Michael McCarthy (Cork South West, Labour) | Oireachtas source

I will outline the context of this debate. In the three years up to March 2011 when the Government took office, the retail jobs sector was in free-fall and 250,000 jobs were lost in that area. From the point of view of small businesses and what Government has done to support them, let me remind the House that the action plan for jobs has four critical areas, namely, starting a business, growing a business, recruitment and, in particular, access to credit. Both the Minister and the Minister of State touched on this in their contributions. The microfinance scheme is a fund set up to assist small businesses with ten employees or less to get loans of up to €25,000. That fund, in the region of a number of million euro in total, will be used to create 7,700 jobs over the next three years. The credit guarantee scheme, an innovative way to provide much needed lending to small and medium-sized enterprise, is a fund of €450 million. That scheme will provide additional lending of €150 million per year for three years. That is a significant issue because we will all be aware of the difficulties that SMEs encountered in terms of accessing finance.

That brings us to the motion before the House. The social welfare spend is approximately €20 billion. One would not need to be an economist to know that it is entirely unsustainable. This Administration, in the last budget, did something that many of the commentators stated was not possible, namely, it maintained basic rates of social welfare. One must bear in mind that as an economic generator, the social welfare spend is vital to the economy, in particular the rural economy. These are the people who go into towns and villages around the country and spend the payment that they receive every week. There is a connection. These measures are not isolated. The dynamic that is necessary to support businesses is as much about the person spending as it is about the person providing that service.

The Netherlands, for example, had a rate of absenteeism of 8% until it introduced a scheme similar to the one proposed here and that rate is now only 4%. Absenteeism is costing Ireland over €800 million per annum, which is an enormous amount. How did we allow that to develop to the point that it did during the boom years? It does not say much for us now, in recessionary times, if we do not try to address it.

Managing sick leave is also an issue in this debate. At the moment there is no incentive for employers to manage sick leave because the State is carrying the can and providing the cash. There is a vicious circle in operation. I acknowledge the efforts of the Minister is setting up a forum through which all stakeholders can come to table, debate the issue, exchange views and formulate opinions. That process is very important in terms of reaching a decision. We must look at this not from the perspective of moaning and groaning about businesses here and there - although there are genuine issues and we are required to raise them on the floor of the House - but from the perspective of the public purse and obtaining value for money for the taxpayer.

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