Galway Independent Column - June 30th 2010

Just last week the government launched a new initiative to help employers create jobs. The Employer Job (PRSI) Incentive Scheme has been set up to help employers to create jobs and get people back to work.
Aimed at taking people who have been unemployed for six months or more off the Live Register, the scheme, according to the government, will save an employer in the region of €3,000 from the annual cost of employing an additional worker by exempting the employer from paying employers PRSI for 12 months from the date of approval of the full time position.
Launching the scheme An Taoiseach said that the measure is being deliberately targeted at those who have been unemployed for six months or more as the proportion of people who return to employment after a short period out of work remains relatively high but after 6 months on the Live Register there is a danger that people will drift into long-term unemployment. Therefore the scheme will only be available for new employees who have been unemployed for 6 months or more.
The scheme will be administered by the department of Minister for Social Protection, Éamon Ó Cuív TD, and will be pertinent to any new job created in 2010 which employed a person who had been unemployed for 6 months or more. The government hopes that this initiative will create several thousand jobs.
Obviously, Galway Chamber welcomes any initiative that makes it easier for an employer to employ and any initiative that cuts employers costs but one wonders whether or not many employers are in a position to take on staff even with the exemption in PRSI.
Could the government come up with an initiative to safeguard existing jobs as well as creating new positions? Most employers are still struggling regardless of what the recent economic outlooks say. (Bloxham Stockbrokers Irish Quarterly Economic Outlook June 21 expects the economy to grow by 0.5% on a Gross Domestic Product basis) Now would be a good time, for example, to revisit local government funding and its reform. The double taxation, both unfair and inequitable, that is Commercial Rates, needs attention. It can no longer be used to balance the books for local authorities. Government needs to get its think tanks working on this before a winter of discontent sets in with businesses frankly being unable to pay their rates bill resulting in staff layoffs and ultimately closure. A closed business can’t take on staff, regardless of any PRSI exemptions.
For more information on the Employer PRSI Incentive Scheme see www.welfare.ie