New State scheme to help businesses ride out the Brexit storm

Budget initiative will target ‘vulnerable but viable’ firms to support in no-deal scenario

 Minister for Business, Enterprise and Innovation Heather Humphreys (above) and Minister for Social Protection Regina Doherty are working jointly on the plan. Photograph: Gareth Chaney/Collins

Minister for Business, Enterprise and Innovation Heather Humphreys (above) and Minister for Social Protection Regina Doherty are working jointly on the plan. Photograph: Gareth Chaney/Collins

 

Businesses deemed to be “vulnerable but viable” in the wake of a no-deal Brexit will be targeted for supports in a new initiative set to be announced in the budget.

State supports will be offered to support both the businesses themselves as well as their workers under a plan being worked on jointly by Minister for Business Heather Humphreys and Minister for Social Protection Regina Doherty.

Well-placed sources said the scheme, expected to be one of a number announced to support sectors of the economy at risk from a no-deal Brexit, will enable collaboration between the State, employers and their employees.

It is understood that Enterprise Ireland will carry out an assessment of businesses to determine if they are viable and able to survive through the difficulties of a no-deal Brexit.

Sources said a judgment will be made on whether such businesses can cope with a difficult transition period in the aftermath of the UK crashing out of the EU without deal, should that come to pass.

The exact level of funding being provided for this scheme is not yet known. Along with Minister for Agriculture Michael Creed, Ms Humphreys and Ms Doherty are seen as the main line Ministers who will deal with workers and businesses who will be most affected by a no-deal Brexit.

Next election

Minister for Finance Paschal Donohoe will unveil the final tax and spending plan before the next election on Tuesday October 8th.

Mr Donohoe will have a budget day package of €2.8 billion, of which €2.1 billion has already been committed. The remaining €700 million, it is understood, will be allocated on budget day for spending in certain areas, such as small, targeted measures in taxation and welfare.

In the event of a no-deal Brexit, however, Mr Donohoe will commit to borrowing more money to fund contingency measures, such as the plan from Ms Humphreys and Ms Doherty.

Mr Donohoe is continuing meetings with Fianna Fáil, whose support is needed to pass the budget

Groups such as Ibec and ICTU have called for similar supports, with ICTU suggesting a short-term work scheme to preserve jobs in at-risk firms and a Brexit adjustment fund to upskill and retain workers while they are still in employment.

Employers’ group Ibec also outlined a number of “stabilisation” measures needed the event of a no-deal Brexit. These include a short-term work subsidy scheme for two years for “vulnerable workers”, which would provide a “subsidy to the worker of up to 60 per cent of the worker’s reduced net wage, for up to 12 months”.

Subsidy scheme

Ibec also called for a subsidy scheme with “subsidies up to €10,000 over 24 months for employees in firms in distress”.

Mr Donohoe is continuing meetings with Fianna Fáil, whose support is needed to pass the budget, as well as individual Ministers in the days before the budget.

He is expected to meet Fianna Fáil’s Barry Cowen and Michael McGrath again on Friday.

Mr Donohoe met the Independent Alliance group of Ministers over the weekend.

Minister of State for Disability Issues Finian McGrath is looking for greater funding for the elderly, as well as the disability sector. While he and his colleague John Halligan have called for €5 increases in the old-age pension, sources in the Alliance accept this is unlikely to happen.