Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

Tá sé i gceist agam mo chuid ama a roinnt le mo chomhghleacaithe, na Teachtaí Mairéad Farrell, Conway-Walsh agus Gould. Ba mhaith liom mo bhuíochas a chur in iúl leis na oifigigh sa Roinn Airgeadais a ghlac am leis an mBille seo a phlé liom. Ós rud é nach mbeimid ag dul fríd an ghnáthphróiseas - níl bheidh an coiste ag scrúdú na reachtaíochta - tá sé tábhachtach go bhfuil an teagmháil sin idir oifigigh agus urlabhraithe. Cuirim fáilte roimh an gcabhair sin agus cuirim mo bhuíochas in iúl do na hoifigigh arís.

I welcome the publication of this Bill and the fact that the Minister's officials were able to engage with members of the Opposition, including myself, to brief us on it. Like many other items of legislation, this Bill is not going through the normal process of pre-legislative scrutiny. As the lead Opposition party, Sinn Féin recognises the necessity of facilitating an expedited process through the Houses of the Oireachtas for a wide range of legislation. This is in spite of the difficulties we may have with certain sections of the Bill. Given the pandemic and, particularly regarding this legislation, the situation in which many businesses find themselves, it is appropriate to waive the normal processes of legislative scrutiny.

That has put pressure on us in respect of timelines for tabling amendments and so on, but we have made the best fist of it. We will deal with that on Committee and Remaining Stages.

I will comment on some but not all of the measures provided for in the legislation. It is a mixed bag. There are very positive measures, some of which we argued for, there are some that are very welcome and there are others that are not welcome. I would like to comment on the spirit in which Sinn Féin has considered this and other legislation introduced by the Government since the outbreak of Covid-19. Sinn Féin has provided robust and constructive opposition in the Thirty-third Dáil. Certain provisions of this legislation are proof of this. The temporary wage subsidy scheme was introduced on 26 March to protect incomes, support businesses and maintain a relationship between an employee and his or her employer. While there were defects in the scheme rolled out by the Government, Sinn Féin supported its objectives and the legislation that underpinned it, the Emergency Measures in the Public Interest (Covid-19) Act 2020.

Since the scheme began, Sinn Féin has recognised elements of the scheme that were deficient. We worked with the Government at the time to have them addressed and the legislation before us is proof of that. As early as 2 April, we called for a minimum payment of €350 to be introduced for the wage subsidy scheme to protect workers' incomes further and to address a discrepancy in the scheme whereby workers earned less under the scheme than if they had been unemployed, undermining its very objectives. The Minister and I corresponded on this issue, with the Government responding by increasing the rate of subsidy from 70% to 85% from 4 May. Section 2(1)(d) of the legislation before us will provide for that change in legislative effect.

Similarly, while others claimed that women returning from maternity leave could not access the scheme without legislative change, Sinn Féin argued that the Government could and should include these women on the same administrative basis as the increase in subsidy for low-paid workers, with legislative change further down the line. On 29 May, the Government did just that following a recommendation, which we very much welcomed. Section 2(1)(b) of the legislation before us will provide for this change. These very provisions speak to the constructive role that Sinn Féin has played during this period, standing up for workers and families.

More broadly, the legislation will provide for the many measures announced as part of the July stimulus package. While a number of these measures are welcome, it should be noted that they come very late for small businesses throughout the State. It must be said that, in many regards, the package falls short. While not provided for in this legislation, the Government has opted for a ratio of approximately 4:1 of debt solution to grants, instead of grants for small businesses. While the Government adopted our approach to the removal of the portfolio cap for the credit guarantee scheme to facilitate lending for SMEs, the Minister for Business, Enterprise and Innovation has previously stated it will not be ready until September or October, with interest rates of between 3% and 4% on loans after a short period. In my view, that is too slow and too costly for some businesses on the brink of permanent closure. It is also the case that while the grant scheme has been enhanced, grants for companies can still be as low as €4,000, which is not the type of ambition that many of the companies had hoped for.

I turn to a couple of other sections in the Bill. While the deadline for the temporary wage subsidy scheme should be extended from 1 September to later in October, which we tabled an amendment for, I am very concerned that those under the new scheme who are earning below €151.50 will get no support from the Government. This will create an incentive if a company has to let a worker go. Obviously, it will be the low-paid, minimum wage worker who works fewer than 15 hours, where the employer gets no support from the State, instead of any of the other employees, who will have been subsidised by the State. This can be rectified by ensuring there is an 85% contribution from the State for these categories of workers. I also believe there is a missed opportunity here because the legislation will not allow the Minister, according to my reading, to target certain sectors. We have tabled an amendment that will allow the Minister to vary the rates for categories and groups of workers, such as in the hospitality industry, as opposed to that of retail or others, depending on how each category progresses over the coming weeks.

On the stay and spend initiative, a good proposal put forward by Sinn Féin related to a hospitality voucher. The idea of a tax credit is cumbersome, as is the idea that I could go for a meal in January and get a rebate in 2022. That will not give the incentive that is required. Almost one in three income earners will be excluded from this. We have seen from the ready reckoner that 711,000 people pay neither income tax nor the universal social charge and, therefore, will not be able to avail of the scheme, of a total of 2.4 million taxpayer units. That does not include others who are not income earners in the first instance, who are also excluded from the scheme, such as those who are on certain social welfare payments.

It is just ridiculous that the help-to-buy scheme will be extended. It makes no sense. This is intended to stimulate demand at a time when the supply is not there. Let us take, for example, the case of a self-build. An applicant has to draw down the first portion of the mortgage before the end of the year to apply for it, but to be able to do so means the site has to be cleared, the foundations have to be in place and the walls have to be built up to roof level. That is the standard practice. That means the applicant will also have had to have approval for the mortgage and to have applied for it. Anybody who has gone through that process will know that it takes much longer than six months to do all that. The only potential beneficiaries of this in respect of self-builds, therefore, will be those who have been approved a mortgage, have not drawn down the loan and will now get an additional €10,000.

We have already seen that property prices have been increasing overnight by €10,000 as a result of this measure. No impact assessment has been conducted to determine the effect of this policy on house prices. Mr. Lorcan Sirr has stated: "The timing of this, which will stimulate demand when supply is being reduced, will likely lead to rising prices for the homes that do come on the market." The Parliamentary Budget Office, which has already reported on the matter, stated it found that the scheme had been disproportionately availed of by high-income earners. That was the lower scheme. The new one will be worse again. In other words, it was largely out of reach of the vast majority of first-time buyers. The majority of help-to-buy purchases have been above the average price. The office also stated that more than 40% of those who used the scheme already had the 10% deposit and did not need the scheme to be able to purchase a house. This is €18 million that will go directly or indirectly into the pockets of developers, but worse than that, it will increase house prices.

I welcome a reduction in the VAT rate on any day, especially given the high levels of the standard rate, but what we need in this country at this time is targeted initiatives. According to the Central Statistics Office, retail sales increased in June, despite many premises being closed. That is not to say that certain retail businesses do not need support, because they do, but what we needed desperately was a support for the tourism, hospitality, accommodation and food sector. That is missing in this legislation. We should be reducing VAT from 13.5% to 9% and stimulating that sector. It is where the lowest paid are, it is where the biggest hit has taken place, and it is the sector that will take the longest time to recover. I cannot understand why a reduction in VAT in that sector, which would be less than half of the reduction from 23% to 21%, was not considered or conceded by the Government. We have an amendment before the House that seeks to do just that. I hope that, given the low levels of money in the context of everything else, this measure in the region of €200 million will be considered. It could be a shot in the arm for the sector, its employers and its workers.

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