Seamus Kirk
Question:8. Deputy Seamus Kirk asked the Minister for Jobs, Enterprise and Innovation if he will consider establishing a retail strategy group; and if he will make a statement on the matter. [3326/13]
View answerRetail Sector Issues
Questions (8)
Written answers
The Government recognises the importance of the retail sector to Ireland’s economy. It is employment-intensive, and covers every community in the country. The combined wholesale and retail sector employs almost 273,000 people in Ireland – that is almost 15% of our total workforce.
In recognising the importance of the sector to the economy, the 2012 Action Plan for Jobs signalled out the sector as one with employment potential and contained a number of measures aimed at supporting the retail sector specifically.
We have also introduced a number of initiatives of particular assistance including:
- Reduction in the VAT rate from 13.5% to 9% on a range of labour-intensive services, with a particular focus on the hospitality sector.
- Introduction of the Credit guarantee scheme
- Reform of wage setting mechanisms
We are also working to reduce the level of compliance on small businesses, and as part of the Action Plan for Jobs developed the business regulation website and aim to deliver a 25% reduction in administrative burdens imposed on business and enable online compliance with regulations where possible. In addition, initiatives by the Companies Registration Office regarding online filing and the forthcoming Companies Bill will ensure a more efficient operating environment for enterprise. During 2012, an audit of 159 licences for key sectors was conducted which identified potential to reduce considerably the burden of compliance with licenses. I will seek to prioritise actions in this area for the retail sector in the coming year.
I frequently meet with representatives of the retail sector and hear the challenges they face, including in relation to the costs of doing business. My officials have also held separate discussions with retail representatives. These engagements have assisted us in implementing the commitments in the Action Plan for Jobs and in identifying any further actions that can be taken to support the retail sector.
I am currently finalising the 2013 Action Plan for Jobs on behalf of the Government and I can confirm that it will include further actions aimed at supporting the retail sector. My Department will continue its on-going engagement with representatives of the retail sector. These engagements have proven very useful in their current format and I do not envisage setting up a separate retail strategy group at the present time.
Export Credit Insurance
Questions (9)
Éamon Ó Cuív
Question:9. Deputy Éamon Ó Cuív asked the Minister for Jobs, Enterprise and Innovation if he will support calls for the introduction of export credit insurance; and if he will make a statement on the matter. [3329/13]
View answerWritten answers
The Government’s position on the issue of export credit insurance generally has been informed by the findings of the 2009 report commissioned by my Department from KPMG consultants. That report established that the introduction of a general scheme would be expensive, with significant on-going costs arising for the State. Annual costs in respect of quite a low level of intervention in the export credit market would be about €1.7m and this cost would rise significantly, if higher risk profile exports were covered. In addition, it was found that such a scheme would be of very limited impact, and that a negligible number of jobs could be connected with such an initiative. As the Government has a responsibility to ensure efficient use of scarce resources, it would be unwise to make a commitment to funding an initiative with marginal benefits for the wider economy and high level risks to the State.
However, in the context of the wider issue of access to finance for SMEs my Department continues to monitor business needs, and will review the availability of medium term trade finance for SMEs, particularly in the area of working capital and performance bonds, in the current year. Work on facilitating access to credit and finance will remain a priority in the context of the forthcoming Action Plan for Jobs 2013.
Employment Rights Issues
Questions (10, 44, 54)
Clare Daly
Question:10. Deputy Clare Daly asked the Minister for Jobs, Enterprise and Innovation the action he will take regarding companies (details supplied) closing down and leaving workers without pay and redundancies. [3192/13]
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John Halligan
Question:44. Deputy John Halligan asked the Minister for Jobs, Enterprise and Innovation his plans to deal with situations in which companies go into liquidation and workers, such as those in a company (details supplied) are left without wages or redundancy payment; and if he will make a statement on the matter. [3308/13]
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Richard Boyd Barrett
Question:54. Deputy Richard Boyd Barrett asked the Minister for Jobs, Enterprise and Innovation his plans to deal with situations in which companies go into liquidation and workers, such as those in a company (details supplied) are left without wages or redundancy payment; and if he will make a statement on the matter. [3310/13]
View answerWritten answers
I propose to take Questions Nos. 10, 44 and 54 together.
I very much share the concern of the Deputies in relation to the company concerned and particularly as regards the position of the employees in the company’s Irish stores who have been understandably apprehensive about the future of their jobs and the payment of monies owed to them by their employer. I understand that this situation has arisen due to difficulties across its operations in the UK and Ireland, arising from dramatic changes in the way music and films are bought and sold.
On becoming aware of the evolving situation in the company last week, I asked the National Employment Rights Authority (NERA) to contact the workers involved in the sit-ins and to mobilise NERA resources to answer queries from all workers on their employment rights.
My Department established a direct line of contact with the receiver from the outset and I was assured that communicating with staff would be a priority. I understand that, over the weekend, the receiver secured the agreement of staff to discontinue their sit-in in return for his commitment to arrange for payment of wages this week. The receiver has indicated he is making every effort to find a buyer for the Irish operation. I understand that the receiver has issued employees with letters notifying them that they are on temporary lay-off, pending an outcome to his efforts to secure a buyer. Redundancy notices have therefore not been issued to the employees.
In general terms, I would note that under the body of Irish employment rights legislation there are significant protections afforded to employees whose employers are insolvent and as a result default on payment of wages. If an employer is unable to pay wages and/or redundancy payments, employees are entitled to apply to the Social Insurance Fund - which is administered by the Department of Social Protection - for payment of the amounts otherwise due from the employer. These rights are contained in the Payment of Wages Act 1991, the Protection of Employees (Employers’ Insolvency) Acts 1984 - 2006 and the Redundancy Payments Act 1967 - 2007. The scheme applies to employees employed in Ireland in insurable employment whose employer is insolvent, as defined under the scheme. Entitlements are based on pay up to a maximum weekly rate of €600. There is a limit of eight weeks’ pay for arrears of pay, sick pay or holiday pay. Monies owed up to the appointment of the receiver are secured by the Social Insurance Fund. Monies owed and earned after the appointment may be claimed through a Rights Commissioner under the Payment of Wages Act, who will adjudicate on the matter. Additional protections afforded by the Protection of Employment Act 1977 (as amended) and the Minimum Notice and Terms of Employment Act are also of relevance. The Protection of Employment Act contains provisions requiring an information and consultation process that must be entered into with employee representatives prior to collective redundancies being implemented. An employer is prohibited from issuing notices of redundancy to employees during the mandatory information and consultation period. Remedies are provided for in the legislation in respect of breaches of these requirements. The Minimum Notice and Terms of Employment Act 1973 entitles an employee to notice of termination of employment of up to 8 weeks, depending on the length of service of the employee. A situation of temporary lay-off may impact on the application of this Act and I would urge individuals to contact NERA to establish the position regarding their rights.
Accordingly, employees left without pay and redundancy payments by an insolvent employer are protected in legislation and are entitled to receive outstanding payments from the Social Insurance Fund.
I am satisfied that the current body of employment rights legislation, backed up by the information and enforcement activities of NERA and the redress available to workers through the State’s workplace relations bodies, provides robust protection for employees, even in these very difficult circumstances.
Prompt Payments
Questions (11, 55)
John Browne
Question:11. Deputy John Browne asked the Minister for Jobs, Enterprise and Innovation the measures he will take to ensure that small and medium enterprise receive prompt payment for their services; and if he will make a statement on the matter. [3314/13]
View answer
Brian Stanley
Question:55. Deputy Brian Stanley asked the Minister for Jobs, Enterprise and Innovation his plans to reduce the 62 day average payment delay culture in Ireland which is having a large negative effect on small business. [3243/13]
View answerWritten answers
I propose to take Questions Nos. 11 and 55 together.
Prompt Payments for goods and services rendered is critical to the effective working of any economy and is an issue on which this Government places great emphasis.
In an effort to help ease cash flow difficulties for Irish small businesses operating under the current economic environment, while at the same time setting an example for businesses in the private sector to improve their payment record by paying each other more promptly, Ireland has introduced, on a voluntary basis:
- A 15 days prompt payment requirement for all central Government Departments to pay their business suppliers within 15 days of receipt of a valid invoice. This arrangement applies to all valid invoices received on or after 15 June 2009;
- A similar arrangement has now being extended beyond central Government Departments to our State Agency Sector to include the Health Service Executive, the Local Authorities, State Agencies, and all other Public Sector Bodies, (with the exception of the Commercial Semi-State bodies). These new arrangements apply in respect of valid invoices received on or after 01 July 2011.
The most recent set of composite figures published are for Quarter 4 2012 and show that 98% of Government payments, valued at €1.25bn, were paid to suppliers within 15 days. The Quarter 4 2012 returns also shows that 93% of Agencies’ payments, under the remit of my Department and valued at €53.9m, were paid to suppliers within 15 days. This clearly shows that central Government Departments, Bodies and Agencies and Local Government continue to comply with the Government requirement to pay business suppliers within 15 days of receiving a valid invoice.
My Department promotes improved payment practices and monitors the operation of the Prompt Payment of Accounts Act, 1997, and the Late Payment in Commercial Transactions Regulations 2002.
At Present the issue of late payment is covered by the European Communities (Late Payment in Commercial Transactions) Regulations 2002 (S.I. No. 388 of 2002). Under these Regulations, it is an implied term of every commercial transaction that where a purchaser does not pay for goods or services by the relevant payment date, the supplier shall be entitled to interest (late payment interest) on the amount outstanding.
Ireland must transpose the Recast of the Late Payment Directive (2011/7/EU) which repeals and modernises the old rules. Minister Bruton signed the Statutory Instrument transposing Directive 2011/7/EU was signed on 22 December 2012 and this will come into effect on 16 March 2013.
The proposed legislation will act as a deterrent to late payment and as a driver for payment on time by establishing a clear expectation in law that payment will be made according to agreed terms. It lays down the specific deadlines for the payment of invoices and establishes a right to compensation in the event of late payment in all commercial transactions, whether they relate to transactions between private or public undertakings, or between undertakings and public authorities.
In practical terms, this translates into the following operational objectives:
- Confront debtors with measures that successfully discourage them from paying late
- Provide creditors with measures that enable them to fully and effectively exercise their rights when paid late.
I am aware that part of the difficulty for small business relates to accessing working capital from banks. A range of national initiatives have been developed to support the flow of credit to enterprises. In addition to initiatives to recapitalise and restructure the banking sector, initiatives have been developed to build better business banking relationships (e.g. the Code of Conduct for Business Lending to SMEs and the establishment of the Credit Review Office). The Action Plan for Jobs 2013 will build on the recent achievements such as the introduction of the 15 day payment period across the public sector in general and the ability for business to attach officially new payment requirements to relevant invoices.
Action Plan for Jobs
Questions (12)
Aengus Ó Snodaigh
Question:12. Deputy Aengus Ó Snodaigh asked the Minister for Jobs, Enterprise and Innovation the steps taken by him to create employment of those at risk of emigration. [3236/13]
View answerWritten answers
The entire focus of the Action Plan for Jobs is on protecting existing jobs and supporting the creation of new ones. This is the most effective strategy to address the risk of emigration. It is designed to achieve a transition from an economy which became dependent on activities that were unsustainable and where over 300,000 jobs had been lost in the three years prior to March 2011.
The Action Plan for Jobs contained a wide range of measures:
- Improving access to finance
- Improving the supports for business and improving the business environment
- Increasing the number of start-up companies
- Securing and deepening FDI
- Improving exports and the competitiveness of Irish business
- Developing sectors of opportunity.
This is just a flavour of the extensive actions which my Department and its agencies have taken to help the enterprise sector to create employment.
We are beginning to see the positive impact of the Government’s policies. 2012 has seen private sector employment growth and significant net job creation by EI and IDA-supported companies, building on the positive results of 2011 and following successive years of significant job losses.
The 2013 Action Plan for Jobs will be published in the coming weeks and will once again include a range of actions to be delivered across Government to support job creation.
Question No. 13 answered with Question No. 7.
Job Protection
Questions (14)
Peadar Tóibín
Question:14. Deputy Peadar Tóibín asked the Minister for Jobs, Enterprise and Innovation the steps taken to prevent job losses such as those lost with the closure of a hotel (details supplied) in County Meath; and his plans to target job creation to areas that are experiencing ongoing job losses. [3221/13]
View answerWritten answers
As Minister for Jobs, Enterprise and Innovation, I regret any job losses. It is an unfortunate reality that businesses can find themselves in difficulty for a wide range of reasons. If my Department becomes aware of a potential company closure in advance, or if the business at risk is a client of one of my Department’s agencies, the Department or agency will do everything within their power to assist that business. However, it is not always possible to prevent closures or job losses.
A number of new measures of particular assistance to businesses under pressure have been introduced recently, including the introduction of the Micro Finance Loan Fund and the Credit Guarantee Scheme, reform of wage setting mechanisms, allowing easier access to examinership, reducing employers PRSI and the introduction of a reduction in the VAT rate from 13.5% to 9% from 1st July 2011 on a range of labour-intensive services, with a particular focus on the hospitality sector. In addition, my Department is working closely with the Department of Finance and the Credit Review Office to evaluate evidence on credit availability and to ensure that the amount of credit flowing to the SME sector is maximised to facilitate sustainable job creation and retention.
The tourism sector is a particular focus of the Action Plan for Jobs reflecting the Government’s commitment to develop the sector by, for example, targeting capital investment in public tourism product and infrastructure, and using the Tourism Marketing Fund to support international marketing and advertising programmes. Also, “The Gathering”, which takes place this year, will be Ireland’s biggest ever tourism initiative.
The enterprise support agencies of the Department, Enterprise Ireland, IDA and the County Enterprise Boards are all alert to the need for business to anticipate difficulties and have developed various Programmes for process improvement, innovation, mentoring and skill development to assist companies in making necessary transformations.
Despite a very difficult domestic and external economic environment, we are beginning to see the positive impact of the Government’s policies. 2012 saw significant net job creation by EI and IDA-supported companies, building on the positive results of 2011 and following successive years of significant net job losses.
I am currently preparing the 2013 Action Plan for Jobs on behalf of the Government, and in that context, am exploring further measures which can be taken to transform our economy and support job creation and retention across all regions of the country.
Business Regulation
Questions (15)
Billy Kelleher
Question:15. Deputy Billy Kelleher asked the Minister for Jobs, Enterprise and Innovation the action he is taking to reduce costs for business; and if he will make a statement on the matter. [3324/13]
View answerWritten answers
Reducing costs for business is a central theme within the Action Plan for Jobs. The Action Plan includes an extensive range of measures across Government which will help to reduce costs for business generally and support job creation.
My Department and Agencies have undertaken several initiatives to support this objective, including:
- Reforming the statutory wage setting mechanisms;
- Reducing administrative burdens by 24.9% in the areas of Employment Law, Company Law and Health & Safety Law, amounting to annual savings for business of almost €207 million;
- Introducing a reduction of 30% in the fees charged by the Personal Injuries Assessment Board to respondents to personal injury claims from €850 to €600;
- Reductions were also made last year in various fees charged by the Registrar of Friendly Societies to co-operative societies, and by the Patents Office for certain patents and design services;
- Publishing the Companies Bill which will lead to significant reductions in administrative burden for business.
There are also a range of cost reduction measures being pursued by other Government Ministers through the work of their own Departments and bodies under their remit. Examples include the freezing or reduction of the Annual Rate of Valuation (ARV) by 87 out of 88 Local Authorities in 2012. Updates on these, and all other commitments in the Action Plan for Jobs, are detailed in the Quarterly Progress Reports on the Plan which are available on my Department’s website, www.enterprise.gov.ie.
I am currently coordinating the finalisation of the 2013 Action Plan for Jobs on behalf of the Government. This year’s Action Plan will build on the progress made last year and will set out a number of new initiatives to further reduce business costs and support job creation. The 2013 Action Plan will be published in the coming weeks.