Business insurance costs are set to soar by as much as 25 per cent next year, the chairman of the Irish Small and Medium-sized Enterprise association (ISME), Mr Robert Berney, said yesterday.
Speaking after addressing the organisation's annual conference in the Ormonde Hotel, Kilkenny, he said many of his organisation's members seeking cover for next year were getting significantly inflated quotes from insurers.
"The biggest insurance cost for most businesses is public liability and there is no evidence that quotes are coming down," he said. "Our members are being quoted between 20 and 25 per cent more for insurance, depending on the sectors that they are in."
Mr Berney pointed out that the latest increases followed a period where business had seen huge increases in the cost of cover. ISME's own research earlier this year established that members had seen premiums hiked by as much as 300 per cent over the last three years.
Mr Berney stressed that the Government needed to speed up the introduction of the Personal Injuries Assessment Board (PIAB) and the proposed reforms of the law governing civil court procedures and liability claims. In the course of the conference, Senator Fergal Quinn, executive chairman of the Superquinn supermarket chain, criticised the insurance industry for failing to cut premium costs, despite the fact that the size of liability awards is falling.
Addressing delegates at the meeting, Mr Berney called on the Government to tackle the growing black economy, which he estimated to be costing the Republic up to €6 billion a-year. He said up to €2 billion, enough to cover the cost of the public service benchmarking pay increase, of the total was lost in unpaid taxes.
ISME believes the black economy could account for between 5 and 6 per cent of Gross Domestic Product (GDP) every year. Mr Berney told the gathering that the number of businesses operating outside the law was rising at an alarming rate.
"Whether we like it or not, Ireland has become an expensive and difficult place to run an enterprise and many businesses are being forced into the shadow economy simply in order to survive," he said. "This is having serious ramifications for legitimate companies who have their business and livelihoods threatened by black economy operators."
He added that the private security was particularly vulnerable to unscrupulous operators in the black economy.
Another speaker, economic consultant, Mr Jerome Casey, warned the high cost of land was damaging competitiveness and driving up the State's infrastructure bill. He said the cost of acquiring the 338 hectares needed to build the €350 million Kilcock/Kinnegad by-pass was €161,900 per hectare.
Mr Casey said that was 13 times the average rate for agricultural land, which is €13,500 per hectare. He told the meeting the agricultural lobby regarded the inflated figure for the land at Kilcock/Kinnegad as a standard for all future road-development compulsory purchases.
