Low inflation figure hides State influenced Business Costs.
ISME calls on Government to reduce state-influenced business costs.
At the release of the CSO inflation figures today (8th May), ISME, the Irish Small and Medium Enterprises Association warned that state administered prices continue to be higher than our competitors, resulting in higher costs for business and continue to outpace even the headline HICP inflation in Ireland. The Association repeated its call on Government to begin a process of reduction of state-influenced costs and local charges as highlighted in the recent National Competitiveness Council report.
Consumer Price Index (CPI) inflation for April was 0.1% for the month and 0.3% in the year.
Commenting on the latest figures, Mark Fielding, ISME CEO, said, “The hidden price increases administered by the State continue to affect our international competitiveness, which has also been falsely enhanced by the depreciation in the euro against the currencies of our major trading partners. As a result of this any small gains in competitiveness could be very quickly eroded.”
“Business owners are continuously hit with excessive state administered or influenced costs, such as energy, transport, rates and local charges which make it difficult to keep the business profitable. Government should be actively reducing these excessive costs so that our indigenous businesses have a fair chance to prosper and expand”.
The Association called on the Government to:
Ensure that all state imposed business costs are reduced in line with competitor countries.
Address the energy and transport costs and exorbitant fees of the monopolistic legal profession.
Legislate for upward only rent reviews on legacy leases.
Reduce Public Sector costs by addressing the increments, perks and inefficiencies.
“The low overall inflation figures do not tell the whole story, as they conceal high state-influenced business costs, at a time when economic revival remains tentative. It is imperative that Government address the issue as any negative change in the international inflation and/or currency situation could send the economy back into recession,” concluded Fielding.