Business, the Economy and Government - Business Revision Notes

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Contents

Business, the Economy and Government 4

What Role does the Government Play in Creating a Suitable Climate for Business in Ireland? 4

Government Economic Planning 4

Government Expenditure 4

Government Agencies 4

Government Taxation 5

Government Grants 5

Government’s Role in Controlling Business 5

Business, the Economy and Government

What Role does the Government Play in Creating a Suitable Climate for Business in Ireland?

Government Economic Planning

  • The government agrees National Pay Deals with the social partners such as ICTU (Irish Congress of Trade Unions) and IBEC (Irish Business and Employer Association).
  • They agree reasonable pay rises over several years for their employees in return for favourable taxes.
  • They aim to increase certainty and lower disputes. There will be fewer pay disagreements as increases are previously arranged.
  • Businesses can plan better for the future as they have a degree of certainty.
  • Example: Lansdowne Road Agreement on public sector pay.

Government Expenditure

  • This consists of both current expenditure (day to day expenses) and capital expenditure (once off, on infrastructure projects).
  • Current Expenditure: the government spends billions each year on products for the civil service such as Garda uniforms, school desks etc. This leads to increased sales for local businesses.
  • Capital Expenditure: spending money on roads makes it easier and faster for businesses to transport their goods.

Government Agencies

  • This help Irish businesses on different aspects such as expansion, staff training and with funding.
  • Enterprise Ireland: helps indigenous plans draw up business plans. Helps them if they wish to expand abroad. Also provides Irish companies with grants.
  • IDA Ireland: work at attracting transnational companies to Ireland. Promote Ireland as a low tax economy, gateway to the European market ec.
  • Fáilte Ireland: this agency spends money developing the tourism industry in ...

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