Budget 2027 must provide supports for food and drink sector - FDI
Budget 2027 must address the cost and competitiveness challenges facing Ireland's food and drink sector.
That is the message from Food Drink Ireland (FDI) which has today (Monday, July 6) published its Budget 2027 submission.
The Ibec group representing the food and drink sector calls on the government to provide supports to help the sector build resilience against a backdrop of increased costs.
FDI pointed to the ongoing trade and supply disruptions which are impacting wider competitiveness for the sector.
Food
Commenting on the submission, Paul Kelly, FDI director said:
"Immense cost pressures across wages, energy, and raw materials are squeezing margins and causing a severe structural investment gap on key priority areas.
"Without targeted State intervention, the sector risks underinvesting in critical green and digital transitions as well as competitiveness-enhancing measures."
Kelly urged government to establish a "State-Aid-based Strategic Capital Fund" to accelerate the digital transformation, automation, and low-carbon transition of the Irish food and drink manufacturing base.
"This should build on the proven co-investment model of previous schemes but also extend eligibility to all food and drink sub-sectors.
"It should directly fund vital enabling technologies such as process automation and digitalisation to enhance productivity," he said.
Budget 2027
The FDI budget submission also offers other recommendations to tackle competitiveness challenges for the sector, such as:
- Introducing a government guaranteed, comprehensive, export credit scheme to mitigate the commercial risks that diversifying businesses face in export markets;
- Postponing further increases in planned labour costs such as PRSI increases due in 2026 and 2027 until inflation has returned to normal levels;
- Increasing the core funding for Skillnet Business Networks by €50 million over three years to meet verified industry demand;
- Enhancing the parameters of the research and development (R&D) tax credit to include new product development in the food and drink sector;
- Reducing the fixed cost component on Irish energy bills through a strategic annual subvention of some of the key policy related fixed costs on electricity bills;
- Introducing a €5 million reformulation fund for the sector.
Kelly noted that the submission also makes several recommendations for the "sustainability journey" of the sector and to "ensure a balanced and proportionate approach to consumption taxes".
