ISME has listed representation for small business on the Labour Employer Economic Forum and the introduction of a junior minister for SMEs among its top priorities for the year ahead.

The small business association said there are some 272,500 SME businesses in Ireland, employing nearly 1.2m people, equating to 52% of the workforce, making SMEs the State's largest employment sector.

As such, ISME believes the incoming government must formally engage with SME employers through the Labour Employer Economic Forum (LEEF), and therefore provide the sector with representation on the LEEF.

The organisation further states that there should be a Minister for State for Small & Medium Enterprise, appointed by the incoming Taoiseach, in addition to the Minister for Enterprise.

"This is both a reasonable and sensible suggestion, based on the number of SME companies and the number of people they employ," ISME said.

"Overall, the sector makes the largest contribution in Ireland in terms of employment and has a positive presence in every town and county in the country."

Furthermore, ISME suggested that the minimum wage should be calculated differently for SMEs than for public service organisations and multinationals, who "enjoy far higher wages and greater job security than the vast majority employed in the private sector."

At a minimum, ISME believes that public sector pay must be disregarded from calculations of the national minimum wage, which has increased to €13.50 per hour, and that future increases in the minimum wage must not exceed the consumer price index.

"Credible research demonstrates that large increases in minimum wages reduce employment and hours worked, particularly for the low-skilled.

"The cost of accommodation and living crisis cannot be addressed by forcing up the National Minimum Wage. It can only be fixed by increasing the supply of accommodation and tackling consumer costs."

Additionally, ISME would like the 8.8% of PRSI to apply to the entirety of the national minimum wage, for the VAT rate for hospitality businesses to be lowered to 9%, and for the standard VAT rate to be reduced to 21%.

The group further recommended a 2% PRSI rate to be applied to all earnings up to the current cut-off of €424 per week, and 6% on the balance, to reduce PRSI payments for all full-time workers earning up to €848 per week while helping to make up the €350bn shortfall in the social insurance fund.

Finally, ISME has called the legal system a roadblock to infrastructure development, affordable housing, affordable family law, free speech, timely commercial dispute resolution, and foreign direct investment.

"The watering down of the Defamation bill by Department of Justice has nothing to do with 'access to justice; and everything to do with the preservation of legal incomes," ISME said.

"Failure to follow through with promised reforms will be viewed with outright hostility by retail and hospitality. The Kelly report is four years old, and nothing material has been done to reform civil procedure and costs. The minority report must be actioned.

"Under no circumstances should the incoming Justice Minister accept the Judicial Council's request to increase personal injuries awards. The old Book of Quantum awards were never indexed to inflation, and the awards guidelines published by the Judicial Council far exceeded those indicated by the Personal Injuries Commission. 

"We are now faced with a remarkable situation, where people injured in other European countries are presenting their cases before Irish courts, such is the premium already available here for minor and fully recovered injuries. 

Commenting on ISME's key priorities for 2025, Neil McDonnell, CEO of ISME, said: “Ireland must not be the most expensive State in the eurozone in which to live. We should aspire to be the most affordable.

"This means looking critically at our standard and reduced rates of VAT, energy costs, insurance costs, legal costs and labour costs.

"Furthermore, Ireland must resource higher levels of infrastructure and housing spend, as well as address risks identified in our National Risk Assessment. This will limit expenditures elsewhere. The private sector can help if it is incentivised to do so.”

(Pic: Getty Images)