Friday, 27 March 2020
An Bille um Bearta Éigeandála ar mhaithe le Leas an Phobail (Covid-19) 2020: Céim an Choiste agus na Céimeanna a bheidh Fágtha - Emergency Measures in the Public Interest (Covid-19) Bill 2020: Committee and Remaining Stages
I thank the Senators. I was not aware of the issue raised by Senators Gavan and Conway, but I will raise it with the Minister for Transport, Tourism and Sport. It is just one of the series of issues that are developing now as our economy responds to the public health emergency. The Minister for Foreign Affairs and Trade and the Minister for Transport, Tourism and Sport are making great efforts in other areas to deal with the concerns of travellers. I will ensure the matter raised by both Senators is raised with the Minister for Transport, Tourism and Sport and his Department.
Regarding the issues raised by Senators Mulherin and Higgins, I will give a brief context for this section in the legislation. Some 11,000 companies have now enrolled in this programme. That shows the breadth of the challenge that is approaching. In other circumstances one could point to that type of enrolment and feel a degree of satisfaction for putting in place a scheme that can make that type of difference to companies, but it is an indication of the challenge that is approaching and the necessity for a programme such as this. The programme was conceived at great speed. I have no doubt there are issues we will have to address and that there will be anomalies and issues of detail that will require work.I ask that companies bear with us as we work on this. If nothing else, the Revenue Commissioners will tonight become an institution of the State that pays people, which shows the kind and speed of change that is happening.
On some of the issues that Senator Mulherin referred to, my explicit message, as articulated by the Chairman of the Revenue Commissioners earlier, is to encourage companies to contact the Revenue Commissioners directly. At a time of great stress for companies, when there is much uncertainty, there is no need to add to that. They should directly contact the Revenue Commissioners and gain advice on how they can participate in such a programme. There are criteria. To companies that have concerns about whether they are in or out, I ask them not to approach Members of the Houses of the Oireachtas about that. The only people who will decide whether a company meets the criteria are the Revenue Commissioners. Companies should not divert their time by approaching a Deputy or Senator, nor place a Deputy or Senator in such a position. They need to engage directly with the Revenue Commissioners.
On the points raised by Senator Mulherin about turnover, the definition will vary as we engage with companies. The most likely way in which decline in turnover will be worked out will be to examine what the expected turnover would have been in quarter 2 and to compare that with an equivalent period, most likely quarter 2 a year ago. It is not unworkable. These are issues that companies and the Revenue Commissioners will be able to resolve very quickly between themselves.
As for declarations of insolvency, the very outcome we are trying to avoid is companies becoming insolvent. We are trying to ensure that if companies are in a position where they are in difficulty, they will be still in a position to retain a relationship with their employees and keep them involved. Participating in this programme is all about ensuring that companies are in a position whereby when our economic health recovers, they will be able to rebound, without having put their employees on the live register.
I am not in a position to answer the question about the deductibility of wages from corporation tax. Nevertheless, the detailed guidance from the Revenue Commissioners on how the scheme will work has been published and I hope the question will have been answered therein for those who have raised it.
On Senator Higgins's questions about the amendments she tabled, the reason we used the term "best efforts" and its corresponding definition was that it is conceivable that, as this emergency evolves, some companies will be able to add to the subsidy. If they are able to do so, we want them to do so. We want them to be in a position where they can ensure that the wages they give their employees include, and perhaps constitute the majority of, a "top-up" payment that they are able to make themselves. Where companies can add to the subsidy, we want and expect them to. We recognise, however, that it could become the case that companies simply will not have income coming in and as a result will not be in a position to pay wages to employees. What would normally happen in such circumstances is that the employer would cease to exist and the employees would become unemployed, but that is what we want to avoid happening. The company would continue to exist and would be able to maintain its relationship with its employees, particularly those on lower wages What is likely to happen in such a scenario is that the State will pay the employees' wages for a period. This is a huge change for the State but we are dealing with extraordinary circumstances and this is what we need to do. In regard to whether an employer would be in a position to pay bonuses or higher wages to different members of the company, one of the definitions we have put in is the inability to pay normal wages. I will simply say that having put in place this scheme and then exited this scheme, hopefully, depending on the public health circumstances, if, later in the year, the Revenue Commissioners discover that employers who are benefiting from the scheme were paying higher and unchanged wages to other members of the company and paying them bonuses, it is pretty likely it would be the subject of action from the Revenue Commissioners. There are many risks with this scheme but, as I said in the Dáil last night, while there are risks, the greatest risk is that if we do not put something like this in place, many hundreds of thousands of people who are currently working might not have a job in a few weeks. We cannot let that happen, which is why we are doing this. That is why we have a reference to "best efforts". As I said, it would be our absolute expectation that if a company is in this scheme, more senior members of that company would see their own wages change.