Legal, Postal and finance fees being allowed to run out of control.
Complacent Government allowing costs to escalate.
Union wage demands could scupper recovery.
ISME, Thursday 10th July 2014.
ISME, the Irish Small and Medium Enterprises Association, at the release of the CSO inflation figures today (10th July), called on Government to reduce state-influenced business costs, which continue to affect our international competitiveness. The Association reiterated its warning on premature and unsustainable union calls for wage increases, as SMEs continue to struggle with high costs and low consumer demand.
The annual inflation in June was 0.4%, a composite figure which includes services inflation of 2.1%, consisting of legal fees under ‘other services’ at a massive annual inflation rate of 24.2%.
Commenting on the figures, ISME CEO, Mark Fielding said, “Because of the composite nature of the inflation figures, real cost increases tend to slip under the radar and get ignored by Government. The ongoing increases by the monopolistic legal profession and An Post are examples and indications of the lack of courage to tackle these issues, which are stifling recovery”. “The latest calls by the unions for a ‘makey-uppy’ living wage is just another wheeze to demand wage increases. Someone needs to inform them that economic recovery is far from assured and unsustainable wage increases will hamper growth. The emphasis must be on productivity and enhanced competitiveness, not on increasing the already high cost base of struggling companies.”
The Association called on the Government to:
Ensure that all state imposed business costs are reduced in line with competitor countries.
Address the costs of energy, transport and exorbitant fees of the monopolistic legal profession.
Legislate for upward only rent reviews on legacy leases.
Reduce Public Sector costs by addressing their increments, perks and inefficiencies.
“Government should be active in the drive to reduce and contain costs so that we can be competitive in the global market. The recent permission for a 13% increase in postal charges is a disgrace and an abdication of responsibility by an Administration out of touch with business reality”, Fielding concluded.