Seanad debates

Friday, 30 April 2021

Business and Covid-19: Statements


10:00 am

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I thank the Leas-Chathaoirleach for the opportunity to speak on business and Covid-19. This may be the first time I have addressed the Twenty-sixth Seanad. It is also a pleasure to be back in the Dáil Chamber. I am not sure I have been here this year. We have been exiled to the convention centre but I am glad Senators are making good use of the Chamber during our brief exile.

I offer belated congratulations to Senators on their election to this august House. In particular, I congratulate Senator Maria Byrne on her return to the Seanad. I also congratulate Senator Horkan.

It is now 14 months since the first case of Covid-19 was confirmed in Ireland. Since then, Covid 19 has dominated our lives and the political agenda. One in 7,000 people in Ireland, North and South, have lost their lives and the public health measures designed to prevent further deaths have taken their toll on people's lives and livelihoods. The Government certainly has not got everything right but there is much to be proud of in Ireland's collective response to the pandemic. We have one of the lowest mortality rates in Europe. Our much criticised health service has stood up to scrutiny, our front-line and essential workers have excelled and our businesses adapted overnight. While we came too close for comfort, we never ran out of ICU beds and never came close to capacity in terms of ventilators or oxygen, or general bed capacity. Unlike many other countries, we did not have to send patients abroad. We have a same-day testing capacity service for Covid and a vaccine programme that has vaccines administered to patients within days of their delivery to the State. With the intensification of our vaccination programme over the next couple of weeks, we can now be hopeful for the future. More than 200,000 people have been vaccinated in the last seven days and we expect close to 250,000 people to be vaccinated next week.

Yesterday's announcement on the reopening of the economy provides a pathway out of this incredibly difficult period for us but it cannot be a false dawn. We must avoid a fourth wave of hospitalisations and deaths this side of autumn-winter 2021, if not entirely. People have sacrificed too much and waited too long. This time, we want to see construction, retail, hospitality and tourism reopen and stay open. So we will continue to reopen the economy based on four tests: stable or falling cases and that is a reproductive number at or below 1; the condition and capacity of our hospitals and ICUs; the vaccine programme’s progress; and any concern about new variants.

India's terrible second wave is a reminder that we must proceed with caution. It is also a reminder that this is a global fight against a highly infectious disease and nobody is safe until everyone is safe. Ensuring that all the world is vaccinated is a mammoth task and is best done through multilateral action through COVAX, the World Health Organization and the World Trade Organization. Where capacity exists, companies that have developed vaccines should licence their product, especially in the global south. Unfortunately, little capacity does exist in reality and so will take time.

On the one-year anniversary of COVAX, the vaccine-sharing facility, we must be honest with ourselves that it is the rich countries, including Ireland, that will vaccinate first. We must redouble our efforts to help less well-off countries catch up. In the meantime, we must do everything we can to send help to India, and we are.

I think the House will agree that the Government's financial supports for both workers and businesses have not been found wanting. The three main schemes, the employment wage subsidy scheme, the pandemic unemployment payment and the Covid restrictions support scheme, compare favourably with any other packages on offer in other countries. We also need to be honest about ourselves, this is borrowed money, and money provided by banks, bondholders and the European Central Bank, institutions that some wanted to burn, default on or repudiate only a decade ago. It was wise that we did not. Nonetheless, this debt will have to be serviced and refinanced but not just yet. There is time to allow our economy to recover.

We have complemented the three main schemes with sectoral schemes such as the tourism business continuity scheme and the small business assistance scheme for COVID, from which there will be a second round of funding shortly. We have also provided a range of other interventions, including commercial rates waivers, tax warehousing, restart grants and low-cost loans.

Around this time next month, we will publish the national economic recovery plan. It will present our vision for what the post recovery economy will look like, and how we plan to support businesses and employees in the months ahead. I think it is going to be a rocky road but I think we are much better placed to recover quickly than we were from the great recession a decade ago. That is partly because the Government has been able to intervene and provide direct financial assistance to businesses and employees when they needed it most. We went into this pandemic with public finances in good order, our debt was falling and we were able to borrow cheaply and easily when we needed to. If we stay on track, I believe we can recover all the jobs lost during the pandemic by 2023.

As a Government, we understand the importance of continued financial supports to business. We will ensure there is no cliff-edge scenario, especially for firms in particularly affected sectors such as aviation, tourism, hospitality, the arts and entertainment. Some businesses will bounce back quickly. Indeed, a number of businesses are already repaying the subsidies paid to them by the Government but others will take longer to come back, if at all. We are also going to look at ways to make State-backed loans more attractive and easier to access within the state-aid rules of the European Union.We know companies are going to require increased liquidity when they reopen over the coming weeks and months and we need to make that assistance as cost-effective and useful as possible. We will complement this financial assistance with a new summary rescue process to provide small companies breathing space to restructure in a fast and inexpensive way that is an alternative to the examinership process through the Circuit Court and High Court. This legislation is being prepared by the Minister of State, Deputy Troy, and will be coming to the House before the summer recess. With the support of Members, I hope we pass the Bill in good time.

I have also asked my officials to work on guidance for employers to make greater use of antigen testing. Some companies are already using it and we want to encourage companies to use it more in our workplaces as another tool to combat Covid-19.

Following a reconfiguration of Departments, my Department has been renamed the Department of Enterprise, Trade and Employment and has taken on some of the employment rights policy remit from the Department of Social Protection. Members may be aware that I am pursuing initiatives to improve workers’ terms, conditions and pay in the coming years. I believe this makes economic sense and is morally right. We must do so, however, in a way that is not counterproductive. If businesses are forced to shed jobs or reduce people's hours due to rising labour costs, nobody will gain from that scenario.

The pandemic has highlighted that there is no legal obligation on employers to provide sick pay in Ireland. The Government has introduced enhanced illness benefit, but it is evident that a longer term, more sustainable scheme now needs to be put in place for all illnesses and not just Covid-19. We are currently finalising the general scheme of a statutory sick pay bill with colleagues in the Department of Social Protection. It will build on the social protections we have put in place over the past five years, including the introduction of paternity benefit, parental leave benefit, the restoration of treatment benefit and the extension of social insurance benefits to the self-employed and farmers, including treatment benefit, jobseeker's benefit and the invalidity pension. We have also effectively abolished zero-hour contracts and increased the minimum wage well ahead of inflation.

The pandemic has prompted us to redefine what we mean by front-line or essential workers. When I was growing up, we thought of them as doctors, nurses, gardaí or paramedics – generally people in a uniform with good public sector jobs, pensions, and who were paid more than the average or median wage. But now we also think of the retail and transport workers, cleaners, security guards and food service staff - the people who kept us going during this pandemic. One of the legacies of the pandemic must be better terms and conditions for everyone, including the move to a living wage and access to an occupational pension for all workers to supplement the State pension.

Earlier this month, following my request, the Low Pay Commission formally began work on examining how Ireland can move towards a living wage during the period of this Government. The study will look at international evidence on living wages and examine different calculation methods. It should report in the second half of this year, allowing us to make meaningful progress on this project next year.

Another dividend and legacy of the pandemic will be the move to remote working. When the pandemic is over, many of us will return to the office and will be glad to do so, but things will never be the same again. Through the implementation of our remote work strategy, I want to make sure that we seize this opportunity to make a permanent change in the way we work - a better work-life balance, less commuting and more collaborative office environments. In addition to the recently signed right to disconnect code of practice, I will be introducing legislation on the right to request remote work. It will provide a clear framework around which requesting, approving or refusing remote work can be based.

I am under no illusions about how difficult the coming months will be for businesses. Some are barely hanging on and simply will not survive into 2022. Reopening will not be successful for everyone. Last week’s announcements by KBC and Carphone Warehouse were a stark reminder of the serious difficulties we are facing in the months ahead. The change in how we shop and bank was not caused by the pandemic but it has accelerated it and it will be permanent. When it comes to the twin transition, digital and green, there will be jobs lost as well as gained, and new businesses as well as business failures. For our part, the Government will be doing everything possible to help the retail and banking sectors adapt and to help employees reskill for new jobs where old jobs are lost.

I look forward to hearing the Senators’ contributions and to responding to their questions.


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