Derek Nolan (Galway West, Labour) | Oireachtas source

I am an optimist at heart and I intend to consider the Fianna Fáil motion from a genuine point of view. There is a genuine case to be made for businesses struggling in the economy. There is no doubt the domestic economy has taken a whack and that small businesses are struggling with reduced incomes and profits as well as reduced customers. The cost base they are obliged to service is an ever-increasing part of their businesses and some of them are simply unable to cope with it or, if they can cope, they are staying just above the water. I wish to put on the record that there is a genuine case to be made for small and medium enterprises.

Our relationship with taxation has been always bizarre. We have never had the concept of a social wage or contract whereby a person pays taxes into a fund or to the State in return for services, a certain standard of living or a Government that provides for that person in return. We have always seen taxation as something that simply goes away, something that is taken from us and we have always resented it. There is no greater example than the Social Insurance Fund, which has been allowed to go into deficit to the tune of almost €2 billion in 2012. I understand the exact figure is €1.82 billion. If the fund is designed to provide for social insurance then it should balance. The fund should be paid into by employees and employers to provide insurance for those who cannot afford certain services or who are out of work and so on.

One issue that annoyed me about the universal social charge when we introduced it was that we gave it a nice name and we had the idea that people were getting social benefits from it, whereas in fact it was simply a tax. We need to move to a different form of taxation and a different relationship between people and the State.

Let us take a step back before we consider the statutory sick pay scheme. What is the first thing we know about sick pay? It is that there is no entitlement to sick pay from one's employer. Employees are often at the discretion of a benevolent employer who may decide to provide sick pay in the terms and conditions of employment. It is not something provided by right. If an employee is sick, the current position is that he or she is entitled to nothing for the first three days. After that an employee is entitled to apply for illness benefit.

The Minister has begun a consultation process on the introduction of a statutory sick pay scheme. While the interests of employers are very important because they provide jobs, we cannot exclude from the discussion the interests of employees. Employees have a right to earn an income, irrespective of whether they are sick, based on the relationship with the employer. In many countries throughout the world, especially in Europe, statutory sick pay schemes work successfully. Examples include Australia, where there is a statutory entitlement to ten days per year, Austria has a scheme for up to 12 weeks, the United Kingdom has a scheme for up to 28 weeks and Finland has a lower entitlement of nine days.

Many things need to be balanced. In discussions on the economy we are always quick to say who should not pay. Were we to listen to all of the debates no one would pay anything and a mythical source of gold somewhere would solve all our problems. Everyone must contribute. The issue of statutory sick pay and the benefits it would have for the economy and for employers in managing absenteeism are manifold. This is especially the case in the public sector to which the scheme could apply and serve as a good impetus for proper human resource management. A scheme would be also better for employees.

The Minister for Social Protection has set out a consultation process. At all times she has engaged with businesses, employee representatives and so on and this process should continue. We should consider the Social Insurance Fund as something to be properly funded and seen as a viable fund to provide services rather than something left to the discretion of a balance that cannot always met.

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