Dáil Éireann Debate, Tuesday - 10 November 2020
332. Deputy Bríd Smith asked the Minister for Finance his plans to seek the reimbursement of the amounts of wage subsidies given to companies in cases in which these companies return to profit by the end of 2020; and if he will make a statement on the matter. [35435/20]
Amharc ar fhreagraThe Temporary Wage Subsidy Scheme (TWSS) expired on 31 August 2020 and was replaced by the Employment Wage Subsidy Scheme (EWSS) from 1 September.
The objective of both schemes is to support firm viability and preserve the relationship between the employer and employee insofar as possible. This has been achieved by subsidising a portion of the employer wage bill in circumstances where the employer’s business has been negatively impacted by the COVID-19 restrictions.
Employer eligibility has been determined by reference to change in turnover, a deliberate design feature that has allowed the schemes to be open to all sectors and applied economy wide, while at the same time remain targeted at employers who are considered to be most in need of support.
The primary qualifying criteria for the EWSS is the “turnover test” and has been specifically designed to target the subsidy at otherwise viable employers whose businesses continue to be adversely impacted by COVID-19 by requiring a comparison of the firm’s pre-pandemic operations with their current operations. The legislation provides that the employer must be able to demonstrate that they are operating at no more than 70% in either the turnover of the employer’s business or the customer orders received by the employer by reference to the period from July to December 2020 compared with the same period in 2019. The employer must have a tax clearance certificate to be eligible to join the EWSS and must continue to meet the requirements for tax clearance throughout the scheme.
To address concerns around the targeting of the measure, the legislation already provides that certain elements, such as the turnover test threshold, may be revised in the event that the on-going monitoring of the scheme and the economic recovery presents the opportunity to make changes that minimise deadweight while also fulfilling the objective of supporting employment as well as enabling employers scale back up their business.
There are no plans to introduce a provision to claw back or to seek the reimbursement of the amounts of wage subsidies paid to those eligible companies in the event that such firms are in a profit making position by the end of 2020.
