JOB CREATION:FINE GAEL has proposed the introduction of a new subsidy of up to €6,000 over two years for employers who take on new staff.
Under the new scheme, which was launched yesterday by Fine Gael leader Enda Kenny and the party’s spokesman on enterprise Leo Varadkar, employers expanding their workforce and appointing new personnel would receive €4,000 in the first year and a further €2,000 in the second.
Funding for the new initiative would come from money which would otherwise have gone to provide social welfare payments.
Fine Gael said the new scheme would complement its existing policy of exempting PRSI for employers who recruited new employees in 2009 and 2010, but that it would be particularly targeted at companies considering taking on young workers as they tended to be paid less and would benefit less from the PRSI exemptions alone.
Mr Kenny said employers would be able to choose one of two proposals it has put forward to encourage them to take on additional staff. The proposed new initiative launched yesterday would not displace existing workers as it would only apply in cases where workforces were being expanded.
He added that the new subsidy – which would be the equivalent of 37 per cent of the amount paid out under the jobseeker’s allowance – would be of particular importance to first-time employees.
“Ireland is facing the very real prospect of a lost generation of young people who cannot get work. Recent CSO figures showed a 123 per cent increase in the Live Register in the last 12 months for the 25 to 34 age group, an increase of 68,760 people. At the same time, many companies would love to expand but cannot afford the cost of taking on extra staff,” said Mr Kenny.
Mr Varadkar said the proposed new scheme “could tip the balance where employers are currently deciding whether it makes sense to take somebody on”.
He said unemployment among those under 25 had more than doubled in the last year, and the country could not have a situation where people slipped into long-term unemployment.
“The Government’s strategy seems to be to just cut welfare for young people. We do not think that is the right way to go. Instead, the Government should use its resources to make it easier for employers to create jobs, particularly for those under 25,” he said.
The Government said last week that it intended in future to apply resources which would otherwise be earmarked for social welfare payments to pay for a new job-retention and creation initiative.
The Government is expected to hold talks with the social partners on such new measures over the next week. The Irish Congress of Trade Unions (Ictu) has proposed a €1 billion State investment in employment-protection and creation initiative, a move which has been broadly backed by the employers’ body Ibec.
