Covid-hit firms hail €5,000 payment plan

Business groups welcome wage support extension and CRSS scheme
Covid-hit firms hail €5,000 payment plan

Chairman SME Recovery Ireland John Moran said CRSS replicates the Danish-style fixed-cost compensations scheme. Photo:Gareth Chaney/Collins

Plans by the Government to support firms through the Covid-19 crisis in a package of measures called the Covid restrictions support scheme (CRSS) has generated widespread support from business groups.

Representatives of SMEs and business groups worst hit by the crisis — including the tourism and hospitality sectors — gave the budget package a broad welcome, but some want to see more detail about other plans to extend the wage subsidy scheme through 2021.

John Moran, a former secretary general at the Department of Finance, and who now chairs business group SME Recovery Ireland, said he was impressed by the €5,000 a week to be paid to firms forced to close temporarily due to restrictions under the new Covid-19 support scheme and a €3.4bn recovery fund. 

"The introduction of the Covid restrictions support scheme is a particularly welcome measure and replicates the Danish-style fixed-cost compensations scheme we have been highlighting to Government," Mr Moran said.  

Business group Retail Excellence, which represents 13,000 stores, welcomed the wage support extension, the cut in Vat hospitality rate, and the commercial rates waiver, but warned about the fallout from any further health restrictions on retail. 

“These measures will be of little use if the country is moved to level four, and non-essential retail is forced to close,” the business group said.

Isme chief executive Neil McDonnell said that he would like to learn more about “the terms and conditions” on the likely areas earmarked for the €3.4bn recovery fund but was upbeat about the measures overall, he said.

Sven Spollen-Behrens, director of the Small Firms Association, said measures including the commercial rates waiver, and the pledge to extend the employment wage subsidy scheme (EWSS) will help the most vulnerable firms.

“Whilst today’s announcements look good today, the key questions will be how quickly these can be implemented and feed through the economy,” he said.

Elaina Fitzgerald Kane, president at the Irish Hotels Federation, welcomed the extension of the wage support scheme and the rates waiver scheme, as well as the cut in the rate of Vat to 9% for hospitality. 

However, the IHF will continue to press for the banks to extend their payment breaks to 12 months, she said.

Brian Keegan, director of public affairs at Chartered Accountants Ireland, said the €2.1bn in Covid-19 business measures were a particularly welcome initiative, and he was impressed by the initiative not to penalise many self-employed people with penalty charges for a year.

The continuing large deficit next year of €20.5bn was needed to ensure spending was directed at the Covid-19 and Brexit crises, Mr Keegan said, but the challenge of supporting the increased levels of spending will require taxation measures in the coming years.

Leo Varadkar defended the size of the new Covid restrictions support scheme, saying it can help protect SMEs and other companies survive further impacts and restrictions due to the pandemic.  

The CRSS offers a maximum weekly payment of €5,000 for those businesses effectively closed due to the restrictions. 

It opens for applications next week, with the first payments expected by the end of November.

It will not be retrospective, but Mr Varadkar said it should be seen “in the round” and as part of a wider “package” which also includes the commercial rates waiver, the EWSS and “all the other low-cost loans that are available”. 

He told reporters the CRSS compares favourably to the UK government’s version, which offers British companies £4,000 (€4,400) a month.

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