Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

In the first instance, it is important to say that these supports are really essential. We are very happy to continue to support them. It demonstrates the importance of the State, particularly at times of crisis. SMEs are the primary driving force for our economy, employing some 70% of the workforce.

These businesses shape the fabric of our cities, towns and communities, providing employment for 1.6 million people across the country, along with vital services without which this country could not survive. They are the very ones on whose doors we knock when it comes to sponsorship for everything from Tidy Towns to football clubs. It is way beyond what is immediately obvious. Our priority when considering those business supports must be ensuring as many of those small to medium-sized businesses survive and recover from this pandemic.

A particular cohort which requires support is young people in employment. Youth unemployment, for those between 15 and 24 years of age, has risen again and now stands at 59.2% according to CSO data. This was 11% at the end of 2019. Sectors which primarily hire younger people are still described as subdued in hiring activity. These would typically be hospitality, pubs, retail, etc. Up to 47,000 of pandemic unemployment payment recipients self-certified as students with almost 90% of these under the age of 25. It is crucial this payment is extended to help these students remain in education as their employment sector is likely to remain closed or severely curtailed for some time.

In a reply to a parliamentary question, I was informed that in past recessions youth unemployment levels typically fell quite quickly once economic activity returned. In addition, the jobs of many currently on the pandemic unemployment payment will not be permanently lost due to the pandemic. However, this is not a recession. It is a pandemic and these are completely different risks to our economy. It will take longer for some sectors to return which are those where many of our young people work.

On Monday, the Governor of the Central Bank outlined the risk that SMEs will face once the Government pulls State support away. A survey published by the Central Bank and the ESRI suggested that almost a quarter of SMEs could be in danger. The survey identified two groups as vulnerable to liquidation when the criteria for insolvency normalise. The first was those which were loss-making in 2019. The second was those that broke even in 2019. There is also deferred debt, rents and other issues which have not been factored in. These may well impact on companies not under pressure in 2019.

There has been great success so far in keeping many businesses afloat through support schemes such as the CRSS, Covid-19 restrictions support scheme, and the EWSS, employment wage subsidy scheme. When the Minister speaks about the cliff edge, June and the CRSS, does he envisage the scheme going beyond June? If so, will further legislation be required to cover that eventuality? None of us expected to be as long in lockdown as we have been or for some of these supports to be as necessary for as long as they have been.

Uncertainty is a real factor. We must also factor in changes to consumer behaviour. The hospitality, events and tourism industries experienced some of the worst impacts. It will take time for them to recover. It is important we design schemes that will facilitate and encourage people to spend the money they saved during the lockdowns in the domestic economy, particularly in the hospitality, events and tourism sectors.

The EWSS has been extended until the end of June 2021, which is welcome. There is an anxiety about the deficit and balancing books. We must be able at some point to balance budgets. However, talking about these two issues at the same time tends to give a degree of uncertainty.

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