Following the publication of the Government’s Roadmap for Reopening Society & Business, which sets out a five-stage plan to ease the Covid-19 restrictions and reopen Ireland’s economy and society. The Irish Government at a special Cabinet meeting 2/5/20 outlined further measures to support businesses impacted by Covid-19.
Like all countries across the globe, the Covid-19 emergency has had an unprecedented impact on the Irish economy and society. As the phased reopening of the Irish economy begins, the Government have recognised that businesses require significant additional supports, which complement emergency income support such as the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment.
Minister for Finance and Public Expenditure and Reform, Paschal Donohoe TD, speaking at the announcement of the additional business supports stated “Covid-19 has created a world that none of us could have imagined just a few short weeks ago. Our collective public health has been targeted; our businesses, and our economy, have been shouldered with an unimaginable burden; and our society is grappling with this new reality. But, by working together, we are minimising the damage. The hard work of the Irish people has ensured that we are getting to grips with this disease, our people are united in caring for one another under the most extreme of circumstances and our businesses are attempting to adapt to this new and most challenging environment. On top of the measures previously put in place by Government, this suite of measures being outlined is designed to build confidence, further assist businesses in terms of the management of their companies, and allow them to begin looking to the future and start charting a path forward for weeks and months ahead. We will continue to seek the best ways of supporting our people, and wider society, and rebuilding our economy so that we can get people back to work safely.”
The package of measures which aims to help businesses in Ireland to restart, reconnect and rehire staff who have been laid off or furloughed are:
- Provision of a Restart Fund for micro and small businesses of €250 million. A €10,000 restart grant for micro and small businesses based on a rates/waiver rebate from 2019;
- A three month commercial rates waiver for impacted businesses;
- A €2 billion Pandemic Stabilisation and Recovery Fund within the Ireland Strategic Investment Fund (ISIF), which will make capital available to medium and large enterprises on commercial terms;
- A €2 billion COVID-19 Credit Guarantee Scheme to support lending to SMEs for terms ranging from 3 months to 6 years, which will be below market interest rates;
- The ‘warehousing’ of tax liabilities for a period of twelve months after recommencement of trading during which time there will be no debt enforcement action taken by Revenue and no interest charge accruing in respect of the warehoused debt;
- A commitment to local authorities to make up the rates shortfall, so they can continue provide full services to the public.
Image: An overview of the supports for industry announced by the Department of Business, Enterprise and Innovation 2/05/2020.
Minister for Business, Enterprise and Innovation, Heather Humphreys TD, believes the Government announcement is a “comprehensive suite of supports for firms of all sizes, which includes grants, low-cost loans, write-off of commercial rates and deferred tax liabilities, all of which will help to improve cashflow among our SMEs. The new €250 million Restart Fund in particular will be a critically important tool to support small businesses to reopen their doors and get back on their feet with supports of up to €10,000 available.”
Business groups have welcomed the Government's new measures to help businesses get back on their feet following the Covid-19 crisis. Fergal O'Brien Director of Policy at business advocacy group IBEC says the grant is particularly welcome. Mr O’Brien says: "We have been saying from the outset for lots of companies more debt is not going to be the solution. Single grants rolled out in particular that are going to be helping companies in the reopen phase and to get that coordination around the roadmap for the reopening is really important."
The supports come as almost a quarter of businesses in Ireland shut down temporarily due to the outbreak of the coronavirus. With the country on lockdown, the construction and tourism industries have almost come to a standstill while many restaurants are only operating a takeaway service for customers. Figures from the Central Statistics Office revealed that over a one-month period from mid-March to mid-April, 23% of businesses ceased trading while almost three-quarters reported that their turnover was negatively affected by the outbreak.
For further information on the individual elements of Irish industry supports for COVID-19 visit: https://dbei.gov.ie/Djei/en/News-And-Events/Department-News/2020/May/02052020.html.