Retail

Irish Government Announces Budget, Retailers Welcome Energy Supports

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Ireland's retailers have welcomed measures to combat spiralling energy costs, as outlined in the government's Budget 2023 announcement, however they warn that more measures may be needed if prices remain high into 2023.

Retail Ireland, which represents the Irish retail sector, was commenting following a Budget announcement in which the Irish government unveiled a Temporary Business Energy Support Scheme (TBESS), to reduce energy costs for firms, as well as offering electricity credits (of €600) to all households.

Additional cost of living supports, changes to tax brackets and reductions in childcare costs are other measures that the Irish government hopes will alleviate the inflationary situation for consumers.

Despite this, the outlook for the sector remains 'very challenging', Retail Ireland said.

Retail Ireland: 'More Help Will Be Needed'

Commenting on the measures, Retail Ireland director Arnold Dillon said, “The new energy support scheme will offset the worst excesses of recent price hikes, but more help will be needed into next year. Without ongoing support the energy crisis will push many vulnerable retail businesses to the wall.

“Reducing personal tax and childcare costs will help those struggling with bills and support consumer spending in the run up to Christmas. It is crucial that people see a way through the current period of high inflation. Today’s budget provides important relief for individual and households budgets and will hopefully support a recovery in consumer sentiment."

Dillon added that it was "disappointing" that the reduced VAT rate for the hospitality sector was withdrawn, noting that the measure helped improve the vibrancy of towns and city centres.

"Planned labour market reforms, which will significantly increase employment costs, remain a concern," he added. "It is crucial that businesses are provided with more support as they work to manage and implement these far-reaching and costly reforms."

Food Drink Ireland: 'Step In The Right Direction'

Elsewhere, Food Drink Ireland (FDI), which represents the Irish food and drink sector, welcomed energy supports as a 'step in the right direction', but also called for larger support measures over a longer time period.

“Energy supports are now central to the sustainability of many food and drink businesses as they will determine their ability to remain competitive in export markets like Great Britain, where they also face the headwinds of a weakened sterling exchange rate," commented FDI Director Paul Kelly.

FDI also called for the energy supports for businesses to match those in other key EU export markets so that food and drink businesses can maintain their valuable market positions.

Dublin Chamber: 'Cuts To Childcare Costs Welcome'

In addition, the business group Dublin Chamber, which represents 1,300 firms across the Irish capital, welcomed efforts to improve the tight labour market, including addressing childcare costs.

“The CSO estimate that there are over 58,000 women who could potentially be in a job, but are not in the labour force,” said Aebhric McGibney, director of public and international affairs. “We believe that the boost to cut the cost of childcare will help bring these people into the many employment opportunities firms have an offer but are currently unable to fill in a tight labour market.”

On moves to alleviate energy costs, Dublin Chamber added that the Irish government should make more of an effort to 'tackle the root causes of rising energy costs', helping business to make a transition to a lower carbon or energy efficient model.

© 2022 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.

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