The employer body’s proposals include covering up to 80pc of employees’ salary and a €250 Irish retail and hospitality voucher for every household.
The Chamber, which is the largest business representative body in the mid-west, said initial measures by the Government have not gone far enough, stressing that it should take “bigger steps to protect the economy and the relationship between the employer and employee”.
‘While the pandemic shock is expected to be transitory, the economic shock could be persistent if we fail to act swiftly’
– DR CATRIONA CAHILL
The set of proposals the body put forward focus on allocating critical business support in the short term as well as working on Ireland’s long-term economic policy.
The proposals include:
- Delivering a Covid-19 employee protection scheme similar to the Danish support model, where the Irish state covers 70 to 80pc of an employee’s salary, or 90pc of hourly wage where the employee is part-time
- Aligning the Covid-19 emergency pandemic scheme with this new scheme so that employees who have already been laid off receive the same entitlement as those who are likely to be laid off in the coming weeks
- Aligning the treatment of employed and self-employed individuals, meaning self-employed people receive 70 to 80pc of monthly income
- Encouraging the redistribution of skilled workers who are part of the scheme above and not working to public sector entities that require increased resources during the crisis period
- Similar to the UK, introducing an SME business rates discount scheme in which a 100pc discount will be applied to all retail, hospitality and leisure businesses for a period of one year
- Allowing a full waiver on water charges, including standing charges, for businesses that have temporarily closed for the duration of the closure and for a period of three months following re-opening
- Extending the Microfinance Ireland Covid-19 interest free business loan to all SMEs
- Reducing tourism and hospitality VAT for a period of two years
- Introducing a waiver of bank fees and charges for businesses that are temporarily closed
- Introducing a retail and hospitality voucher scheme where every household in the state is given a set amount – such as €250 or more – to spend in local Irish businesses when the crisis is over, amounting in total to €1bn for the economy
The Chamber’s long-term suggestions include setting aside additional measures for reskilling and training the people whose jobs have been “irrevocably lost” during this time.
An exceptional response for an exceptional situation
Limerick Chamber’s chief economist, Dr Catriona Cahill, highlighted that the coronavirus outbreak has presented an “exceptional situation” in need of an “exceptional policy response”.
“Although public health measures must remain an absolute priority, we must now also begin to consider the most effective policy response to support the economy during and beyond the crisis period,” she said.
“Limerick Chamber called for several initial and immediate actions at the onset of this crisis. The government has responded to these calls by implementing a range of business supports. While we welcome the Government’s swift response, the measures represent what was necessary in terms of immediate action, but do not go far enough.
“During a normal recessionary period, we might pause to consider the budgetary repercussions of excessive spending. Such budget considerations cannot be a priority on this occasion, however. While the pandemic shock is expected to be transitory, the economic shock could be persistent if we fail to act swiftly.
“Borrowing rates for sovereigns are at historical lows and Ireland should take advantage of this. It is imperative that the Covid-19 response is funded from additional borrowing and not from previously committed public funds.”