A campaign has been established, www.smealliance.ie, which includes CSNA and a range of other trade and employee representative organisations, and is calling for immediate and essential reform in the key areas of the national minimum wage and taxation. It is also seeking recognition for SMEs and employer representation at the Labour Employer Economic Forum (LEEF) and on the Low Pay Commission.
National Minimum Wage Reform
The way in which we consider changes to the minimum wage must change. Calculation of the minimum wage must reflect the fact that 48% of the workforce are employed by public service or multinationals, which enjoy far higher wages than the rest of us. At a minimum, public sector pay must be disregarded from calculations. Future increases in the NMW must not exceed CPI.
Tax Reform
Meaningful tax reform has been postponed for too long. We will rarely have a better time to address it. We want to see:
- The 8.8% rate of PRSI must apply to the entirety of the National Minimum Wage, currently €495.30 per week. (The SME Alliance understands that Government has accepted this Alliance recommendation for Budget 2025)
- The food service and grooming sectors require the permanent establishment of a 9% VAT rate.
- Our 23% standard VAT rate is too high and should revert to its historical 21% rate.
Industrial Relations Reform
The manner in which Government engages with employers is flawed. SMEs employ 68% of the active workforce, which totals 2.3m people, but they have no representation in industrial relations matters with Government.
We require pro-rata representation on the Labour Employer Economic Forum (LEEF) and on the Low Pay Commission.
All legislation affecting labour and overhead costs for SMEs must be subject to the SME Test and regulatory impact assessment. As is required by Irish and EU law.
Vincent Jennings, Chief Executive, CSNA, said: “The recently published Draghi Report on EU competitiveness stated that more than half of SMEs in Europe flag regulatory obstacles and administrative burdens as their greatest challenge. This is a clear wake-up call for the Irish Government which needs to recognise that while small employers are the backbone of the Irish economy, many are close to breaking point with the amount of extra cost and regulatory burden imposed on them.”
Among those organisations who have initially signed up to the campaign are ISME, Convenience Stores & Newsagents Association; the Irish Hairdressers Federation; Restaurants Association of Ireland; Irish Hardware Association; Nursing Homes Ireland; Retail Excellence Ireland; Hair and Beauty Industry Confederation and Vintners’ Federation of Ireland.
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