Business leaders lobby against budget measures

COMPANY DIRECTORS want the Government to generate more savings in its own departments before targeting businesses in the forthcoming budget.

In its pre-budget submission, the Institute of Directors said businesses are being targeted for a “disproportionate percentage” of the measures being considered for the budget and this would have a “serious negative impact” on the sector.

In particular, it wants the Government to hold back on raising both employee and employer PRSI and is asking it to reconsider establishing a statutory sick-pay scheme. Business lobby group Ibec has also voiced concerns about PRSI and sick pay.

“The Government must realise that short-term gains through proposed taxation measures will be offset by longer-term problems as more businesses in Ireland come under pressure,” said IoD chief executive Maura Quinn.

A statutory sick-pay system could see employers bearing the first few weeks of employee sick leave. The IoD says the €90 million in savings the Government expects statutory sick pay to generate could come instead from “greater efficiencies” in the Department of Social Protection. The institute highlighted €92 million in welfare overpayments in 2011 as a potential target.

Almost 60 per cent of the directors surveyed said the Government had not demonstrated transparency and accountability since taking power.

Some 77 per cent rated the performance of the Department of Health as “poor” or “very poor”, while slightly more than half awarded similar ratings to the Department of Public Expenditure and Reform. The Department of Finance was identified as the best performer.

The Institute of Directors has almost 1,700 members but just more than 200 took part in the survey, which was conducted at the start of this month.

Three-quarters of survey respondents were in favour of a “two-tier” child benefit system.

The IoD also called on the Government to make good on its commitments to ensure tax exiles make a fair contribution to the exchequer. Three-quarters of respondents supported the reintroduction of a “place of abode” test for taxation.