Dáil debates

Wednesday, 3 February 2021

Emergency Measures in the Public Interest (Covid-19) Act 2020: Motion


4:25 pm

Photo of Jennifer Carroll MacNeillJennifer Carroll MacNeill (Dún Laoghaire, Fine Gael) | Oireachtas source

I thank the Minister for bringing the motion on this extremely important subject, the EWSS, to the House today. I thank him for his work on this, for putting the scheme in place and for its efficiencies to date. It is fair to say that without it we would have more than 300,000 employees who would either be on substantially lower incomes or who may not be in work at all. This transfer from the State to families directly is able to keep people paying existing mortgages and allow them to continue with their lifestyle and employment. Employment is the most important issue for any household to maintain itself.

I thank the Minister for his work in that regard but also for the role he has played in Europe. It is fair to say that none of this would have been possible without the sort of cohesion that has been generated with the participation of the Minister. It is very welcome that the ECB and other institutions have been able to take a very different approach now than was the case previously in 2011 when we did not have an opportunity to take countercyclical stimulus measures of this kind, or indeed other kinds, and where the pressures were very different. That is only possible for a number of reasons. One is that we had a well-run economy going into the pandemic, where there was close to full employment in technical terms. We had good jobs, and we still have good jobs and the opportunity to create more and we have had an activated and engaged labour market using the skills it has. To be able to ride out this crisis and get through it we need the type of supports that ensure people can stay with their employer. This scheme has been doing that extremely well.

It is also fair to say that the existence of the scheme and its efficiency have been able to contribute to our income tax performance, which has been better than all of our predictions and those of the Department. I accept it is a circular process. One of the aspects of the scheme that has been so helpful to businesses, especially small businesses and employees in them, is the certainty that the EWSS model has given them. They can continue to get through the difficulties of lockdowns and the difficulties they face in other parts of their lives knowing there is a degree of income security in their house for those who are eligible to avail of it. I urge the Minister to continue to provide that certainty.

I appreciate the motion before the House and the fact that the deadline under the Act is the end of June.

It is clear that the restriction of activities may go beyond that time and some businesses will need continued support thereafter. I ask the Minister to discuss this with his Government colleagues and provide certainty for businesses as soon as possible. Businesses need different types of certainty. Businesses that can continue to generate income need certainty around the timing of the ending of relevant schemes. They need sufficient notice, whether that be six, eight or 12 weeks, to be able to transition their employees back onto a different pay model. I refer here to businesses that have a significant revenue stream and are able to continue with activity but there is, of course, another class of business that has had no activity for a very long time, predominantly in the hospitality industry.

The Government has taken a range of steps to provide ample support to the hospitality industry, including the EWSS and a reduction in VAT but in many cases, these businesses have not had the opportunity to claw back the benefits of same because they have been closed. I give the example of an hotel in my area which engaged in substantial investment in the last number of years. The hotel accrued profits and invested them in the redevelopment of the hotel. It was achieving four-star status, had significant commercial loans which it was more than amply servicing and had approximately 80 employees. The hotel is managing through this crisis and doing what it can with its employees to continue to invest and improve the hotel for when it reopens. Of course, the VAT reduction was very welcome but because of the lockdown, this business has not really been able to enjoy the benefit of it because it has not generated sufficient revenue. For businesses like this one, and countless others around Dublin and the rest of the country, the extension of the EWSS is important in itself but it is also an opportunity, if particular consideration can be given to that sector, for them to try to claw back some of the lost revenue in circumstances where they have had to continue to service commercial loans of the kind I have described. There is something slightly different about these businesses vis-à-visthose that have been able to continue to trade, albeit on a reduced basis. As we come out of the lockdown and hopefully move into a more nuanced period of economic planning, I hope the Minister will be in a position to consider sectoral solutions of that kind.

The mortgage issue raised by other Deputies is such a difficult one to resolve. I have had the same issue raised with me and I understand the difficulties at the moment in terms of security of income from the perspective of lenders generally. This is causing difficulties and leaving people stuck, including those who have - or hope they have - stable jobs, incomes and deposits. The overall impact is going to be on housing market activity and activation and people may be stuck in rental accommodation for longer than is necessary. I appreciate the risk issue from the perspective of banks generally but this is affecting people who are not at fault. There is nothing they can do and it is an ongoing problem.

I thank the Minister for bringing this motion before the House today. The EWSS has been an absolute lifesaver for businesses in Ireland, particularly small businesses and the hospitality sector more generally. Without this measure and without the support that the State was able to acquire and then provide to our businesses and their employees, we would be in a very dark place indeed. It is extremely welcome and I thank the Minister for his efforts in Europe to ensure it can be continued. The more certainty that the Minister can provide to employers and businesses over the next 12 months, which we hope will be very different to last 12 months, the better.


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