Firms face ‘very tough conversations’, warns Mairead McGuinness

There will need to be “very tough conversations” in workplaces and boardrooms as a result of the Covid-19 pandemic, and those conversations “need to start yesterday”, Ireland’s EU Commissioner Mairead McGuinness has said.

Ms McGuinness, who is European Commissioner for Financial Stability, Financial Services and the Capital Markets Union, was speaking to business owners in the capital as part of a Dublin Chamber political event.

“The future will not be the past,” she said. “That will be a challenge for businesses, particularly when they are trying to recover from a crisis and look to the future.

“The truth is there will have to be very tough conversations in workplaces and boardrooms, and those conversations need to start yesterday.”

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Ms McGuinness said it will be important businesses are not subject to a “cliff edge” in terms of Government supports.

“We need to avoid a cliff edge so that we carefully manage this phasing of the recovery,” she said. “We know those supports need to remain as they are, so we are going to see a much larger State. Government is bigger now in our economy.

“People are being supported to hold on to their work and businesses are being given supports to tide them through this. For some sectors, the impact is very deep.”

In terms of the recovery, she said the expectation is that the Irish economy could expand by 3.4 per cent this year, which would be a little under the EU average of 3.7 per cent.

“But of course the questions is what type of recovery will we have,” she said. “We need to get this right.

“There is a risk the crisis could leave very deep scars in the economic and social fabric of Europe: bankruptcies, job losses, and young people again being hit, as they were in the last crisis. So we could see an increase in long-term unemployment and worsening inequality.

“There are many challenges. We need to improve our financial system. We need to get the EU back on track around the sustainable digital and more inclusive economic recovery.

“The societal challenges will be great when we are able – if we are – to go back to living with Covid in a more normal circumstance.”

The commissioner added that the bloc and its member states have learned lessons from the pandemic in terms of how they organise themselves.

“I think it’s also interesting that before the Covid-19 pandemic, many countries couldn’t spend money on their health system,” she said.

“There were pressures, budgetary and otherwise, but when we had the pandemic, we realised the place we had to put money was into our health systems.

“So I think we have learned lessons as a community, as a European Union about where money needs to go now and where we need to target, so we have for the future a more resilient system around public health.”