22nd September 2011I am pleased in these difficult times to perform the official opening of a new business. I am particularly pleased to have been asked to open a business like this one. Tax Assist is a valuable and much needed enterprise and I am delighted with the initiative of Dermot and his colleagues and at their willingness to take the risk involved in developing a business concept that is absolutely right for these times. What all the professions should be offering, and what citizens increasingly need, are easily available, transparently structured and priced services – backed by a tough regulatory professional body.
This is important for two reasons: one of which is the ease of doing business in Ireland and the other is the importance of access to advice and support for anyone who is in financial difficulty. We will only emerge from our present circumstances if we can increase the level of domestic business activity and actually grow our economy.
Figures out today show GDP expanded by 1.6 per cent in the second quarter of this year, which is encouraging. An even stronger increase was recorded on an annual basis. Taken together with the first quarter figures, today’s data clearly show that a recovery is underway. The increase in activity is being led by the exporting sectors of the economy. This, in no small part, reflects the significant improvement in competitiveness that has taken place in recent years. This, in turn, is testament to the flexibility of our economy. Unsurprisingly, domestic demand remains weak. It will take time to rebalance and strengthen the domestic economy.
Crucial to this will be our SMEs. For them to succeed, we must remove as many obstacles and costs as possible. Access to competent, competitively priced financial advice is an essential part of this. The World Bank league table on the costs and ease of doing business has us at Number 7 which is good, but we can do even better. We are seventh on the scale of ease of paying taxes, which is not bad. To have an efficient, client orientated tax collecting mechanism is an important priority. Transparency and efficiency in the public service, which supports growth in the economy is also crucial. Entrepreneurs are entitled to have competent and professional services at their disposal.
Because of major improvements, tax compliance has become the norm rather than some kind of random lottery. But we need to keep working on this. Tax Assist has a very important role to play in this regard.
It is our own, home-grown businesses that will lead us to strong, domestic growth again. If they cannot grow – Ireland cannot grow. I am proud of the Government’s achievements since coming to office in helping to create an environment in which business can survive and thrive.
The jobs initiative was an immediate and forceful move to inject life into the business sector. Everywhere I go I hear from people in the hospitality industry how helpful the VAT reduction on tourism-related services has been. That reduction is the best example of the kind of common-sense action this Government is taking to ease the burden on small business. We want to let business people do what they do best – provide services and employment. So, it may take some time but we want to tear down the obstacles, slash the red tape and ensure that if someone wants to sell something, provide a service or create a job, it will be as easy and inexpensive as it possibly can be.
We’ve already cut red tape by increasing the number of businesses exempt from the requirement to hire external auditors under EU law, a measure likely to save Irish SMEs up to €5 million this year. But we want to multiply that by a hundred! We’re working to the reduce red tape imposed by Government on business by 25% by the end of next year, resulting in savings of €500 million. My colleague John Perry, in his role as Minister for Small Business, has assembled a Small Business Advisory Group - made up of real business men and women - to facilitate an ongoing structured and regular dialogue on how to promote the economic development and job potential of the sector.
Ladies and Gentlemen I can assure you the Government is diligently working to unravel the economic morass imposed on this country by the previous administration. One of the greatest achievements has been the successful renegotiation of elements of the EU/IMF programme. The savings associated with the reduction of the interest rate will reduce the cost of our assistance by at least €800 million per year. That is not to be sneezed at.
As I said at the outset people are struggling to cope with the consequences of the financial crisis. In line with the commitment in the Programme for Government and the commitment under the EU/IMF Programme a Personal Insolvency Bill is in the course of being developed in the Department of Justice to provide for a new framework for settlement and enforcement of debt and for personal insolvency. This Bill will provide for comprehensive reform of bankruptcy law and the creation of a new non-judicial debt settlement system.
There will also be quicker, interim reform in the bankruptcy area. The Civil Law (Miscellaneous Provisions) Act 2011 provides for some early changes to judicial bankruptcy law: a reduction in the period of application to court for discharge of a bankruptcy from 12 years to 5 years- and the introduction of automatic discharge of a bankruptcy after 12 years.
In an economic environment where we desperately need to promote the enterprising spirit, this is an important step.
In my role as Minister for European Affairs, I am working with the Taoiseach, the Tánaiste and my colleagues across Europe to resolve the seemingly never-ending Euro-zone crisis. The Euro is essential for Irish business. The European Union provides us with direct access to a market of more than 500 million people.
Less high profile is my work on the implementation of the Europe 2020 strategy for growth across the Union which strives to strengthen the European SME sector. The biggest increases in Ireland’s exports have been to EU member states. But we need a greater opening and deepening of the Internal Market, which has to become the natural reference point and basis for a wider global growth on the part of Irish business.
I like to think of the opening of this office as a fitting metaphor for what we in Government are trying to do – simply make it easier to do business. I have a very clear vision for the type of society I want Ireland to be - and I purposely use the word society and not economy because one depends on the other. Ireland, with its entrepreneurial spirit can once again be a work leader in business and innovation while nurturing a compassionate, caring and supportive society.
We can become a people who know their responsibilities as well as rights, who look after their neighbours, support local business and strive to achieve better for themselves, their families, their communities and their country. But before we can begin to realise this, we have to address the basic need of any society – work for its people. The Government cannot do this directly (we all know where increasing the Government and public sector payroll got us!) but we can create an environment where business, Irish business, can create wealth and employment that will contribute to the kind of society we all wish to see.
Thank you and I wish you well.