Newly appointed Minister for Enterprise Peter Burke is a busy man. Our 2.30pm meeting at the Department of Enterprise on Kildare Street in Dublin is cancelled at the last minute because of a Dáil vote, then reinstated for later that day.
When I arrive at 23 Kildare Street, one of the finest art deco buildings in the State (the interior is a composite of marble flooring and walnut panelling), I’m told I have just 20 minutes as the Minister needs to exit shortly for a meeting with Google.
I turbocharge through a series questions while his minders monitor the clock. I put it to him that the biggest issue surrounding his brief is the current power play between unions and business groups.
The latter complain that a raft of pro-worker legislation enacted by the Government – increases in the minimum wage (it was lifted by 12 per cent to €12.70 per hour this year), new sick pay entitlements, new flexible working rules, pension auto-enrolment (which is incoming) – have placed an unfair financial burden on businesses already struggling with higher costs.
According to the Restaurant Association of Ireland, a typical food business with a turnover of €1 million will see its total costs increase by €97,000 this year.
At the National Economic Dialogue conference earlier this week, Small Firms Association director David Broderick claimed two businesses a day were closing under the weight of increased costs and that small businesses accounted for 85 per cent of “all shutdowns”.
“There is change, legislation by its very nature is change ... but it’s not a zero-sum game. What’s good for the worker doesn’t have to be bad for the employer,” Burke says, insisting Government moves to strengthen workers’ rights will improve productivity.
He alludes to figures from the Companies Registration Office (CRO) that suggest that for every one enterprise that fails, 10 new ones are set up. “In the sectors that are vulnerable like the restaurant sector, the ratio is five to one,” he says.
However, he concedes that a lot of small businesses are transient, sole trader enterprises (think of a small independent coffee shop) that may not be captured in the CRO data.
Business failure rates (currently at 27 in 10,000), he says, are lower than what they were in 2019 (36/10,000) and a fraction of what they were at the height of the financial crisis (109/10,000). Ireland remains a “fertile place” for start-ups and that’s backed up by the CRO data, Burke says.
That said, he admits there has been a significant amount of regulatory change for employers over the last 18 months which, “while each individually is important, accumulated and collectively coming at the one time is a significant ask for business”.
That “significant ask” is said to be generating a lot of lobbying behind the scenes. Employers’ groups want action while unions want the Government to press ahead with the transition to a universal living wage.
Burke’s period in enterprise, however long it lasts, will centre on navigating these pressures.
The Fine Gael TD for Longford-Westmeath was elevated from the junior ministerial ranks (he was previously minister of State for European affairs and defence) on the recent Harris tide. He is the first Mullingar native to hold a senior Cabinet post.
Taoiseach Simon Harris, in his maiden speech as Fine Gael leader, promised two things: increased housing targets and enhanced supports for small businesses. Burke has been tasked with delivering the second of those pledges.
His first big act as Minister was to unveil a new enterprise support package for small- and medium-sized businesses earlier this month, particularly those in the hard-pressed hospitality sector. The measures included increased cash supports under the existing “increased cost of business scheme”, which targets businesses with commercial rates bills of up to €30,000; an increased threshold for the higher rate of employers’ PRSI; and increased energy efficiency grants.
“I hadn’t the option of doing a new budget. What I was doing was trying to reprofile a lot of expenditure within the department and find some new money” to support businesses with cash flow problems. He insists the measures could be worth an additional €1,000-€1,500 a month for businesses.
The Government’s move to stress-test the impact on business of any further moves towards a living wage is seen an acknowledgment of the current cost pressures on business.
“The evidence suggests that businesses in the hotel/hospitality/food sectors are under significant pressure and I hear that voice coming at me,” he says, indicating the budget will contain “a strong business package ... that will show we’re rewarding enterprise”.
The tax code is the strongest instrument a business minister has at his or her disposal, he says, indicating he is supportive of further measures to index the income tax code which, he says, aids not just workers but employers too. In Budget 2024, the Government lifted the threshold for paying the higher 40 per cent rate of income tax from €40,000 to €42,000 for a single person.
Another potential headache for Government is the incoming EU directive on adequate minimum wages which, apart from obliging members to move towards a minimum wage equating to 60 per cent of the median income, obliges them to ensure that collective bargaining wage agreements cover up to 80 per cent of the workforce. Currently in Ireland, the rate is just 35 per cent.
Will he legislate to achieve this? Burke kicks to touch, saying he is waiting on a report from the Government’s Labour Employer Economic Forum which will inform how the State should respond.
Burke, a chartered accountant by trade having studied commerce at NUI Galway, says he cut his teeth in the profession during the boom and bust of the Celtic Tiger, an experience that left a mark. He says he saw many businesses going to the wall in upsetting circumstances.
“[As an accountant,] I saw some very distressful scenes with businesses, which people had sacrificed so much to start, suddenly becoming non-viable because the country was run off a cliff,” he says.
Like many of the current crop of politicians, his outlook and political calculations can be traced back to the State’s spectacular financial blowout in post-2008.
“I saw when things got out of control, when spending went into double digits ... and when so many of my clients felt the harsh impact of that. Back then, the government had no capacity to act, to inject capital expenditure into the economy when private investment fell,” he says.
Burke contrasts that period with recent crises when contingency funds were set aside for Brexit, when wage supports were rolled out during Covid and when cost-of-living supports were delivered during the energy price shock.
“We’re in a different space now but we shouldn’t take it for granted,” he says, highlighting the importance of the new Future Ireland Fund, which aims to future-proof the public finances against further crises.
Burke quit his accountancy practice in Mullingar in 2016 when elected to the Dáil for the first time (he previously served as a councillor on Westmeath County Council between 2009 and 2016). He describes himself as a pragmatist. Politically, he says, he is part of the “progressive centre”.
Investing in infrastructure is a theme the interview keeps coming back to. “Any money you put into capital projects will be paid back in spades because it makes the State more competitive and it attracts more employment,” Burke says.
But most of the criticism directed at Fine Gael and his Government relates to infrastructural deficits in housing, health and transport.
“And why is that? When we came in, we had a country that was borrowing off lenders of last resort, it was spending 50 per cent more than it was taking in. How can you embark on a capital building programme then? Next year, the Government will spend €13 billion on capital projects. When we took office, we had a budget of less than €4 billion,” he says.
Why doesn’t the Government call an election now when its main adversary Sinn Féin is wobbling in the polls and the economy remains at near full employment?
“We need to ensure we have a strong budget ... that’s going to be critical for the country. Polls will come and go. They’re a snapshot in time. The focus of this Government is to keep delivering for our citizens,” he says.
He lambastes Sinn Féin as a party that merely offers slogans and one-line solutions to complex problems in housing and on immigration. “Their cupboard is bare. They’ve no housing plan. They said a number of weeks ago they would publish a housing policy, I don’t see it,” he says. He describes Sinn Féin’s pre-budget submission on enterprise as “scant”.
He also claims that much of the party’s policies weren’t stress-tested last time because they weren’t the main Opposition party. “This time it’s different,” he says.
He won’t be drawn on when he thinks his boss will the call the upcoming election – most of the commentarial see an autumn poll as the most likely – but insists the Coalition needs to deliver another budget.
A traditional problem for the incumbent administration in Ireland’s multinational, export-led economy is the gap between the headline economic metrics (strong growth, strong employment, relatively strong consumption) and the real feel at street and household level. The metrics are cumulative, the micro experience is often different.
Echoing recent comments by the Taoiseach, Burke admits that many citizens haven’t felt the benefits of Ireland’s strong economy, insisting the framing of recent budgets around cost-of-living supports was an attempt to redress that.
“Those measures were the fruit of a strong economy,” he says.
Despite the recent influx of migrants, the ratcheting up of rhetoric and a string of attacks on refugee accommodation, Burke doesn’t believe immigration has changed the political climate “materially”.
“There’s always a fringe either on the hard left or the hard right that – for want of a better word – migrate around different issues,” he says, suggesting the Government is addressing the issue by “enforcing a strong and fair rules-based system” while signing up to the EU migration and asylum pact in contrast to the UK’s go-it-alone policy, which, he says, has aggravated the problem there.
Politically or electorally, the biggest issue for Burke remains housing. And he believes the Government’s chances of staying in office have risen in tandem with the pickup in homebuilding.
“We don’t have to say, ‘trust us’, any more. Get in your car, go to any town in this country, you have large-scale housing estates under construction, the builders are on site, they are there, people can see the units being delivered into their communities,” he says. “That is a big [electoral] advantage for the Coalition,” he says.
Burke has perhaps only several months to make his mark on a busy portfolio before a system reset. He leaves in a rush with a bundle of folders for his meeting with Google.
PETER BURKE: FACT FILE
Name: Peter Burke
Age: 41
Position: Minister for Enterprise, Trade and Employment
Family: Lives with his wife Olivia and their two young sons in Mullingar
Something you’d expect him to say: “Everything I do in this portfolio will be evidence-based and driven”
Something that might surprise: His 5km personal best in Mullingar’s Park Run is 22:29
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