Wednesday 21 March 2018

Business chiefs fail to agree on way out of recession

Competitiveness is key to recovery, delegates are told

John Bruton,
chairman of IFSC Ireland, at IBEC
conference for chief executives in
Convention Centre in Dublin yesterday
John Bruton, chairman of IFSC Ireland, at IBEC conference for chief executives in Convention Centre in Dublin yesterday
Thomas Molloy

Thomas Molloy

BUSINESS leaders ranging from Aer Lingus chief executive Christoph Mueller to Glen Dimplex's Sean O'Driscoll gathered in the National Convention Centre yesterday to discuss the state of the economy -- but disagreed on what needs to be done and who should do it.

The €400-a-ticket event entitled 'Now, Back to Business' included talks from some of the country's most successful businesspeople as the pro-business lobby group IBEC sought to bolster confidence in the economy.

While speakers from a variety of companies painted a picture of an economy that is beginning to recover, most also emphasised that the country has much to do before the situation improves.

"I do not believe we face the prospect of a lost generation but we have to take steps to stop it happening," IBEC chief executive Danny McCoy said in the opening address. "My contention is that the scale is not unmanageable."

The former ESRI economist, like many other speakers, accused the media of exaggerating the country's problems.

The €50bn cost of the Government's bank bailout will cost taxpayers just €1,000 a year or €20 a week which is manageable, he calculated.

His calculation assumes an interest rate considerably lower than the present cost of borrowing and assumes that the actual sum of €50bn will never be paid off.

Aer Lingus chief executive Christoph Mueller sounded a more cautious note, complaining that his airline had to pay higher interest rates than rivals simply because it is based in Ireland.

Irish companies are often too big and have failed to adjust to the shrinking economy, he said.

"You have to figure out when your overhead is just too large," the German chief executive added in a blunt warning to his Irish counterparts.

Other speakers were also quick to point out that business had played a role in the country's problems while also emphasising their belief that Ireland retains many strengths and can recover from the present problems.

"We have been world class at foreign direct investment and we remain world class at foreign direct investment," said Jim Barry of NTR. "We were rolling out the red carpet when others were rolling out the red tape."


Despite these successes, Mr Barry was critical of many aspects of Irish life. "We paid ourselves too much and we taxed ourselves too little," he admitted. "Everybody was in on this."

The theme of excessive payments was picked up by Glen Dimplex boss Sean O'Driscoll who blamed chief executives for presiding over excessive pay increases during the past decade which damaged national competitiveness.

While critical of his colleagues, Mr O'Driscoll devoted most of his speech to a call for national renewal ahead of the centenary celebration of the 1916 Rising.

Ireland should seek to become the European Union's most competitive country over the next six years to ensure that the next generation does not become the first in our history to be worse off than previous generation, he said.

"Germany has shown it can be done. Germany has reduced its labour costs by 20pc," he told the audience.

The Glen Dimplex boss was especially critical of the public sector, saying it needed to be fixed rather than reformed.

"The dead hand of bureaucracy is seen all over the public sector but the finder points are hard to find," he added.

Irish Independent

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