Business opinion: Business leaders have their say

Tom Costello Managing director, John Sisk & Son

Tom Costello, managing director of the one of the State's biggest building and civil engineering businesses, John Sisk & Son, believes that despite Mr Cowen's decision to end a number of property-based tax reliefs, Budget 2006 will broadly benefit the construction sector.

"From a construction point of view, the termination of certain property-based tax reliefs, including hotels and holiday homes, was well anticipated," he says.

"We welcome the Minister's decision to do it on a phased basis over the next 2½ years."

He says that the construction industry is also likely to favour the decision to keep tax breaks for the development of health facilities such as private hospitals and nursing homes.

"Overall, the input of Transport 21 and increased State spending on health and education infrastructure should ensure that the construction sector remains buoyant," he says.

Mr Costello points out that increased spending on developing the State's infrastructure will offset any fears within his business that the end of the property tax breaks will hit activity.

At a broader level, he says that Mr Cowen's attempts to level out the tax burden, to ease pressure on low-paid workers and to maintain competitiveness are positive measures.

Mike Maloney Chief operations officer, BT Ireland

Mike Maloney, chief operations officer, BT Ireland, believes that providing for childcare is vital to increasing women's participation in the workforce, but questions if the Budget, designed to create an extra 50,000 places, goes far enough.

He points out that while the Republic is keen to attract immigrants to increase its workforce, many of the parents forced to stay at home by the high cost of childcare have the education and qualifications needed by his company and other businesses.

"The measures seem to be more on the surface than structural or strategic," he says. "The real question is whether it's going to address the problem in a structural way."

Mr Maloney says that high property and rents are making it increasingly difficult for immigrants to come to the Republic. However, the parents, mainly women, who stay at home, do not have to deal with these issues and as such are an "untapped resource".

"It's a huge labour force, but there's no real incentive for them to come back," he argues.

He also feels that spending on primary and secondary education do not go far enough, and points out that while the support for third- level education is welcome, the State also has to address the basics.

"I think it's all very well, but we still have a problem if there are not enough buildings for primary and secondary school students," he said.

Fran Whelan Architect, Whelan Corcoran Smith

From the point of view of Fran Whelan, partner with architects' firm Whelan Corcoran Smith, Brian Cowen's pledge on infrastructure spending is vital.

"It's going to have a huge impact on the construction industry," he says. "We have to recognise that it's a very important industry with over 250,000 people employed, and that we need this level of investment maintained."

Mr Whelan's practice is based in Swords in north Co Dublin. Swords is in the Fingal local authority area and is considered to be one of the fastest-growing areas of Europe. This is partly related to the fact that it is also home to Dublin Airport, the busiest on the island.

As a result, it is going to attract a large chunk of the €34 billion committed under Transport 21, the transport plan launched by the Government last month.

Mr Whelan says Mr Cowen made the right decisions in the area of property and construction-led tax breaks, retaining those aimed at stimulating investment in health, while phasing out the others. However, he admits he would have liked to have seen new urban renewal schemes.

He believes giving a stay of execution on reliefs for park and ride facilities was a good move, as some of these schemes hit planning difficulties and were delayed. Mr Whelan says the five-year plans for investment in farming and the biofuel schemes as good ideas.

"Overall, it's hard to criticise it," he says.

Mark Bourke Chief executive officer, IFG Ireland

Mark Bourke, chief executive of financial services company IFG Ireland, says that Budget 2006 looks very much weighted in favour of middle-income families, some of which he estimates could gain between €60 and €80 a week next year from Mr Cowen's package.

However, now that interest rates are on the way up again, Mr Bourke says the Budget offered a good opportunity to introduce reliefs on mortgage interest repayments and on stamp duty. He argues that because demand for housing in Dublin pushes property prices up in the capital, stamp duty payments, which are tied to the cost of a home, effectively penalise those who have to buy property in the city.

"With the closure of rental reliefs and the interest rate increases, I would have thought that those measures would have been very appropriate at this time, so it's a bit of a missed opportunity in that respect," he says.

He also believes that the closure of property-based tax reliefs is positive in the sense that investors will redirect some funds from the portfolios into other assets. Currently, Irish portfolios tend to be skewed towards property.

He argues that the Minister's approach of pursuing equity in the tax system and eliminating areas subject to "egregious abuses" is a good idea. "It was a pretty positive, Fianna Fáil-type budget; there was very little that we were surprised at," he says.

Eilís Quinlan Accountant, Eilís J Quinlan and Company

Beyond a few small concessions on VAT, accountant Eilís Quinlan says that Budget 2006 offers nothing to small businesses.

Minister for Finance Brian Cowen increased the thresholds for VAT registration from €25,500 a year to €28,000 for services, and from €51,000 to €55,000 for goods. Ms Quinlan, principal of accountancy practice Eilís J Quinlan and Company, says that this will make little difference to small and medium-sized businesses, which account for the bulk of the Republic's employers.

"There were a lot of opportunities that he missed," she says. "What we were hoping for was help in the area of competitiveness. The local authority service charges are still not addressed. Local authorities are underfunded and businesses still have to fund the increase in the cost of services."

Ms Quinlan, a board member of the Irish Small and Medium-sized Enterprise Association, says Mr Cowen could have taken some steps to deal this problem yesterday.

She is critical of the fact that the bulk of support for research and development has gone to universities, while small businesses attempting to innovate are going largely ignored. She points out that people working for small businesses who contribute to childcare costs are subject to benefit-in-kind taxes, while those who work for big companies that provide creches are not. "He also could have changed the rules in this area," she says.