Aidan Davitt (Fianna Fail) | Oireachtas source

I welcome the Minister to the House. He is a Mullingar man the same as me. We soldiered on the town council and county council together and last week was a great week for the town as we now have a senior Minister. I wholeheartedly welcome the Minister to the House and congratulate him on his elevation. As the Minister knows, I am involved in running a business and employ quite a lot of people, so I have quite a vast knowledge of what goes into running a business. There are a lot of things to mark. The easy answer is to say they are matters for Revenue, but unfortunately they are related to business, so they are all under the one umbrella. The Minister has not shirked his responsibility to deliver in any portfolio he has held.

Everything came at the turn of the year. There is pension auto-enrolment which is still progressing and whatever else. Something which came under the radar that people would not know of unless they run a business is the division of the expenses. Heretofore your business will claim a certain expense, but if I brought four people for dinner I would have to return my own expense, a fifth of the total, now and the other four parts are claimed by the company. The paperwork and manpower involved in this is absolutely ridiculous. I am sure the Minister is aware of this. This has come under the radar a bit and it is tying it to the business owner or employer that they have to make a return on what exactly they were spending. There is not as much scrutiny on the money being spent on his clients or whatever else, but that division of expense has to be returned with your wage slip to claim the expense back. People do not get the amount of manpower and work being put into this at present. This came in at the same time of year as the minimum wage increase - which I do not have a problem with - but it is all these things at once. It was like a storm of different paperwork coming all at one time. We are going to have a change in the corporation tax rate. All of these are not of the Minister’s doing, of course, but they are all things that fall within the remit of the Department he is walking into.

Then there are elements many employees are not aware of. When you talk to employees they talk to you about increasing wages and everybody’s wage going up. It is a good conversation to have with your employees, but they seem to be totally unaware of the PRSI and USC that employers are paying, which can be at different rates. It can be up to 7% with PRSI and up to just over 8% with USC. That is 15% if you are ticking both those boxes. It is on employees’ wage slips if they are getting a detailed one, but what employee is reading what an employer is paying? It is an extreme hidden cost employers are paying.

Employment is slowing at present, as the Minister knows. Looking at America, which the Leas-Chathaoirleach is very aware of, there is fear there about a recession in the last quarter. This will have a massive knock-on effect for Ireland. As our Leader has mentioned here, the average business on the street is competing with online retailers, especially on main streets. How the Minister will deal with that I do not know. I am just laying out the problems facing him from the viewpoint of a day-to-day business guy. I am not like the Opposition Members who could not be bothered turning up, because I am going to provide some practicalities about what I think it might help to do. They would not provide any of them either to be honest, going by the big black holes in their budgets. Maybe they are out trying to find the money for their budget that does not exist at present. We will give them that; they could be busy at that.

The abolition of the USC, which was a short-term measure when it originally came in, would be a huge step forward if we were really serious about bringing people into the workforce. Certainly we could try to cut it back. We had still been increasing it until recently. I am sorry, I meant the PRSI rate. It increased in the last budget by 0.1% in nearly all categories and more in some, as the Minister will be well aware. We should link the rates to the profitability of a business. That would be a huge help. We have done that before. We have linked different grants to profitability of businesses and it said if a firm was over a certain threshold here is how much it would get. That would be a huge step forward. For Aldi, Tesco and the like, which are paying a lot in rates in larger footprints it is no problem, but what about the small guy trying to cope who has ten or 15 employees and is to the pin of his collar paying the wages every week? Why is he paying €10,000 in rates when he is trying to keep the lights on? There has to be a real look at the rates and the model. I appreciate it is not going to be easy, but we have previously linked profitability to grants and whatever else.

The requirement related to expenses only came in recently. I would reverse it. It is harebrained and a lot of manpower is going into it. It is killing businesses. It is a thing being put on top of businesses, especially smaller businesses that do not have the manpower of a full-time accountant or somebody working on accounts full time. It is murdering them. The auto-enrolment and all that is tough enough for these guys, but this is something silly. It is being accounted for anyway. I thank the Minister.