THE Government has announced its Economic Recovery Plan, setting out a roadmap for the emergence from the impact of Covid-19 including a phased reduction of the Pandemic Unemployment Payment (PUP) from September.
Speaking today at the launch of the Economic Recovery Plan 2021, Taoiseach Micheál Martin said that the Government want to avoid a cliff-edge end to emergency supports.
Under the plan, the Government will be extending the Employment Wage Subsidy Scheme (EWSS) and Covid Restrictions Support Scheme until the end of the year while businesses may also apply for enhanced reopening payments.
In September, a new Business Resumption Support Scheme will be available for those with significantly reduced turnover as a result of Covid-19.
It has also been agreed to maintain the 9% VAT rate for the tourism sector until September 2022 as part of the plan.
The PUP payment will be maintained at its current rate until September when a “gradual reduction” will commence in increments of €50.
It is planned that the scheme will be closed to new applicants from 1 July.
Solidarity TD Mick Barry said that there will be many workers still unable to return to work for reasons related to the pandemic by the time September's PUP cutbacks roll around.
The Cork North Central TD called for “an intelligent debate about what a decent basic social welfare rate should look like before we do anything else”.
Meanwhile, Sinn Féin TD Thomas Gould described any decisions regarding reducing the PUP as “premature”.
"This is a time where we should be supporting people and businesses because a lot of people will suffer if these payments are cut and it’s through no fault of their own.”
He noted the “stress and worry” that the announcement of any cuts may cause for people.
“What we would be proposing is that these payments should maintain in place until 2022,” he added.
However, President of the Cork Business Association, Eoin O’Sullivan said that the PUP is proving to be a challenge for many businesses who feel as though they are competing with the payment.
“The biggest challenge for the hospitality industry is recruiting staff at the moment.
He described the September date for the phasing out of the payment as a significant timeframe to try to get people back into the workforce.
“Hopefully the economy will be back to 100 per cent by then.”