Employment Subsidy 'Won't Make Impact' Says Labour

A new financial subsidy scheme is unlikely to have "much of an impact", according to a Labour TD.

Labour remain cynical on the Employment Subsidy Scheme announced by Tanaiste Mary Coughlan on Thursday.

She said it was a €250million subsidy initiative aimed at protecting almost 30,000 jobs yesterday.

The scheme will involve the payment of a subsidy to firms to keep a person in employment for a period of 15 months, according to the Taniaste.

Vulnerable companies will be able to access a grant of up to €9,100 per worker over a 15 month period to help meet their wage bills enabling the company to continue paying the employee their normal wages.

However, opposition TD Willie Penrose said that the Tanaiste's 27,000 jobs target "does not appear to be very ambitious in the context of the 1,000 or so jobs that have disappeared every week since Brian Cowen became Taoiseach".

Mr Penrose said: "The €250m that the Government is putting into this scheme is small change in the overall scheme of things.

"Each job loss costs the exchequer somewhere in the region of €20,000 when the lost taxes and welfare payments are taken into account, so the Government can well afford to spend more than the €9,100 per job that Mary Coughlan is proposing under this scheme."

Mr Penrose's scepticism comes as figures emerge showing that more than 17,000 more people signed on the Live Register over the past month, according to the latest figures from the Central Statistics Office (CSO).

The CSO says almost 436,000 people were on the register in July, an increase of 83% over the past 12 months.

In opposition to the scheme, the Labour proposed a Pay Related Social Insurance exemption proposal to exempt employers from paying employer’s PRSI for 18 months, where they employ a person who has been unemployed for more than six months, and where they demonstrate clearly that they are creating a new job.

(DW/BMcc)