Public Policy Bulletin, 14 April 2020

Apr 08, 2020

 

In this week’s bulletin, read about the €1 billion package of business supports for SMEs announced last week by the Minister for Business, Enterprise and Innovation Heather Humphreys. Additionally, take a look at the European Commission’s latest resources in their effort to mitigate the impact of the COVID-19 pandemic, and read about the ESRI’s research into the likely impact of the Government’s income-support measures.

 

Minister Humphreys announces €1bn package of supports for COVID-19 impacted SMEs

Minister for Business, Enterprise and Innovation Heather Humphreys has announced further measures to help businesses adversely impacted by the COVID-19 restrictions. 

Among the measures is an additional €450m expansion of two loan schemes operated by the Strategic Banking Corporation of Ireland (SBCI), bringing the total allocation to support liquidity in companies affected by the COVID-19 crisis to €650m.

  1. The Working Capital Loan Scheme, which provides liquidity support to businesses, will receive a further €250m, bringing the total fund to €450m. 
  2. The Future Growth Loan Scheme, also operated by the SBCI, will receive an additional €200m that will be released in tranches to provide longer-term loans to firms that have been impacted by COVID-19. 

The package is now worth €1 billion in liquidity measures including a new €180m Sustaining Enterprise Fund for firms in the manufacturing and international services sectors. Free mentoring and online training is also available for all SMEs. You can read more about additional business supports available on the Department’s dedicated page.

 

European Commission mobilises resources to fight the COVID-19 pandemic

The European Commission has set out plans for a robust and targeted EU response to support member and partner countries' efforts in tackling the COVID-19 pandemic. The EU's collective action will focus on addressing the immediate health crisis and resulting humanitarian needs, strengthening partner countries' health, water and sanitation systems and their research and preparedness capacities to deal with the pandemic, as well as mitigating the socioeconomic impact. We’ve collated a list of their latest initiatives:

Coronavirus Response Investment Initiative – Factsheet and PDF

Support to mitigate Unemployment Risks in an Emergency (SURE) Initiative – Factsheet and PDF

European Commission and European Investment Fund unlock €8 billion in finance for 100,000 small and medium-sized businesses

Global EU response to the coronavirus pandemic


ESRI Research: 
Policy response significantly supports incomes from COVID-19 job losses

In a recent paper published yesterday by the Economic and Social Research Institute (ESRI), the think tank analyses the potential costs and distributional effect of COVID-19 related unemployment in Ireland. The research suggests that the measures announced by Government will significantly cushion incomes from COVID-19 related job losses. It finds that the flat-rate Pandemic Unemployment Payment (PUP) of €350 per week does most to support incomes, reducing the number who lose more than 20 per cent of their disposable income by around a third.

According to the ESRI: “The Government’s policy response will significantly reduce the number of families who see extreme reductions in their income as a result of job losses related to the ongoing COVID-19 pandemic. However, the rise in unemployment will bring significant costs to the exchequer: around €800 million per quarter for every 100,000 individuals who lose their job.”

The research also finds that the additional cost of the Government’s Temporary Wage Subsidy Scheme may be minimal, in part because its current design is less generous to lower earners than the Pandemic Unemployment Payment they would receive if laid off by their employer.

Read the full publication on ESRI’s website.

You can also view all updates on our Public Policy web centre.


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