As we approach Budget Day on Tuesday, October 1, there are two priority issues that Retail Ireland has called for urgent action on. Firstly, new measures are needed to off-set spiralling labout market cost increases. Secondly, more needs to be done to address the concerning rise in retail crime and the harassment of retail workers.
At a series of meetings with senior Ministers in advance of the budget, Retail Ireland highlighted the deep concern at the cumulative cost of ongoing and planned labour market reforms, following a period of already unprecedented inflationary pressures. These measures, taken together, have the potential to significantly undermine job creation and investment in the sector into the future.
In March, a Government report highlighted that over the next few years many retail and hospitality businesses are facing into employment cost increases of up to 37%. For many retail businesses, of all different sizes and across the full range of retail categories, this is simply too much to bear. So, what can be done on budget day to help?
Retail Ireland has called for the introduction of a PRSI rebate based on the number of lower earning workers on a company's payroll. The PRSI support scheme would be based on a rebate for each worker below an agreed earnings threshold.
We have also said the entry point to the top rate of PRSI must remain above the minimum wage. A failure to increase the income threshold for the reduced employer PRSI rate of 8.8% in Budget 2024 was a mistake, particularly given the very large increase in the National Minimum Wage in January of this year.
Recognition of this during 2024 was welcome. The threshold should be indexed above the minimum wage each year in the coming years. At a time of major cost challenges, the Government should also confirm that sub-minimum National Minimum Wage rates will stay in place. The introduction of a Living Wage will deliver significant increases in sub-minimum rates over the coming years. In addition, sub-minimum rates are an important incentive for the recruitment of those with limited workplace experience.
The removal of sub-minimum rates would have a negative impact on the ability for young people to access the labour market, as their employment would come at the same cost to employers as employing more experienced, older workers. It also ensures young people are given what may be their first opportunity to join the labour market, instead of losing out to more experienced counterparts.
The other key concern is the significant increase in retail crime, anti-social behaviour and the harassment of retail workers. This issue is a source of immense concern and frustration and is costing an ever-increasing amount of time and money to manage.
Businesses are doing what they can to support their staff, prevent crime and reduce incidents of harassment, but without additional support and high frequency patrols by An Garda Siochana there is little that individual retailers can do to alleviate this in the longer term.
The problem is seriously and negatively impacting retail workers, who have to manage issues as they arise, and it is ultimately making key town and city centre locations less attractive places in which to shop and trade.
Budget 2025 should increase funding levels to An Garda Siochana to allow them to effectively deploy resources to reduce retail crime levels. This must include an increased and highly visible Garda presence on the ground, improved response times to incidents and speedy follow-up to apprehend and prosecute perpetrators. Investment in better street lighting, improved outdoor areas, accessibility, and safe transit hubs is also required. October's Budget is an important chance to address some of the key challenges facing the sector. It is vital that the opportunity isn't missed.
