Vol. 994 No. 8
18. Deputy Catherine Connolly asked the Tánaiste and Minister for Business, Enterprise and Innovation his plans to review and strengthen the co-operative legislation; and if he will make a statement on the matter. [15761/20]
Baineann mo cheist leis an co-operative movement. I am not sure if the Tánaiste is replying to this question, but what plans has he to review and strengthen the co-operative sector? I ask this against a background of many promises and reports stretching over 60 years. The legislation in this area dates back to the 19th century, with one amendment to it in the 20th century. What steps are being taken?
I will reply to this question. The Industrial and Provident Societies Acts 1893 to 2018 provide the statutory regulatory basis for the formation and general operation of industrial and provident societies, primarily co-operatives, in Ireland. The current legislative framework is largely Victorian statutory code incorporating a number of antiquated provisions. Following a root and branch review of the existing legislative framework, which included conducting a public consultation on the operation and implementation of the current statutory code, the Department is well advanced in the preparation of a general scheme of a Bill for modernised and consolidated legislation. I expect the Minister to bring this to the Government in the fourth quarter of 2020.
The purpose of the Bill is to consolidate the existing industrial and provident societies legislation and to ensure that a modernised and effective legislative framework, suitable for the diverse range of organisations using the co-operative model in Ireland, is in place. The Bill will deal with a wide range of issues that have arisen, informed by the public consultation and bilateral engagement with stakeholders, issues identified by the Department and the Registrar of Friendly Societies and the report on the Private Members' Industrial and Provident Societies (Amendment) Bill 2018 prepared by the Joint Committee on Business, Enterprise and Innovation in 2019. The Bill will, among other issues, provide co-operative societies with a distinct legislative identity reflecting the co-operatives' ethos, revise the provisions on debentures, introduce audit exemptions in line with the approach taken in the Companies Act 2014, strengthen the governance provision and revise the powers of the Registrar of Friendly Societies.
A modernised legislative framework aligned with the realities of the 21st century business and regulatory environment will ensure a level playing field between co-operatives and other legal options for structured enterprise activities.
I do not have a copy of the reply to hand, which makes it a little awkward to respond to the Minister of State. I welcome the fact that the heads of the scheme will be published. Forgive my cynicism, however, as I go back over 60 years of promise after promise. Following a suggestion from Mr. Lemass, a report was published in 1964. We move forward to a report in 1986, 20 years later, and to 2007, when there was a very good report from Forfás. In 2009 there was another consultation and there was a further consultation in 2016 and 2017. Then there was the committee's report mentioned by the Minister of State arising from the Bill from Independents 4 Change, which forced some action. Given all of that, I want a definitive answer from the Minister of State on when the Bill will be published.
The Deputy spoke about a history of 60 years, but I am not 60 days in this role. I have said that a substantial body of work has already been undertaken. The Deputy rightly referred to the Private Members' Bill that went through the Dáil in 2018. It was referred to the committee on business and enterprise and the committee conducted a review and produced a report on the Bill. That has fed into the work that has been ongoing in the Department. I ask the Deputy to judge me on my track record. I have given a commitment in the Dáil today that this is a priority for the Department. It is envisaged that we will bring this legislation forward by the fourth quarter of 2020 to be debated in the Dáil, and I will welcome the Deputy's engagement at that stage.
I welcome that commitment from the Minister of State and I will certainly judge him on his actions. The reason 60 years was mentioned was to put it into perspective. The legislation dates back to 1893 and gives no recognition to the distinct characteristics of co-operatives, or any reference to the co-operative principle. The Forfás report in 2007 highlights that the co-operative sector in Ireland is vibrant, but concentrated in certain traditional sectors. It goes on to say that it is static. We simply have not used the potential that exists in co-operatives. I would have thought we would have learned from the recession and certainly we should learn from Covid-19. If one looks at the underlying principles, they fit in with what the Government says in theory. There are seven parts to the definition and one is particularly striking, that co-operatives work for the sustainable development of their communities through policies approved by members. There must be Government recognition of that. We need policy and legislation. I welcome the Minister of State giving his word today and I will hold him to it.
I reiterate that the Government acknowledges and recognises the good work that is being done by various co-operatives throughout the country, be they in the agrifood sector, group water schemes or housing co-operatives. Their work is recognised and it is on the basis of that good work that my Department has already started the work to bring forward the necessary legislative change. That legislative change will recognise the distinct identity reflecting co-operative ethos, reduce the number of members required to form a co-operative, revise the provisions on debentures and introduce audit exemptions in line with the approach taken in the Companies Act 2014. The Deputy will be aware that the Companies Act 2014 required a vast volume of work.
It took a lot of time, and now that it has been done there is the opportunity to move it at an accelerated pace in respect of this legislation. I anticipate engaging fully in this regard with the Deputy before the end of the year.
19. Deputy Cormac Devlin asked the Tánaiste and Minister for Business, Enterprise and Innovation his plans to enable SMEs to return to capacity in circumstances in which it is possible; and his further plans to strengthen the resilience, productivity and innovation of SMEs. [15818/20]
Covid-19 has fundamentally changed Ireland's social and economic landscape. At the end of 2019 almost 2.3 million people were at work. Today approximately 1 million people are on some form of income support. We knew that reigniting our economy after the Covid shutdown would present significant challenges. The message from small businesses, though, is clear. They want supports. They do not want to take on additional debt. They want grants. It is important that this distinction is made. What confirmation can the Tánaiste give to the House on the plans to have SMEs reopen and get people back to work?
I thank Deputy Devlin for raising this important question.
As Tánaiste and Minister with responsibility for enterprise, trade and employment, I am committed to playing my part to get businesses reopened and to provide grant aid, advice and access to finance as we work to get businesses open and people back to work. A crucial part of this work will involve getting our SMEs back to capacity as soon as possible. So far the Government has introduced a €12 billion package for firms of all sizes. This includes the temporary wage subsidy scheme, the pandemic unemployment payment for the self-employed and sole traders, grants such as the restart grant, low-cost loans, the write-off of commercial rates, and deferred tax liabilities. All of this has helped to improve the financial position of SMEs.
As business reopens, what is needed now is a plan of sufficient speed and scale to repair some of the damage that has been done and to restore confidence. The July stimulus package, as promised in the programme for Government, will do just that. It will save jobs and create new ones and get our people back to work. In considering the analysis, I see five areas on which we should focus in helping our enterprises into the future: income supports for workers, direct grants for business, cheaper finance, new opportunities for future jobs, and support for the hardest-hit sectors. It is a matter of enabling our SMEs to return to capacity, where possible, and, more broadly, strengthening the resilience, productivity and innovation of SMEs. SMEs are the backbone of our economy and communities across the country and are key drivers of employment.
Separately, the programme for Government set out our ambition to honour this commitment. I intend to form an SME growth task force shortly. This group will help to bring about a national SME growth plan, which will map out an ambitious long-term strategic blueprint well beyond Covid-19. The national SME growth plan will be largely informed by the comprehensive OECD report, SME and Entrepreneurship Policy in Ireland, which was published last year. The plan will include detailed proposals to help SMEs to start up, scale up and access foreign markets. It will look at ways to make them more productive, innovative and ready to transition to the digital and green economy of the future. It will make improvements to areas such as local entrepreneurship ecosystems and local industry clusters to drive regional development. The plan will be brought before the Government for approval as part of the national economic plan in October.
I welcome and support the initiatives announced to date. They have been much needed by the businesses the Tánaiste speaks of. I also welcome and support the July stimulus package. I reiterate, however, the difference between the grant aid scheme and the loan scheme. Equally, I ask the Tánaiste to focus on the under 25s. Approximately 250,000 people aged under 25 are unemployed, and I hope his Department will focus on that cohort too. It is now just four working days until the start date of the next phase of the reopening of the economy, and businesses need clarity on this. They need to order stock, train staff and prepare their premises. Can the Tánaiste confirm when they can expect such clarity?
As for moving to phase 4 and allowing pubs and, I think, nightclubs, casinos and a few other entertainment businesses to reopen, it is likely a decision on this will be made by the Cabinet tomorrow evening, following advice from NPHET. I cannot yet say whether the decision will be in the affirmative or the negative, but it will be made most likely tomorrow evening at our Cabinet meeting. That would give those sectors the best part of a few days to prepare. I hope it will be possible for them to reopen. I know there has been an uptick in the number of new Covid cases in the past week or two, but they still number in the teens or about 20 per day. We did think there would be a slight increase in case numbers as we eased restrictions. I do not think the increase has been so enormous that at this stage it should prevent us moving to stage 4, but that is not a decision for me on my own. We need the advice from NPHET, and the Cabinet needs to decide.
I totally take the Deputy's point about grants and loans. We need more of both. One of the things that I expect will be part of the package next week will be an improved and enhanced restart grant that is open to more businesses. A lot of businesses did not qualify for one reason or another. I would like to expand the grant in order that more businesses can qualify and get up and running or, as the case may be, stay up and running.
Yes. It is important there is a balance between the two. I wish to reiterate and focus on the fact that it is estimated that 2.1 million people will return to work. That is approximately 90% of the pre-Covid number of people in employment. That 90% has presented and, I have no doubt, will present challenges over the coming months, but the 10% who are expected not to return to work must not be left behind. As I said earlier, I would focus on the under 25s. We do not want to see young people long-term unemployed if at all possible. We need to look at schemes and initiatives to get them back to work as quickly as possible.
I hope that Deputy Devlin is correct and that 90% of people get back to work. I think he is correct that a proportion will not be able to return to their old jobs, if only because the companies they had been working for will not succeed or the sectors for which they were working will struggle. It is important we have alternatives for those people, whether new jobs in areas such as housing construction, the care sector or green energy or other opportunities such as apprenticeships, higher education options, back-to-work enterprises and back-to-education options. The Minister for Education and Skills and the Minister with responsibility for higher education are doing some good work on that in order that we have opportunities and plenty of options for people and do not have young people on the pandemic unemployment payment or jobseeker's payments for a prolonged period. The Minister, Deputy Humphreys, is examining community employment, which is a good scheme and can be scaled up or scaled down depending on the economic conditions. Now is probably the time to scale it up again.
20. Deputy John Lahart asked the Tánaiste and Minister for Business, Enterprise and Innovation if the review of the business restart grant has commenced; and if he will make a statement on the matter. [15800/20]
The question concerns the restart grant. It was launched with a fund of €250 million, as the Tánaiste will be aware, on 22 May. It was devised in recognition of the fact that some small and medium-sized companies and microbusinesses were particularly vulnerable to the economic effects of the pandemic. The programme for Government pledged a review of the grant, which I welcome because it shows a degree of responsiveness and flexibility towards it and how it should work going forward. Regarding that pledge in the programme, have any issues been identified by the Department as needing improvement and, if so, what might they be?
The restart grant was launched on 22 May and is a critically important tool to assist small businesses in reopening their doors. Grant payments range from a minimum of €2,000 to a maximum of €10,000. The scheme was devised in recognition of the fact that microbusinesses and small businesses were and are particularly vulnerable to the economic effects of Covid-19. Using funding allocated by my Department to Enterprise Ireland for the scheme, local authorities are the granting authorities in each of their respective areas.
Some €250 million was allocated to the scheme, and roughly 40,000 companies have applied. That will come to a value of approximately €120 million or €130 million, so there is still a lot yet to apply. Local authorities have been mixed in their capacity to pay the money out, but we are certain that more will be paid out. What we are examining for next week is limited to companies with 50 employees or fewer. We are considering whether the scheme should be expanded to companies with more employees. The average country hotel will have more than 50 employees. They need to get reopened. Educational and other businesses can also have more than 50 employees. In addition, it has not been open to non-rateable businesses such as B&Bs. We need to look at a few businesses like that and consider whether we can extend the scheme to them. However, it should always be seen as part of a wider assistance package for businesses and firms of all sizes.
The main measure is the wage subsidy scheme, which, for most employers I meet, is the one they most want to see extended. It is the issue that is raised most with me by employers. That has already cost about €2 billion. There is the pandemic unemployment scheme for the self-employed and sole traders. We are encouraging them to come off it with an upfront payment. There are low-cost loans, the write-off of commercial rates and the deferred tax liabilities. All of these have helped to improve the financial position of SMEs. It is encouraging that 67,000 people came off the pandemic unemployment payment last week. Some went back into employment and some went back into employment through the wage subsidy scheme. If we can keep up that kind of momentum in the next couple of weeks, we could be heading for a faster recovery than we might have thought possible but I think it will be a bumpy road.
I welcome the last two sentences from the Tánaiste. I am speaking as a former Dublin spokesperson on the other side of the House. We have all championed the notion of remote working but it is having consequences. It has consequences for the city in terms of hospitality. Walking around the city, one sees a lot of offices are not occupied and that has an impact on hospitality, whether it be restaurants, cafes, sandwich bars or pubs. It is having enormous consequences. While I hear the Tánaiste's comments on the July stimulus and I welcome them, he seems to indicate that businesses will fail. I know he will agree with me that almost every hospitality business in this city and its suburbs is viable, in the absence of a pandemic, and needs assistance to survive. Is that being considered in the context of the July stimulus? I acknowledge it is not part of the question, but if the Tánaiste could humour me in answering it, I would appreciate it.
The truth is that not every business was viable before the pandemic. There were those who hoped they would become viable as the economy continued to grow. That has not happened. We had a pandemic instead and now the economy has shrunk so, for some businesses that hoped to become viable, that hope is now lost. We will see businesses close in all sectors, unfortunately. That is just the truth of it but we want to minimise the number of businesses that fail and for sectors who were hit hard, hit first and hit worst, such as the hospitality, arts and entertainment sectors, we want them to be able to at least trade through to Christmas if not to the tourist season of next year. They will need special help to do that.
I take the Deputy's point about the city centre. I am a fan of remote working. It has huge benefits for parents and for the rural economy and rural areas. It has benefits in terms of reducing traffic congestion and greenhouse gas emissions but it is evident how quiet the city centre is at the moment. I wonder how many of those sandwich bars, coffee shops, small restaurants and so on in our city centres - not just in Dublin - can survive, if we do not have footfall. No amount of Government interventions, changes to VAT rates or commercial rates will replace footfall. We will need to have some sort of return of people to their offices over the next couple of weeks, providing the pandemic is under control - perhaps people working two or three days at home and two or three days back in the office. That will help the city centre.
On the Tánaiste's comment on trading through Christmas and until the next tourist season, in what way does he anticipate the environment will be different next spring in terms of the pandemic that will allow businesses that cannot function and trade now, to function and trade then?
What is the Tánaiste's response to the recent comments by Irish Small and Medium Employers, ISME, that the scale and aggressiveness of the business support measures announced by our UK and EU counterparts might serve as a template for Government when it comes to the stimulus package?
I met representatives of ISME last week. We are paying attention to what other countries do and every country's package is different. We compare favourably when it comes to the pandemic unemployment payment. Not many countries are providing €350 per week to workers. That is triple what it is in Northern Ireland or Britain. We compare quite well when it comes to the wage subsidy scheme, which will end in the UK, for example, in October. We have not yet set a date for ours. We probably need to do more with direct grants and in terms of our loan guarantee. These are the kinds of things we are working on for next week and beyond.
Regarding next spring, unfortunately none of us can predict the future. I anticipate we will have spikes and clusters but I hope we will not return to a nationwide lockdown again, which will allow the economy to recover. I hope we will get to the point where we have a vaccine, effective treatments and potentially screening at airports and so on. That would allow a decent tourism season to happen next year. This year will be very difficult but I hope Christmas and next year will be good and maybe there will be pent-up demand to help compensate for some of the losses this year.
22. Deputy Bríd Smith asked the Tánaiste and Minister for Business, Enterprise and Innovation if he will meet with representatives of construction, contract cleaning and security workers to discuss the way in which to safeguard pay rates in these and other sectors in view of recent court rulings that could dramatically affect workers; and if he will make a statement on the matter. [15812/20]
The paths in the House are well trodden by the captains of industry and sometimes by trade unions and their representatives. My question to the Tánaiste is a bit like the question he was asked earlier about meeting the Debenhams workers. Maybe he could clarify it but I believe he responded positively to that. In the light of the recent High Court judgment which sent shockwaves through the industries affected by the judgment, would he be willing to meet representatives of construction, contract cleaning and security workers, those most affected by that judgment?
I thank Deputy Bríd Smith for raising this issue. She has raised it in the House previously and she will understand we are appealing this decision, as confirmed by the Tánaiste last Thursday. I reiterate the Tánaiste's message at that time and again today to all workers and employers affected by this decision in regard to sectoral employment orders, that until the appeal process is concluded and legal certainty has been obtained, there can be no unilateral diminution of the terms and conditions of employees by employers. In regard to contract cleaners and the other sectors the Deputy raised, they are covered by employment regulation orders, which is a slightly different part of the Industrial Relations Act 2015 and they are not impacted by this judgment directly. In regard to meeting representatives of the workers governed by the sectoral employment orders, I intend to meet the Irish Congress of Trade Unions in the coming weeks to discuss this and other pressing matters. We can take it from there. I am happy to engage with the Deputy on this but the important thing is that we appeal this at the appropriate time.
I welcome that the Minister of State said he will meet their representatives in the coming weeks. I hugely welcome the announcement that the Government will appeal the High Court decision and I particularly enjoyed the Tánaiste’s video that he put out on Twitter last night with Countess Markievicz clearly having his back. I doubt he will take her advice and leave his jewels in the bank and buy a revolver but nevertheless-----
I do not have jewels or a revolver. I am a simple man.
-----he might follow her inspiration and show us that he has the backs of the workers involved. The reason I am putting the question in this manner is that I think there is more to protecting and advocating workers’ right than just what goes on in the courts. There is also the ability of workers to defend themselves. There is plan A, where one defends the rights in the courts and plan B, where the State gives workers the possibility to defend themselves. Here I am talking about the legal right to trade union recognition where if one has a high percentage or a certain percentage - as is the case in other countries - of workers who join a union, then the employer must recognise and deal with them and give them access to the workplace, which would prevent the sort of scandals which are alleged to have happened during the Covid crisis in meat plants. That sort of legislation that enables workers to defend themselves rather than always relying on the courts is also needed. It is not just about appealing laws we make here but it is about enabling workers to fight for and defend themselves.
It is fair to say that we, as Ministers, have over the past nine years committed to proving our worth when it comes to industrial relations. The Industrial Relations Act 2015 was quite a large Act. Previously, we had 15 or 16 years of discussion and legal cases. We tried to bring certainty to this and we acted on that with that legislation. We have built on that since and we have shown our absolute commitment here. The national minimum wage has been increased four or five times over the past nine years since we have been in government. When it comes to any cases, we try to strengthen the position of employees and workers. Naturally, we try to bring employers with us on that journey at all times and to get that balance right and that is what the legislation was about.
It is important that we concentrate on appealing the court decision and trying to get that appeal right. The ruling in this case calls into question the constitutionality behind the regulations and statutory instruments that were based on the relevant legislation. We will concentrate on this issue in the weeks and months ahead, and both the Tánaiste and I will engage with trade union representatives as part of that. There is no doubting our commitment to this area.
I agree that we need to appeal the decision in this case and robustly defend the right of the workers concerned to sectoral employment agreements. I do not agree that this Government and its predecessors have done their best to defend workers' rights. The Lockout more than 100 years ago was all about trade union recognition and we still do not have that in this country. Several Bills were put before the previous Government, which ended up being delayed and never progressing through the legislative Stages as they should have. No doubt we will introduce similar Bills in this term.
Workers need the right to organise and defend themselves and they cannot consistently rely on the courts to uphold that right. I refute the Minister of State's claim that this and previous governments have always had the interests of workers at heart. We need to look again at the Duffy Cahill report in view of what has gone on at Debenhams. What happened in that case will repeat itself in other cases. We need to consider giving workers the ability to organise and trade unions the ability to access workplaces such as meat plants where there are contentious issues. Construction sites are notoriously bad for bogus self-employment, precarious working conditions and low pay. All of those practices must be addressed. That will require a commitment from the Government to introduce robust legislation that will ensure workers can organise and defend themselves instead of having to rely on the courts to uphold that right.
A number of agencies are working with departmental officials to ensure workers' rights are protected and there is follow-through on all the legislation we introduce in this House. That is the focus of a lot of our work in the Department. The Deputy referred to a particular report. Our officials work through all such reports and bring forward any changes that are required on foot of them. The machinery at the disposal of the State when it comes to employees' rights is very strong. We are proud of that machinery and we will protect it. We will be happy to engage with the Deputy on any legislative proposals she brings forward in this area. It is about getting the balance right. We are all committed to protecting workers' rights and that is why we will launch an appeal to the ruling in question when it is the appropriate time to do so.
24. Deputy Jackie Cahill asked the Tánaiste and Minister for Business, Enterprise and Innovation the further grant supports for small and medium enterprises being considered by his Department; and if he will make a statement on the matter. [15798/20]
In light of the passing last week of the Microenterprise Loan Fund (Amendment) Bill 2020, will the Tánaiste set out the Government's plan to provide further supports to small and medium enterprises countrywide to aid them in their recovery following the Covid-19 pandemic?
I thank the Deputy for his question and for his interest in advocating on behalf of small business in his constituency and elsewhere. To assist businesses to overcome the unique and unprecedented challenges posed by Covid-19, the Government has put in place a package for firms that includes the wage subsidy scheme, direct grants, low-cost loans, the write-off of commercial rates and deferred tax liabilities. These measures are designed to restore confidence and further assist businesses in terms of their management and business continuity, thus allowing them to begin planning for the weeks and months ahead.
My focus since I took up my role has been on the July stimulus package, which is aimed at protecting the viability of the business and enterprise sector and enabling people to get back to work as quickly as possible in all sectors. The stimulus will extend and enhance existing measures to address the impact of Covid-19 on businesses. I am engaging with my ministerial colleagues on a range of proposals. Helping SMEs is central to our efforts, given their pivotal role in the economy and employment. The July stimulus package to be announced next week will be of scale and speed.
In considering the analysis, I see five areas on which we should focus. These are income supports for workers, by way of extending the wage subsidy scheme; better direct grants for business; cheaper finance for business; new opportunities for future jobs; and targeted supports for the hardest-hit sectors. While I have emphasised the importance of preserving existing firms and jobs, the July package should also have an eye to exploiting emerging opportunities and attracting high-value projects with significant economic benefits. Importantly, the July stimulus must position our economy and firms to meet future challenges. In the near term, this includes helping companies further in meeting the challenges of Brexit, but we also need to include actions that will build enterprise resilience and help businesses to transition to the low-carbon and digital future. I look forward to announcing the details with the Taoiseach shortly.
I thank the Tánaiste for his reply. There is a significant focus at the moment on the July stimulus package and a lot of SME owners are waiting very anxiously for it. Some sectors have been hit harder than others by the Covid-19 pandemic and they are particularly anxious to see what will be announced next week. Private bus operators, small retail outlets, boutique owners and many others have suffered greatly during this period. We are hugely dependent in this country on the SME sector and the July stimulus will be critical in rebooting our economy following the Covid-19 pandemic. Some 65% of workers in the State are employed in SMEs, which means that getting the vast majority of those businesses back on an even keel is absolutely essential. They are anxiously awaiting next week's announcement.
I very much agree with the Deputy about the importance of the SME sector. In all parts of Ireland, large numbers of people are employed in small firms. When we talk about SMEs, people might not appreciate that we are talking about firms with up to 500 employees. A company with that number of employees is quite a large firm but it is technically an SME. We know that the public sector has been largely protected through the pandemic. Very few people in the public service have lost their job, which is a good thing. Employees of large multinational companies have also largely been protected. The people who have borne the brunt of the pandemic are those working in small firms in the private sector. That is why we need to focus our efforts on them.
The urban-rural divide in the sector is quite significant. Rural-based SMEs, although likely to employ fewer numbers than SMEs in urban areas, are nevertheless significant employers. We need to look to the future when considering the issues they face. Access to broadband, transport infrastructure, education facilities and further tax-based incentives will be essential in ensuring the future viability of the sector and enabling the future growth that will enable us to recover from this unique pandemic. As the Government prepares the July stimulus, there is very significant weight on the Tánaiste's shoulders in seeking to address the issues facing SMEs and enabling them to recover. Doing so is an essential part of rebooting our economy. I hope the stimulus package will answer the vast majority of our concerns.
As I said, the July stimulus will be a package of scale. I expect it to include actions we can implement within weeks or months, not actions that cannot be done until next year or the year after, and to amount to several billions of euro in funding. It is important to say, however, that we are not going to fire all our bullets next week. We will do more in October as part of the budget and as part of the national economic plan. The proposals we publish next week will provide a multibillion euro package of measures that can be implemented quickly. It will include measures to help businesses that are closed to reopen and help those that have reopened but are struggling to stay open. Most important, it will maintain the connection between employers and employees so that we see more and more people going back to work over the next couple of weeks.
25. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation his plans to obviate the negative impact of Brexit on the economy here; and if he will make a statement on the matter. [15689/20]
This question seeks to ascertain the extent to which the Government continues to examine the potential impact of Brexit as the year draws to a close.
I thank the Deputy for his question and for his ongoing interest in Brexit and how it will impact on this State. Whatever shape it finally takes, Brexit will have a significant impact on the economy. It will fundamentally change the trading environment for businesses currently trading with the UK. In 2018, my Department published a report, entitled Strategic Implications for Ireland Arising from Changing EU-UK Trading Relations, which examined the implications of Brexit for the economy and trade. While tariffs often spring to mind as a significant cost factor, in fact, the cost of non-tariff barriers due to regulatory divergence and bureaucracy will have a greater impact on businesses trading with Britain.
In January of this year, my Department published a further study on Brexit impacts based on the withdrawal agreement and the revised political declaration agreed between the EU and the UK. The findings suggest a reduction in Irish GDP of between 3.2% and 3.9% by 2030, compared with a baseline whereby the UK remains a member of the EU. This compares with a negative impact of 7% in the no-deal, or WTO rules, scenario modelled in 2018. Of course, both Brexit studies predated Covid-19, which has had a severe impact on the Irish and British economies, with recent forecasts suggesting negative GDP growth of around 10% this year.
The Government has taken extensive action to mitigate the worst effects of Brexit and in each of the last three budgets, provision was made to assist businesses to prepare for Brexit. That provision includes a wide variety of soft and harder enterprise and financial interventions delivered mainly through the enterprise agencies. At entry level, training, mentoring and consultancy advice has been provided, leading to financial assistance by means of vouchers, grants, short-term liquidity loans and longer-term loans to assist businesses to restructure and diversify into new markets beyond Britain. Customs is another area in which we have been actively working on putting in place training programmes, as well as the Clear Customs initiative, which is designed to build sufficient capacity to deal with the new checks, controls and documentation that businesses will need post Brexit.
I thank the Tánaiste for his comprehensive reply. To what degree are he and his Department pursuing the alternative markets that are currently emerging and which might become available, with a view to identifying the best possible options as we proceed? Given that it is in the interests of businesses to keep costs as low as possible, to what extent is the Tánaiste satisfied that we are on the right road and are capable of meeting any challenges we might face?
Diversifying our economy in order that over time, it becomes less and less dependent on trade with Britain is an enormous part of our work, not just in the Department and the Government as a whole but also for the trade section of my Department, Enterprise Ireland and IDA Ireland. If one looks back far enough, Britain was once our only significant trading partner and it now makes up about 17% or 18% of our trade, though that is a misleading figure because it is so important for certain sectors such as the food and drink sector, small manufacturers and many SMEs. While our food sector still exports about 40% of everything we produce to Britain, there was a time when that was 70% or 80%. Much progress has been made in that regard but we need to build on it. As we are part of the eurozone, we need to develop trading links with more eurozone countries. There are huge opportunities in our trade agreement with Canada and more opportunities in America, China and Asia as well. The difficulty is that much of that work has been disrupted in the past few months because of Covid, as IDA Ireland and Enterprise Ireland offices in Asia were closed and no site visits were happening. Much of that work is now being done online but it is not the same and that has been quite disruptive. The good news is that some of the offices in Asia are reopening this week.
In the Tánaiste's experience, has the UK's position softened in any way as we approach the end of the year or has it hardened? To what extent does he expect the UK's attitude to impact on the final analysis of our particular economic situation?
I do not know. I have not had the chance to speak to my new counterpart, Alok Sharma, yet but I intend to do so in the next week or two. Based on the experience I have had with Brexit negotiations up until now, I think there will be a deal but that it will come late in the day, maybe as late as October, November or December. That is why we once again have to prepare for the risk of a Brexit with no trade agreement. We unfortunately have had to march businesses up that hill a few times already but we need to be prepared for it if it happens and we are going to have to step that up again over the next few months. I think there will be an agreement with the UK but whatever that agreement is, it will not include membership of the Single Market so it will be a diminution in the trading relationship and will mean checks and costs for businesses. It will not be good news but hopefully it will be manageable rather than detrimental.
26. Deputy Louise O'Reilly asked the Tánaiste and Minister for Business, Enterprise and Innovation if funding loaned or granted under schemes offered to assist businesses due to Covid-19 will be made contingent on businesses which have not been tax compliant becoming tax compliant within a certain short timeframe, on businesses fulfilling Labour Court recommendations and on businesses with outstanding cases at the Workplace Relations Commission committing to a definitive date by which they will attend to resolve such cases. [15754/20]
This is another fairly straightforward question. While I do not imagine for a minute that the answer will be easy or straightforward, it is something that should be investigated by the Department and should form part of the discussions around both the July stimulus and other measures as we move forward. As the Minister said, this is only the first foray and then there will be more measures announced in October. As we move forward, we want assurances from him that workers will be protected in the same way as he is going to move to protect businesses.
The key focus of any grant, assistance around lending or other help provided to businesses to cope with the Covid-19 crisis is sustaining jobs and vulnerable but viable businesses. We referred to this last week. Our number one focus is helping businesses to survive and keep their doors open and then to thrive thereafter as well. That is the main focus but there are links to tax compliance in all the various grants, funds and opportunities given out by local enterprise offices, LEOs, Enterprise Ireland, IDA Ireland and the local authorities. Applicants have to show they have a tax certificate before the money is drawn down.
Labour Court recommendations, which are not always legally binding, and outstanding Workplace Relations Commission awards are not linked to the drawdown of grants. They are generally enforced by other sectors rather than Enterprise Ireland, IDA Ireland or the local authorities. There is other legislation to protect that area and those organisations do not track it.
Earlier, when we were discussing the striking down by the courts of the sectoral employment order, SEO, the Tánaiste confirmed that those who were engaged on Government contracts would honour the terms of the SEO. We know that the Government knows how to respect workers' rights. The question is whether it is going to use the power it has to enforce them. I ask the Minister of State to imagine for a moment that he is a worker with an outstanding award from the Labour Court. Such awards are rarely legally binding and are often modest. It is a slap in the face for workers on low incomes who are awaiting payment of Labour Court awards to find their employers are in receipt of grants or special funding from the Government. For many of those workers, their employers have simply walked away. Would that Labour Court recommendations were legally binding but they are not, or very rarely are. If a worker is a trade union member, he or she then has the opportunity to take industrial action in support of that decision, but that is a large undertaking, particularly for people who have just been out of work. I ask the Minister of State to consider stitching in a mechanism that ensures the third-party mechanism of the State is respected. I also ask that he adheres to the principle, to which the Tánaiste alluded earlier, that when the State spends money, it will spend it where workers' rights are protected.
To be clear, the Tánaiste was referring to State and public contracts and we can deal with those under contract law. The Deputy asked me about our agencies, whose number one job has been helping businesses survive and stay open over these last few weeks and months. Only last week, the Deputy and many of her party colleagues were complaining that the application process for assistance was too cumbersome and involved too much red tape. Our focus is on getting supports and help out as quickly as we possibly can. While we expect all our applicants to honour State law and be tax compliant, Enterprise Ireland, LEOs and local authorities are not in a position to track everyone's responsibilities regarding the Labour Court and Workplace Relations Commission recommendations and I do not think the Deputy expects them to do so in the current climate. She will probably be in here again next week demanding quick action and that is what we are trying to do. A number of other agencies and people under our Department are also responsible for tracking employment legislation and employment law but they are not the ones in charge of getting the money out to the businesses as quickly as possible. Again, our aim is to support businesses to stay open, reopen or restart and survive during these difficult times over the next six to 18 months. They will then hopefully be in a position to grow again, expand and employ more people. That is what we are trying to do here and we need to reach out to all those employers as quickly as we possibly can. There is no proposal to add to the list of requirements they have to comply with to draw down funding at this moment in time.
I remind the Minister of State of the words of the Prime Minister of New Zealand. "Economic growth accompanied by worsening social outcomes" is not worth having. We fully respect and we will insist that extraordinary measures be taken in extraordinary times to sustain jobs, but it is not counterintuitive to insist that those are also decent jobs. The recovery of which the Minister of State speaks will not be built on the back of the gig economy, precarious work or low-hours contracts. It will instead be built on decent work, if it is to be sustainable, and he has a role in that regard. Will he take on that responsibility? I do not for a minute suggest that it will be easy and I also do not suggest that it should be so cumbersome that businesses will not be able to engage. The Minister of State will have to give thought and regard to workers' rights for decent work as he proceeds with the stimulus package.
We will of course have thought and regard for all those employed; that is why we are in charge of employment legislation. We take that very seriously in our Department. We have several agencies that excel in their work in that area. They have built up much experience and they work with our Department and other agencies. Bodies such as our LEOs, local authorities, Enterprise Ireland and IDA Ireland have to focus on business development and growth and putting the money out.
The majority of jobs created under the remit of Enterprise Ireland and IDA Ireland in recent years have been full time and high end. Naturally, as a Government and a Government party for the past several years, we have been focused on decent jobs and wages. Our track record will show where our focus has been and is. We brought forward legislation on several occasions concerning industrial relations and protecting employees. We have strengthened their position, if at all possible. When it comes to pay and decent conditions, we have also not been behind the door in bringing forward four or five increases in the minimum wage. We are, therefore, showing our focus by our actions. Our focus now, however, has to be on getting the money out. That is one arm of our Department. The Deputy's question is about the fees concerning the action in the High Court, however, and that shows that we are very much committed to the issue of employee conditions.
27. Deputy Éamon Ó Cuív asked the Tánaiste and Minister for Business, Enterprise and Innovation the steps he plans to take to assist events businesses which are very seriously affected by Covid-19 to survive financially through the crisis taking into account their importance economically, socially and culturally to Ireland; and if he will make a statement on the matter. [15664/20]
In a reply earlier, the Tánaiste referred to getting businesses going again. Some businesses by their very nature, however, will not be able to get going until next year. The events business is one of those businesses that involves crowds by definition, in many cases at big outdoor events but also big indoor events. I refer to everything from weddings right to music events in Croke Park, St. Patrick's Day parades, etc..
What are we going to do to sustain during this period businesses, such as events businesses, where opening is totally dependent on health advice? Once things get back to normal, or whatever the new normal will be, we are going to need those events businesses. We often see the musicians, but sometimes we do not see the people who make all the events happen.
The Department of Business, Enterprise and Innovation and its agencies have been focused on coming up with solutions to help businesses overcome the challenges presented by the arrival of the Covid-19 virus. I recognise the difficulties and concerns that events businesses are facing and those businesses that rely on events companies for trade shows, exhibitions, events etc.. to promote and sell their products.
Ensuring that measures are in place to prevent the transmission of Covid-19 at organised and ticketed events with members of the public attending is first and foremost a public health concern. The Deputy is correct, however, to identify the real concern regarding the number of people working in the events industry. Last week, I met representatives of the Event Production Industry Covid-19 Working Group, EPIC. It is a new group, as the Deputy will be well aware of, because its representatives outlined how helpful he has been since its formation. The group represents 3,500 full-time and 15,000 part-time employees.
The Deputy is correct that 2020 is a write-off for these companies because of the magnitude of the events in which the industry participates. They are now facing the issue of skills retention, as well as issues in respect of brand Ireland because these companies promote Ireland in St. Patrick's Day parades, the new year's eve festival, etc. It is important that the July stimulus recognises that this is also a critical sector of the economy. As the Tánaiste said earlier, the July stimulus will be ambitious, it will look at how we can protect employees and it will look at how we can expand the restart grant to accommodate people not normally accommodated. I also refer to the credit guarantee scheme enabling businesses such as event companies to refinance. I met them in that context, but I also asked officials in my Department to meet the representative groups in the days to come to see how we can support this industry in the future.
