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In this week’s public policy bulletin, we take a look at the launch of Enterprise Ireland’s 2022 annual report as well as the latest unemployment statistics for December released by the CSO. In addition, we examine the findings of the independent review into Invest NI released this week as well as details on the UK’s new Energy Bills Discount Scheme. We also take a look at the World Economic Forum’s latest Global Risks Report together with the findings of the European Parliament’s recent Eurobarometer survey. Enterprise Ireland reports creation of approximately 20,000 jobs with client companies during 2022 In its annual report for 2022 released this week, Enterprise Ireland reported the creation of 19,660 new jobs via its client companies during 2022. According to the report, client firms of Enterprise Ireland employed 218,178 people in the Irish economy overall during 2022, with over two thirds of these roles based outside Dublin. Taking account of jobs lost during the year, the net increase in employment created was 10,841 or 5 percent. The agency’s report also noted there were 161 early-stage company approvals or start-ups with funding in 2022. Drop in unemployment rate recorded in December – CSO The Central Statistics Office (CSO) recorded a drop in the rate of unemployment seen in Ireland to 4.3 percent in December 2022. In its latest Monthly Unemployment Estimates published this week, the CSO noted how this figure was down from 4.4 percent in November 2022, and significantly down from the rate of 5.1 percent seen in December 2021. The seasonally adjusted number of persons unemployed was 114,500 in December 2022 compared with 117,000 in November 2022. Moreover, according to the estimates, there was a decrease of 18,600 in the seasonally adjusted number of persons unemployed in December 2022 when compared with a year earlier. Independent review of Invest NI finds that “profound change” is needed An independent review into the efficiency and effectiveness of Invest NI, Northern Ireland's economic development agency, has found that “profound change” is needed that will require both reform and repurposing of the organisation as a whole, if it is to perform as intended. Finding that the agency is having limited impact on productivity, with considerable room for improvement in leadership, structure, operation, control and public accountability, the independent review has called for stronger governance and oversight of the body by the Department of the Economy. Launch of new Energy Bills Discount Scheme The UK government has announced a new Energy Bills Discount Scheme (EBDS) from April 2023 to April 2024 for eligible non-domestic consumers in Great Britain and Northern Ireland. The current Energy Bill Relief Scheme provides a discount on wholesale gas and electricity prices for all non-domestic consumers. This includes public sector organisations, voluntary sector organisations and businesses. With this current scheme due to come to an end in March of this year, the new scheme will come into effect from 1 April 2023 and run for 12 months, with a cap set at £5.5 billion based on estimated volumes. Worsening cost of living crisis identified as number one global risk by World Economic Forum as Europeans expect additional state supports In its latest Global Risks Report, The World Economic Forum (WEF) has identified “growing debt distress” and “a continued cost of living crisis” as the top threats to geo-economic security in the next two years. Precipitated by the global pandemic and ongoing war in Europe, a combination of energy, inflation, food and security crises have consequently created “follow-on risks” including the risk of recession across a number of economies, according to the report. Meanwhile, the European Parliament’s latest Eurobarometer survey indicates that the rising cost of living is the most pressing concern for 93 percent of Europeans with citizens surveyed highlighting a clear expectation for the EU to provide additional support measures to combat the crisis.

  In this week’s Sustainability/ESG bulletin, read about a webinar on the Corporate Sustainability Reporting Directive, NTMA’s sale of a new green bond, and updates to the TBESS and Cycle to Work schemes. Also covered is a public consultation on draft Circular Economy Strategy for Northern Ireland, the ‘polycrisis’ list from the World Economic Forum’s Global Risks Report 2023, Chartered Accountants Ireland’s new network for Chartered Accountants working in ESG, and articles, podcast and jobs. Save the date: Department of Enterprise, Trade and Employment Webinar on Corporate Sustainability Reporting Directive The Department of Enterprise, Trade and Employment (DETE) will hold a webinar on Thursday 26 January (10am-12pm) to explain the new Corporate Sustainability Reporting Directive (CSRD). The Directive and accompanying mandatory reporting standards will apply to large companies whether listed or not, and to listed SMEs. Companies will have to report on their impact on the environment, social and governance matters and human rights, based on common standards, and the information companies provide will be audited. Registration will be open soon, but in the meantime save the date, and email any other questions to csrd@enterprise.gov.ie.  NTMA raises €3.5 billion from the sale of a new 20-year green bond (From our Public Policy team) The National Treasury Management Agency (NTMA) has raised €3.5 billion through the syndicated sale of a new 20-year Irish Sovereign Green Bond (ISGB), maturing in October 2043. The funds were raised at a yield of 3.106 percent and generated a total order book of €35 billion from just under 300 investors. An increasingly popular form of sustainable finance, green bonds are a type of fixed income instrument the proceeds from which must be used for environmental and sustainable development projects. This is Ireland's second sovereign green bond, following the inaugural issue in October 2018. Updates on the TBESS and the Cycle to Work Schemes (From our Tax team) Revenue has updated the guidelines on the Temporary Business Energy Support Scheme (TBESS) with additional information following queries received by businesses wishing to avail of the scheme. A summary of the changes is outlined in the “What’s new” page at the beginning of the guidelines. Revenue has also updated the Tax and Duty Manual regarding the Cycle to Work Scheme to reflect the Finance Act 2022 amendments. The guidance now includes a definition of cargo bike for the purposes of availing of the higher exemption limit of €3,000, together with updated examples. Broader scorecard planned for National Competitiveness and Productivity Council (NCPC) Changes to the competitiveness indicators typically used by the for National Competitiveness and Productivity Council (NCPC) have been announced, following a review of potential additional benchmark data sources. Changes include the inclusion of sustainability and equality indicators. The NCPC Scorecard benchmarks the competitiveness of Ireland’s business sector against international peer countries. The change was reportedly prompted by ‘[g]lobal transformations, such as the twin digital and green transitions and the shift towards sustainability and equality’. In its bulletin, NCPC Secretariat announced that “it [was] timely to consider newly available indicators, including those on sustainability, skills, innovation and well-being, and to refresh the selection of comparator countries, in measuring Ireland’s performance against key competitors and the world’s best performers.”   Public consultation on draft Circular Economy Strategy for Northern Ireland The Department for the Economy in Northern Ireland has launched a public consultation on the draft Circular Economy Strategy for Northern Ireland. This draft strategy sets out a vision that by 2050, Northern Ireland will have an innovative, inclusive and competitive economy where business, people and planet flourish, with responsible production and consumption at its core. It will be a key enabler of Northern Ireland’s 10X Economic Vision for a decade of innovation. The overarching target of the Circular Economy strategy is to halve Northern Ireland’s annual material footprint per person to eight tonnes by 2050. The public consultation is open for 10 weeks until 20 March.   Find out more about the circular economy in the Resources section of Chartered Accountants Ireland’s Sustainability Centre. €169 million for a just climate transition in Ireland €169 million from the Just Transition Fund (JTF) will be invested in Ireland following the approval of its Territorial Just Transition Plan (TJTP).  The Fund will invest in economic diversification and job creation in green sectors, particularly in approximately 500 local micro, small and medium-sized businesses. The TJTP also allows for financing under InvestEU (a programme which supports sustainable investment, innovation and job creation in Europe) and the Public Sector Loan Facility for Just Transition, a new tool that combines €1.5 billion of Commission grants with €10 billion loans from the European Investment Bank to mobilise billions of public investment to meet the development needs of just transition territories. ‘The age of the Polycrisis’: the World Economic Forum’s Global Risk Report The World Economic Forum’s Global Risks Report published this week, and identified ‘natural disasters and extreme weather events’ and ‘failure to mitigate climate change’ in top 5 risks in both the near-term (2 years) and long-term (10 years). The report, which tracks global risks perceptions among risk experts and world leaders in business, government, and civil society, examines risks across five categories: economic, environmental, geopolitical, societal, and technological. While ‘cost of living crisis’ is the number one risk in the short term, in the long term climate-related risks occupied each one of the top five risks places, and included failure to adapt to – as well as mitigate – climate change, biodiversity loss and large scale involuntary migration with natural disasters and extreme weather events. Of these, large scale involuntary migration was the only newly identified risk. A new term emerging the year is ‘polycrisis’, where risks are more interdependent and reciprocally damaging than ever. Commenting, Saadia Zahidi, Managing Director, World Economic Forum warned that “Climate and human development must be at the core of concerns of global leaders, even as they battle current crises. Cooperation is the only way forward.” Network for Chartered Accountants working in ESG Are you a Chartered Accountant working in ESG or working on ESG-related projects? Would you like an opportunity to engage with other Chartered Accountants working in this space to share insights, challenges and opportunities? Chartered Accountant now has a network to allow members working in sustainability/ESG to meet and discuss all matters of interest re ESG and accounting. 3rd Wednesday of every month, beginning with 25 January 2023 14.00-15.00/30 Chartered Accountant House/Teams If you would to attend please email sustainability@charteredaccountants.ie Articles Batteries, hydrogen and storage: Flexibility is new frontier of zero-carbon electricity (Irish Times) Q&A: The EU Corporate Sustainability Reporting Directive: To Whom Does It Apply and What Should EU and Non-EU Companies Consider? (Skadden.com) Abu Dhabi oil chief appointed president of COP28 climate summit (Financial Times) Podcasts Welcome to the age of the polycrisis: the Global Risk Report 2023 (World Economic Forum) Jobs Financial/Reporting Accountant for major energy provider in Ireland’s Energy/Sustainability/Renewables sector. Newly qualified ACAs can contact Dave Riordan, Careers Team, Chartered Accountants. Certificate in Sustainability Strategy, Risk and Reporting Find out more about Chartered Accountant Ireland's 8-week Certificate in Sustainability Strategy, Risk and Reporting programme designed to provide accountants with a strong foundation in sustainability and ESG issues and how they are relevant to their business, organisation, practice, and clients. Understand key reporting frameworks, tools, and metrics, and be equipped to address the sustainability opportunities and challenges already faced. You can find information, guidance and supports to understand sustainability and meet the challenges it presents in our online Sustainability Centre.    

  In our first Sustainability/ESG bulletin of 2023 we bring you sustainability/ESG predictions for 2023 as well as news of Ireland’s 2023 Climate Action Plan, a major overhaul of the EU’s carbon market, and the agreement reached at the Biodiversity COP. Also covered is a new network for Chartered Accountants working in ESG/Sustainability, and articles, jobs and events. Sustainability in 2023 – ‘Just smart business’ 2023 is likely to see increased focus on sustainability reporting for businesses, with the transposition into Irish law of the Corporate Sustainability Reporting Directive (CSRD), and ongoing updates from the International Sustainability Standard Board (ISSB), the EU Taxonomy and the Sustainable Finance Disclosure Regulation (SFDR). Also expected is an increased focus on biodiversity and business, an increase in the need for businesses to adapt to the impact of rising temperatures, more circularity and conscious use of resources, a greater awareness of greenwashing (and ‘green wishing’ and ‘green hushing’), and increased investment in renewables. Overall the ongoing integration of ESG into ‘business-as-usual’ is likely to continue. John Friedman, Managing Director of ESG at Grant Thornton, reportedly called for sustainability to be described as simply “business”, because “no matter what you call it, it is just smart business to understand and manage those things that are levers for attracting more customers and investments [and] engaging your workforce, which all drive profitability.” For more predictions on sustainability/ESG in 2023, here is what Reuters, the Economist and MSCI are saying. The Climate Action Plan 2023 The Irish Government has published its Climate Action Plan 2023 which aims to deliver new jobs and a thriving, green economy for current and future generations. Other benefits include warmer homes, cheaper electricity, better transport, vibrant and resilient communities, biodiversity-rich landscapes and improved health. Read more here. EU overhauls its carbon market Provisional agreement has been reached by the European Parliament and Council on the EU Emissions Trading System (ETS), the Carbon Border Adjustment Mechanism (CBAM) and a new Social Climate Fund. These are important legislative proposals of the ‘Fit for 55’ package that will further reduce emissions and address their social impacts: Read more here. Agreement reached at ‘Biodiversity COP’ A landmark agreement was reached at the ‘Biodiversity COP’, the United Nations Convention on Biological Diversity (‘COP 15’) which took place from 7-19 December in Montreal, Canada. Governments from around the world came together to agree on a new set of goals to guide global action through 2030 to halt and reverse nature loss. Find out more in our article Biodiversity - a look at the numbers. Consultations The Irish Government has launched a public consultation, open until Friday 17 February 2023, on the National Risk Assessment. This outlines proposed risks facing Ireland in the short, medium, and long term, categorised under the headings economic, geopolitical, social, environmental and technological. The Irish Government is seeking expressions of interest for participants – either individuals or groups – for the 2023 SDG Champions Programme, run by the Department of Environment, Climate and Communications. The goal of the programme is to raise public awareness of the UN Sustainable Development Goals. Deadline for receipt of submissions is Friday 20 January at 5pm. A meeting of the National Stakeholder Forum on the key principle of Agenda 2030 for Sustainable Development of ‘Leaving No One Behind’ will take place on Tuesday 17 January online and in the Aviva Stadium, Dublin from 10.30am – 4.30pm. Register here. Network for Chartered Accountants working on ESG projects Are you a Chartered Accountant working in ESG or working on ESG-related projects? Would you like an opportunity to engage with other Chartered Accountants working in this space to share insights, challenges and opportunities? Chartered Accountant now has a network to allow members working in sustainability/ESG to meet and discuss all matters of interest re ESG and accounting. 3rd Wednesday of every month, beginning with 25 January 2023 14.00-15.00/30 Chartered Accountant House/Teams If you would to join us please email the Institute’s Sustainability Officer susan.rossney@charteredaccountants.ie or sustainability@charteredaccountants.ie Articles Hiring rates decline but focus on 'green talent' - report (Irish Times) EU strikes deal to overhaul carbon market and cut Europe's emissions (Irish Independent) Climate action plan: Clear but painful path set out to cut Ireland’s emissions (Irish Times) Jobs Financial/Reporting Accountant for major energy provider in Ireland’s Energy/Sustainability/Renewables sector. Newly qualified ACAs can contact Dave Riordan, Careers Team, Chartered Accountants. Events The Leinster Society kicks of the new year with a free Expert Series webinar on 11 January, from 12.30pm - 1.30pm on energy saving for your household. A representative from the Sustainable Energy Authority of Ireland (SEAI) will give advice and tips, and answer your questions on how to make your household more energy efficient and sustainable. Register here

  In this week’s public policy bulletin, we take a look at the record Exchequer receipts for 2022 reported by the Department of Finance. We also examine the commencement of the new statutory sick pay rules and increase in the national minimum wage that took effect this week. Additionally, we review the NTMA’s launch of its latest 20-year green bond as well as the 30th anniversary of the European Single Market. Department of Finance reports record Exchequer returns for 2022 According to figures published by the Department of Finance this week, the Exchequer collected a record tax take of €83.1 billion during 2022. Resulting in an overall budget surplus of €5 billion (compared to the deficit of €4.7 billion seen in 2021) the buoyant figures reflected a strong growth in tax revenue together with a decline in COVID-related public expenditure. However, excluding estimates of windfall corporation tax receipts, the figures reported are consistent with an underlying general government deficit in the region of €5.25 billion. In addressing these windfall tax receipts, the Department of Finance estimates that approximately half of these receipts are potentially at risk in coming years with the Government therefore transferring a significant portion of the windfall tax collected to its National Reserve Fund. Statutory entitlement to employer-paid sick leave takes effect alongside increase in national minimum wage Following the enactment of the Sick Leave Act last year, new provisions entitling employees to up to 3 days of employer-paid sick leave in a year (paid at 70 percent of gross salary up to a cap of €110 per day,) have formally taken effect this month. Where an employee has an extended period of illness, the scheme will operate alongside the existing illness benefit system which kicks in on day four of an absence. Once the employee has exhausted their entitlement to employer-paid sick leave, they will move onto illness benefit, if eligible. In addition, the National Minimum Wage this week increased from €10.50 to €11.30 per hour. This 7.6 percent increase will see employees on the National Minimum Wage, who work a 39-hour week, receiving a pay increase of €31.20 per week or more than €120 per month. The increases mark a further step toward the Government’s ambition to introduce a National Living Wage which will be set at 60 percent of hourly median wages in line with the recommendations of the Low Pay Commission. It will be introduced over a four-year period and will be in place by 2026, at which point it will replace the National Minimum Wage. NTMA raises €3.5 billion from the sale of a new 20-year green bond The National Treasury Management Agency (NTMA) has this week raised €3.5 billion through the syndicated sale of a new 20-year Irish Sovereign Green Bond (ISGB) maturing in October 2043. The funds were raised at a yield of 3.106 percent and generated a total order book of €35 billion from just under 300 investors. Green bonds, an increasingly popular form of sustainable finance, are a type of fixed-income instrument, the proceeds from which must be used for environmental and sustainable development projects. This is Ireland's second sovereign green bond, following the inaugural issue in October 2018. European single market marks 30th anniversary This year sees the EU celebrating a significant milestone – the 30th anniversary of the Single Market. Established on 1 January 1993, the European Single Market allows goods, services, people and capital to move around the EU freely facilitating greater market integration between Member States' economies. Having recently published an analytical paper on the state of the Single Market 30 years after its establishment, this year the EU Commission plans to host numerous debates, exhibitions and campaigns co-organised with stakeholders across the EU to promote the successes of the Single Market and engage citizens in discussing its future.

  Provisional agreement has been reached by the European Parliament and Council on important legislative proposals of the ‘Fit for 55’ package, the European Union's package of policies to reduce its net greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels and to achieve climate neutrality in 2050.  The agreement pertains to the EU's carbon market, and plans to further reduce emissions and address their social impacts. The proposals aim to: Strengthen the EU Emissions Trading System (ETS). The EU ETS is a cornerstone of the EU's policy to combat climate change and its key tool for reducing greenhouse gas emissions cost-effectively. Introduced in 2005 it is the world's first major carbon market and remains the biggest one. It is a cap-and-trade system which requires, among other things, that energy-intensive industries and the power generation sector buy CO2 permits when they pollute. In 2021, installations covered by the EU ETS accounted for around 40% of the EU's total emissions. Negotiators have agreed to raise the overall target to cut emissions in the sectors covered by the ETS from 43% to 62% by 2030 from 2005 levels, and to apply of the ETS to heating, road transport and shipping for effective economy-wide climate action. Gradually phase out free emission allowances to certain enterprises and phase in the Carbon Border Adjustment Mechanism (CBAM) between 2026 and 2034 for the sectors covered. The CBAM is the EU’s tool to put a fair price on the carbon emitted during the production of carbon intensive goods that are entering the EU, and to encourage cleaner industrial production in non-EU countries. Establish a Social Climate Fund to protect and support vulnerable households, micro-enterprises and transport users from rising CO2 costs. The deal also includes shipping emissions in the EU ETS, making the EU the first jurisdiction to put an explicit carbon price on emissions from the maritime sector, and increases the size of the Innovation and Modernisation Funds. European Commissioner for Financial Services, Financial Stability and Capital Mairead McGuinness, described the provisional deal as "a really significant development” and “a massive transformation of the way we live, work and play.” On formal adoption by the European Parliament and Council, the new legislation can be published in the Official Journal of the Union and enter into force.

  The Irish Government has published its Climate Action Plan 2023 which aims to deliver new jobs and a thriving, green economy for current and future generations. Other benefits include warmer homes, cheaper electricity, better transport, vibrant and resilient communities, biodiversity-rich landscapes and improved health. The plan, which builds on previous Climate Action Plans sets out how Ireland will accelerate the action required to respond to the climate crisis, putting climate solutions at the centre of Ireland’s social and economic development. It is the framework through which the Government intends to meet the legally-binding emissions reductions targets set out in the Climate Action and Low Carbon Development Acts, and the economy-wide carbon budgets and sectoral ceilings agreed in July 2022 to set down limits on the amount of greenhouse gases that Ireland must not surpass over three five-year cycles. Changing the systems that shape how we live, work, get around and produce food is required to meet these targets, which are a key pillar of the Programme for Government. Key measures of the plan involve: a rapid scaling up of the transition to renewables, with enough renewable electricity to power every home and business in the country by 2030; a dramatic change to Ireland’s transport system with more buses, electric cars and active travel (walking, cycling and public transport); ambitious home and business retrofitting and climate-based construction, and 500,000 homes retrofitted to BER B2 by 2030; and innovative systems that will protect and support family farms to diversify their income streams, with tillage farming to cover up to 400,000 hectares by 2030. Industry is identified as one of the six vital, high-impact sectors which will have to reduce emissions. Industry accounted for 10.2 percent of Ireland’s greenhouse gas emissions in 2021. Under the Plan it is required to reduce its emissions by 35 percent, by changing how goods and services are produced, consumed and designed. Also required is a ‘decoupling’ of the links between fossil fuel use and economic progress. An Annex to the Climate Action Plan, outlining more detail on the Plan’s actions, will be published early in 2023.