225. Deputy Paula Butterly asked the Minister for Enterprise, Tourism and Employment the measures he plans to introduce to support small and medium-sized enterprises (SMEs) in managing rising labour costs; and if he will make a statement on the matter. [66669/26]

The Government recognises that rising business costs, including labour costs, have placed significant pressure on firms, particularly SMEs, in recent years. The Government continues to closely monitor cost trends across the economy.

Government is taking significant action to tackle the cost of doing business, including on labour costs. Last year, as part of measures designed to bolster business resilience and competitiveness, the Government agreed to extend the timeline for progression to a Living Wage from 2026 to 2029. This decision reflected the challenges faced by the enterprise sector in recent years, particularly SMEs where a significant majority of minimum wage workers are employed.

The Government has also delivered on several Programme for Government commitments relating to this issue, including through the establishment of the Cost of Business Advisory Forum and the publication and continued implementation of the Action Plan on Competitiveness and Productivity.

The publication of the Cost of Business Advisory Forum report in August represents a notable step forward in this regard. The report is the product of nine meetings held with public and private sector stakeholders, with discussions encompassing a wide range of cost drivers, including energy and insurance costs, planning and infrastructure regulations, water services costs, legal costs, reporting and compliance requirements, as well as banking, payments and financial services.

The final report comprises 63 recommendations across these areas aimed at easing business costs, particularly for SMEs. Key examples include initiatives to consider the feasibility of a new scheme to reduce prices for large energy-intensive business users, to alter the Central Bank's remit to promote competition within the banking sector, and to pursue the National Competitiveness and Productivity Council's recommendation to exempt SMEs from the Enhanced Reporting Requirements (ERR).

It should also be noted that the Department intends to support SMEs beyond reducing business costs. The Action Plan for Competitiveness and Productivity was published in September 2025. The plan reflects a whole-of-government approach to the domestic drivers of competitiveness and focuses on areas that are firmly within our national control. It contains 85 actions, with just under half due for delivery in 2026.

One of the six key themes in the plan relates to the creation and scaling of SMEs. Key actions for completion in 2026 under this theme include establishing Start-up Ireland as a central coordinating body across the national start-up ecosystem and establishing an SME Scaling Fund to help close the funding gap for SMEs seeking to grow.

Other key actions in the plan that are particularly relevant for SMEs include introducing a "Red Tape Challenge" across Government to reduce regulatory burdens on SMEs and promoting the digitisation of tourism SMEs by supporting the adoption of innovative technologies such as artificial intelligence.

Finally, another important action is to further promote the application of the "SME Test", under which policymakers are required to assess the specific impact of new legislation on SMEs. Under the Action Plan, all Government Departments would be required to apply the test consistently in relation to all proposed measures, helping to ensure that the needs and circumstances of SMEs are fully considered in policymaking.