Thursday 19 October 2017

Positive moves but no 'Whitaker moment' as we brace for Brexit

There are positive measures within the Budget that will provide real help and support for businesses as they try to prepare for Brexit.

The Brexit Loan Scheme, which will provide up to €300m for SMEs at competitive rates, is to welcomed. SMEs employ over 69pc of the workforce so ensuring they have the means to prepare for Brexit is vital as part of our national effort to mitigate its negative impacts.

Likewise, the additional €25m that will be made available in loans to the agrifood sector should go some way to helping Ireland's most exposed sector.

The retention of the 9pc VAT rate for the hospitality sector is also a help, and is something that the British Irish Chamber of Commerce has been advocating. Currency fluctuation has made Ireland a more expensive market for our largest customer, the UK.

Already this year we have seen 140,000 fewer visitors from across the Irish Sea and Brexit is expected to cost the sector €100m this year alone. The lower VAT rate has done a lot to help the sector rebuild following the financial crisis and has facilitated the creation of 50,000 jobs. Its retention is sensible in light of the uncertainty ahead of us.

The commitment to increase Capital Expenditure will provide a much-needed boost to infrastructure investment, which has suffered greatly over the past decade. It is only right that as we experience economic growth that money be strategically invested in critical infrastructure projects that will improve our competitiveness and our ability to take advantage of any opportunities that might arise because of Brexit.

While there are positive measures within this Budget, Ireland is about to go through one of the biggest economic events in the history of the State, and we feel the budget strategy should reflect that.

There is no Whitaker moment in this budget.

It is relatively safe with few big surprises and while a certain degree of prudence is necessary, we must also be brave and put forward big ideas to help best protect our future.

An increase in entrepreneur relief to help support those brave visionaries who will drive our economy forward into the next phase of our economic development would have been welcome.

While we welcome the increases in spending on education, Ireland lacks a long-term, sustainable funding model for higher education. This is something that is vital for both our third-level institutions and the businesses that rely on a steady stream of educated and skilled graduates.

We must also be aware of the additional support that is needed for businesses outside of traditional fiscal measures. Uptake on existing Brexit supports has traditionally been low. The Chamber welcomes the provision for 40 additional staff in the Department of Business, Enterprise and Innovation and the enterprise agencies. The Chamber and other like-minded organisations will work together to educate businesses on the risks ahead and to support their efforts to open new sustainable markets for their goods and services.

Eoin O'Neill is president of the British Irish Chamber of Commerce

Irish Independent

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