Chambers Ireland welcomes today’s ratification of the programme for government

 

There is an urgent need for our new government to provide clarity regarding the extension of business supports. The July economic package must provide for:

• Continuity for the Temporary Wage Subsidy Scheme,
• Simplification of the restart grant process, in tandem with its expansion to businesses that have been excluded thus far and more meaningful grants, and
• Ensure that monies are transferred to Local Authorities to plug the budgetary shortfall that results from extending the Commercial Rates waiver.

But much more beyond that needs to be done.

Even without a second wave of the virus, all the economic indicators suggest that our economy will struggle for a considerable period. The World Bank estimates that the shock will result in a global recession, the severity of which has not been seen since at least 1870.

It will likely take years rather than months to recover from this shock, and we know from the Great Financial Crisis that while we may recover the growth rates of earlier years, we never make good the shortfall of the crisis.

It is therefore vital that the new government acts boldly to minimise the extent of the damage to the economy. As Chambers Ireland has said – since the beginning of this crisis – under-reacting poses a greater threat to our national wellbeing than overreacting.

Piecemeal actions that are ineffective not only waste financial resources, they waste time, and we lose out on opportunities as a result.

Those parts of the economy that have suffered least from the Covid-19 Crisis will likely be most affected by Brexit in the new year, and the form of Brexit that is looking most probable now will be far closer to World Trade Organisation rules than what we are working with now.

Amplifying these affects are the structural factors inherent in Ireland’s status as a small, open, advanced economy; we grow most quickly when the world economy grows, but we also shrink more as the world economy shrinks.

A programme of sustained investment in the domestic economy must be a fundamental feature of our economy over the medium term. Even before the Covid-19 crisis our economy was constrained by a decade of under-investment in infrastructure.

This government must use the coming years to make advances in this.

Critical to our recovery will be:

• Creating the regulatory infrastructure to permit the development of offshore wind-farms
• Aligning our National Development Plan and Climate Action Plan with the European Green Deal if we are to be able to access the €1.5 Trillion which is being made available, and
• Making progress on restoring economic health to our cities and towns

 It is very positive to see a new government finally formed, but the real work has yet to begin.”

-ENDS- 

For further information contact Shane Conneely, Senior Research and Policy Executive on 01 400 4331, 086 608 1605 or email Shane.Conneely@chambers.ie