Vol. 1028 No. 5
1. Deputy Louise O'Reilly asked the Tánaiste and Minister for Enterprise, Trade and Employment if he will outline his Department's position on EU legislative proposal COM (2022) 71 on due diligence and corporate sustainability. [53894/22]
The question relates to the corporate sustainability due diligence COM (2022) 71. It is an extremely important proposal, which I believe we need to get right. From the hearings we have had and the small piece of research into this that I have done I believe there is a real opportunity for us to get this right and make a difference.
I thank Deputy O’Reilly for the question on the proposal for a directive on corporate sustainability due diligence, CSDD, which was published by the European Commission on 23 February 2022. It addresses corporate behaviour and due diligence processes for the companies within its scope. The proposal focuses on establishing a system within company law and corporate governance to address adverse human rights and environmental impacts arising from companies' own operations, their subsidiaries' operations and their value chains.
At the outset I wish to state that Ireland is supportive of the objective of the proposed directive, which should promote responsible business conduct and is seeking to ensure that the proposals strike the right balance by providing effective protections while ensuring that the measures to be implemented by companies are clear, proportionate and enforceable. The proposal will apply to large companies, both EU and non-EU. SMEs are not directly within scope but may be indirectly impacted under the proposal, for example, if they are part of a large company's supply chain.
The proposal has the potential to be far reaching and it is vital that we get it right. Good progress has been made in discussions to date at EU level but further work is needed to clarify aspects of the proposal, ensure that the practical implications are well understood and that the obligations on companies are reasonable and effective. For example there has been relatively little discussion of financial sector aspects of the proposal and clarification has been sought on the interaction of the proposal with the suite of existing regulation in the financial sector. Fundamental issues relating to the scope and definitions remain and are currently under discussion. There is considerable interest in the proposal across a wide range of interests and my Department has been actively engaging with stakeholders, including civil society organisations and business representative organisations, since the proposal was published. Officials in my Department have met members of the Irish Coalition for Business and Human Rights, ICBHR, and with the UN special rapporteur on human rights defenders, the latest of which was two weeks ago. I myself will be meeting both groups in the coming weeks.
I thank the Minister of State. It was promised that this directive on corporate sustainability due diligence would ensure that EU companies undertook due diligence and checks along their full supply lines to prevent environmental abuses and human rights violations. The aims behind the directive were welcomed by progressive politicians, trade unionists, environmental groups and human rights groups. As it stands, however, unfortunately the law falls far short of what is needed to protect workers, communities and our environment. The directive falls short of what we need because it will only apply to companies with an annual turnover of €150 million and more than 500 employees and companies in high-risk industries such as agriculture and fashion with more than 250 employees. Will the Minister of State outline for me the clear policy position of the Irish Government on this corporate sustainability and due diligence directive? Will Ireland act at European level to raise the ambition of this directive and address the weaknesses that have been highlighted? The Minister of State said he met representatives of the ICBHR. I am sure it has outlined to him the weaknesses in this proposal. The Minister of State should indicate what is our position and what we are doing to address those weaknesses.
As I said earlier I will personally meet representatives of the ICBHR and the other bodies in the coming weeks. SMEs are not within the scope directly but may be indirectly affected. Deputy O'Reilly confirmed what the thresholds are. We currently consider these thresholds to be appropriate. While I hear the Deputy's criticisms, it should be noted that the cohort of companies within those thresholds accounts for some 50% of the annual turnover of all the companies within the EU. It is important to ensure that the right companies are within the scope, namely, those companies with the potential to make significant adverse impacts on human rights and environmental matters and which, through their actions, have the ability to change value chains and change these matters. By extending the threshold the concern is you will take in much smaller companies that are not in a position to make the kind of changes that are necessary. The aim is to reach a degree of appropriateness in regard to the transposition of this directive. I certainly will pursue those issues. We will come back to the House on it.
Human rights abuses are never appropriate and no company is immune to engaging in them regardless of its size. Sorcha Tunney, the co-ordinator for the Irish Coalition for Business and Human Rights, stated recently "We need to take forced labour, deforestation and oil spills out of our shopping baskets once and for all, but this proposal just doesn't go far enough and is riddled with loopholes." The current guidelines as they stand will exclude 99% of companies. Only 1% of companies will be included. The reality is that any size of company can engage in human rights abuses or environmental destruction or both. Therefore the directive on corporate sustainability and due diligence has to be sufficiently broad and strong to reflect this. I am worried that the Minister of State stated that some companies may not be able to put the necessary checks and balances in place and make the changes that will be needed, because we are talking about changes that will prevent human rights and environmental abuses. It should apply in the broadest sense to as many companies as possible. I do not believe any company can claim immunity just by virtue of its size. We are talking about human rights abuses, we are talking about environmental destruction.
To be clear, I am not saying that anybody should be absolved of any responsibility in regard to human rights or in regard to the environment. It is about the appropriateness and the effectiveness of the regulations. As I said, 50% of companies with the biggest turnover in the EU will be affected by this directive. We need to make sure that in its implementation it is effective and that it actually does what we want it to do, rather than it being an ineffective piece of work that does not actually achieve. My concern is also that by extending it in the manner on which the Deputy is focusing, companies that are not in a position to actually make effective use of it will not be able to do so. We have to get an appropriate balance and ensure that we get the result we all want in respect of environmental sustainability and human rights. The best way to do that is to ensure it is effective.
2. Deputy Paul Murphy asked the Tánaiste and Minister for Enterprise, Trade and Employment the steps that his Department has taken to progress additional regulations on clean air in the workplace as promised in Dáil Éireann in December 2021; and if he will make a statement on the matter. [53848/22]
It is almost a year since our Workplace Ventilation (Covid-19) Bill 2021 passed through Second Stage. At that time the Minister of State, Deputy English, stated that we wanted to see it speedily and effectively implemented. He was going to call me that afternoon to see how we could have regulations to get this implemented because we do not need legislation. Where are the regulations? What has happened? We are back into winter. The issue of ventilation is going to be central in regard to the spread of Covid-19 again. What has the Government done to ensure that workers have the right to clean air?
As the Deputy is aware, following our discussion that night on his Private Members’ Bill on workplace ventilation, which was not opposed by the Government, I asked the Health and Safety Authority, HSA, to start immediately a formal review of the existing provisions on workplace ventilation to determine what further enhancement measures could be considered. Following this review, a decision was made to update the existing regulations and to introduce a robust code of practice on ventilation in the workplace. Both the new regulations and the new code of practice are being progressed by my Department officials in conjunction with the HSA.
The code of practice for indoor air quality will set out the optimal standards for indoor air quality, along with detailed practical guidance for employers and employees. A code of practice is an established compliance mechanism and can be referred to in legal proceedings.
The board of the HSA has approved the draft code of practice for indoor air quality for public consultation. The public consultation will commence in the week beginning 31 October 2022, that is, next week. It will last about four weeks. The timeline for the publication of the finalised code of practice will depend on the extent of any amendments to be made following the public consultation but it is anticipated that the code of practice will be published in early 2023 and the updated regulations will be introduced at the same time.
The existing 2007 general application regulations create a requirement on employers to make sure that there is an adequate supply of ventilation in the workplace and that the evaluation of ventilation forms part of an overall workplace risk assessment. Amendment of the general application regulations will bring into force the new code of practice for indoor air quality. Any worker who is concerned about appropriate levels of ventilation in their workplace should immediately contact the HSA for advice and guidance on the matter.
This is progressing quite well as per our agreement on that, even with the Deputy’s legislation as well. I believe our regulations will probably go further and achieve more. The Deputy’s legislation requires specific Covid measures and we are trying to improve air ventilation in general, which has many other benefits beyond the prevention of the spread of Covid.
The Minister of State said there will be a code of practice. What will be the consequence if a company does not abide by the code of practice? What is the level prescribed in terms of CO2 parts per million in the code of practice?
Our Bill did not just relate to Covid, rather, it related to CO2 parts per million. It effectively was a proxy for the likely presence of Covid but it related to the air being of good quality. This is a moment when it is not just in relation to Covid but where we can guarantee workers access to clean air at work. It is estimated that 2 million disability-adjusted life years are lost in the EU 28 each year due to poor indoor air quality and effects, which include, but are not limited to, cardiovascular diseases, lung cancer, asthma, respiratory tract infections, chronic obstructive pulmonary disease and acute intoxication. We need to know what the levels are and what the consequences are for not sticking to them.
This is a problem. We are going into winter again, people will be inside more and Covid will spread. This needs to be done as soon as possible.
The fact that the code of practice is being published next week means we are moving it pretty quickly. It will be in place in 2023, which I must remind the Deputy is only about eight or nine weeks away. It is not as if we are saying this will be in a couple of years’ time. To be fair, there is a process to go through when updating these regulations. I assume the Deputy wants this done right. I believe it will be done right in the way it is being done.
The code of practice will be published next week. The development of the regulations to bring into force the new code of practice in the workplace is being progressed by officials. The existing 2007 regulations are being amended to impose an obligation on employers to comply with higher standards of indoor air quality, which will be set out in the associated code of practice. The updated regulations will give legal effect to the code of practice.
The Deputy asked what that is about. The code of practice for indoor air quality will set out the optimum standard for indoor air quality, along with detailed practical advice and guidance for employers and employees on areas such as contaminants, indoor air and its sources and health effects, risk assessment, indoor pollutants and their thresholds, measurement and analysis, ventilation strategy, ventilation types and appropriate control measures, along with practical checklists and a tool for employers. Under the code of practice, the HSA inspectors will have the full range of powers available to them, including the right to assess a report of inspection, serve an improvement or prohibition notice, enter a place of work, question certain individuals, investigate and examine records and examine the workplace activity and processes carried out. Findings can be used in criminal proceedings.
Let us see what the code of practice is. I wonder whether there is a need for a primary legislative framework for there to be real, substantial sanctions on employers that do not provide clean air for their workers. Belgium, for example, which has been one of the first movers on this in the EU, is currently introducing something quite similar to our Workplace Ventilation (Covid-19) Bill.
Has the Department any idea of how many people who have long Covid were infected in their workplace? Will the Department change its policy of refusing to classify Covid as an occupational illness? The Oireachtas Library and Research Service estimated last January that there could be around 115,000 people in Ireland suffering from long Covid. We will add more people to that list over the course of the coming winter and many of them will have picked Covid and long Covid up in their workplaces in poorly ventilated buildings.
Again, we analysed the Deputy’s Bill and we felt that amending existing regulations was a more appropriate and pragmatic way of achieving the objectives of that Bill. We probably will have achieved the same things.
The Deputy’s Bill, as drafted, focused primarily on improved workplace ventilation. However, both the Department and the HSA believe that workplace ventilation goes beyond Covid-19. The code of practice will provide a more long-term, sustainable and holistic approach to workplace ventilation and gives flexibility to further updates, as opposed to primary legislation. The Bill, as currently drafted, is quite prescriptive. It is not practical to use primary legislation to deal with every single place of work because places of work are very different. They differ greatly from one another and the impact of CO2 readings must be judged in the context of different workplaces with different workforces at different times.
The measurement of CO2 levels was recommended by the Government’s expert group on ventilation as an effective measure of identifying poorly ventilated, multi-occupant and enclosed indoor areas. The work safety protocol set out how these monitors should be used in the workplace. However, a high CO2 monitor reading is not a proxy for risk of exposure to Covid-19 but, rather, for identifying poor ventilation. This needs to be fully appreciated when reading CO2 levels, as well as the fact that other sources of CO2 exist in certain workplaces. That is why we think regulations that can be changed and adjusted as we move on are important.
3. Deputy Louise O'Reilly asked the Tánaiste and Minister for Enterprise, Trade and Employment if preparatory work has begun to incorporate into legislation the recommendations on collective bargaining made by the high-level group on collective bargaining and industrial relations. [53895/22]
The Tánaiste will have received the recommendations made by the high-level group on collective bargaining and industrial relations. Has preparatory work begun to incorporate these recommendations into legislation given that, as we know, the European Council has given the green light to the EU directive on adequate minimum wages and collective bargaining on 4 October?
Collective bargaining is an important element of ensuring good industrial relations in Ireland. Industrial relations stability comes from a voluntarist system where the State does not seek to impose a solution on the parties to a dispute but will assist them at arriving at one. This approach has served us well in resolving many complex and protracted disputes. However, our laws are very weak when parties refuse to engage.
As the Deputy knows, I appointed a high-level working group under the auspices of the Labour Employer Economic Forum, LEEF, to review collective bargaining and the industrial relations landscape. I want to record my appreciation to the group, the employer and trade union representatives and its chairperson, Professor Michael Doherty of Maynooth University, for their hard work in concluding this report. The report was published earlier this month and is now available to the public on my Department’s website.
The report is timely, as we need to keep abreast of developments at EU level, which require us to promote the capacity of social partners to engage in effective collective bargaining systems. The EU directive on minimum wages and collective bargaining was adopted by the European Council on 4 October and I welcome the directive’s focus on strengthening collective bargaining structures in member States.
The way forward is by no means predetermined and we have to work through the various legal hurdles and legislative issues in this area. I have asked my Department to carefully consider the report, consult with stakeholders and develop proposals for the Government in respect of its implementation. These proposals may well include examining how recommendations need to be incorporated into legislation. I am pleased to inform the House that this work is already under way.
I look forward to continuing to engage, through the LEEF, on the issues raised in the report and how we can continue to promote positive industrial relations in Ireland.
I want to join with the Tánaiste in thanking the members of the group. I want to particularly thank Patricia King, the outgoing general secretary of the Irish Congress of Trade Unions, a former colleague and, indeed, a very good friend of mine. I wish her well in her retirement. I also wish Owen Reidy, the incoming general secretary, well. He has much work to do.
The Tánaiste’s answer does not fill me with an awful lot of optimism that this will get moving quickly. We need to expand the percentage of workers who are covered by some form of collective bargaining. It is clear that we need legislation to be able to facilitate this. It is not our job as legislators to organise workers; we know that. However, it is our job to create the conditions for workers to be able to organise. As I have said many times on the floor of the Dáil Chamber and in other places, the best way for a worker to ensure that his or her voice is heard at work is to join his or her trade union and be active in it. Unfortunately, however, the system as it currently stands facilitates employers effectively ignoring not just their trade union, but the will of their own workforce.
I join with the Deputy in thanking Patricia King for her service on the group and her general service in the past couple of decades. I interacted with her in many ways and on many levels in the past ten years or so. She is a very impressive person and I wish her the best in her future. As the Deputy is aware, Ms King will continue to be a member of the commission on housing and to bring her expertise to the table in that regard. In addition, I congratulate Owen Reidy on his recent appointment to his new role in ICTU.
To give the Deputy some assurance, we will get moving on this. The new directive is now European law. It is not a choice. We cannot ignore it, nor do we want to. The European directive requires us to have 70% or 80% of the working population covered by some form of collective bargaining. That does not necessarily mean being a member of a trade union or trade union recognition; it can be done through joint labour committees, JLCs, or different mechanisms. It is absolutely the case, however, that we need to make progress in this regard. We are only at about 30%, so the gap is large. I anticipate that there will be legislative change next year.
We need to move quickly on this. As the Tánaiste stated, trade union density is at a low level and that means protection for workers is at a low level because the two things are interlinked.
An issue that is not expressly related to this but on which the Tánaiste and I have corresponded previously is that agencies that are funded by the Government are also ignoring Labour Court recommendations when they do not have the funds to respond. That makes a mockery of the system. The quicker we can move to a system of collective bargaining and recognition, the better. As the Tánaiste stated, we may have different views on how that might be done, but we need to expedite this legislation because workers have waited a very long time for this. Trade union density being at its current level means that protection for workers is at a low level and that needs to change. Many of the practices that could be stamped out by having collective bargaining and strong unionised workforces were exposed during Covid. We need to move quickly on this.
I thank the Deputy. I know she will agree, however, that it is important that we get this right. That is why it will require further engagement with unions and employers. We also need to have particular regard to small business and how this would operate at the level of a company that might only have one or two employees. There is a lot to be worked out at this stage. It is not intended to make Labour Court recommendations legally binding. The Deputy will be aware of unions that have not respected Labour Court recommendations, particularly in the public transport sector. That does work both ways. The fundamental change that needs to come about is there needs to be proper legal procedures where employers refuse to engage. That is the change I anticipate happening both in terms of refusal to co-operate or participate or to appoint members to JLCs. As regards the wider issue of where employees want to be represented by a union but their employer states it will not even have a meeting with them, that is not going to be sustainable into the future.
4. Deputy Matt Shanahan asked the Tánaiste and Minister for Enterprise, Trade and Employment if he will outline any expanded scope that is being offered to Enterprise Ireland to provide financial support to indigenous industries that are facing energy cost increases that are more than twice the Government's €10,000 per month support package; and if he will make a statement on the matter. [53737/22]
It is good to see the three Ministers with responsibility for enterprise here this morning to take questions. My question relates to any expanded scope that is being offered to Enterprise Ireland to support indigenous industries financially, particularly those facing energy bills that are well outside the proposed additional increase of €10,000 in energy supports.
Understandably, many businesses are very worried heading into the winter period. The cost of energy, and the cost of doing business generally, is rising, interest rates are going up and consumer confidence is waning, so businesses need help with their energy bills. The Government has introduced a significant package in the budget to help them in the coming months.
This morning, along with the Minister for Public Expenditure and Reform, Deputy Michael McGrath, I launched the €200 million Ukraine enterprise crisis scheme. It will be implemented through Enterprise Ireland, IDA Ireland and Údarás na Gaeltachta and is now open for applications. It is not limited to client companies of those agencies. It will assist viable but vulnerable firms of all sizes in the manufacturing and internationally traded services sectors that are suffering liquidity problems or are affected by severe rises in energy costs as a result of Russia’s invasion of Ukraine. The scheme will operate under two streams and will provide between €20,000 and €500,000 per firm to ensure there is sufficient liquidity available in the markets, thereby reducing additional costs for firms. For energy-intensive companies impacted by exceptionally severe increases in gas or electricity costs, the scheme will provide for a minimum of €20,000 and a maximum of €2 million per firm.
In line with the Government’s commitments under the climate action plan, the scheme recognises the importance of encouraging sustainability, and successful applicants will be required to put in place an energy efficiency plan. I point out that the scheme is only for manufacturers and those involved in the internationally traded sectors.
The scheme will work alongside other measures announced in the budget, such as the Ukraine credit guarantee scheme which will provide €1.2 billion in low-cost lending to business, and the temporary business energy support scheme, administered through the Revenue Commissioners. The latter scheme is being finalised at present and will have an estimated cost of approximately €1.25 billion. It will provide energy subsidies to businesses of that level.
There is an urgent need for financial supports across the SME trading sector. I have raised previously with the Tánaiste the need for specific sectoral supports. I highlight the food processing sector, which is in real trouble, and food retailers. I recently wrote to finance Ministers regarding a south-east food processing company whose monthly bill has gone from €8,000 to €48,000. Just last night, I was in discussion with Associated Craft Butchers of Ireland. More than 650 butcher shops are facing increases in their electricity rates, with bills rising from less than €1,000 to more than €4,500 per month. That is unsustainable. Two butcher shops closed in the past week alone. There is a need for urgency here.
The Tánaiste stated that the TBESS is due to open. When will it be available to be accessed? These businesses will not remain viable for much longer. Many of these small butcher shops are very much integrated in the rural and regional economy and employ between two and eight people each. This is an indigenous sector that badly needs to be supported.
I thank the Deputy. The scheme announced this morning is now open for applications through the agencies. I will have to double check to be certain, but I think food processing should be covered under the scheme because it is the manufacture of food products and most of our food is exported, so I anticipate that the companies to which the Deputy refers could apply under the scheme. They would have to demonstrate that their energy bills constitute a significant amount of their turnover and that their profits are down. This may be an option for some of them.
I need to be frank with the House, however. We are not going to be in a position to cover fully the cost of increases in electricity bills for business, no more than we can do it for households. There are limitations on the budget even though the economy is going well. We know the effect of unlimited price promises across the water. We are not going to do that. We are not going to be able to cover fully the increased cost, unfortunately. In addition, we are covered by EU temporary crisis framework state aid rules. They are there for good reasons, namely, to protect the taxpayer and to ensure that different countries do not engage in unfair competition.
I thank the Tánaiste. I welcome the news of the Ukraine enterprise crisis scheme. I hope the company to which I referred will be able to access funding under the scheme.
There are incredible challenges right across the business and SME sectors, particularly for companies such as food processors which are using large amounts of gas or electricity and whose business model has been completely destroyed. We need to have a clear strategy in terms of what we are trying to do. I accept, as I am sure does every other Member, that we cannot save every business, but we do need to have a serious look at the businesses that can be saved, particularly those that contribute to Tourism Ireland and our tourism offering. The hospitality and retail sectors are part of that.
I am not sure if the Tánaiste clarified when the TBESS scheme will be open and business will be able to access funding from it. That is what these small businesses need, particularly now. They just need some relief from the bills they are facing.
To clarify, the Ukraine enterprise crisis scheme announced this morning is now open for applications. The temporary business energy support scheme requires legislation. The Finance Bill has to get through this House and the Seanad before that scheme can be up and running. It will be administered by the Revenue Commissioners.
Presuming we get the Finance Bill through the Houses, and I believe we will, we would expect it to be up and running by the end of November or early December. Any payments will be backdated to September. Businesses can be assured that they will receive money through the Revenue Commissioners before Christmas to help them with their energy bills, not just going forward but backdated to September.
