Wednesday, 31 March 2021

Questions (362)

Jennifer Carroll MacNeill

Question:

362. Deputy Jennifer Carroll MacNeill asked the Minister for Finance his plans to reassess the employment wage subsidy scheme and the level of support provided through the scheme owing to the return to level 5 in the Living with Covid Framework; and if he will make a statement on the matter. [1915/21]

View answer

Written answers (Question to Finance)

I would like to assure the Deputy that the EWSS is sufficiently flexible to take account of the changes to the economic conditions that have arisen from the additional public health restrictions.

The EWSS is an economy-wide scheme that focuses primarily on business eligibility, delivering a per-head subsidy on a flat rate basis to the employer.

The EWSS “turnover test” has been specifically designed so as to target the subsidy at otherwise viable employers whose businesses continue to be adversely impacted by COVID-19 by requiring a comparison of the firm’s pre-pandemic operations with their current operations. The legislation provides that the employer must be able to demonstrate that they are operating at no more than 70% in either the turnover of the employer’s business or the customer orders received by the employer in Q1 and Q2 2021 compared with the same period in 2019.

There is additional flexibility in the application of the turnover test to allow employers to take account of potentially sudden changes in turnover on a month-to-month “opt-in/opt-out” basis. Under the legislation, an employer is required to carry out a review of their turnover each month and confirm that they are still eligible for the scheme. At the same time, there is no cut-off deadline for access to the scheme, so if there is a reduction in turnover because of an unexpected reduction in business activity or a sudden change in business circumstances the employer may be entitled to make a claim for that future period.

I have been clear that there will be no cliff-edge to the EWSS and, as the Deputies will be aware from announcements made on 23 February, it has been decided that the scheme is now to be extended until the end of June 2021. This will be at the enhanced rates of subsidy introduced with effect from late last October.

With the agreement by Government on the revised plan, COVID-19 Resilience and Recovery 2021: The Path Ahead, a cautious and measured approach will be taken as we lay the foundations for the full recovery of social life, public services and the economy. It is therefore appropriate that key business supports should remain in place until the end of June 2021.

As the revised plan is implemented, the EWSS will play an important role in getting people back to work as public health restrictions are eased, thereby reducing the numbers dependent on social welfare payments over time, including the Pandemic Unemployment Payment (PUP).

I am therefore satisfied that the design of the Employment Wage Subsidy Scheme (EWSS) fully takes account of the changing environment around living with the COVID-19 pandemic.

For those businesses who may need additional support, I would draw attention to the comprehensive package of other business and employer supports that have been made available since the July Stimulus Plan and Budget 2021 - including the Covid Restriction Support Scheme (CRSS), the Credit Guarantee Scheme, the SBCI Working Capital Scheme, Sustaining Enterprise Fund, and the Covid-19 Business Loans Scheme.

Question No. 363 answered with Question No. 114.