Thursday, 16 December 2021
Department of Finance
Covid-19 Pandemic Supports
246. To ask the Minister for Finance the position regarding supports for the hospitality sector from his Department in response to the further public health restrictions imposed on the sector to reduce the spread of Covid-19; the date the scheme will be open for applications; and if he will make a statement on the matter. [62421/21]
The objective of the Employment Wage Subsidy Scheme (EWSS) is to support employment and maintain the link between the employer and employee insofar as is possible. The EWSS has been a key component of the Government’s response to the Covid-19 crisis. It is an economy-wide scheme that operates across all sectors.
In money terms, the overall support provided to-date (9thDecember) by EWSS is over €6.6 billion comprising direct subsidy payments of almost €5.73 billion and PRSI forgone of €902 million to 51,700 employers in respect of over 696,900 employees.
Following the agreement of Government on 3 December 2021, my Department and Revenue sought to develop a proposal to modify the Covid Restrictions Support Scheme (CRSS) to provide for a supplementary subsidy (in addition to EWSS) for businesses which are subject to the latest restrictions on operating. The objective of the modified scheme was to provide targeted, timely and sector-specific support to supplement the reduced EWSS payments to the sector.
However, on further consideration and analysis of the data on CRSS, it proved to be administratively complex to design such a scheme and it would not be possible to have it operational ahead of Christmas as was hoped. The proposed modifications which included a change to both the turnover threshold and the rate, as well as consideration of a higher weekly cap, had the potential to significantly increase the cost of the scheme, particularly in the context of uncertainty around the trajectory of Covid-19 and the impact of the Omicron variant.
Instead, maintaining the enhanced rates of subsidy under the EWSS offers a relatively more efficient and effective way to support affected businesses in the immediate term. As such, the Government decided, and it was announced on Thursday last (9thDecember), that the enhanced rates of EWSS subsidy would apply for a further two months, December 2021 and January 2022. This will give certainty to businesses when they need it most.
The Government and I have been clear that there will be no cliff edge to supports for employers but we have also been clear that the EWSS cannot run indefinitely, nor is it sustainable to continue with the enhanced rates for a prolonged period of time given the very substantial costs to the Exchequer.
As such, from 1 February 2022, the original two-rate structure of €203 per week and €151.50 per week will apply; for March and April 2022 the flat rate subsidy of €100 per week will apply and the scheme will end on 30 April 2022.
The CRSS will remain in place to support businesses who are required to close or significantly restrict customers from accessing their business premises, and who meet the qualifying criteria. Under the relevant legislation, the CRSS was due to end on 31 December 2021 but is now being extended to the end of January 2022 under the same Government decision of 9 December as mentioned above. Provision is also being made to allow me, as Minister for Finance, to extend the CRSS up to 30 April 2022 by Ministerial Order if deemed necessary.
Amendments to the Finance Bill 2021 were brought forward this week to give effect to the EWSS and CRSS changes mentioned.
Finally, as has been the case throughout the pandemic, the Government will continue to monitor developments closely.