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Government extends Wage Subsidy Scheme to end of August

5 Jun 2020

The Government is extending the Temporary Wage Subsidy Scheme until the end of August and has introduced a new structure for the Pandemic Unemployment Payment.

Today (5 June), the Government announced that it is extending the Covid-19 Temporary Wage Subsidy Scheme to the end of August.

The scheme, which came into effect on 26 March, subsidises a portion of the wage bill for employers whose businesses have been negatively impacted by restrictions introduced to slow the spread of Covid-19. The scheme aims to prevent job loss during the ongoing health crisis.

So far, more than 58,300 employers have registered for the scheme and more than €1.37bn has been paid out to support 514,700 employees around the country.

Extending the scheme

The Government said today that the scheme is to remain in place until the end of August, to support businesses as they reopen and to avoid the risk of forcing otherwise viable firms to close.

In a statement, the Government said that the cost of the scheme “remains significant”, with more than €500m paid out per month so far.

Minister for Finance and Public Expenditure and Reform Paschal Donohoe, TD, said: “I have always been clear that this support cannot last forever, but I am satisfied that a decision has been made, for now, to continue the scheme until the end of August.”

Donohoe added that he expects to see a “continued decline” in reliance on the Wage Subsidy Scheme throughout the summer as businesses continue to reopen and people return to work.

He said that the country’s economic recovery will be monitored and it will inform a later decision on the need for further extension or tapering beyond August.

The Pandemic Unemployment Payment

The Government also announced that a two-tiered structure will be introduced for the Pandemic Unemployment Payment from 29 June. It will be linked to each employee’s prior earnings.

Individuals who earned above €200 per week will continue to get €350 per week in the Pandemic Unemployment Payment, however those who were previously earning less than €199.99 per week will now get a reduced payment of €203 per week.

Minister for Employment Affairs and Social Protection Regina Doherty said: “We are extending until phase five of the roadmap the waiver of waiting days on jobseeker payments, the increased rate of payment for qualified adults on jobseeker claims and the waiver of waiting days and the payment of the enhanced rate of illness benefit for the people who are affected by Covid-19.”

Doherty said that in the long term, officials will take the progress on reopening the economy and the developing health situation into account as they plan the extension or tapering of the scheme.

“I think the crisis has been the ultimate test of our State’s structures and services,” she said. “A pandemic is a fluid and evolving challenge. It’s imperative that we continue to tailor our responses to the evidence before our eyes. This applies to the economic response, just as much as the health response.”

Kelly Earley
By Kelly Earley

Kelly Earley was a journalist with Silicon Republic. She joined in June 2019 and covered start-ups, Big Tech and developments in consumer technology.

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