Le: Aire Airgeadais; Paschal Donohoe
Foilsithe
An t-eolas is déanaí
Teanga: Níl leagan Gaeilge den mhír seo ar fáil.
I move this resolution.
Following a robust debate last week on the Covid Restriction Support Scheme, the resolution for debate today seeks the approval of the House for another order which also deals with the challenges faced by businesses across the economy arising from the Level 5 public health restrictions.
This order provides for additional support to be given under the Employment Wage Subsidy Scheme, the EWSS.
This enhancement to the EWSS is in the context of unprecedented levels of support that are being provided by the Government to assist businesses and workers in Ireland through this pandemic.
To date, additional expenditure of well over €10 billion has been paid out with more planned still in 2021 to sustain businesses and help people to manage financially in the midst of these very difficult times:
In addition to the above, the wage subsidy schemes have been a central pillar of the Government’s response to the economic impact of the Covid-19 pandemic, supporting viable firms and encouraging employment. To that end it is an important bridge between social welfare payments like the PUP and regular employment which is the ultimate goal.
The Temporary Wage Subsidy Scheme, or TWSS, was in place from March until the end of August 2020. Over 66,500 employers received subsidy payments of almost €2.9 billion in respect of over 664,000 employees.
To date, over 44,800 employers and 505,600 employees have been supported by the EWSS with direct subsidies of over €1.7 billion being paid out and PRSI credit of €303 million being granted by the 28 January 2021.
Although it is noted that this scale of support cannot continue indefinitely, the Government continues to assess the effects of the Covid-19 pandemic on businesses and the economy and I will continue to work with Ministerial colleagues to ensure that appropriate supports are in place to minimise the negative effects insofar as is possible.
The EWSS is an economy wide support open to all sectors, with the primary employer qualification based on the employer’s turnover in the current six month period being less compared with the same pre-pandemic period in 2019.
The legislation provides that the employer must be able to demonstrate that they are operating at no more than 70% in either the turnover of the employer’s business or the customer orders received by the employer by reference to the period from 1 January to 30 June 2021 compared with the same period in 2019.
The EWSS is designed to be flexible for the employer and take account of potentially sudden changes in turnover so if there is a reduction in turnover in the future because of a change in circumstance the employer may be entitled to make a claim for that later period.
The EWSS is administered by Revenue and payments are made as soon as practicable, typically within 2 working days after payroll to minimise cashflow concerns for employers when paying wages.
I would like to take the opportunity in the House today to acknowledge the efficiency with which Revenue has been operating the scheme, which has been extremely effective at getting support to employers quickly.
The level of subsidy given to the employer is based on the number of paid workers on the payroll per week, and a flat-rate per head value is applied based on prospective pay levels so that claims may be made for new hires and seasonal workers.
Following the re-introduction of Level 5 restrictions in October 2020, the Government decided that from 20 October 2020 the EWSS subsidy would be up to €350 per week in line with the levels of payments given under the PUP scheme. As a result, the weekly rates of subsidy payable to the employer are as follows:
The subsidy payable is nil for employees paid less than €151.50 and more than €1,462 per week.
As set out in Finance Act 2020, the enhanced rates were to be in place until 31 January 2021 after which they were due to return to the original rates of €151.50 for those paid more than €151.50 per week and €203 for those paid more than €203 per week.
However, in the context of decisions taken on the latest public health restrictions, at the Government meeting of 6 January 2021 it was decided that the current rates of the EWSS will be maintained until 31 March 2021.
This decision is aligned with the retention of the current pay-related rates of payment for the PUP until 31 March 2021.
Such alignment is considered essential in that, in the absence of same, there is a risk of migration of employees from EWSS to PUP during the current Level 5 restrictions, thus undermining the purpose of the EWSS.
To the maximum extent possible the objective is to maintain a position where as many employees as possible currently on EWSS retain their link with their employer rather than migrate to the PUP and lose their connection with an employer.
Recent trends on the EWSS would also indicate that it plays an important role in getting people back work as public health restrictions are eased, thereby reducing the numbers dependent on the PUP.
Section 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020 provides that, as Minister for Finance, I may vary certain aspect of the scheme by Ministerial Order.
The aspects of the scheme that may be amended in this way relate to:
The exercise of this power is subject to specified conditions and the legislation sets out a number of steps to be taken before an Order varying the scheme can be validly made:
I can therefore confirm that I intend to exercise the powers conferred by Section 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020 and that the following steps have been taken to comply with the legislation:
The resolution before the House approves this Order and I commend it to the House.
I will conclude by noting that the operation of the EWSS and its effectiveness continues to be kept under close review and, while there are no plans to re-visit the core eligibility criteria for the EWSS at this time, the Government’s position is that there will be no cliff-edge to the EWSS.
In that regard it is noted that the legislation implementing the measure provides that it will be in place until 31 March 2021, but also provides that the scheme may be extended until the end of June 2021 if required and subject to the same procedural conditions set out above.
It is likely that continued support will be necessary out to the end of 2021 to help maintain viable businesses and employment and to provide businesses with certainty to the maximum extent possible.
Decisions on the form of such support will take account of emerging circumstances and economic conditions as they become clearer.
In the meantime, I commended this resolution to the House.