ISME: Next Government must prioritise SMEs

The Irish Small and Medium Enterprises Association (ISME) has published its ‘Priorities for the New Government’ document, emphasising that a pro-enterprise Government and the formation of a genuine entrepreneurial culture across Ireland is essential to breathing new life into the Irish economy.

Within its report, the ISME called on the new administration to retain the role of small business minister and outlined 13 key priorities that must be reformed during the next Dail term.

Mark Fielding, chief executive, ISME, said: “Ireland will not secure a sustainable recovery without an economic recovery of SMEs, the backbone of our economy and our society.

“SMEs represent two-thirds of employment and around 60 per cent of turnover. Furthermore, SMEs have created nine out of every ten new jobs during the last five years and are the main drivers of innovation.

“We need more entrepreneurs and more entrepreneurial spirit in our society at large. The new Government must ensure a “cultural change” towards entrepreneurship, as the current culture often fails to recognise and reward entrepreneurial endeavours.

“SMEs must be at the centre of the Government’s decision making process leading to a stronger indigenous sector and an economy that is not over-reliant on foreign direct investment.

“In essence this new Government must “Think Small First”. If the next government creates the right environment, SME businesses will create jobs and sustainable growth.”

Within the ISME’s document, the 13 key priorities highlighted are:

• Retain the position of a Small Business Minister within the Enterprise Department.

• End the tax discrimination against the self-employed and proprietary directors. SME owner/managers pay more tax than their employees, despite the fact they are job-creators.

• Additional employment could be generated by reinstating the 4.25 per cent rate of Employers’ PRSI.

• High Capital Gains Tax rates are dissuading owner-managers from passing on their business through succession or sale and should be reduced to 10 per cent.

• ISME surveys suggest that almost half of all small business loan applications are being rejected. Improving SME Access to Finance must be a priority going forward for the new government.

• 30-day payments should be made mandatory as part of Prompt Payment legislation.

• Government needs to address state-influenced costs such as local authority rates and tax on transport to keep a lid on business costs.

• Improved broadband infrastructure across all areas of the country should be a priority.

• Reinstate redundancy rebates as a matter of course.

• Remove obstacles to Public Procurement for SMEs.

• Cut childcare fees e.g. a second free pre-school year, a €2,000 childcare subsidy for working parents of children aged nine months to 36 months in formal childcare settings.

• Raise funds allocated to SME management and employee training.

Conduct a Comprehensive Spending review in Public Service and introduce an Independent Public Sector Pay Commission.

Date published 25 Apr 2016 | Last updated 25 Apr 2016