The Employment Wage Subsidy Scheme (EWSS) will continue into 2022, the Tánaiste has signalled.
Leo Varadkar said on Monday that the scheme, introduced at the start of the Covid-19 pandemic, will be phased out slowly and extend into next year.
The scheme, which Mr Varadkar said is currently costing the Government €400 million a month, helps businesses hit hard by the pandemic to pay the wages of staff.
He said the Government is currently working out the exact date to which the scheme will be extended.
“That’s what we need to work out between now and Budget Day. In the UK and Northern Ireland, they’re ending the furlough scheme at the end of this month. We think that’s a mistake. We wanted to continue into next year, but we’re going to have to work out what we can afford and how we can work that into the budget.”
The Budget will be announced this autumn by Minister for Finance Paschal Donohoe.
Mr Varadkar told RTÉ radio the Government does not want to phase out the scheme “too quickly”.
The Pandemic Unemployment Payment (PUP) has already begun to be phased out, with another €50 reduction in the payment set to kick in from the middle of November, drawing criticism from Sinn Féin and other opposition TDs.
Mr Varakdar said: “What I want to say to employers, particularly in those hard-hit sectors like hospitality, for example, we understand you’re not yet operating at full capacity. And for those reasons we need to continue these wage supports.”
He said his Fine Gael party, which is holding its think-in in Trim in Co Meath, is committed to reducing the deficit and getting the country's budget “back in order”.
