Covid Restrictions Support Scheme Regulations and Employment Wage Subsidy Scheme Regulations: Motions

Minister for Finance (Deputy Paschal Donohoe)

I move:

That Dáil Éireann approves the following Regulations in draft:

Taxes Consolidation Act 1997 (Covid Restrictions Support Scheme) (Date Adjustment) Order 2021,

a copy of which was laid in draft form before Dáil Éireann on 8th April, 2021.

I am pleased to move two resolutions today, seeking the approval of the House for the following draft orders which provide for the extensions up to the end of June of two support schemes, the employment wage subsidy scheme, EWSS, and the Covid restrictions support Scheme, CRSS.

Speed and scale of response to the supply and demand shocks created by the pandemic have been the focus of our economic response. Since March last year, we have moved rapidly, using the balance sheet of our country to replace lost private sector demand, to ensure firms, workers and incomes were supported and protected through wage subsidies, the deferral of liabilities and income supports. Our overarching objective has been to support homes and firms as well as to limit the scarring or permanent effects of the pandemic.

The schemes we are seeking to extend today are part of the broad range of supports provided by the Government to help businesses through the pandemic. The level of support provided to businesses has been unprecedented. Significant levels of support have been provided by way of direct income supports via the pandemic unemployment payment, PUP, and the wage subsidy schemes, which represent real payments to our citizens and businesses to help manage financially in these very difficult times.

The temporary wage subsidy scheme, TWSS, cost almost €3 billion, the EWSS has cost €2.8 billion with almost half a billion in PRSI forgone, the CRSS is approaching €500 million, and €2.3 billion of tax debt has been warehoused. This gives a total of €9 billion in supports for businesses under the aegis of my Department alone. In addition, €6.5 billion has been paid by the Department of Social Protection under the pandemic unemployment payment.

The wage subsidy schemes have been central to our efforts. The TWSS was in place until the end of August last year. It was replaced by the employment wage subsidy scheme, which began on 1 September 2020. In addition to these schemes, a number of other Departments are also providing direct supports.

Of course, we have to look at the motions before the Dáil today in the context of where we are in relation to the reopening of our country. We are already seeing the start of the reopening process, with the full return to schools from last Monday week, travel limits extended to 20 km or within the county, the resumption of residential construction, as well as early learning and childcare projects. This week, inter-county GAA training and elite athlete training was permitted to resume. As we look towards this cautious reopening of our economy, it is clear from last week’s stability programme update that the relationship between economic activity and public health restrictions has weakened with every wave.

Much of this is due to the flexibility of domestic enterprises but consumers have adjusted also. Last month’s VAT data was up 8.5% on the first quarter alone. Our consumers are buying local. They are buying online.

In the medium term, the speed at which the economy can recover depends uniquely on our vaccination programme. This was a consistent theme of the IMF and World Bank spring meetings that I attended recently.

Our vaccination programme will be the touchstone for our economic recovery. However, this will take time. In recognition of the challenges facing so many businesses I want to reiterate today that there will be no cliff edge in the removal of support. We will put in place supports to continue for as long as they are needed to ensure the beginnings and the taking hold of the strong recovery we all know is needed. We have not fought this pandemic and its economic fallout for just over a year on a scale that is unprecedented in Irish economic history to fall at the final hurdle.

The motions are required as part of the process of extending the schemes until the end of June. In the case of the Covid restrictions support scheme, CRSS, subparagraph (ii) of section 484(2)(a) of the Taxes Consolidation Act 1997 inserted by section 11 of the Finance Act 2020 provides that the Minister for Finance may vary the scheme by extending the end date of the measure beyond 31 March but not later than 31 December of this year.

The draft Taxes Consolidation Act 1997 (Covid Restrictions Support Scheme) (Date Adjustment) Order 2021 provides for this extension and was laid before the Dáil on 8 April. The legislation requires that the order shall not be made unless a resolution approving the draft has been passed by the Dáil.

In regard to the employment wage subsidy scheme, EWSS, section 28B(21) of the Emergency Measures in the Public Interest (Covid-19) Act 2020 provides that the Minister for Finance may vary the employment wage subsidy scheme by extending the end date of the measure beyond 31 March 2021 but not later than 30 June 2021. I have formally consulted my colleagues, the Minister for Public Expenditure and Reform, Deputy McGrath, and, in respect of the EWSS, the Minister for Social Protection, Deputy Humphreys, and have determined it is necessary for both schemes to remain in place until 30 June.

It is fair to say, and I hope the House will agree, that the two schemes have provided much-needed support as they endeavour to help businesses cope with the effects of the pandemic. They have helped businesses remain viable as we start the process of reopening the economy.

The numbers are striking. I think we should recall them. As of today, 22 April, 22,100 businesses have registered 25,900 premises for the CRSS with Revenue. A total of 148,400 claims for CRSS payments of €478.9 million in respect of 24,600 premises have been made to date and €475.5 million of this has been processed for payment.

With regard to the EWSS, 48,900 employers have currently registered with Revenue and over half a million employees have benefited. A total of €2.8 billion has been paid and, as of last week, there were more than 420,000 people in receipt of the pandemic unemployment payment, PUP.

I want to take this opportunity to acknowledge the huge amount of work of the Revenue Commissioners. Without their efforts we would not be where we are today.

I wish to say a word about the extension of the EWSS to 30 June 2021. This policy represents a substantial and key part of the Government’s response to the pandemic. This is the second extension of the scheme, thus demonstrating that this is a successful and vital policy instrument.

The primary employer qualification for the EWSS is based on the employer's turnover in the current six-month period being less compared with the same pre-pandemic position period in 2019. The legislation provides that the employer must be able to demonstrate it is operating at no more than 70% in either the turnover of the business or the customer orders received by the employer by reference to the period from 1 January to 30 June 2021 compared with the same period in 2019. This is a very flexible policy tool designed to take account of potentially sudden changes in turnover. If there is a reduction in turnover in the future because of a change in circumstances, the employer may be entitled to make a claim for a later period. The amount of subsidy given to the employer is based on the number of paid workers on payroll per week combined with a flat, per head value rate which is applied based on prospective pay levels so that claims may also be made for new hires or seasonal workers.

Following the reintroduction of level 5 restrictions in October 2020, the Government decided that from 20 October the amount of the EWSS subsidy paid per employer would be up to €350 per week, graduated on the basis of the income of the employee. As set out in the Finance Act 2020, the enhanced rates were to be in place until 31 January 2021 after which they were due to return to the original rates of €151 for those paid more than €151 per week and €203 for those paid more than €203 per week. However, given the current circumstances with this pandemic, the Government decided on 23 February last to maintain the current EWSS rates to 30 June. This is aligned with the rates of payment of the pandemic unemployment payment. This is a very important alignment. Otherwise there would be a risk of migration of employees from the EWSS to the pandemic unemployment payment. That could undermine the very work of the employment wage subsidy scheme. It is also an important bridge between social welfare payments such as the PUP and regular employment, which is the ultimate goal.

The relevant legislation provides that, as Minister for Finance, I may vary certain aspects of the scheme such as the end date, the rate of subsidy and the criteria of the turnover test for qualifying employers by ministerial order. This affords the Minister sufficient flexibility to ensure the scheme remains agile and responsive. In terms of direct subsidy payments, the estimated cost of the extension of the enhanced rates for quarter 2 is €1.167 billion. This is to be met from the voted expenditure of the Department of Social Protection. In addition, it is estimated that a further €180 million will arise from the continuation of the 0.5% reduced rate of employers’ PRSI, with an estimated total cost of approximately €1.3 billion.

Turning to the CRSS, this scheme has provided much-needed support to businesses that have been forced to close. The vast majority of businesses in Ireland are affected by Covid but the CRSS is intended to target specific businesses where access by customers is restricted. This was intended to be and has been implemented as a targeted scheme. It was never meant to be a general support measure. As I have said, the economy is only slowly and cautiously beginning to reopen and therefore the Government has agreed that the CRSS should be extended for now to 30 June. The restart week provided for in the CRSS, which allows a business to claim for an extra week upon reopening after restrictions are lifted, will be of particular benefit as businesses start to reopen. The estimated cost of the extension of the CRSS is in excess of €240 million, to be met out of resources allocated for Covid contingency funding.

As we look forward to reopening the economy and our society in the coming weeks and months, we can and should expect an initial rebound, in part fuelled by pent-up demand, but this is not the same as a full recovery. I recognise that reopening will be costly and will pose new challenges that will need to be sustained by supports and corrective measures to allow us get the balance right between supporting the recovery and the cost to the taxpayer. I want to restate the Government’s commitment that there will be no cliff edge to the supports at the end of June. We are conscious that continued support is required to assist sectors of the economy on the path to recovery and we will set out these plans in the coming weeks.

I am very much aware of the value of the supports I have outlined but I am equally aware of the huge level of strain many businesses are facing at the moment, particularly small and medium enterprises, SMEs, with all the major challenges they faced so suddenly.

I strongly contend the support plans in place have played a major role in helping companies to be viable when closed while also giving them the foundations they need to reopen. I know much needs to be done. Even yesterday, when I attended the Committee on Finance, Public Expenditure and Reform, and Taoiseach, I heard views of different colleagues regarding supports, how they should be changed and what their future should be. For example, I heard of the challenges retailers are facing and was reminded of the challenges being faced by the hospitality sector. I listened to those views and look forward in the coming weeks to working with other Ministers to bring forward plans that will play another role in getting the balance right between supporting our economy at this really difficult time, meeting the many public health challenges we have and which we are getting the better of while continuing to get the balance right between those costs and those that the taxpayer will ultimately pay.

Deputy Louise O'Reilly

I am thankful for the opportunity to speak to these important motions. There is no doubt that the extension of these schemes will give workers and businesses some certainty, although just for the coming weeks. I have spoken to people availing of these schemes, where they work, and they speak incredibly highly of them and are incredibly grateful for the assistance. We cannot lose sight of the fact that these are viable businesses that were closed for public health reasons. As soon as it is safe, they are anxious to get back to being the employers they were and making the contributions that they did. They want to be in a position to be able to bounce back.

The continuation of these schemes is essential and perhaps, as the Government speaks about easing the public health restrictions, greater clarity could be given to workers and businesses on how the schemes will operate as we move through the easing of public health restrictions and with increasing rates of vaccination. It would be remiss of me not to relay the problems that some businesses have raised for some time now.

The exclusion of many businesses from the CRSS is still significant. Since budget day, when the scheme was announced, many limitations within it have been highlighted and their effect has become more acute since businesses have tried to draw down funding. In the days following the 2021 budget, both I and my colleagues pointed out that the narrow nature of the scheme would mean suppliers, event management companies, taxi drivers, businesses without fixed premises and many others would simply fall through the cracks.

Before the finance committee, my colleague, Deputy Pearse Doherty, has highlighted problems with the schemes directly to the Minister. At a meeting of the Oireachtas Joint Committee on Enterprise, Trade and Employment last October, I called on the Tánaiste to expand the scheme to include businesses such as event management companies, the business event industry, artists, taxi drivers, suppliers and other businesses currently excluded. It took nearly six months for some of these difficulties to be addressed by the launch of the small business assistance scheme for Covid, SBASC, and I am thankful that scheme will offer some hope to businesses that they can continue to weather this storm. Unfortunately, that scheme, like the CRSS, does not address the exclusion of businesses without a fixed premises. As a result, a host of businesses will continue to go without supports. Sinn Féin still believes, in the interests of protecting as many businesses as possible, that the sensible action is to include all of those whose turnover fell by 75% or more.

The EWSS, along with the PUP, has helped workers significantly. A matter has arisen with workers in receipt of the EWSS, especially those in the aviation sector, who are due to lose their short-term work support payment because their entitlement is due to end under the current rules surrounding jobseeker's benefit. I ask the Minister to raise this with his colleague, the Minister for Social Protection, and seek that the rules surrounding jobseeker's benefit be extended beyond the current six and nine months, with the rules around requalification suspended so that workers can have access to this absolutely vital support. Such changes are badly needed by workers in the aviation sector, especially those in Aer Lingus, who are down 60%, 70% and, in some cases, 80% of their usual wages.

With regard to businesses and especially SMEs, I ask that the Minister and his Department look at the question of hidden debt to ensure it does not affect the ability of SMEs to bounce back to profitability. From speaking with owners of many SMEs and family businesses, I know there is a fear that hidden debt, such as warehoused tax debt and commercial rent arrears, will hinder the ability to bounce back to profitability when the current health crisis is over. Data provided by the Minister's office indicate that SMEs have warehoused more than €1 billion in tax liabilities under the debt warehousing scheme. This scheme is important for SMEs, microbusinesses and family businesses. It has improved the short-run cash flow for them but the Government must ensure there are some checks and balances in place so they are not hit with a tsunami of debt immediately after they try to reopen.

As we know, SMEs are the backbone of our economy, particularly with regard to employment. That they have warehoused more tax debt than any other sector should be of grave concern to the Minister. I encourage the Department, in conjunction with the Department of Enterprise, Trade and Employment, to examine this specific matter and assess the sort of structures that may need to be put in place so businesses can safely exit and bounce back. Many businesses have suggested solutions such as repayment of tax debt over an elongated period or reduced interest rates. I encourage both the Minister for Finance and the Tánaiste to begin these conversations immediately.

Commercial rent arrears are an extremely serious matter for businesses right across the State. The Government has published a code of conduct between landlords and tenants but some businesses have outlined that many commercial landlords are refusing to engage. There are sensitive constitutional questions to be gotten over, which we recognise, but I know that in some Nordic countries arbitration systems have been established to help address questions of commercial rents and rent debt. Looking at such systems may be a very good place to start as many of these firms are absolutely terrified of the debt that may await them. If we are to come out of this crisis and be resilient, we must ensure such hidden debt does not hinder SMEs.

Yesterday we saw yet another company announcing a closure, with 486 jobs gone in Carphone Warehouse. That is 486 people and their families getting some of the worst news at the worst possible time. Retail is facing an absolute crisis but we know the sector is the backbone of many of our towns, villages and cities. It is in crisis and the sector is crying out for some sort of certainty or help. The Mandate trade union has proposed a forum on the future of retail. I know that some people in the Government say, when asked, that retail and our habits are changing. That is true but our habits have changed out of necessity. With some encouragement, the Minister might be able to revitalise the retail sector and save hundreds of thousands of jobs. I urge him to consider seriously a forum on the future of retail to bring stakeholders together and really work hard to try to salvage jobs and the sector as a whole.

Deputy Mairéad Farrell

I have written to the Aire a number of times on an anomaly in the CRSS and I have raised it in this Chamber. What I will say today is not something new but something of which he will be very much aware. My colleague, Deputy O'Reilly, mentioned it as well. Under the current scheme businesses without a fixed premises are not able to qualify. The Minister indicates the scheme is targeted rather than prescriptive but only those businesses with fixed premises that can show reduced footfall as a result of the restrictions will qualify. We know there are a great many businesses that cannot qualify for the CRSS as a result.

When it was introduced, we saw these anomalies and my colleague, Deputy Pearse Doherty, even tabled an amendment in January that would have changed the qualifying criteria for the scheme. Unfortunately, the Government rejected it. It seems, nevertheless, that some of the criticism has been taken on board with the launch of the new Covid-19 business aid scheme, which allows the likes of wholesalers, suppliers and caterers to be included. That should be welcomed, although unfortunately the new scheme does not address the exclusion of businesses without a fixed premises. It is an anomaly that needs to be rectified.

In the interests of protecting as many businesses as possible, it would be sensible to include all businesses that have seen turnover fall by 75% or more in this scheme. It would have been a simpler and more inclusive scheme that would acknowledge the businesses out there that are continuing to struggle with non-payroll expenses and fixed costs. Their future viability is in doubt. We saw in the recent stability programme update that the Government would have no role in supporting businesses that are no longer viable. The problem is there are large numbers of businesses that have been excluded from these schemes that are viable. I raised with the Minister before some of the businesses in my county of Galway, including Killary Fjord Boat Tours and a bus tour company on the islands. They have historically been successful.

When matters return to normal they will probably rediscover that success, but they are under great pressure at present due to the lack of support because they do not have a fixed premises. Their businesses are threatened as a result. It should be remembered that these businesses are embedded in the community. They are very important for these rural areas and form part of the commercial ecosystem.

It might be easy to take the view that the exclusion of these businesses is only a minor matter, but it can have significant unintended consequences. Consider the example of the boat tours. As the economy begins to reopen and the tourism industry begins to see increased activity, these must be viable in order to attract people to the area so they will go to the shops and restaurants. While the Minister has saved money in the short term by excluding these businesses, it will more than likely end up costing him far more in the long term because of potential tax and business activity forgone. The CRSS has cost less than was projected so I urge the Minister to reconsider this, to allow these businesses to be eligible for it and to help them. It will help not only the businesses but also the communities.

Deputy Ged Nash

I am pleased to support the continuation of these important supports for jobs, businesses, our economy and our society generally. As the Minister has asserted time and again, and he reasserted the principle today, it is important that there not be a cliff edge through the withdrawal of these critical supports. As I did previously and as the Minister did today, I pay tribute to the staff in the Revenue Commissioners and across the public service and Civil Service for their hard work, innovation, dedication and effort in developing and implementing these important systems and schemes, literally overnight just over a year ago. They are owed a debt of gratitude from all of us. I hope that those who have made careers out of lambasting the public service reflect on that and on where the business community might be without these interventions, if the State had not asserted itself in the way it did when these awful circumstances arose just over a year ago.

When we say there will be no cliff edge to these supports we should also acknowledge that not all businesses will come through this period unscathed. That is true and we all accept it. I am anxious that efforts be made to establish a series of supports that will provide what I might call a set of stabilisers for businesses that can be viable again, but which will need customised and tailored supports over the next period of time to help them through the early phase of what we hope will be a successful economic and social recovery. What I have in mind, and the Minister will have heard me speak about this time and again, is a repurposed wage subsidy or support scheme based on the principles of the German Kurzarbeit model. This would help businesses and workers to get a shot at returning to profit, sustainability and viability. This is the type of scheme the principles of which should be embedded into our economy and labour market model, at least for a period of time to help us return to where we want to be. In addition, any such schemes that may be developed should have appropriate conditions attached to them with regard to job retention, minimum rates of pay, minimum hours and so forth. The State should not be taken for a ride and provide endless forms of corporate welfare into the future without using the resources that hopefully will be deployed to drive better outcomes for everyone in the context of our planned and hoped-for economic recovery.

In the time I have left I will turn to another matter related to Covid-19 business supports and the way in which insurance companies such as FBD Holdings and others are operating in respect of business interruption insurance claims. The Social Welfare and Pensions Act 2013 introduced a measure which provided for the deduction of certain benefits, such as illness benefit, from personal injuries awards obtained through a claim for damages. In such cases the law provides, effectively, that the money be returned to the State. In the case of business interruption claims and the actions of companies such as FBD Holdings, can the Minister outline his interpretation of which section of law the insurance companies are relying on to make deductions from awards, as is reported? Will he outline what plans he has to recover any such moneys reclaimed by insurance companies which should logically, and arguably in law, be reimbursed to the State if, indeed, the insurance firms are relying on the logic and principles enshrined in the 2013 Act in terms of the treatment of personal injuries awards?

I am not entirely clear about the plans of the Minister of State, Deputy Fleming, after listening to his interview on this issue on "Morning Ireland" this week. He appeared to want to see the difference between an award and the reduced award, based on the amount of Covid support issued, returned to the State and for the policyholder to enjoy the benefit of the full award at the same time. I am not sure that is possible. I understand what he was driving at, but I am not entirely sure what he plans to do. Perhaps the Minister can clarify the position because this issue will come even more considerably into view over the next period of time. As these supports continue and as more business interruption claim issues are addressed by the courts, and potentially by the Financial Services and Pensions Ombudsman, there must be reassurance from the Minister that individual policyholders who require our support and those who are depending on State supports will have the Minister's and the Government's support in getting what they are entitled to. A message must be conveyed to the insurance companies that the type of behaviour they are involved in at present will be given short shrift by the Government.

Deputy John McGuinness

First, I welcome the Minister's statement on the continuation of the Covid support schemes and the fact that there will not be a cliff edge at the end of this. We had a good discussion in the finance committee this week in which, as the Minister said, various suggestions were put forward to deal with some of the shortfalls affecting the SME sector. I support that. In supporting it, I wish to take up the points raised by Deputy Nash when he spoke about FBD Holdings. It is time for the Minister to make a statement on FBD Holdings, the claims being paid and the deductions it says it is entitled to make. It is very important that we ensure the greed of the insurance companies is not allowed to continue to affect businesses, particularly those in the SME sector that require and are entitled to the claim.

The schemes have supported businesses. The Minister said the financial level of support was €12 billion. I would like the Minister to examine the very small businesses that are affected by turnover in terms of qualifying for some of the schemes. They need support, and they will need support to reopen. One of the biggest problems is that many of these small businesses have carried forward debt from the financial crash. They had made deals with their banks at high interest rates. Some of the bigger ones, particularly in the tourism sector, have been bought by vulture funds which are demanding their money. It would be helpful if there was a scheme in place whereby very small businesses and those that are affected by banks and vulture funds at the other end of this were able to access low interest rates and to rebuild their balance sheets and loans in terms of what they have to repay. If that happened, it would mean they could restructure their loans, they would have a reasonable interest rate and they would be able to continue in business and quickly respond to the reopening of the economy.

There is nothing like a family business and an individual in business to respond to the challenges of the time. They proved that in the financial crash and I believe they will prove it again this time if given an appropriate break. The commentary from the Central Bank indicates that some businesses will not reopen. I am making the case for the smaller ones. I ask the Minister to look at those that do not have a fixed premises. People aged 66 years and older who were enterprising enough to go into business and create employment should be given some benefit, perhaps the difference between the social welfare benefit and the €350.

That is absolutely essential. At this time, with the commercial rates, for example, it would have been a great opportunity to introduce reform. We have missed that boat. It was a lost opportunity. Commercial rates, as far as businesses are concerned, are an unfair tax on them. It should be linked to turnover. That is the only fair way to do have that kind of tax. I am sure businesses would respond positively to that type of development. There is no doubt, however, that in spite of the €12 billion being spent, businesses are still not being supported to the level needed to get them into the space where they are reopening and are competitive once again. We will need them to pay their taxes. The warehousing of tax is fine but the day of reckoning will come when they will have to pay. That day will be difficult for them if they are not allowed to reschedule their loans and rebuild their books and there is not a proper banking system that will facilitate small businesses. I encourage the Minister to do this.

Deputy Brendan Smith

I endorse the comments of my colleague, Deputy McGuinness, particularly with regard to people aged over 66 and, in many instances, sole traders, self-employed and with smaller-scale businesses. I welcome the Minister's outline of the supports available, however. They are very significant. The figures the Minister quoted earlier regarding the economic cost of Covid-19 demonstrate very clearly the impact it has had on employment, enterprise and commerce in general. Of course, that pales into insignificance when we think of the cost in lost lives and people suffering.

I welcome those supports, however. I welcome also the fact the Minister said that certainty will be given. We need to ensure we help maintain viable business and employment and provide businesses with certainty to the maximum extent possible. I gather the estimated cost of the extension of the employment wage subsidy scheme, EWSS, amounts to €1.32 billion. That is a substantial amount of money.

Since the onset of pandemic, some €12 billion has been spent in direct income supports. Overall, the amount allocated for Covid-19-related supports across 2020 and 2021 is in excess of €28 billion. That demonstrates very clearly to all of us the awful economic cost of Covid-19.

The Covid restrictions support scheme, CRSS, is a good and essential support to businesses that have witnessed a major reduction in their turnover. Again, the EWSS supports employment and supports employers to maintain the link with the employee. For too long in this country, we did not value enough the corporate knowledge, expertise and experience that had been built up by employees, whether it was in the public or private sector. It is important that link is maintained between employer and employee so that, hopefully, these businesses can return to a trading position and become viable again. We need those experienced personnel back. We need the person back who knows the customer for their business, who knows the market and has expertise and corporate knowledge in that particular area.

I welcome the fact the small business assistance scheme, SBAS, was introduced last month. In quarter 1, that will allow a maximum payment of €4,000 to companies, the self-employed, sole traders and partnerships. I raised a number of queries with regard to this particular scheme. I am aware of a number of business owners who were deemed ineligible for this new scheme due to having claimed under the CRSS. The amount received was much lower than what they would receive under the SBAS. I repeat, and I know it is under the aegis of the Department of Enterprise, Trade and Employment, that I would like the Minister to look at this again with his colleagues across Government. Such businesses, which will struggle to remain open in the future, should be allowed to avail of the SBAS. Any amounts claimed under other grant schemes, however, should be deducted from the final approved amount if they were to be allowed to participate in the new scheme.

Of the cases I have in mind, the applicants availing of a very small CRSS payment were not aware of the small businesses assistance scheme when claiming under the other schemes. They are small traders and one-person enterprises. Those are the types of business that populate the main streets in our smaller towns and villages. All of us know of the particular challenges facing retailers in our smaller towns and villages when we see nothing only delivery vans carrying goods to households in every estate in each town and county in the country today. That demonstrates very clearly the huge challenge faced by retailers to open again and make their businesses viable. Again, assistance had been given through the local enterprise offices, LEO, to assist smaller businesses to go online and partake in the digital economy. I appeal for Government to place a particular emphasis on and give particular assistance to the smaller-scale businesses in order that they can develop an online presence.

Deputy Darren O'Rourke

I wish to raise a couple of issues with the Minister this afternoon. I ask that the Government look into them as soon as possible as they remain unresolved despite repeated requests for action.

The first issue relates to aviation workers, specifically Aer Lingus employees. My colleague, Teachta O'Reilly, referenced this point. The pandemic and resulting necessary travel restrictions have had a massive impact on workers in the sector. This hardship has been compounded by repeated failures of the social welfare system to support them when they need it most. Last year, we ran into issues where the airline refused to sign forms correctly for workers on the short-term work support scheme. Workers were continuously pushed from pillar to post by the company and the Department for Social Protection. This was eventually resolved for the temporary wages subsidy scheme, TWSS, after we raised it repeatedly with the Minister and with the airline. A satisfactory resolution or fair solution was never found for the EWSS.

Now, cabin crew and other staff are getting notifications from their social welfare offices that their period on jobseeker's benefit is coming to an end and they will have to face a similar further substantial cut in pay in the time head. What has been suggested for them? A further reduction in hours. That is entirely unsatisfactory as a proposal. It is absolutely brutal that this would be suggested. These workers are barely getting by as it is. It is scandalous that the rug is being pulled from under them at this point. They cannot get clarity on it. My colleague, Deputy Clarke, raised the issue with the Tánaiste earlier and, amazingly, he did not seem to understand that a Department, of which he was formerly the head, was responsible for Xs and Os.

We call on the Minister, therefore, to intervene and work with his colleagues in the Department of Social Protection to address this issue as a matter of priority to ensure aviation workers continue to be supported by the wage subsidy scheme, which is welcome, and other necessary social welfare supports. Aviation workers and their unions have called for a German-style wage support. I echo that call here.

My second point relates to another group of transport workers who have been severely impacted over the last 12 months. Taxi drivers have seen their business disappear and their income cut massively. These workers have had to continue to cover expensive overheads for their vehicles and the income supports put in place for them simply do not cover it. Thousands of drivers in the sector are over the age of 66, meaning they are not entitled to the pandemic employment payment, PUP.

We called for tailored supports for this sector to ensure taxi drivers are supported but this request has fallen on deaf ears. In the North, for example, there is a simple, targeted £3,000 grant. The Minister for Transport here seems to be living in a parallel universe to taxi drivers. The suggestion that the main initiative by this Government is a grant for electric vehicles, EV, is simply completely out of touch. A direct and focused support for this sector is needed or it will not survive. It is a case of survival and support rather than cosmetics on the outside.

Deputy Catherine Murphy

In the first instance, it is important to say that these supports are really essential. We are very happy to continue to support them. It demonstrates the importance of the State, particularly at times of crisis. SMEs are the primary driving force for our economy, employing some 70% of the workforce.

These businesses shape the fabric of our cities, towns and communities, providing employment for 1.6 million people across the country, along with vital services without which this country could not survive. They are the very ones on whose doors we knock when it comes to sponsorship for everything from Tidy Towns to football clubs. It is way beyond what is immediately obvious. Our priority when considering those business supports must be ensuring as many of those small to medium-sized businesses survive and recover from this pandemic.

A particular cohort which requires support is young people in employment. Youth unemployment, for those between 15 and 24 years of age, has risen again and now stands at 59.2% according to CSO data. This was 11% at the end of 2019. Sectors which primarily hire younger people are still described as subdued in hiring activity. These would typically be hospitality, pubs, retail, etc. Up to 47,000 of pandemic unemployment payment recipients self-certified as students with almost 90% of these under the age of 25. It is crucial this payment is extended to help these students remain in education as their employment sector is likely to remain closed or severely curtailed for some time.

In a reply to a parliamentary question, I was informed that in past recessions youth unemployment levels typically fell quite quickly once economic activity returned. In addition, the jobs of many currently on the pandemic unemployment payment will not be permanently lost due to the pandemic. However, this is not a recession. It is a pandemic and these are completely different risks to our economy. It will take longer for some sectors to return which are those where many of our young people work.

On Monday, the Governor of the Central Bank outlined the risk that SMEs will face once the Government pulls State support away. A survey published by the Central Bank and the ESRI suggested that almost a quarter of SMEs could be in danger. The survey identified two groups as vulnerable to liquidation when the criteria for insolvency normalise. The first was those which were loss-making in 2019. The second was those that broke even in 2019. There is also deferred debt, rents and other issues which have not been factored in. These may well impact on companies not under pressure in 2019.

There has been great success so far in keeping many businesses afloat through support schemes such as the CRSS, Covid-19 restrictions support scheme, and the EWSS, employment wage subsidy scheme. When the Minister speaks about the cliff edge, June and the CRSS, does he envisage the scheme going beyond June? If so, will further legislation be required to cover that eventuality? None of us expected to be as long in lockdown as we have been or for some of these supports to be as necessary for as long as they have been.

Uncertainty is a real factor. We must also factor in changes to consumer behaviour. The hospitality, events and tourism industries experienced some of the worst impacts. It will take time for them to recover. It is important we design schemes that will facilitate and encourage people to spend the money they saved during the lockdowns in the domestic economy, particularly in the hospitality, events and tourism sectors.

The EWSS has been extended until the end of June 2021, which is welcome. There is an anxiety about the deficit and balancing books. We must be able at some point to balance budgets. However, talking about these two issues at the same time tends to give a degree of uncertainty.

Deputy Dara Calleary

I commend the Minister on his practical approach to this entire issue since the start of the pandemic and join with him in thanking Revenue. I also acknowledge the role of local authority staff who have been involved in rolling out the various supports to businesses locally. I give them credit for a job incredibly well done.

I welcome the commitment about the cliff edge, which is important. We need to continue to emphasise that, particularly as we, hopefully, move into a reopening phase. There are several issues about the scheme, however, I wish to raise. Many businesses are being affected by standing utility, IT and security costs. These are eating up much of their subsidy. I know the Minister cannot provide for everything. However, given that no revenue is coming in, the utility and credit card companies need to stand up to the plate in terms of working with businesses and providing them with support, particularly where there are standing charges not necessarily for the use of a service.

The hospitality sector is at the forefront of many of the restrictions. As hospitality begins to open up again, we will see that there has been a flight of experienced and qualified hospitality staff to more secure employment such as essential retail. Without that experience, we are going to find it hard to get our hospitality industry back up to the level at which it was. This will also affect the level of contribution the sector makes to the Exchequer. At some stage, consideration should be given to a key worker initiative to assist the hospitality industry retain or bring back experienced workers. I will be raising this with the Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media, Deputy Catherine Martin. I hope the Minister for Finance will consider this as well.

Many retailers have been left with stock more appropriate to the winter and most definitely not appropriate to opening up for the summer. They must be able to sell that stock but their suppliers are not dealing with them. Again, that is an issue that is soaking up much of the money under the supports and the CRSS. Will the Minister consider this matter as well?

Several Deputies raised the issue of the older self-employed. We are quite ageist in our approach to this. Just because one is over 66, does not mean one does not have outgoings and may need the supports. The exclusion of this age group from many of these schemes is very unfair.

I endorse what has been said previously about insurance companies. They were dragged kicking and screaming to the courts to adhere to their commitments and to their liabilities. They are now using State supports to subsidise the payment of what they should be paying to their customers. We need a strong statement from both the Minister and Minister of State, Deputy Fleming, who is doing much in this area, that this will not be tolerated.

Deputy Pádraig O'Sullivan

I welcome the Minister's speech in which he reiterated there would be no cliff edge in the removal of supports and that they will continue for as long as is necessary to ensure a strong recovery. Given what we have gone through, we do not want to fall at the final hurdle and I welcome those sentiments today.

The point about FBD Insurance was a recurring one made by many speakers today. Will the Minister comment on reports last week that FBD is deducting the value of State supports from pay-outs? We are all aware of the landmark judgment in February. FBD was dragged kicking and screaming to stand over its policies. Now the insurer is attempting to use State supports and moneys to limit exposure of its own company in terms of pay-outs. This is wrong. These State schemes are supports for businesses. State-sponsored supports are not tailored to mitigate against the losses of private insurers. If FBD succeeds in what it is attempting to do, pay-outs to struggling businesses will be significantly reduced, making it more difficult for viable businesses to re-establish themselves once we reopen.

I was heartened by the comments of the Minister of State, Deputy Fleming, last week that Government pay-outs are made to help businesses struggling through the pandemic, not to reduce the liability of insurers. I would welcome a response from the Minister regarding the same.

Deputy Joe Carey

I too commend the Minister on his work in delivering these schemes and working on a very hands-on basis with business people and his Government colleagues. I also thank the staff of local authorities and of the Revenue Commissioners. Businesses have endured an unprecedented year, and without these vital supports, many of them would have folded. Schemes like the CRSS and the employment wage subsidy scheme are vital, therefore, and it is vital that they are extended. It is equally important there is no cliff edge, and I welcome the Minister’s comments again today on that. For many of the sectors that have been so badly affected, such as aviation, hospitality and tourism, there should be a specific sectoral support tailored for these specific industries and those supports should be made available for the rest of this year and indeed into next year.

If you look at County Clare, the mid-west region and Shannon Airport, we have a huge number of people involved in aviation. Indeed, the Minister and I met a company on the vital nature of the employment wage subsidy scheme and the company asked that it be extended to the end of the year. I plead with the Minister and the Government to make the commitment that these particular companies, which employ so many people in County Clare and the mid-west region, need to give them certainty to plan for the future so that they will be able to survive into the future.

I also lend my voice to the case in relation to insurance. It is regrettable the insurance industry would stoop so low as to try to reduce the premiums awarded to businesses that have been shut down and after the business interruption they have endured. It is regrettable the industry would seek to reduce the premiums awarded to businesses by reducing the award due to the State supports they have received. I, too, call on Ministers to make a strong statement to the insurance industry on this issue.

Deputy Patricia Ryan

I appreciate the opportunity to speak today on the CRSS and the EWSS. I have had many conversations with business owners over the past year and they all speak with one voice in saying the Department is unsympathetic to the many hard cases that are out there. Even when they are present themselves in large numbers, the Government is slow to make changes to accommodate them. It is slow to accommodate businesses that do not pay rates, slow to accommodate businesses without fixed premises, and slow to accommodate rural-based businesses whose usual customers could not legally travel to them outside of their 5 km up to last week. The Government needs to do more or these businesses will not be here this time next year. I ask if the small business assistance scheme for Covid can be extended to non-rateable businesses whose turnover is below 25% of their 2019 figure. It is a matter of survival for these businesses and a matter of survival for rural Ireland that we stop the chain reaction that will happen in the rural economy if these businesses close.

On the EWSS and TWSS, Revenue has publicly stated that for certain employees whose employer paid net weekly earnings of between €586 and €960 pre-Covid, the full amount of that subsidy due to such employees may not have been paid through the payroll process during the period the TWSS was in operation. The process of identifying those employees who qualify for an additional subsidy is currently in progress. Revenue intends to offset any additional amount against an individual’s outstanding income tax and USC due for 2020 or by way of direct refund if the person has no 2020 arrears. It is hoped this process will be implemented by the middle of the year when all the relevant data from employers have been reconciled and the required IT systems developments have been completed. More needs to be done and it needs to be done more quickly. I ask the Minister when people who have received huge bills can expect to receive TWSS reviews?

We need to ensure the bespoke version of the EWSS which has been made available to early years and after-school settings remains in place until at least the end of the year. We must support this vital but struggling sector.

Deputy Richard Boyd Barrett

Since the very outset of this pandemic I have been arguing for specific supports for those sectors disproportionately hit or indeed just closed down by the impact of the pandemic. I reiterate those calls because while some of the supports the Government has bought in have been very good and have kept businesses alive and wages going into people’s pockets, certain groups have not seen the benefit of those supports to the extent they need to.

Next Thursday, I think at 10.30 a.m., the taxi drivers of this city and a number of others will once again be gathering around Leinster House and around the cities to protest about the continued failure of the Government to extend grant supports to them. They will remain in their cars so they will not be breaching the public health regulations. They have, in the estimate of one survey, €11,000 a year in fixed costs, car repayments, insurance, maintenance of the cars and so on. Some, because of the ten-year rule, which has been extended to some extent, still face a cliff edge as they must replace a car in spite of having had no income, or virtually no income, for the past year and a half and very likely very little income for the coming months at least until we are beyond this pandemic. Despite this, they have been excluded from the CRSS and from the Covid-19 business aid scheme, CBAS, and they do not even get the restart grant if they are still on the PUP. It is just not fair. If the Government is giving other businesses support, it must give the taxi drivers grant support so they can survive, cover those costs and not leave them in extreme debt positions and without the money to replace their vehicles when they reach the point where they must replace them.

I should point out that many of them are very willing to move to electric vehicles as part of the move to address climate change but the grants are totally inadequate. They are between €20,000 to €25,000 whereas a new electric vehicle costs about €50,000. How are people who have had no income, or virtually no income, for the past year and a half supposed to be able to buy electric cars? I therefore appeal to the Minister once again on that. By the way, the taxi drivers are having a meeting tonight and most of the relevant Ministers have received invitations to that. Some politicians are going. It will be online and start at 7 p.m. I issue an invitation to the Minister. He needs to hear what 20,000 taxi drivers and their families are going through.

In the remaining 15 seconds let me just shout out for another group - the musicians. Some in the music, entertainment and events industry have benefited from the grant support the Government has given, but again there are a lot of musicians who work out of a van, who do not have a premises and so on. Their incomes have been decimated but they have fixed costs and are not getting the grant support they need.

Deputy Mick Barry

I raise an issue that pertains to Aer Lingus workers. I am going to read from a letter I have:

I am a cabin crew member working for Aer Lingus. As you know, myself and my colleagues have been on reduced wages and working hours since March 2020 when the pandemic hit. Since November of 2020 up until now I have been on 60% of my wages and working hours. My employer is currently paying me through the EWSS and I am paying PRSI stamp A contributions since 1 September 2020. I have been claiming jobseeker's benefit since 1 September 2020 on the days I am not working. Myself and my colleagues have been begun to be notified by our local offices that this payment is now coming to an end. My local social welfare office informs me that I must experience further substantial loss of earnings from the 60% working hours I’m currently on in order for me to be able to requalify for casual jobseeker's benefit as per the law. I am writing to you today as we need an additional or alternative urgent income support to the EWSS to be set up for employees whose working hours are affected by Covid, in particular aviation workers. The EWSS alone is not effective in delivering for aviation. I ask you please to deal with this as a matter of urgency so myself and my colleagues do not have to experience weeks on the breadline with no additional welfare payments while a decision is made.

I ask the Minister to comment on that. Is he aware of that situation and what steps, if any, is he prepared to take?

Deputy Bernard J. Durkan

I am happy to support these motions, which are important. It is important at this stage to give reassurance to the small business sector, in particular, which has been severely hit on three occasions in the past ten years. The first was the economic crash, the second was Brexit and coming along in tandem with that was Covid.

One of the issues that has emerged in recent days is that the Central Bank has opined that many businesses will not be able to open again. This is a prediction that seems to be running right through the stream of thoughts coming from the Central Bank and I want to warn against it because it could become a self-fulfilling prophecy. We should be careful to ensure that the people who assess the future viability of small or medium businesses should have particular business acumen, have shown they can run a business, know all about those businesses and be in the best position to restore those businesses to their former standing.

There is also a question of a number of businesses, or sole traders as they have been referred to by other speakers, who have been severely hit by virtue of their inability to qualify for supports in some areas. They have also been hit through the fact that they have been shut down for quite a long time and have to recover. Those businesses will be able to say that other businesses, including larger stores, have been able to operate throughout the pandemic. It is important to recognise those businesses and their particular ability to restore themselves on the basis that they have the wherewithal and the business acumen to be able to do what is necessary at this particular time. They will do so if given a chance.

Credit will be a big issue when the country gets back to work. It is hugely important that credit is made readily available to the business sector and that assurances are given to it to ensure that it has the confidence to restore itself to its former glory and continue.

I want to make a point about employees. They and their employers have been equally affected by Covid. I hope that with the ongoing supports, they will take the reassurance that Government has given them to date, which has been well-intentioned and targeted. I acknowledge also the announcements by the Minister for Social Protection in recent months. What has happened was right. The job the Government undertook was right and the supports that were put in place at the time were right and are still valid and required. I hope this continues and that the fruits of the efforts made by all involved will be seen in the near future.

Deputy Cormac Devlin

I wish to acknowledge the unprecedented support the Government has provided to support businesses and maintain jobs throughout this pandemic. I welcome the Minister’s commitment that there will be no cliff edge to these supports and that Government support for businesses and jobs will continue well into the year. As he will be aware, some industries will need additional support to restart as Ireland fully reopens.

I recently held an online meeting with the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Troy, mainly focused on the hospitality sector in Dún Laoghaire-Rathdown. The message from that sector was straightforward; they welcomed the supports given to businesses by Government during the pandemic but they also called for certainty around the timeline for reopening and asked for key supports such as the reduced VAT rate and the commercial rates waiver to be continued until they get back on their feet. Larger hospitality businesses in particular, such as hotels, need adequate notice to prepare their premises, buy stock and rehire staff. They have also asked for flexibility with supports such as the PUP so that staff can return on a phased basis. I ask that the Minister has regard to these points as the Government finalises plans to reopen the economy.

On the credit guarantee scheme, I understand €2 billion has been made available to Irish businesses. Can the Minister advise the level of uptake of this scheme? Can he also provide an update on the uptake of the enterprise support grant scheme, which provides a once-off grant of €1,000 to self-employed people?

I join other Deputies in urging him to work with colleagues to introduce fast-track business insolvency arrangements to support entrepreneurs who need to wind up businesses that are no longer viable and allow them a fresh start. As we have seen with other downturns, both here and abroad, supporting efficient structural adjustment of non-performing sectors ultimately aids entrepreneurs and the wider economy to rebound.

Deputy Christopher O'Sullivan

We have to acknowledge that the Government supports for businesses have been good, so much so that even Deputy Boyd Barrett acknowledged in his contribution that some of the supports have been good. That is a little highlight reel that I will keep for myself but I also agree with some of his statements on those sectors that have been left out. They have been good and the star of the show for so many has been the CRSS. It has been the lifeblood and support that has meant survival for so many businesses so to see it extended until June is welcome.

At every opportunity I try to speak up on behalf of the hospitality sector because it is such a big employer where I am from. The hospitality sector had some simple asks that we should take seriously. There is the extension of the 9% VAT rate until 2025, something we should consider to give the sector security. There is the continuation of the EWSS, which is vital for the hospitality sector, particularly in the retention of skills and staff because there is a fear that the hospitality sector will lose staff and skills to other sectors unless it can retain them in employment. The EWSS is key to that. The other ask is for the extension of the CRSS, not just until June but until the end of the year, and even to look at the possibility of increasing the CRSS, particularly for the hospitality sector to allow it to flourish and to make sure there is a sector there going forward.

Coming back to Deputy Boyd Barrett's point about those sectors that have been left out, I have to mention outdoor activities. I am thinking about companies involved in golf, driving ranges, boating activities and other outdoor activities that have not paid rates and that may have a turnover below the €50,000 per year requirement to qualify for the small business support scheme. Everywhere they turn, when it comes to restart grants there is nothing there for them. We have had a couple of opportunities to address that anomaly and we have not done so. I implore the Minister to look at this, whether it is under the CRSS or the small business support scheme, to accommodate those businesses because they are crying out for help.

Deputy Ruairí Ó Murchú

I welcome the Minister's commentary that there will not a be cliff edge in the EWSS and the CRSS. Many supports have been provided in recent times that have got businesses and families through what was a difficult gap and that is welcome. I want to add my voice to what Deputy O'Reilly said earlier. We had the issue of Carphone Warehouse and the job losses there, including in my town of Dundalk. We need to look at a forum on the future of retail and to build whatever that conversation is on a similar conversation on how the future planning of our towns will leave them looking. That is all necessary.

There have been many supports but certain sectors have been failed. There have been people who we have been consistently talking about having fallen between stools when it comes to supports. There has been mention of taxi drivers and the man or woman driving a van. I have had representations from many viable businesses in my locality.

Some of them are leisure companies and some of them are mobile beverage and food units, of which some individuals may have a number. In some cases, the business premises or offices of people just happen to be in a location that is not rateable, such as in a community centre. The problem with all of this is these people missed out on the CRSS and the Covid-19 business aid scheme. They still carry huge amounts of costs, whether a huge fleet or insurance, and a number of them also have employees. While they may be able to draw down the EWSS, they still have huge costs which will be incredibly difficult for them to bear. We are speaking about opening up, but because they have missed all of these supports, it will be incredibly difficult for them to ensure they are in a position to be able to do that. We need to have a conversation on this. We need to have supports.

Many Deputies have said there have been a number of instances where we could have dealt with this but we did not do so. This is a failure we need to take off the table. We need to deliver for these people. The whole idea of the supports was that we would maintain viable businesses throughout this period so that, when we got a roadmap, as we have at this time, for getting into a better time, these businesses would survive and the families and those working for them would be in a better situation. It is the whole idea of all being in this together. I have spoken to the Tánaiste about this and there is a viable option for a support scheme that could be run through the local enterprise offices. There could be an element of discretion whereby the criteria would not be as tight with regard to rateable premises and would take into account the costs. It could even take into account how viable these businesses were beforehand. If the Minister came back to me on this, I would appreciate it.

Deputy Verona Murphy

I welcome having time to speak on the CRSS. There is no doubt those eligible will be very glad to hear of an extension. I do not believe those who are ineligible will be very pleased to see nothing is being announced for them today. The eligibility criteria set by the CRSS have been far too narrow and exclude far too many important businesses. It has seen numerous small local indigenous businesses excluded. People have seen their life's work go down the drain because they do not meet the eligibility criteria.

I want to talk about charter skippers. They are part of the lifeblood of rural and coastal towns and villages, particularly the tourism sector in those coastal towns and villages. They also contribute greatly to training young people who are boat or sea enthusiasts for the future. The charter skippers have small well-kept boats to facilitate people who wish to explore, for instance, the Saltee Islands in Wexford, or perhaps do a spot of angling or fishing between Kilmore and Duncannon along the coast of County Wexford. Most of those involved are aged over 66, in receipt of a pension, and therefore not eligible for the PUP. They all have insurance, harbour dues and the maintenance and upkeep of their boats. This is estimated to cost €8,000 to €10,000 per annum, and this is their second year to pay these costs without business. They were ignored by the Minister, Deputy Catherine Martin. In turn, they were ignored by Fáilte Ireland. Will the Minister please acknowledge they are a valuable asset? They are as significant as garden furniture or outdoor furniture. Can we acknowledge we need them by providing support and assistance to keep them in existence, because when they are gone, they are gone. None of the schemes announced was delivered to charter skippers. They do not qualify for the small business assistance scheme for Covid either because they do not turn over €50,000 a year.

Many other cohorts have been left out of supports or schemes, such as event catering companies, which have invested heavily in work premises and transport fleets to cater for concert-goers. They provide the food we love to eat when we go to concerts but they have not had events. They have been excluded because they do not pay rates but they have greatly invested in their premises.

I sent the Minister an email, and I sent it to all of the Cabinet some months ago, in respect of the EU's temporary framework that allows member states to use full flexibility under state aid rules to support the economy through Covid-19. This framework allows the Government to grant compensation to companies and businesses for damage due to and directly caused by the pandemic. I ask the Minister to consider the thousands of retailers, especially boutique owners, who are carrying the stock of three seasons because we have had the longest pandemic closure in Europe.

Deputy Matt Shanahan

I join with other Deputies welcome the extension of CRSS and EWSS. We also need to acknowledge Revenue's forbearance on debt warehousing. We must also acknowledge that, as we open up the economy, many small to medium-sized enterprises will open with significant debt attached to their businesses. With regard to the EWSS, we know there needs to be a 30% reduction in turnover or unit orders from a six-month period in 2019. This can be very difficult for businesses to chart. Some businesses have tried to access the scheme and are now afraid that having done so, they may be over the threshold and are concerned about how Revenue will treat them at a time when cash flow will be difficult for them.

The Minister highlighted how he has kept the EWSS in line with the PUP, but he needs to be very cognisant when we go to open the economy that the supports given for those unemployed and furloughed at present do not keep them so. We need to get people back into the workforce and back working. These supports must not act as a disincentive for employees to return to work.

CRSS is a large-scale payment which, as a number of Deputies have outlined, is tied to rateable premises. Along with many other Deputies, I have made a number of representations to the Department regarding people who are not able to access payments and supports, particularly in my area. I mentioned to the Secretary General of the Department of Enterprise, Trade and Employment that people in the showmen's guild do not have rateable premises but provide a lot of employment in the summer season. Many of them carry significant lease costs on equipment. They have had no support whatsoever from the State. It makes it very difficult.

I welcome the announcement of the live entertainment fund, but we need clarity on how it is to be administered and what are the criteria to access it. The schemes being extended and the fact there will be no cliff edge, as the Minister outlined, is very helpful and I applaud it but we must now place particular emphasis on the SME sector. The Minister outlined a number of times how foreign direct investment has remained robust through Covid, but this is not the case for the SME sector, in which a large amount of regional and rural employment in particular is based. What other supports does the Minister envisage for the future? What are his thoughts on how future debt will be carried after the period of forbearance? What interest rates will apply? What benign aspects might Revenue take on this? In essence, I support the extension but we will need to do more and for longer to support the SME sector as the economy tries to open up.

Deputy Jackie Cahill

I acknowledge the exceptional effort the Government has made in recent months to pump finances into our national economy in an effort to save jobs and protect businesses. In doing so, the Government has supported businesses and undeniably saved jobs, helping to prevent tens of thousands if not hundreds of thousands from having to sign on the live register throughout the country. I acknowledge these supports cannot last indefinitely and they are emergency measures to shore up our economy until we can reopen fully and recover the economic ground we have lost over the past 13 months.

Hospitality and tourism have been among the sectors worst hit by the pandemic. I draw the attention of the Minister to FBD. I am getting reports from publicans in my constituency that FBD is not honouring the claim awarded against it in the court case in February. I urge the Minister to look into this and ensure FBD deals fairly with its customers.

When we do reopen, hospitality will still be under severe pressure.

I ask the Minister to double the CRSS for the four weeks prior to reopening. That would allow these businesses to have a reasonable cash flow in place so they could open their doors in a viable manner. There will be restrictions when they reopen. There will be a need for continuous support for these businesses when they open their doors. We have put so much into the economy and into these businesses, so it would be a shame if some of them were not able to reopen because we did not go the last leg of the journey with them. The tourism sector, whether it is bus operators or people who operate golf tours who depend on tourists coming into the country, will have another difficult year, continuing into next year. Some of these businesses will need support far beyond 2021.

Deputy Paul McAuliffe

I acknowledge the unprecedented level of support for the creation and support of employment, and that is because that is a core value of the programme for Government. It probably will not be fully understood, perhaps given the mechanism in which it is paid. Sometimes there is not transparency around how much support Government is giving. However, we have a problem. When Members supporting the Government and Members opposing the Government are indicating that people who are not rateable-based self-employed business operators have no support, the Government must act. From speaking to the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Varadkar, and the Minister of State, Deputy Troy, I understand the difficulty is in how we administer a scheme that supports such non-rateable, perhaps vehicle-based, employment. We must find a way. If one wrote down on a piece of paper how much the Government has given a taxi driver in the past year compared to how much it has given many other sectors, it is obvious we have not provided equal support. It is obvious also that we must go much further to help them meet the fixed costs they have. They have fixed costs but they do not have fixed premises. I urge the Minister, the Taoiseach and the Tánaiste and Minister for Enterprise, Trade and Employment to find a mechanism that allows us support these businesses. We all support the small business man and woman and yet we have left them behind in how we have supported businesses. I urge the Minister to match the ambitions we have had for CRSS, EWSS and all the other schemes in targeting those people who have been left behind.

Deputy James O'Connor

I thank the Minister for being here. While I welcome the decision to continue the Covid restriction support scheme and the employment wage subsidy scheme until the end of June 2021, it is important there is not a cliff edge when that date comes around.

I have spent the past number of weeks engaging with employees in different sectors and with management in different areas, including yesterday when Deputy McAuliffe and I engaged with workers in the aviation sector. There is a deep degree of worry about what this date at the end of June will mean, and Deputy McAuliffe would share this view with me. I refer to workers in industries, such as the aviation industry which faces unprecedented levels of difficulty and will face remarkable difficulty in restarting and returning to some degree of normality in terms of what was the case before Covid-19 and the recovery period to get it to that stage. We have to make sure that, as a Government, we do more to protect workers in those sectors and to ensure sector-specific supports are available for those working in aviation, whether pilots, baggage handlers or airport staff. I had the absolute privilege of visiting Cork Airport recently to engage with staff and management there. I would very much appreciate if the Minister, Deputy Donohoe, could look into that particular issue for me.

It is also worth noting that in addition to the 140,000 livelihoods that are supported by aviation, there are also hundreds of thousands of people supported by tourism. Whether they are working in tourism companies or operators or in hospitality in hotels, restaurants or pubs, they are going through extraordinary hardship because of Covid-19. There is no end in sight over the summer months with the current Government plans, some of which I would disagree with. To be honest, we could be much more adventurous in our provision of technology to help live with Covid. I would very much appreciate if the Government could show extra specific supports to those industries.

Deputy Jennifer Murnane O'Connor

Supports for businesses are very welcome and have been a lifeline for so many over the pandemic. I agree with my colleagues. I have spoken to taxi drivers, those in the hospitality sector and small and medium-sized businesses, SMEs, in particular. I have a case in my area where a man has machinery that he bought over the years. He cannot hire out that machinery because there is no work and yet he does not get any grants as he does not have a fixed premises. That is a huge issue that needs to be addressed. We will have many hardship cases going forward. We need to make sure our economy is opened up. I ask the Minister to look at these cases and at hardship cases.

Payments under the original TWSS, treated as salary and wages for tax purposes, were not subject to PAYE during the operation of the scheme. The amount received by the employee is now liable to PAYE and USC and thousands of employees have been hit with enormous tax bills. These were employees who put their shoulder to the wheel and stayed working during the pandemic. Revenue has made provision for employers to pay this bill on behalf of employees but I want to ask the Minister about the communication here on how these employees can be assisted.

Will the bespoke version of this scheme be made available to the childcare sector and remain in place until at least the end of 2021? Childcare is the only essential service that had to rely on a wage subsidy scheme in order to operate throughout the pandemic. The EWSS contributes at least 70% of salaries for childcare staff. There is cause for significant concern about the survival of childcare settings, if this scheme does not continue or is withdrawn suddenly. This should be available to the childcare sector until at least 2022.

I ask the Minister to look at individual cases and at different sectors. I understand these grants have been valuable and businesses have appreciated them but we are facing hard times and we need to look at that.

Deputy Carol Nolan

I acknowledge and welcome the extension of the Covid restrictions support scheme and the employment wage subsidy scheme. I also point out that, to date, 22,000 businesses have registered for the Covid support scheme with Revenue but it is clear that for a number of businesses, especially those which do not an annual turnover of €50,000, and this has been mentioned here on a few occasions and it is a big issue, it is extremely unfair. If those businesses are in small towns which do not at the same advantage as other businesses which might have an advantage of being in a better location, it is totally unfair. I ask for the criteria to be broadened or for a greater range of schemes to suit those other businesses that do not have turnover of €50,000 be devised. By that, I mean schemes with a decent amount of money and not some tokenistic scheme. We must be realistic. We have to ensure that our businesses survive and, more importantly, thrive as soon as this pandemic is over. We need to give them every chance. I would be grateful if the Minister could respond to that. Will the CRSS criteria be reviewed to allow businesses with a turnover of less than €50,000 apply?

Many outdoor activities providers in the midlands are not eligible for the €15 million funding provided through Fáilte Ireland simply because they do not have a minimum turnover of €50,000. The unfairness of this is that counties in the midlands, such as Offaly, are only getting their tourism strategy together. We are at a disadvantage and one cannot compare the midlands to areas on the coast that have established a tourism base and, indeed, a tourism initiative over many years. It is predicted that they would have a much greater turnover than those in the midlands. That tourism scheme is available through Fáilte Ireland and I would be grateful if this could be urgently looked at in terms of the turnover and discrimination against regions, such as the midlands.

Deputy Mattie McGrath

I too acknowledge the extension of these schemes until the end of June. I would like to see them extended but at least it is tús maith leath na hoibre. I thank the local authority officials and, indeed, the social welfare officials and the Minister's officials who have worked on these schemes for businesses which, through no fault of their own, found themselves in the situation of being forced to close by Government regulations.

I acknowledge that but the schemes are very rigid. At this stage, we should be able to tweak them. Applicants must have a turnover of €50,000 to avail of some of the schemes which is just far too high for some small, self-employed people. There are so many such people, including the man with the van, taxi drivers, self-employed lorry drivers, hairdressers, barbers and so on. The situation is particularly difficult for clothing retailers. They have stock from two winters, from spring, summer and autumn of last year as well as spring of this year. All of that stock is still there and they cannot get rid of it. We are talking about some wonderful businesses and we need to look after them.

There is a large cohort of business people who do not have a rateable premises. I already referred to the man with the van and lorry drivers. This cohort also includes artists and wonderful entertainers who give us so much joy and so much tuition and support, which is so important for people's mental health in these difficult times. There are many such people but they get no allowance. They are self-employed. They might have a machine for hire, a tractor, a lorry or a van but because they do not have a rateable premises, they are ruled out. A year or 13 months on, we need to be able to tweak these schemes as well as extend them because large cohorts of people are being left out. The tourism industry, including motor coach drivers, is being left behind. Many dance teachers and dance schools have not received a bob either. The schemes need to be tweaked. I do not know for how much longer we will be in this situation but I am appealing to the Minister and the Government to adapt the schemes. When churches were open, only 50 people were allowed inside, no matter the size of the church but one size does not fit all. Another group being left behind are those bookmakers who do not have premises but who take bets at race courses. They have been denied any help and have not received aon phingin amháin. There are so many areas that need to be looked at. I know it is not easy but we need to widen the net and be fair to everybody. Fáilte Ireland is not distributing money for the music industry fairly either.

Deputy Joan Collins

I support the two motions before the House. Obviously it is necessary to extend these schemes but I believe the Government should go further. It should consider tapered measures as workers return to work. Many will not go back to work full time initially. Many will go back on 20 hours per week or will experience some reduction in their hours but no worker should be left short of money or struggling to survive.

I wish to raise the issue of grants and supports for certain sectors. There is a sports complex in Ballyfermot that I have raised a number of times in the Dáil. It is a not-for-profit organisation that does not pay VAT. It has not received any grants or financial support over the last period. Taxi drivers, circus and fairground owners have also been left to flounder in the community.

I seek clarification from the Minister on one specific issue related to the TWSS which I raised with the Taoiseach in March and again recently. I sent an email to the Taoiseach about it and received a reply telling me that it had been forwarded to the Department of Social Protection. Then I received another email telling me that my query had been forwarded to the Department of Finance. The TWSS is a very necessary scheme which I fully support. I will outline my understanding of the scheme. The Government and Revenue devised the scheme in order to keep companies open and to keep workers as close to their workplace as possible. Let us say the gross pay of a worker is €100 and after tax the net income would be €80. The Government agreed to forfeit the tax revenue from the €100 and that the State would subsidise the wages of workers up to €410 per week. Companies could top that up if they so wished. The normal 11.5% rate of PRSI was reduced to 0.5% and there was a facility under Revenue's TWSS for the employer to pay that but the fact of the matter is that very few companies are paying that tax. Workers are now experiencing this as a pay cut, in effect. These workers have been on the front line since March 2020. They can be considered essential workers and they see this tax on their net income as a pay cut. Workers are facing tax bills of between €1,000 and €2,500. This must be dealt with. If the Minister could sit down with the Revenue Commissioners to introduce this scheme and agree to forfeit the tax on gross pay, surely he can consider forfeiting the tax on net pay. Failing that, he must put something in place to assist these workers.

Workers in McAuley Pharmacy are calling on their employer to pay the tax but the employer will not do so. Staff have met and are discussing conducting a ballot on industrial action. They feel really let down. These are workers whose health and well-being was tested in March, April and May of last year. They were afraid when going home to their families in case they would bring Covid home. These are essential workers who were in meat plants and other important areas. We have clapped for them so many times and wished them well but they are now facing tax liabilities on their net pay, as such.

I urge the Minister to make a point of dealing with this. These workers should not be facing tax bills and I do not think the Government foresaw these workers having to take what amounts to a pay cut in the form of a tax obligation. I ask the Minister to respond on this. Workers want to know what is happening in this regard. They will react. I have had many workers contacting me about this matter. I have heard of multinational companies making profits of €1.5 million whose workers are obliged to pay this tax. It is absolutely shocking that workers are in this situation.

Minister for Finance (Deputy Paschal Donohoe)

I thank Deputies for raising many issues with me relating to the WSS and the CRSS. I also want to acknowledge and thank the Minister of State, Deputy Fleming, for all of the work he is doing in the Department of Finance in dealing with many of the issues that have been raised by colleagues this afternoon.

I want to begin by answering a number of questions that were put to me in the course of this very important debate. Deputy Devlin put a number of questions to me on the operation of a number of our schemes. In particular, he posed questions regarding the operation of the credit guarantee scheme. He asked how many applications were submitted and the value of same. A total of 5,929 applications were submitted to our banks under that scheme, with a value of €410 million. To date, 4,170 applications have been approved, with a value of €254.8 million.

Another issue was put to me which I have become aware of in recent times relating to the interplay of the short-time work support payments and the operation of the EWSS. This is of particular concern to those who have been or are still working in our aviation sector. This matter was raised during the week with me. The operation of those jobseeker payments is a matter for the Minister for Social Protection, Deputy Humphreys. I will be raising the issue with her in order to understand it better and I look forward to being able to provide the House with a report on it if it is raised with me again.

On the sectoral issue that was raised by many Deputies, the Government made a choice, given the scale of the shock we were facing as a country, to respond by implementing broad, big schemes and that was the right choice. That choice has worked. It has saved livelihoods and jobs. That response was only possible because of the support we are receiving from the European Central Bank, ECB, and because of the health of our public finances and our economy prior to this terrible pandemic.

If the Government had decided to respond with a multiplicity of different sectoral support schemes, we would have spent the last year debating comparisons between those schemes, asking why one scheme was different from the other, why that was the case and why there were differing levels of payment. In the meantime, as we consumed ourselves with those everlasting debates, we would have seen jobs lost, our economy suffer and employers go out of business and face even greater challenges than they already have. We did not want that to happen.

Instead, what we have done through the employment wage subsidy scheme is to protect employers, in all circumstances, whose businesses go below a certain level and through the Covid restrictions support scheme is to support businesses that are closed. These are strong, big, simple schemes which, due to the excellent work of the Revenue Commissioners, we can administer with speed, and which have worked.

When one puts in place schemes that are clear, there are, despite the best efforts of all, companies that will not be able to participate and employers that will not meet the qualifying criteria. To deal with that, the Government has rolled out an array of additional sectoral schemes to respond to those issues, from the Covid-19 business aid scheme, CBAS, implemented by the Tánaiste to various schemes implemented by the Minister, Deputy Catherine Martin. All of these schemes were designed with the objective of responding to the issues raised by Deputies in this debate today.

As the Government considers the supports needed for our economy in the latter part of the year, we will consider what the appropriate design is for those support schemes and what changes are merited in our employment wage subsidy scheme, the Covid restriction support scheme and the various sectoral schemes in place.

The tourism business continuity scheme was brought in, in particular, to deal with those businesses that do not have a fixed premises and do not qualify for the Covid restrictions supports scheme but still face significant cost and business difficulty. It is implemented by Fáilte Ireland and has a fund and value of up to €55 million, which is being deployed. It was brought in to deal with these issues and it is working. The CBAS scheme, which was brought in by the Tánaiste, provides additional payments to businesses that find themselves in this challenge.

The debt warehousing scheme was raised. I remind the House of the qualifying criteria for the scheme. The 12-month 0% period only starts two months after the businesses are allowed to reopen. Therefore, many businesses are still in the first phase of the liability warehousing scheme and, for many businesses, the deferred liability phase has not yet commenced, so the clarity of these schemes and their impact is demonstrated in how many jobs are, and how much income is, still being protected and saved.

In terms of the challenge we face with our aviation sector, I absolutely recognise the challenge the sector faces. It is why the Government, the Minister, Deputy Coveney, and the Minister, Deputy Donnelly, are working so closely together to ensure the schemes we have in place are proportionate. People have called for these schemes to be implemented and while it is completely understandable why there is a need for them from a public health point of view, of course, they also have huge consequences for those travelling in and out of our country and for those working in the sector.

The aviation sector has been a substantial participant in our employment wage subsidy scheme. The scheme has made a huge difference to those sectors. My colleague, Deputy Carey, spoke at length about the impact the employment wage subsidy scheme had on the aviation sector, which is particularly concentrated in his area.

The Minister, Deputy Ryan, made additional support schemes available for national and regional airports to support the sector. An extensive array of supports were brought in to support the aviation sector, but, of course, we are aware of the many issues and the need to get that sector open. However, no Government or support scheme can take the place of normal revenue created by normal travel in and out of our country. The Government will continue to work to get the balance right between our public health imperative and how we can have access for an economy that depends so much on being open.

Deputy Collins raised the issue of bills and tax liabilities created by the operation of the temporary wage subsidy scheme. The Revenue Commissioners indicated there were many options regarding how that bill can be paid. I know that for many the arrival of this bill came at the end of a very difficult year but the temporary wage subsidy scheme was created in the most difficult of circumstances and at speed and the employment wage subsidy scheme deals with the issue of taxation at source. It has been raised by others who are concerned about it but the principle of income being taxable is one that is critical to stand by, even if the income is made available directly by the State, which is what happens in the wage subsidy scheme.

I thank the Deputies for their contributions and I commend both these motions to the House.

Question put and agreed to.

Minister for Finance (Deputy Paschal Donohoe)

I move:

That Dáil Éireann approves the following Regulations in draft:

Emergency Measures in the Public Interest (Covid-19) Act 2020 (Covid-19: employment wage subsidy scheme) (Date Adjustment) (No. 2) Order 2021,

a copy of which was laid in draft form before Dáil Éireann on 8th April, 2021.

Question put and agreed to.

Sitting suspended at 5.38 p.m. and resumed at 5.58 p.m.

Dáil Éireann díospóireacht - Thursday, 22 Apr 2021

Covid Restrictions Support Scheme Regulations and Employment Wage Subsidy Scheme Regulations: Motions

Dáil Éireann díospóireacht -
Thursday, 22 Apr 2021