Govt to layout roadmap to economic recovery with plan announcement
The Government will unveil its Economic Recovery Plan later today, which is expected to lay out a roadmap for the economy as it emerges from the impact of Covid-19.
There will be many different aspects to today’s Recovery Plan.
Much attention will be focused on the detail of the planned withdrawal of the Pandemic Unemployment Payment (PUP) and wage subsidy schemes.
The PUP is expected to close to new entrants from next month and to reduce in instalments of €50 from September.
The wage subsidy scheme and commercial rates waiver are both expected to continue until at least September.
It is understood the cost of extending these schemes will be around €2bn.
Supports for small and medium sized companies get into the export market will be announced as well as 50,000 training places for digital and green jobs.
Details will also be given on projects to be funded through the EU’s Recovery and Resilience Fund, one of which will be a low cost loan scheme for retrofitting homes.
Yesterday, Minister for Rural and Community Development Heather Humphreys said the number of people claiming the Pandemic Unemployment Payment for the coming week has dropped to 309,000.
Ms Humphreys said the figure is now down approximately 100,000 since the economy began to partially reopen, and said it reflected the number of people who have gone back to work.
The minister said there would be more clarity on the phasing out of PUP payments when the Cabinet meets today.
She said it is not sustainable to keep payments up in the long-term, but stressed that there will be no “cliff edge” announcement.
Minister for Public Expenditure and Reform Michael McGrath has said that in announcing an overall economic plan today there is much to be confident about in Ireland’s post-pandemic recovery.
Speaking on RTÉ’s Morning Ireland, he said businesses are open and consumers are spending and the OECD is forecasting growth of over 4 per cent in the economy this year.
He said that the government intends to draw down €950m in EU grants for spending projects and reform initiatives between now and the end of 2022.
Minister McGrath said the Government has spent over €28bn across 2020 and 2021 in additional expenditure and this “was and remains appropriate”.
He said that €7.5bn has been spent on PUP supports and 6 billion euro on the wage subsidy scheme.
Mr McGrath said the Government will announce details today about the extension of supports to protect employment and help people to get back to work “so we can make choices to re-build the economy”.
He said the Government will announce an extension of the PUP beyond June, but a tapering off of the payments, which he said will move “in a careful and gradual way” to a more regular social welfare system.
He said that pandemic-related payments were introduced for a specific reason and the Government is cognisant of its the importance.
However, he said the payments are a significant cost to the State and that in relation to the many thousands of people who are on social welfare rates that are much lower than the PUP he said ‘we have to be fair to everyone’.
The minister said that it is necessary to strike “a fair and proportionate balance”.
He said the PUP has been, and continues to be, the right thing to do but that the Government wants to help people to return to work.
He said the number of people on the PUP is expected to fall significantly in the coming weeks as businesses reopen, with 25,000 to 30,000 people signing off from the payment each week.
He said the emphasis in today’s announcement is on a ‘Pathways to Work’ plan that focuses on upskilling, re-training and helping people to get back to work.
Sinn Féin spokesperson on Finance Pearse Doherty strongly criticised the plans and said there is “a moral obligation” to support those who are restricted from going back to work because of public health guidance.
Mr Doherty told Morning Ireland that the supports will be phased out naturally as people start to go back to work, and over 125,000 have gone back to work since reopenings began this year.
He said that by September not everyone can go back to work due to restrictions.
He said that workers in aviation, event management, hospitality and other sectors will still be restricted from going back to work and Government is saying “we are cutting your supports and forget about ‘we’re all in it together’.”
He said the Government has “pulled the rug from under these people” by reducing supports and has strayed from the principle of supporting those as long as there were barriers on a return to work due to public health guidelines.