Dáil debates

Tuesday, 7 July 2009

Priority Questions

Redundancy Payments.

12:00 pm

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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Question 35: To ask the Tánaiste and Minister for Enterprise, Trade and Employment the average time taken by her to pay out redundancy payments upon receipt of an application for support; and if she will make a statement on the matter. [27945/09]

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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The considerable increase in the number of redundancy payment claims lodged with the redundancy payments section of my Department in the latter part of 2008, and to date in 2009, is unprecedented and is giving rise to delays in the processing of redundancy payments for individuals and companies within acceptable timeframes. The scale of the challenge is evident from the statistics for the first half of 2009, which indicate that the number of new claims lodged with my Department stands at 42,724, an increase of 160% over the equivalent period last year. Moreover, claims lodged at this half-year point now exceed the total number of claims received for the full year 2008, which, of itself, was an exceptional year by comparison with earlier years when claims received were of the order of 25,000 or less.

I am acutely aware of the difficulties the inability to deliver an acceptable turnaround of redundancy rebate payments is giving rise to for both individual employees and the business community. Together, we have taken and continue to take all possible steps to address the issues. Measures already taken include the reassignment of 19.7 additional staff, full-time equivalents, from other areas of the Department to the redundancy payments area since early 2009 with ongoing review of trends and demands; the prioritisation of the Department's overtime budget towards staff in redundancy payments section to tackle the backlog outside normal hours; the establishment of a special call handling facility to deal with the huge volume of telephone calls from people and businesses who are naturally concerned about their payments, using the facilities and cooperation of the National Employment Rights Authority, NERA; and the provision of better quality information on current processing times on the Department's website. This enables the staff in the redundancy payments area to concentrate on and prioritise the processing of redundancy payment claims.

The average time it takes to process rebate applications from employers filed on-line is six months while claims submitted by post take seven months. In respect of lump sum payments paid directly to employees in instances where the employers are unable to pay the statutory redundancy entitlements, the current processing time, assuming all of the necessary supporting documentation is filed, is between six and eight weeks.

I agree with the Deputy that this is totally unacceptable and that is why I have streamlined a transfer of my human resources, and, to the disgruntlement of every member of my staff all of my overtime budget, to deal with this inordinate difficulty. I appreciate that it is not good enough and we will do all that we can to correct this as quickly as possible.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I thank the Minister for her full reply. I will not be as grouchy as usual because I got a good answer this time. Did the Minister say that the Minister of State sitting beside her had 'cute' eyes or 'acute' eyes or is keeping 'a cute eye' on something?

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Acute eyes.

Photo of Willie PenroseWillie Penrose (Longford-Westmeath, Labour)
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The Deputy should wait until Saturday night.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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I should have said sharp eyes. He is cute all right but not in that way.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I would not like the other Minister of State, Deputy Conor Lenihan, to be jealous.

I accept why there is a problem. Allocating 19 extra staff is a good move but the figures have been very high for the past six months and will unfortunately be just as high if not higher for the next six months. Can anything else be done to reduce those waiting times? The Minister has said that a six or seven month wait is not acceptable. It is a massive jump from six weeks and is not good enough. We know that businesses are under great pressure. They cannot get money from banks or from their customers or even from the Department. The small sums, €1,000, €2,000 or €3,000, are a great deal of money. They need that just to pay some of the bills each week. It is very serious. Does the Minister have any statistics on the average sum in rebates owing to companies and if so could she furnish them to me later?

Is it possible, in prioritising those to whom money is owed, to examine the serious cases that are owed a large sum of money because some businesses are under immense pressure to get the money back? They are legally obliged to pay it out and do so as the person leaves the premises. We must work with them on this because it is not acceptable that they must wait six or seven months, which could become eight or nine months in some cases. I will not argue with the Minister because she has given a fair answer, and has admitted it but we must do more to address the problem. The Minister needs another plan A to deal with this for the future.

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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The Deputy is right. Had we discussed this four or five years ago the complaint would have been that the work permit section was not delivering quickly enough. We have transferred many of those people to the redundancy section. Following further meetings with the Minister of State, Deputy Calleary, we have not just added 20 staff but transferred an additional 14. I have also requested another staff transfer which I believe the Minister for Health and Children will facilitate with an additional ten people to effect that transformation as quickly as possible. We will also use NERA so that people can do the work while someone else answers the telephone.

I do not disagree. I know that everybody is crying out for the few euro to which they are entitled, for one reason or another. We have met several businesses which have asked us to transfer the money to the Revenue Commissioners to get these people off their backs. We have facilitated that on an individual basis but only with the client's imprimatur. We continue to do all we can to try to deal with this problem.

I hope that the Deputy will be proved wrong about the number of redundancy notices that have been put in. There was a high number between January and March of this year but we will do all we can. If other ideas, or initiatives that need to be taken, I will be forthcoming. One suggestion was that we outsource this work but I have not yet come to a final agreement on that but if necessary it is another option.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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Have the deals with the Revenue Commissioners begun yet? It was agreed that something would happen but is it happening? Is that only a PRSI offset or can they offset other taxes due?

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Although we do not have electronic funds transfer from one to the other we do facilitate a full offset, at the employer's request, of the amount against its tax liability.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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Is that regardless of the tax category?

Photo of Mary CoughlanMary Coughlan (Donegal South West, Fianna Fail)
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Yes. The Revenue Commissioners do not mind.