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Budget 2024 Did Not Do Enough to Secure Economy’s Future

Budget 2024 did not do enough to secure the future economy of the country, according to a representative of the Irish Business and Employers Confederation (Ibec).

Ibec’s executive director Fergal O’Brien told RTÉ radio’s Today with Claire Byrne show that while Budget 2024 was balanced and appropriate for the current economy, not enough is being done to really secure the sustainability of the economy for the long term.

Corporate tax had grown from €5 billion seven years ago to €25 billion, Mr O’Brien noted, but not enough was being invested in the future, he claimed.

He said the infrastructure fund announced in the budget was really positive for Ibec’s members, but not enough was being invested in things like education, research and science, upskilling and competitiveness issues, particularly in the ‘experience’ economy, such as hospitality and related sectors.

“There are a lot of costs coming on to business, and I think the one-off measures are good.”

However, he warned: “I think businesses are really going to feel the economy becoming a higher-class economy over the next number of years, and we would have concerns about a lot of business viability and ultimately employment in that sector.”

Mr O’Brien said measures such a minimum living wage, statutory sick leave and pensions will mean extra costs for businesses, some of which would have tight margins and will not be able to survive.

“I think some of those won’t be able to survive without proper support in the indigenous sector.

“I think you’ll probably see less employment. I think businesses will be desperately looking at ways to reduce their employment levels, but also you’re just going to have to see that passed on to the consumer.

“So the consumer will have to pay for a large amount of this as well,” he said.

He added: “We have two or three more years of these labour cost increases to come through, and we need to figure out how we want to manage the transition.

“We want to move to a higher value economy, better quality jobs, and that’s all super, but right now we’re not investing enough in the education or the research, the science and the upskilling that we really need to.

“We still have [€1.5 billion] surplus sitting in a national training fund that employers are paying into. We can’t seem to find a way to get that money out, but they’re the kind of things that would help you build a more sustainable economy.

“So lots of good things, but probably things that we need to start planning much more strategically for the long term as well.”

Mr O’Brien pointed out that recommendations from the Commission on Taxation and Welfare have still not been implemented, adding that ultimately more is going to have to be paid in taxes to maintain the quality of public services.

He warned the tax base needs to be broadened so the State is not so reliant on corporate tax receipts.

Source: Breaking News