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PRSI rate hike in Budget would cost jobs

Thursday, October 18 10:07:52

An increase in PRSI rates in December's Budget would cost jobs across the economy, according to the Accounting Technicians Ireland 2012 Business Sentiment Survey out today.

This is the third business sentiment survey carried out by the leading professional body that represents over 10,000 accounting technicians on the island of Ireland.

More than half of the respondents worked in organisations employing up to 50 people, with the remainder working in businesses employing over 50 people.

Almost two-thirds, 64pc, of those surveyed said that an increase would have a negative impact on hiring or employment levels within their organisation.

Overall expectations for the coming 12 months have improved since 2011. There has been a fall in the number of those expecting the levels of business at their place of employment to contract of 3pc, dropping from 14pc to 11pc. There has been a corresponding rise in positive sentiment, with the number of respondents expecting business levels to grow increasing by 2pc to 22pc since 2011. The survey found that 40pc of Accounting Technician members expect business levels to remain steady at current levels over the coming 12 months.

There was another large increase in the numbers of respondents who said that the cost of doing business in Ireland was rising. This figure has risen consistently since the Survey began in 2010, rising from 25pc in 2010 to 44pc in 2011 and now standing at 59pc.

Bad debt levels remain a problematic feature of Irish business life. While almost half of Accounting Technicians Ireland members report that bad debt and overdue payment levels have remained the same between this year and last, almost 45pc of respondents are reporting an increase in bad debt levels in 2012. Those members who reported increased levels of bad debt in the past 12 months said that the majority, 51pc, of these increases have been between 1-10pc, with a further 32pc at a level of 11-20pc.

On a positive note, there was a slight fall in the number of members reporting redundancies in their place of work in the last 12 months, falling from 39pc last year to 36pc in 2012. Looking forward to the coming 12 months, 67pc said they do not anticipate any increase in employment numbers at their location over the coming twelve months, a slight fall from the 2011 figure of 71pc, while there was a small rise in the number of members anticipating new hiring, up from 14pc to 15pc.

There has been a very slight increase in positive economic sentiment, with those members who consider economic and business conditions to be improving very modestly to 8pc from 6pc. However, almost two-thirds of members continue to believe that business conditions are worsening (62pc), remaining at this level consistently over the last three years.

Eithne O'Sullivan FIATI, President, Accounting Technicians Ireland, said: "Our members are of the firm belief that an increase in either of the PRSI rates in December's Budget would have a very negative effect on employment levels in the wide variety of organisations they are working in. While they are aware of the very tough financial predicament the country is in, our members would advise the Government to consider all other financial measures before resorting to a potentially very damaging measure."