140 days after the Irish went to the polls on February 8th 2020, a new government has finally been formed.
On June 28th, The Green Party, Fianna Fáil and Fine Gael plus several Independents entered a coalition to form a working majority based on an agreed 'Programme for Government'.
This Programme for Government is broad and ambitious, aimed to drive economic growth with a strong focus on investment in infrastructure and jobs.
How will this ‘Programme for Government’ be funded?
As the new coalition enters cabinet, ‘borrowing to invest’ is the plan and economic growth is the key benchmark.
Since the Covid-19 crisis, the government has borrowed billions at incredibly low interest rates (less than 0.25%) and this rate of borrowing isn’t expected to increase any time soon.
Ireland has also received billions through the European Union’s Recovery and Resilience Fund, with even more funding yet to come. Plus, the European Central Bank continues to make cheap cash readily available for Irish businesses too.
With continued assistance from the EU and very low borrowing rates, the government is in a good place to push out repayments over much longer periods. Therefore, attempts to ‘balance the books’ will be primarily based on Ireland's economic performance and recovery.
Will I be paying more tax?
In July 2020, stimulus initiatives to tackle the fallout caused by Covid-19, will be quickly rolled-out followed by an autumn 2021 budget.
The good news is that there is no plan to increase income tax or USC rates and the new government has also committed to 'no-change' on income tax credits or bands. But, expect to see a review on this commitment in the 2022 budget if incomes are once again rising.
It should also be noted that the new government has now made it clear that the Pandemic Unemployment Benefit (a.k.a Covid-19 payment) is a taxable source of income. Therefore, Revenue Commissioners will be chasing those workers who were in receipt of the payment and who may have tax to pay come January 2021.
Will this new government do anything about the high cost of insurance?
The cost of insurance in Ireland has risen by over 40% in the last decade, which has left many tradesmen and small businesses paying increased insurance premiums.
To tackle this problem, the new government will form an Economic Recovery and Investment unit, which will prioritise the issue of insurance reform.
This unit will focus on enhancing competition in the insurance sector and seek to reduce the costs of insurance including motor insurance premiums and public liability insurance.
What will this new government do for rural areas?
The new government’s Rural Policy is dedicated to aid recovery and development for rural areas.
One of the areas of immediate focus is to accelerate the roll-out of the National Broadband Plan. Once this is in place, it is intended that a strategy for remote working and co-working spaces in rural areas will also be accelerated.
The good news is that this has the potential to increase jobs for trade pros in rural areas, especially as more people to move to smaller towns and villages and telecommunte.
Will this new government finally fix the housing crisis?
Dealing with the country’s housing crisis is going to be a top priority of the new government – not least because housing was one of the driving factors to how people voted.
However, there are many hurdles the government must overcome before we see real progress.
What we do know for sure is that tradesmen are going to be in huge demand, especially when planned initiatives like self-build property and state back affordable home purchase schemes kick-in.
How will the ‘Climate Action Plan’ shape up?
A coalition plan involving the Green Party has resulted in some very ambitious commitments aimed at Ireland reducing its carbon emissions.
The news for trade professionals is that the plan includes the installation of 600,000 heat pumps plus 500,000 Irish homes to have at least a B2 rating by 2030.
The upgrading of heating systems, retrofitting insulation and replacing windows and doors will all require skilled and qualified tradesmen to get this work done.
Training and Reskilling
Along with the national retrofit plan for Irish homes, the new government will also overhaul apprenticeships, traineeships and education programmes to up-skill the workforce to deliver the retrofit plan.
If you are thinking of reskilling or retraining or even looking to recruit to expand your business into other home improvement service areas, there will be investment and opportunities for advancement.
Did you know? As a Member of Onlinetradesmen you can request business support to help you decide whether to enter new trades, employ more staff or apply for finance. Request a call back from our membership team today here.