Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I join with other colleagues in starting by conveying my deepest personal sympathy to those who have tragically lost their lives as a result of Covid-19 to date and to pay a heartfelt tribute to all of those working on the front line in our healthcare sector and in so many other vital sectors across the country at this extraordinarily difficult time; a time when we are asking the Irish people to make great sacrifices. It is difficult for so many people to do what we are asking them to do and it makes it all the more important that the State and the Government stand by those people and provide the supports, insofar as they can, to workers and businesses and give them a realistic and credible prospect of recovering once all of this passes, which it will.

Our overall priority, whatever the cost is, has to be to minimise the human toll of Covid-19 and we should spare no effort and no resources in order to do so. There can be no doubt there will be a sharp economic contraction as a result of this crisis. The ESRI has put initial numbers on this of a contraction of 7.1%, a deficit of close to €13 billion this year and unemployment potentially reaching 18%. It could be better than that and it could be worse than that. Those figures are based on certain assumptions. We must ensure the inevitable recession does not develop into a prolonged depression across our economy. That will require significant and seismic decisions to be made in the weeks and months ahead. We need support at an international level and we need cheap debt but we need more than that. I welcome the comments made by Mario Draghi, as have been referenced already today, in his article in the Financial Times. The support of monetary policy and what we can do in our fiscal policy here, underpinned by support from the European Union, will become all the more important in the period ahead. A lot of sectors will be badly damaged in our economy and it will not be a simple case of clicking the switch and everything going back to normal once this health emergency has been declared to be over. That will not be the case. A lot of significant and costly decisions will have to be made.

Turning to the provisions of the Bill, and I look forward to Committee Stage later on, the Minister has put a cost of €3.7 billion on this. I would like to find out at some point whether the €3 billion that was already announced on 9 March, €2.4 billion of which is for social welfare, has been subsumed into this €3.7 billion or whether we can add that €3 billion to the €3.7 billion and arrive at a cost of €6.7 billion. The Parliamentary Budget Office has done up a good paper on that issue, as it always does.

I also seek clarity on the basis of those estimates. Is it the case that the Minister is assuming that about 800,000 people will be affected by these schemes, whether it be moving onto the Covid-19 pandemic emergency payment or the employees who will benefit from the temporary wage subsidy scheme?

Are we talking about a number of that order? Can we extrapolate what the cost would be if the numbers ended up being different from that?

On Committee Stage, I will be raising several issues with the Minister relating to section 26, especially around the qualifying criteria for employers and the role of Revenue in that regard. There are employers who have cash resources at the moment and who perhaps can pay wages in the coming weeks. They may not benefit or avail of the scheme. We need to put some flesh on the bones of exactly how Revenue interprets this issue. Reference is made to a reduction of 25% in revenue for the period the Minister defines, but relative to what period? Is it relative to the same period last year? Is it relative to the forecasts for the period in question?

I believe the Minister should reflect on another provision. It states the Revenue will publish the list of businesses that will avail of the wage subsidy scheme. Is that really necessary given that state aid provisions have been essentially set aside by the European Commission? That needs to be reflected on. It could have trading implications for businesses down the line. Others may say they were not in as healthy a position as they had thought pre-Covid-19. I believe this issue needs to be dealt with.

I had thought I had a clear understanding of the position on the taxation treatment of the wage subsidy. I had understood it was not taxable and any top-up would be taxable and a change in the PRSI would be factored in. However, there is a line in the Revenue guidance stating that the subsidy will be liable to income tax and the universal social charge on review at the end of the year. Can that issue be clarified? It seems to me there is a contradiction there.

I am sure some positive things will come out of this. If anything, I hope it will be a stark reminder to all of us of what matters most in our lives: health, family, community and friendship.

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