Government subsidy to stop firms laying off staff Sunday, May 31, 2009 By Ian Kehoe, Chief News Correspondent The government is preparing to unveil a package of measures aimed at retaining employment and supporting indigenous exporters, including a subsidy to encourage firms not to lay off staff.
With unemployment soaring, the government will move to try to protect jobs that are under threat, by diverting funding that would otherwise go on dole payments to a special subsidy. The scheme would effectively subsidise some of the wages of employees in threatened jobs, cutting the cost to the employer in return for the employee remaining in work.
Details of the plan will be announced by Minister for Enterprise, Trade and Employment Mary Coughlan in the coming weeks. The scheme is likely to operate only for a set period of time, with strict rules to ensure that it only applies to jobs genuinely at risk.
Atop-up export credit insurance scheme to support Irish firms who ship goods overseas will also be finalised. Many companies are having difficulty getting access to such insurance, which protects them in the case of default by an overseas customers, but consultants are now to advise the government on how to introduce a scheme. The moves are being planned as new figures indicate that tax revenues may be stabilising at a lower level.
The May exchequer figures, to be published this week, will show that tax revenues are down by close to 25 per cent from last year, similar to the rate of decline in recent months.
While the state is still running a considerable deficit, the figures are leading to guarded optimism in government circles that the marked decline in tax revenues might have bottomed out.
Measures introduced in the supplementary budget last month will boost revenues in the months ahead.
The figures will show that the government has raised between €13 billion and €13.5 billion in the first five months of the year, down from €17.1 billion in the same period last year.
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