Joan Burton (Dublin West, Labour)

Section 23 must be read in conjunction with section 22, which involves the restoration of the national minimum wage to its previous level. The reinstatement of the national minimum wage will be very important for low-paid employees who work a 40-hour week because they will benefit by €40 per week. The latter is a significant sum. The counterpart measure to this reinstatement is to offer a halving of employers' PRSI for the period up to the end of 2013. As the Deputy pointed out previously, there is a significant cost involved in this regard. The national training fund levy is, therefore, being used to facilitate what we are trying to achieve. A commencement date of 2 July in respect of the halving of the lower rate of the employers' PRSI contribution has been chosen to align it with the start of the tax week.

The purpose of section 23 is to provide for the contribution to the national training fund to be reduced by 50%. The fund has been substantially in surplus in recent years. I am advised that it was in surplus by €104 million at the end of 2010. It is estimated that the halving of the national training levy will cost €7 million this year and €13 million in a full year. Even with the reduction, it is estimated that the fund will still be in surplus by approximately €61 million at the end of 2011. It will remain in surplus in 2012.

As discussed previously, the reduction in employers' PRSI is a significant incentive in the context of employers being in a position to reduce the cost of labour. When taken in conjunction with the reduction in the lower rate of VAT, particularly as applied to industries such as tourism, it is clear that the purpose of what the Government is doing is to produce a stimulus in respect of employment retention and creation in key sectors of the economy.

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