Cost of housing has become ‘material threat’ to our prosperity, says ISME

The cost of housing has now become “a material threat” to Ireland’s social prosperity, the chairman of small business association ISME said on Wednesday, as he warned that it this was feeding through into increased wage pressures.

Speaking at the annual ISME conference in Citywest, Dublin, chairman Ciaran Murtagh said Irish society, as well as the economy, faced "real challenges".

Against a background of rising rents, Mr Murtagh said that the price of rent and housing had now become “a material threat” to Ireland’s social prosperity. Moreover, there was now an expectation among employees that their employer could meet ever-increasing housing costs through their wage packet.

“Even if this was true it would succeed only in transferring money from employers to landlords through rent. We need a viable alternative,” he said, adding that State intervention “ on a significant scale” was needed in the social and affordable housing market.

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Another challenge was the country’s large level of debt, and Mr Murtagh said that per head Ireland had one of the largest debt burdens in the world.

“Our generation will gift to our children a debt of €42,000 each. That’s before we ask them to pay for our unfunded pensions,” Mr Murtagh said, adding that despite this the public sector still called for “more people, more resources, and more pay”.

“We need to say to our public servants that we’re entitled to value for money and good service. We’ve paid for it.We need to understand that if we don’t control costs, ultimately they will be borne by every one of us as citizens”

Political failure

Mr Murtagh also said that there was “too great” an emphasis on foreign direct investment .

“We have long called out the universal political failure to embrace the contribution that small enterprise makes to Ireland. We have long said that focus is required on indigenous enterprise” .

On Brexit, Mr Murtagh said that while the next two years would “fundamentally alter” Ireland’s trading relationship with the UK, the UK would still remain the largest trading partner for many Irish SMEs. “Brexit won’t change that,” he said, adding that our future as a trading nation “is bright”.

However, he warned that the next few years would be turbulent, “but everyone will be affected by that turbulence”.

“What we need from Government is commitment, resolve, and leadership.”