| The managing partners of Ireland's top twenty firms list their recommendations for Irish economic recovery: Accountancy Survey 2011 |
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| The managing partners of the top twenty firms suggest up to five policy initiatives to aid Irish economic recovery |
Terence O’Rourke
MANAGING PARTNER, KPMG
The Government needs to be steadfast in its efforts to retain our 12.5% rate of corporation tax. The FDI sector is a vital component of Ireland’s business landscape and any threat to the rate of CT would harm future investment decisions in Ireland Access to finance remains a major issue for many businesses in Ireland. Given the ongoing turmoil in the banking sector it is hard to articulate exactly what can be done in the short term to address this but it is a significant impediment to getting back to a more normal business environment. We are increasingly advising clients with successful businesses but who have significant personal debt as a result of property investments etc. try to extract money from their businesses to deal with their personal banking issues. To the extent that Government plans to sell State Assests (new ERA programme) proceeds from such asset sales should, at least in part, be re-invested back into the Irish economy to support job creation activities and initiatives. The Government needs to address this important issue with the Troika in advance of any sale. | | Terence O'Rourke |
The Government must continue to rollout the recommendations of the Innovation Task Force. We see in our everyday business dealings with clients, across all sectors, their focus on innovation and striving to be the best in their industry. R&D investment is the bedrock of sustainable economic recovery. Fostering an environment that clearly demonstrates support and encouragement for such investment must remain at the top of the Government’s agenda.
The Government in partnership with businesses in Ireland needs to continue to focus on developing a cost base that is at the top of the class in terms of competitiveness. We have recent evidence in KPMG that we are still some way off being able to compete with a number of our European counterparts where set up and running costs remain more attractive to would be investors. While understanding the absolute need to address public spending - and efforts here must continue - we must not as a country allow ourselves revert to third world infrastructure by taking short term decisions that have a long term impact. The Government needs to continue to invest in those critical capital projects that enables businesses to function and compete effectively on the international stage. | | Ronan Murphy |
Ronan Murphy
MANAGING PARTNER, PWC
While significant progress has already been made in repairing our economy with some signs of early recovery, the three areas requiring continued attention are: stabilising our fiscal position; reforming the public sector and rebuilding our international reputation. At a micro level, measures to actively restore consumer confidence and finance availability are also critical for the restoration of our indigenous business sector.
Brendan Jennings
MANAGING DIRECTOR, DELOITTE | | Brendan Jennings |
(i) An action plan to reform the public sector.
(ii) Greater availability of funding to support domestic businesses.
(iii) Incentives to stimulate export-led growth initiatives.
(iv) A concerted effort through the budget and other measures to build public confidence.
(v) Increased focus on building the reputation and attractiveness of Ireland internationally, as a location for business.
Mike McKerr
MANAGING PARTNER, ERNST & YOUNG
Low domestic and consumer confidence together with ongoing economic uncertainty is encouraging high levels of saving at both an individual and corporate level. Government needs to set out its fiscal policy for the next 3 years to deliver as much certainty as possible to consumers and business alike thus encouraging investment, corporate transactions and a recovery in consumer spending. | | Mike McKerr |
Government must develop and communicate a clear plan to drive liquidity back into the banking sector as SMEs are struggling to refinance existing loans or get new working capital facilities that provides fuel for growth.
Entrepreneurial businesses are also experiencing challenges in raising capital and government should consider intervening to correct this market failure by replicating models proven to be effective in other countries where equity gaps arose.
The Government must do everything in its power to renew global investor confidence in Ireland by telling them confidently that our corporation tax is not for changing. With much scrutiny and well publicized concerns raised by some of our Eurozone colleagues, the need to be seen to be standing firm on this topic is important - now more than ever.
Government must look towards niche sectors where Ireland can distinguish itself against international competition.
For example, Ireland is in a strong position to grow, develop and create a leading global renewable industry.
Government must do everything in its power to make it easier for indigenous and international businesses to invest in this emerging sector.
More needs to be done to establish greater awareness of Ireland in Asian markets - particularly India and China - of the benefits of working in or with Ireland. For example, Ireland currently sells US$3.3bn worth of merchandise goods exports to China, which is just 0.24% of total Chinese goods imports.
There is a massive opportunity to build on this - growing out businesses and benefiting our entire economy. The strong potential of its domestic market enabled India to deliver a resilient performance during the global economic slowdown - there are huge opportunities for Irish businesses selling directly into India or building businesses relationships in India.
The Government must do everything in its power to renew global investor confidence in Ireland by telling them confidently that our corporation tax is not for changing. With much scrutiny and well publicized concerns raised by some of our Eurozone colleagues, the need to be seen to be standing firm on this topic is important - now more than ever. It is also critical that the debate does not centre exclusively on the 12.5% rate, and should instead be driven by the need to continually review our broader tax landscape to ensure it remains sufficiently innovative and attractive to continue to add high value activities on what is an increasingly competitive pitch"
Derry Gray
MANAGING PARTNER, BDO
Rebuilding confidence is the key to a recovery. All initiatives must aim to restore confidence in our economy and in consumers. | | Derry Gray |
1. Given the State’s ownership of our key pillar banks, we nationally should provide for greater support of working capital to your businesses large and small who have sustainable business models and robust business plans.
2. State development of key infrastructure projects such as hospitals, where long term savings and efficiencies can be driven to
ultimately pay for the initial capital expenditure. Again based on robust business planning driving operational savings for the long term based on sound and appropriate Cap Ex. This investment will retain key construction and project management and architecture skills in Ireland which are currently being drained from the country due to the lack of work.
3. Generate confidence by accelerating the sales and transfer of assets from NAMA into appropriately funded private or JV hands. By getting our fixed asset and building stock into new ownership, new less costly options will be made available for
business, which will act as a pump primer for the economy.
4. Ireland has many friends globally. Between the power of the famous diaspora and the goodwill towards us as a nation we
need to have a Government department focused on links and connections with these groups permanently.
Joe Carr
MANAGING PARTNER, MAZARS | | Joe Carr |
1. Agree nationally key sectors on which we should focus and appoint personnel responsible for the development and growth of each areas
2. Suggested areas should be Agri-Food, Financial Services, ICT, Pharma and Medical Support Devices
3. Growth in these areas should be built around the pre defined niche areas within the industries in which Ireland has specialist
expertise and where we have the ability to compete internationally
4. Ensure that the workforce has the skills to work in these specialist areas
5. Coordinate and integrate all services and infrastructure nationally to ensure they are aligned with these growth areas and can service the needs of both domestic and international companies in these areas.
John Glennon
MANAGING PARTNER, BAKER TILLY RYAN GLENNON
1. Re-affirm the Government's firm commitment to the continuation of the 12.5% corporate tax rate. Coupled with this there is a need for annual assessment of the effectiveness of our regime for FDI projects. The recent return to the UK of a number of
large companies was due in no small part to UK tax changes. We cannot sit on our laurels - changes to the R&D regime has
been called for by the profession for some time and Government needs to act on these.
2. The education system needs to be reformed to prepare our young talent for their future careers. Whilst the system cannot simply be a tool for business, it currently does not serve our young people well in preparing them for their future working lives.
3. Continuing lack of liquidity is stifling economic growth and threatening some businesses with closure. Use of the funds from privatization of some State assets to develop a National Development Bank has merit and should be seriously considered.
4. Reform and streamlining of the Public Service is crucial. The undoubted talent that exists within the Public must be freed up to
manage.
Neil Hughes
MANAGING PARTNER, HUGHES BLAKE
(i)Seeing through landlord and tenant legislation reform; (ii) Insolvency Practitioner licensing; (iii) Making formal corporate recovery mechanisms easier to access by moving them out of the High Court (i.e. introducing a system of voluntary xaminership).
Gerry McInerney,
MCINERNEY SAUNDERS
Smart Regulation - Government and regulatory bodies that may be smarting from the justifiable criticism leveled agains
them for the damage to the banking system and the consequent knock-on effects on the public finances need to guard against overregulation that could have the effect of lessening the attractiveness of Ireland as a destination for foreign inward investment.
Taxation -The government needs to provide a more certain taxation platform to encourage Irish based and Foreign Inward
business investors make investment decisions. This certainty needs to be set for a number of years hence and must cover all
of the main taxes that are focused at business - particularly employment tax, corporation tax and the tax incentives to
promote the transfer of business from one generation to another should be re-affirmed.
Historical tax relief for investment by individuals, whether for property investment or otherwise, should be let stand as investors only made these investment decisions and took on personal borrowing on the basis of the government policy at the time that encouraged them to do so with the promise of tax relief. To curtail or withdraw relief is unethical and undermines the credibility of the State when it seeks to contract with its citizens and with business.
Public spending - Apart from benchmarking public service pay to the private sector (to also include their current generous pension entitlements) the government should take the bold decision to re-evaluate policies around public services based upon need and productivity. By setting challenging but attainable targets across all services we might be able to achieve more with less. There should be positive incentives for people to turn in for work to reduce absenteeism which seems to be a more
significant problem in the public sector than in the private sector. The need to balancing the public finances is a priority but efforts
need to be made to grow the economy as a means of closing some of the gap between income and outgoings.
Outsourcing to the private sector - The use of outsourcing regulatory policing and other public service functions to the private sector should be considered. As a result of the major work involved in providing the government and NAMA with information on loan portfolios and other related information the private sector has demonstrated its ability to respond to and satisfy the needs of government bodies.
Paul Raleigh
MANAGING PARTNER, GRANT THORNTON
(i) Investment in education and positioning Ireland as a centre for educational excellence so as to improve our own skills and knowledge base and to attract overseas students. (ii) Support for export focused businesses. (iii) A structure to deal with personal insolvency
Tadhg O’Sullivan
SENIOR PARTNER, OSK
(i) Continued public sector reform; (ii) More initiatives to improve/encourage bank lending to SMEs; (iii) Retention of low corporation tax rate
Brian Conroy
MANAGING PARTNER, HORWATH BASTOW CHARLETON
1. Updating of company law and streamlining of ‘corporate’ bureaucracy; Infrastructure investment in energy and public services, especially education
2. Incentives to assist construction/ engineering services sector to 'sell' overseas
3. ‘Tourism’ infrastructure plan integrated with 'hotel' rationalisation
4. R &D State leadership especially in healthcare, and engineering
Pat Lawlor
MANAGING PARTNER, BRENSON LAWLOR
(i) Review/eliminate the Croke Park Agreement and the Government reducesubstantially the Public Expenditure levels to corresponding international levels; (ii) Establish a banking system that will provide finance to the Irish SME sector and allow
good businesses with significant debt to continue trading; (iii) To develop green energy technologies/incentives further in order to reduce our dependency onoil/gas and to increase employment in these areas;
(iv) To continue to further developments in IT infrastructure/services; (v) Support for Ireland as an international education destination.
Carl Dillon
MOORE STEPHENS
(i)Address budget deficit by reducing public sector spending.
(ii) Provide better incentives and support to start up businesses.
(iii) Get banks lending.
(iv) Deal with personal debt issues.
(v) Maintain the 12.5% Corporation Tax Rate.
Jim Mulqueen
MANAGING PARTNER, RSM FARRELL GRANT SPARKS
(i) Access to Finance for SMEs;
(ii) Continued Commitment to the 12.5% Corporation Tax Rate;
(iii) Restore Reputational Damage; (iv)Fixing the Banking System;
(v) Job creation initiatives
Liam Rattigan,
CHIEF EXECUTIVE, RBK
(i) Focus more initiatives on food and alternative energy sectors- our natural resources.
(ii) Access to Credit and Lending
for business on reasonable terms and conditions.
(iii) A support Irish campaign
(iv) Reform the costly and complex legal system.
(v) Reform of the grocery retail
sector.
Willie Fahey
IFAC
1. Front load taxation and spending cuts for the next 3 years within reasonable specific terms. This will bring money currently on
deposit into spending which will lead to much needed domestic growth.
2 .Financial institution regulation under Elderfield is now too restrictive. The credit unions have lent to people and businesses over the years based on the original bank lending model which was based on “local knowledge” and they are now having to refuse lending which they know would be sound. The banks are still in transition, shredding staff, re training with a focus on “Lending” as opposed to “Sales” which was the norm in the Celtic tiger era. A vacuum has developed, many businesses cannot get credit and this is detrimental to the economy. This should be addressed by Government as a matter of urgency.
3. We need a new partnership model which will have at its core the overriding objective of keeping costs low so that we remain
competitive as the economy grows. This new model must avoid past mistakes where sectorial interests predominated in a weak
political but strong trade union environment. Short term gain must never again take precedence over long national economy objectives. |
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