Government assessment on EWSS indicates need for support beyond June

Mar 30, 2021

The Minister for Finance, Paschal Donohoe TD, published assessments carried out by the Department of Finance on the utilisation of the Employment Wage Subsidy Scheme (EWSS). The results of analysis on the uptake of the scheme indicate the continued importance of the scheme. Accordingly, the Department of Finance is considering the need for continued support to the end of 2021.

The paper on EWSS utilisation to 4 March indicates that coverage of the EWSS remains significant with over a quarter of employers making claims in relation to 15 percent of all employees in January. January claims were also proportionately more than EWSS claims in November and December.

The papers also indicate that the EWSS compares favourably to international equivalents.

An extension of the wage supports to the end of 2021 would assist in getting people back to work when restrictions are eased, expediting a reduction in numbers dependent on social welfare payments. The papers consider the EWSS to be an important bridge between the transition from reliance on social welfare payments to regular employment. This runs alongside the objective of helping to maintain viable businesses.

Despite questions over the sustainability of these scheme and the risk of employers becoming dependent on State supports, the papers indicate a need to plan an appropriate exit strategy from the scheme to ensure there is no cliff-edge end date for employers, due to the cost associated with future labour market reactivation measures.

The EWSS is designed to be responsive to the continued changing environment associated with the pandemic and allows for adaptations as the COVID-19 Resilience and Recovery 2021 – the Path Ahead is rolled out. A decision on the form of continued support will consider the emerging circumstances and economic conditions, as they become clearer.

The Department of Finance’s press release was published alongside the papers on EWSS utilisation to 4 March 2021, 18 December 2020 and 12 October 2020.

The Minister for Finance published the assessment papers in compliance with his obligation to monitor the scheme under section 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020.