ISME calls for action on business costs

The Irish Small & Medium Enterprises Association (ISME) has called for urgent action to address Government-influenced costs.

The employers' body was reacting to the latest inflation figures, issued today, which still remain well ahead of many international competitors.

A report released by the Central Statistics Office today showed that the rate at which prices are rising fell to 2.2% in August, down from 2.7% in July.

The Association stated that costs were still increasing in many areas, particularly those influenced by Government, including gas and electricity, health and transport, which will lead to more company closures and job losses.

According to ISME chief executive Mark Fielding: “As businesses do their best to reduce the costs under their control, they are being completely undermined by high costs imposed from outside the enterprise, in particular commercial rates, rents, transport, labour and energy.

“From an SME perspective, the never ending round of cost increases, together with the economic uncertainty, is destabilising businesses, impacting on planning and growth prospects.”

Fielding was particularly critical of the recent decision by ESB to increase electricity costs by up to 15%, which he described as another slap in the face for hard-pressed businesses.

“The calls from Government representatives for a competitive economy sound 'hollow' when the State itself is doing little or nothing to address the costs of goods and services under its control,” he said.

“The reduction in inflation should not be a signal for complacency and jumped on by spokespersons to indicate that ‘all is well’.

“In the week where it has been confirmed that our world competitiveness position has remained at a disappointing 29th, it is imperative that a root-and-branch review is carried out to address our cost structure, particularly the impact on indigenous businesses. Unless appropriate action is taken, the future of thousands of companies and the individuals they employ remains in jeopardy.”