Ongoing reassessments of proposed regulatory changes such as an extension of paid sick leave duration and the abolition of the sub-minimum wage are likely to help Ireland’s struggling small and medium enterprises even if the measures are eventually approved, Minister for Enterprise Peter Burke has suggested.
He said a desire to support SME’s had been one of the reasons a number of such reviews had been ordered but that even if the measures ultimately went ahead, their delay would help SMEs avoid the sudden, cumulative impact of the original scheduling.
He was speaking at a post-budget briefing on Wednesday during which he acknowledged he had been unsuccessful in having the VAT rate for the hospitality sector reduced to 9 per cent.
However, he pointed to a range of significant supports that had been provided and said regulatory measures in the pipeline have been delayed for further consideration.
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“We’ve brought the new SME test into the heart of Government with stress tests of any regulatory change that might impact that sector,” he said. “We’ve also been very slow to progress other regulatory changes which has given them the opportunity to avail of the various supports that are being given.”
Mr Burke’s decision to seek further reviews of the extension to paid sick leave of five to seven days from January, and a recommendation by the Low Pay Commission to abolish sub-minimum pay rates for those aged under 20, have been criticised by unions. They have said the issues were subject to protracted consideration and debate before the recommendations were made.
“I have really looked at the increased cost of regulatory change. In terms of sick pay, we are currently assessing that and we are looking at a piece of research that will allow us to make a more informed decision on it,” the Minister said.
“We are also looking at the sub-minimum [pay] rates; that’s another proposed regulatory change that we are being very careful to respond to.”
He said he was not seeking to undermine the potential value of the measures but that the cumulative costs involved had the potential to put particular strain on businesses if they came into effect simultaneously.
Unions have been concerned, however, that Government would delay or stagger the implementation of the 80 cent increase to the national minimum wage announced on Budget day.
The Minister hailed its implementation on January 1st as “a very significant intervention by Government”, saying the increase would leave those on the minimum wage significantly better off.
The increase, from €12.70 to €13.50 will add €31.20 to the weekly wage of someone of the minimum wage, or €1,622.40 over the course of a year.
About 165,000 people earn the minimum wage in Ireland, a group disproportionately made up of women, younger workers and people with disabilities, many of them employed in the retail, hospitality and services sectors.
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