled zones alongside streamlined planning and better street policing to combat theft from shops.
It also wants the next government to consider developing a digital hub for Irish online retailers to expand their reach abroad.
Tesco, one of the State's biggest retailing operations, understandably wants the next government to consider addressing the cost of childcare.
"Tesco employs over 14,500 people and has an even gender ratio in our workforce," said its chief executive Andrew Yaxley. "[But] it is important to remove the barriers to greater female participation in the workforce arising from the cost of childcare."
He said the next government should also consider policies to spread the recovery “more evenly” across the State.
Yaxley also suggested that consideration should be given to ramping up the already “excellent” efforts to promote Irish food suppliers, especially ones that export their wares. Tesco says it is the single biggest buyer of Irish food and drink in the world, with €1.6 billion of purchases, including €1 billion of exports.
“Enhanced ways of working between the government and the retail sector to showcase and promote [Irish suppliers] could be very important,” said Yaxley. “Bord Bia and other State agencies have done an excellent job providing support . .. to grow national or export capabilities and this should be built on to help more Irish SMEs break into export markets and fully realise their potential.”
Food
Keogh’s Farm, a family-owned potato farming and crisp-manufacturing business in north Dublin, is typical of the new breed of marketing-savvy, innovative Irish food businesses that have thrived in recent years and can be found on the shelves of most major retailers.
Tom Keogh, the 36-year-old managing director of the business, told an industry conference this week of its efforts to drive sales even further afield, including China.
Keogh agrees with Yaxley that State supports for Irish food start-ups are “excellent”. “However, there is room for improvement for businesses, such as ourselves, that have evolved past the start-up stage and are in a phase of growth and expansion,” he says.
On taxation, Keogh supports a proposition from the Small Firm’s Association to increase the self-employed income tax credit to the same level as the employee PRSI tax credit.
Hugh MacKeown, a member of the extended Musgrave family that owns SuperValu, also recently lobbied the Government over the taxation system, which he argued penalises the handing-on of family businesses to following generations.
“With regard to changes to the family business tax regime, we are wholly supportive of the Musgrave family on this and agree with their position,” said Keogh, whose family has farmed the same area for well over 100 years.
“Exports are also increasingly important to our business and we find the regulations surrounding the export of food products to be restrictive,” he added, echoing Ibec’s call to cut red tape. “For example, Keogh’s Farm exports Irish potatoes to the United Arab Emirates and meeting requirements for phytosanitary certification is very limiting.”
Technology
The
Irish Software Association
and ICT Ireland are the two tech-sector divisions of Ibec. They jointly produced a list of policy recommendations for the sector, an election manifesto to “make Ireland a global technology powerhouse”.
The 30 separate policy suggestions coagulate around three main themes:
measures to make Ireland the best country for tech talent,
measures to drive a culture of digital leadership at the top policy formulation levels of government, and
measures to drive growth through “competitive tax structures”.
ISA chairman Cronan McNamara, the founder and chief executive of data-modelling technology company Creme Global, says the suggestions are not simply being "thrown over the fence" at the Government by the industry.
“We are keen to work with the Government on implementing them. We’ll do whatever we can to help,” he said.
The proposed measures around “talent” include investing in technology training and promoting coding initiatives among children at school. It also calls for a skills action plan, the promotion of gender balance within the industry, and steamlining the work-visa system for tech sector immigrants.
“All the obstacles are surmountable. And, as for embedding technology in the education system, you would wonder why we are still talking about it,” said McNamara.
The main suggestion under the theme to make Ireland a “global digital leader” is the creation of a government chief information officer role, and the establishment of a “full department and minister for digital affairs” to drive policy.
Tax advantages are also pitched as crucial for attracting the mobile investment that circulates the global tech industry. Maintaining Ireland’s 12.5 per cent corporation tax rate is hardly a new suggestion: less tax is the oldest election issue in the book.
The ISA document, however, also calls for other measures, including reducing the rate of tax on capital gains for entrepreneurs to 20 per cent to bring it “closer in line with our competitor jurisdictions”.
“They’re not incentives,” argued McNamara. “ Entrepreneurs, if they want to do it, will do it anyway. So it isn’t about incentivising them. But they should be rewarded so that they are capable of trying it all over again.”
