Mick Barry (Cork North Central, Solidarity) | Oireachtas source

I will share the remaining time with Deputy Paul Murphy, who will be present shortly. I will refer to the July stimulus but I will first make some specific comments about the TWSS and the PUP. I welcome the fact that the payments are being continued into 2021, albeit with the TWSS under a slightly different guise. However, I do not welcome the fact that the PUP is due to be cut on 17 September and that workers who are out of work through no fault of their own will be forced to take pay cuts of between €50 and €100 a week. The Government's July stimulus package will give more than a few people in such circumstances a nasty September shock.

Though I am here to discuss these payments, I will also comment in passing on the U-turn the Government performed this morning regarding the PUP and holidays. That U-turn shows two things about this Government. First, it shows that there is a basic right-wing instinct in this Government. Second, it shows is that this is a weak Government that can be forced into climbdowns when it takes a step too far or attacks the rights of ordinary people. Ordinary people should take note of that because what happened this morning is significant.

The July stimulus has been hailed as by far and away the biggest stimulus package in the history of the State. It certainly is big in comparison with the past. The question is whether it is big in the context of what is needed now. It represents 1.5% of GDP, but when combined with all the other measures that have been introduced since March, it equates to 4.3% of GDP, which is the European average for such packages, although it is less than Germany's 4.9% or France's 5%. It is well below the US package, at 12.2%, or Japan's, which is more than 20%. The grant aid for small, medium and big businesses is somewhat blind to the question of the size and needs of different firms. For example, a larger company, which may have profited from the pandemic, has a large cash surplus and is paying large dividends to shareholders, is able to tap into the grants through the reduction in VAT, the waiving of rates, and so on.

I strongly support Deputy Boyd Barrett's point that conditions must be attached to grant aid given to small and medium companies. If workers want to join a union and those companies are denying them the right to do so, they should not automatically get the cash. They should also not get any money if they are paying big bonuses to people on the board of directors or if they are not tax resident, and so on. Conditions need to be put on them. Instead of receiving grant aid, big companies that shed jobs should be nationalised. Aer Lingus, which is seeking 500 redundancies, should be nationalised. The lack of scope for direct State-led investment is a huge weakness of this stimulus, and that is a missed opportunity.

The Nevin Economic Research Institute, NERI, estimated in 2018 that €1 billion of State investment can create 10,000 jobs directly. In fact, it is less than €1 billion; it is €575 million when one gets one's tax back and take into account one's savings on social welfare. The aforementioned €575 million creates not just 10,000 jobs directly but also 6,750 jobs indirectly and therefore, for €575 million, it is possible to create 16,750 jobs. Spending this stimulus money spent on such an initiative would see 200,000 jobs, and more, in construction, in banking and finance, in green energy, in apprenticeships and among young people.

My final point is that this is a bigger recession than was experienced in 2007 or in 1974-75. The comparison is with the 1930s and the Great Depression. What does this mean for Ireland, a small open economy? It means mass unemployment, inequality and tax increases, as well as cuts down the road. I will conclude by stating that what will come onto the agenda in the years to come is not this or that change, it is system change. I refer to a break with capitalism and a democratic socialist alternative.

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