Brian Cowen (Laois-Offaly, Fianna Fail)

I propose to take Questions Nos. 1 and 2 together.

Arising from discussions with the Irish Congress of Trade Unions and IBEC, the Government has proposed some specific further measures to be taken reflecting the framework agreed with the social partners in January and subsequent consultations. The Government plans to introduce a new scheme to support jobs in addition to the already significant measures introduced to support jobs and competitiveness.

The temporary employment subsidy scheme aims to help the economy retain its productive capacity through the downturn, to help employees retain their jobs and to promote economic and fiscal stability. The scheme will be designed and implemented to minimise the risk of deadweight or displacement while not inhibiting the adjustments which will be necessary to underpin economic recovery at enterprise level. The scheme will involve a subsidy to firms to retain a person in employment for a period which would be limited to 15 months or the end of 2010, with a subsidy of a maximum of €200 per week per employee and a tapered reduction towards the end of the period.

Eligibility for the subsidy will be determined based on certain criteria, including that the firm is a manufacturing or internationally-traded services company, that it is currently engaged in exporting, that a financial assessment establishes that it is now facing significant difficulties as a result of the crisis, that it is viable in the medium term and that it has already taken restructuring measures to improve its competitive position including appropriate measures to address work processes and cost issues. The scheme will operate under the terms of the European Commission's temporary aid scheme for Ireland and implementation will be overseen by a national monitoring committee with representatives from the social partners, as well as relevant Departments and agencies.

The terms of the scheme may be adapted in the light of experience and an allocation of €250 million is being made available at this time. The Government has indicated its intention to have further discussions with the social partners on other measures to maintain employment and help those who lose their jobs. Given that considerable resources are already being spent on this agenda, including social welfare payments to those on part-time working, this new proposal, and our willingness to consider further measures including in the light of experience with this scheme, the Government believes that Congress's ambition for an allocation of €1 billion to the jobs agenda is achievable. The Government has also reaffirmed its objective of ensuring that the rate of home repossessions should remain at its present low levels and we have agreed to establish a mechanism whereby the social partners will be involved in monitoring the situation and advising on any further policy responses which may be required.

The Government's proposals have been published and placed in the Oireachtas Library, and are being considered by the social partners. The ICTU and IBEC are also considering proposals on private sector pay which have emerged from recent discussions between the parties to the transitional agreement under Towards 2016.

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