Rates hikes the last thing Westmeath businesses need now

Businesses throughout Westmeath are watching their takings figures go down, their costs bills go up - and watching as customers drive north to avail of the cheaper prices there.The 0.5 per cent VAT rate isn"t helping anyone in the south to compete against Northern business - and the next fear on businesses" minds is to what extent rates are likely to rise when Westmeath County Council holds it annual bugetary meeting.Expenditure by Government is being slashed. It means that County Councils around the country are going to be desperately stretching their funds to cover the cost of essential services. It means too, that after cutting what they can, and plugging as many gaps as they can, they will be looking to the ratepayers to make up the difference.This has been the answer in other times when there has been a shortfall between Council needs, and Government provision. But unlike other times, this cannot, this time, be the answer. It is the time when a rates hike can least be afforded. Indeed, one might say that despite the shortfalls in taxation generally, and the stretch on public finances, a further charge on the business sector cannot be justified: the private sector in this country is now at breaking point.Unemployment figures are rising at an alarming rate. In January, Ireland"s unemployment rate was a respectable 4.8 per cent. At the end of last month, it had soared to 6.7 per cent. And most of those joining the dole queue are people who were employed in the private sector.Businesses have been slashing numbers: letting one person go at one time; letting others go a few weeks later. In last week"s Westmeath Examiner, businessman Johnny Owens spoke of how he has had to let 45 staff go, and may have to let others go in Deccember. MABS - the Government"s Money Advice and Budgeting Service said it has been experiencing a 22 per cent rise in calls, many of them people who were experiencing unemploment for the first time. The housining crash is leaving not just builders out of work. Frighteningly rapidly, the web of those affected is spreading: solicitors whose main business was conveyancing; hardware stores; building supplies firms; building supplies manufacturers; auctioneers.Even those in employment are becoming afraid to spend, uncertain about the security of their own jobs.The fact that there are fewer people in jobs - and that those who are aren"t spending at the same rate as before - is all impacting on business, and while there may have been hopes that the annual Christmas spend would have livened things up a bit, all indications to date are that people are cutting back.That addition of a half per cent on VAT may not sound like a lot: but it comes just as the UK has announced a cut in its VAT rates. These factors combined will see the numbers going north to shop soar. There"s not much fun ahead for businesses around Mullingar, which is, after all, within a couple of hours" drive from the major border shopping towns. With spending down dramatically locally, every type of business is suffering, whether they are in retailing, manufacturing or the services area.Westmeath County Council needs to look at other ways it can make ends meet this year, beyond increasing the stress on businesses already under pressure.