An Ireland that works
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An Ireland that works Business priorities for growth and jobs
description
The Ireland that works campaign maps out the key priorities for business in the next phase of the recovery and will form a central part of Ibec's activities to influence and shape the national debate. With the Troika gone, Ireland has important decisions to make on how to build on the economic progress already made, tackle unemployment and drive growth across the economy. We need to get these right. At Ibec we plan to lead the debate. We have identified five pressing issues on the national agenda that will have a major impact on Ireland’s success into the future: 1. We need to reduce the tax burden: Ireland is out of line internationally and our income tax rates, in particular, are too high. Irish consumers deserve a break. 2. We need better government: Poorly designed policy, legislation and regulation add to the cost of doing business and are an obstacle to growth and job creation. 3. We need to invest in the future: To meet our future economic needs, we need to spend much more on infrastructure projects and skills and education. 4. We need to extend Ireland’s global reach: International debates on tax and EU reform could have major implications for Ireland. We need to influence and shape the agenda. 5. We need to promote entrepreneurship: Business need to have access to effective enterprise supports, credit and export markets. Risk needs to be rewarded. We hope the campaign priorities are relevant, challenging and resonant with your own ambitions for your business and for Ireland. Ibec will be rolling out more elements of the campaign over the coming weeks and months, and we'll keep you updated on our blog. Download, share or embed this campaign brochure. You can also join the conversation on twitter, #irelandworks @ibec_irl or on the Ibec Linkedin group.
Transcript of An Ireland that works
AnIrelandthatworks
Businesspriorities forgrowth and jobs
Business isn’t part of the plan for economic recovery, business IS the plan for economic recovery.
Ibec believes that the Irish economy can grow by an average of 3% to 4%every year over the next 20 years. We’re not there yet, but Ibec andIrish business, working with government, can make it happen.
Danny McCoyIbec CEO
About the “path to prosperity”,you’ll be pleased to know we have a map.
Join the conversation@ibec_irl #irelandworkswww.linkedin.com/company/ibecwww.ibec.ie/irelandworks
Ourpriorities
1. Reduce the tax burden
The challenge
The tax burden is too high and is a drag on employment, investment and consumer spending. It is making the move from welfare into work less attractive and is making it more difficult to attract much-needed mobile talent to the country. Yes, it was necessary to broaden the tax base and increase some taxes in the austerity budgets, but the tax hikes have gone too far and are restraining recovery in retail and the domestic economy generally.
Tax on work is now completely out of line with our international competitors: Ireland now has the highest marginal income tax rate at average earnings in the OECD.
The government’s pension levy is an inequitable and unjustifiable tax on the savings of private sector workers, which undermines property ownership rights. Consumer taxes are also amongst the highest in the EU and are eroding householdspending power.
The solution
Increase the entry point to the highermarginal tax rate
Reduce the fully-loaded marginal incometax rate below 50%
Bring the marginal tax rate for the self-employed back into line with other workers
Drop the unfair private sector pension levy
Reverse excessive increases in excise rates
Reform capital gains tax to support enterprise investment over speculative activity
The country’s hard work should beless taxing.
2. Better government
The challenge
Poorly designed policy, legislation, regulation and service delivery add to the cost of doing business and are an obstacle to growth and job creation. While Ireland scores well internationally for ease of doing business, we have a poor track record in how we legislate and develop policy.
Our public administration does not apply a sufficiently systematic approach to assessing the impact of new regulations which leads to unintended consequences.
The State and its agencies also have a significant impact on business conditions in areas such as enterprise support structures, utilities, local government services and infrastructure delivery. Ireland ranks poorly in many of these areas and urgent reform is needed.
Continuous reform is needed to deliver greater efficiency and cost competitiveness in government services. The number of state agencies and the overlap between them causes problems for business by generating additional costs, uncertainties and inconsistencies.
The solution
Embed rigorous regulatory impact assessmentinto the policy making process
Eliminate unnecessary regulatory and administrative costs
Introduce a new low-cost, timely and non-judicial appeals model for regulated sectors
Simplify and reform enterprise support structures, particularly innovation funding
Reform the procurement process to reduce costs and encourage SME participation
Reduce the cost of local government and introduce a fairer, more transparent system of local government charges for business
Extend recent changes to public sector pensions for new entrants to all staff
Protect Ireland’s successful, voluntarist approach to collective bargaining
Irish companies should be ableto go abouttheir business,in fairness.
Priority 3:Invest in the future
The challenge
About 70% of the public expenditure reduction during the crisis was achieved from cutbacks in the public capital programme. Capital investment must be ramped up again if we are to avoid the mistakes of the past, when infrastructure gaps were a major constraint on growth. Significant infrastructure gaps in the transport, health, education, energy and environmental services sectors need to be addressed. Record low borrowing costs mean that now is the time to invest ambitiously in the future.
Targeted investment is also urgently needed to help address the growing gap between the pace of economic recovery in Dublin and in the regions.
Investment in education, skills and labour market support is poorly targeted and is not having the desired effect. Education spending has been cut in recent years and we don’t have a robust financing model for third-level education.
The solution
Increase public investment in infrastructure to 4%of GDP by 2020
Streamline the planning process, particularlyfor energy projects and show greater leadershipon community acceptance for infrastructure projects
Ensure public private partnerships (PPPs) arethe key delivery mechanism for investment
Develop a new national spatial strategy,which supports balanced regional development
Involve more employers in the reform and roll-outof activation and training programmes
Increase effective investment in education and skills and put in place a sustainable funding model for the third-level sector
Implement a co-ordinated strategy for further education and training, and update the second-level curriculum so school leavers have coreemployability skills
Growing our infrastructure doesn’t haveto be apipe dream.
3. Invest in the future
Priority 4:Extend Ireland’sglobal reach
The challenge
Ireland remains one of the world’s most open economies. Irish business is increasingly global in focus, based on innovative manufacturing and internationally traded services.
Our prosperity is determined by important economic and strategic ties with major global partners. Investment and trade success will be central to our economic recovery and we must continue to foster effective international links.
International developments in areas such as trade and taxation will shape our prospects over the coming years, while political developments in the EU and the UK will also have significant implications for business and employment in Ireland.
The solution
Support Ireland’s competitive position in relation to international tax reform
Complete agreements with the US, Asia and others to support trade and investment opportunities for Irish and EU business
Proactively shape EU policy and regulation, promoting Irish business priorities to influence the European Council, Commission and Parliament
Work with business and authorities at national, EU and international level to advance trade facilitation and efficient customs procedures
Support exporters, particularly SMEs, by reducing regulatory and administrative barriers
We’re on the world stage,isn’t it time we played the lead?
4. Extend Ireland’s global reach
5. Promote enterprise & entrepreneurship
The challenge
Ireland doesn’t produce enough start-up firms and not enough small companies make it big. Many EU countries have a much stronger indigenous SME base, while Irish-owned firms account for only about 15% of total exports.
Finance, access to export markets and the ease and cost of doing business all remain significant hurdles for Irish business.
We need a business environment that supports entrepreneurship and rewards innovation and risk-taking. Much more must also be done to help Irish companies scale up.
The solution
Improve credit flow to business by enhancing tax-based investment schemes, state-backed capital funds, EIB support and the venture capital environment.
Address business costs, such as the government element of labour costs, utilities andgovernment charges
Prioritise entrepreneurial attributes and skills at all levels of the education system
Improve the innovation and technology supports for SMEs
Ensure Ireland’s R&D tax credit modelis world-class
Enhance the links between business andhigher education
Being in businessfor yourself doesn’t mean you have tobe in businessby yourself.
Our ambition for Ireland
Double the EU Average
for annual GDP Growth
Grow export share of
indigenous companies
Best country in the
world to do business
Rank in top 20 for prosperity
of EU's 230 regions
EU IRELAND
2012
1.5-2.0% 3-4%
20202016
20
3035
15%2012
2016
2020
20%
25%
12 3
New Ibec businessconditions ranking
Rank in top 5 OECD
Better Life countries
2012TOP 15
20 - 15
10 - 15
5 - 10
1 - 5
2016TOP 10
2020TOP 5
2.1 million people
working by 2020
2.0 2016 2.1 20201.8 2011
Double the EU Average
for annual GDP Growth
Grow export share of
indigenous companies
Best country in the
world to do business
Rank in top 20 for prosperity
of EU's 230 regions
EU IRELAND
2012
1.5-2.0% 3-4%
20202016
20
3035
15%2012
2016
2020
20%
25%
12 3
New Ibec businessconditions ranking
Rank in top 5 OECD
Better Life countries
2012TOP 15
20 - 15
10 - 15
5 - 10
1 - 5
2016TOP 10
2020TOP 5
2.1 million people
working by 2020
2.0 2016 2.1 20201.8 2011
Our ambition for Ireland
A prosperous Ireland for your children, your children’s children,and, more importantly,your children’s children’sgrandparents.
Join the conversation@ibec_irl #irelandworkswww.linkedin.com/company/ibecwww.ibec.ie/irelandworks
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