Róisín Shortall (Dublin North West, Social Democrats) | Oireachtas source

At the outset I congratulate the Tánaiste on his new post in what is a very critical Department at any time but especially in the current circumstances. I wish him well in his work there.

We are considering the Revised Estimates in the context of three very major challenges. I refer to what has happened already this year in the context of an unprecedented shock to the economy. The second is the ongoing threat from the pandemic and the third is Brexit. The fact is that the backstop was dropped, we are likely to be facing a no-deal Brexit, and we must consider all of the implications of that. Ostensibly, what we are considering today is a supplementary budget for an additional €480 million for the Department of Enterprise, Trade and Employment.

To a large extent, it is considering this Estimate after the event. There are many reasons we are just doing it at this stage and the Social Democrats support this Supplementary Estimate.

It is also important, however, to look at some of the criticism of how the Department has actually been dealing with Estimates. Much good work has been done by the Parliamentary Budget Office. There are two key points made by that office that need to be taken on board. I am not looking for a response from the Tánaiste and Minister for Enterprise, Trade and Employment today but he should note and respond to them at an early stage. It is accepted by everybody that the current circumstances are extremely challenging. However, the Parliamentary Budget Office stated it is regrettable that output targets have not been updated to reflect the new and expanded schemes aimed at responding to the impact of the pandemic. It further stated that, without such indicators, the performance of the additional spending may be difficult to assess. There is no doubt about that. We all accept that everything had to be done very quickly but these are important points. It is assumed that some unit in the Department would be tracking that spending very closely.

The other point that was made by the office is that the Department should consider providing updated performance metrics to the relevant Dáil committee. That is an important point too. Irrespective of the scale and the unprecedented nature of what we are dealing with at the moment, we have to bear in mind that there is a responsibility on the Dáil to ensure all public moneys are spent in a way that gets value for money. Those are two important points that could easily be lost in the context of this debate but need to be taken on board.

Covid is a dynamic situation. Up to last week, the view was that we have got on top of the virus and we need to now move on to dealing with the economy. It is not one thing and then the next, however, because we still live with the threat of the virus and the significant likelihood that there will be another wave or an upsurge at least. From listening to the Chief Medical Officer, we have to be very cautious in that respect.

A measure of that is that IBEC presented recently to the Covid committee. It has good plans and proposals for rebooting and reimagining the economy. One of its three immediate demands is to remove the quarantine restrictions. That is an indication of how, just in the space of two weeks, the thinking on that has changed and the dynamic involved. We all accept the urgency of reopening the economy, but it is so dependent on getting the response to the virus right, however. That means having a quick response to any outbreak and being back in a position where we can do the necessary testing and tracing, as well as the asymptomatic testing and tracing in high-risk areas. All of these issues are connected.

SME Recovery Ireland, a new umbrella organisation, is presenting today to the Covid committee. It is a pity that we are not doing this in a more co-ordinated way but that organisation made several good points. It calls for a €15 billion recovery plan with €6 billion of that being released immediately to deal with liquidity problems. The current supports in Ireland are based primarily on debt-based lending whereas other European countries have introduced more grant supports which in turn encourages take up. It is really important to get that balance right, not just domestically but in the approach taken at European level as well. SME Recovery Ireland cites, for example, Northern Ireland where grants to the value of €25,000 were made available to the retail and hospitality sector in mid-April. Germany also has invested over 25% of GDP to support businesses, while Denmark has a €6 billion compensation fund.

SME Recovery Ireland also points to the European Central Bank proposals for a predominantly grant-based approach rather than loans. Most of the business support schemes, it points out, were originally based on a hard-Brexit scenario. In many ways, it was fortuitous that the schemes were drawn up but they are now needed to be re-examined. We had the schemes when Covid struck, which was good, but those schemes do not exactly fit the bill at this point. They need to be re-examined and restructured with purpose to fit the current crisis.

Brexit has been a long lead-in issue, whereas Covid has been a massive sudden shock to the economy. When restructuring these schemes, there needs to be serious debate about the cost benefits of grant aid versus debt-based lending. It is important to recognise the challenges involved in that. I agree with the Tánaiste and Minister for Enterprise, Trade and Employment, that it is not a matter of signing a blank cheque and giving a 100% guarantee. A real difficulty will be the ability to identify those companies which are not viable and, unfortunately, will not survive.

It is important to be in a position to identify any attempt at gaming the system. Inevitably, there will be an element of that. We need to have very clear criteria set down and clarification on who exactly or what body is going to take those key decisions.

SMEs point out the contribution that they make to the economy both in terms of the fact that they employ the vast number of workers in this country but also how they put back in so much money into the economy through PRSI, tax and so on.

I support and commend what the previous Government did in its rapid response. The question is where we go from here and how we fund that. Several weeks ago, I raised with the Tánaiste and Minister for Enterprise, Trade and Employment the need to ensure that we draw down as much support as we possibly can at EU level. He told me that borrowing substantial amounts of money long term is Venezuela. It is not actually. Austria, Germany and many central European countries are doing that. For example, last Wednesday Austria raised €2 billion in a bond auction with a maturity of 100 years which was priced at below 1%. The auction was more than ten times oversubscribed. That is not Venezuela; it is Austria. We should be learning from what other European countries are doing because there is huge support.

In the recovery, it is important we use the potential of and build public services to ensure we have good quality employment. We must also ensure we are more competitive. If our public services are available on the universal basis, it takes the pressure out of wage demands and the green agenda.

It seems the Department of Enterprise, Trade and Employment is taking over responsibility for employment, employment rights and so forth. The Tánaiste and Minister for Enterprise, Trade and Employment must bear in mind that it was the youngest workers who paid the biggest price in the crisis created by Covid. They are the people who have been struggling with low pay and precarious work in the main. They must be given priority when it comes to identifying those employment areas that have the greatest potential to get that younger generation back to work. They have been locked out, to a large extent, and they need to be prioritised, as we, hopefully, work our way back to recovery.

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