The Taoiseach has said the jobs plan announced today is a 'down payment' on the promise by the Government to put jobs at the centre of its agenda. He said that Government targets on job creation would be achieved and he said all Ministers would work hard to do that.
Enda Kenny said it was impossible to put a figure on the number of jobs that could be created under the plan and that a resurgence of confidence could not be measured. Nevertheless, he stated that 100,000 jobs during the period of Government is 'but a start'.
Referring to the various measures aimed at boosting the tourism sector, the Taoiseach said that the number of people who will holiday at home this year as a result of the measures cannot be measured and that he himself will be holidaying at home himself this year.
Mr Kenny said the Government is committed to not increasing tax on work and investment and he described the corporate tax rate as being 'un-negotiable'.
Asked about the pension levy, Enda Kenny said most of the funds are involved in overseas assets. He said the measures are designed to focus on the more than 400,000 people who are out of work in the country.
Mr Kenny said the concerns of some areas of the pensions industry are understood and would be listened to by the Minister for Finance. But he said the Government made 'no bones' about making jobs a priority and he said if the crisis was not addressed it would only get worse.
The Taoiseach said re-allocation funding from within current allocations would help create jobs through investment and that the plan is a deliberate focus on where the most jobs can be created through limited resources.
The Taoiseach insisted that the programme is being financed in a fair and efficient way and he said pensions funds being levied had been the beneficiaries of massive tax relief over recent years. He said a reduction in the administrative cost base of pension funds could offset the levy.
Also speaking at Government Buildings this evening was the Tanaiste and leader of the Labour Party Eamon Gilmore. He said the 'whole focus' of the Government is to bring about economic recovery and get the country back to work. Mr Gilmore said the jobs initiative had been promised within the first 100 days of Government and that had been delivered.
He said the plan was significant and focused and he said sectors of the economy where people can be put into work in the short term had been identified. Mr. Gilmore said the country has a number of advantages in the tourism sector and he said the infrastructure here could cater for an increase in tourists.
Mixed reaction to jobs initiative
But the reaction to the jobs plan was mixed elsewhere.
The Small Firms Association welcomed the announcement, particularly the halving of the lower rate of PRSI. This will sustain jobs in the labour intensive domestically trading sector, by directly reducing the cost of employing someone, which is a key factor in the owner-manager's decision to keep or indeed create a job, said SFA director Patricia Callan.
However, she criticised the Government's decision to increase the National Minimum Wage by €1 per hour, which she said 'will null and void the effect of the PRSI measure on job creation by cancelling the cost saving out.'
The SFA director also condemned the decision by Government to fund its initiative through a tax on private sector pensions, which she says 'is short-sighted and will prove to be a costly mistake.'
IBEC welcomed what it called 'the many positive measures in the jobs initiative and the decisive way in which the government has moved to support the jobs market, boost confidence and get people back to work.'
The group, however, said the decision to fund the move through a levy on pension funds will have serious consequences for defined benefit pension schemes, many of which are already in significant deficit.
'Many of the initiatives announced today will have a positive impact on the economy,' said IBEC director general Danny McCoy.
'The PRSI reduction will make it easier for employers to take on new staff and the VAT cut will provide a significant boost to the tourism and hospitality sectors. It is a sensible approach to have a meaningful VAT reduction of a targeted nature, rather than a very small cut spread more thinly.'
But Mr McCoy also said that the absence of a Government decision on the outcome of the independent review of ERO and REA wage setting mechanisms is disappointing and needs to be taken as a matter of great urgency.
Congress welcomed the announcement as a 'promising first step' and said it must be seen as the beginning of a concerted campaign to create good jobs and restore economic well-being.
'There are some promising measures outlined in these proposals,' said Congress Assistant General Secretary Sally Anne Kinahan.
'But this has to be seen as a begining - the opening shot in a coherent, concerted drive to create jobs and get people back to work. Government must adopt a fairer approach to recovery and become more ambitious for Ireland and more ambitious for people if we are to create a genuine recovery,' she said.
However, Congress raised concerns about the impact of the imposition of a levy on pension funds.
'We believe a small levy on top earners would have been a better prescription,' said Ms Kinahan.
Social Justice Ireland said that the jobs initiative is far too small to make any impact of substance on record levels of long-term unemployment.
'The proposals contained within the Jobs Initiative are welcome as far as they go but there will be no major reduction in the numbers long-term unemployed for the foreseeable future without far more radical action being taken,' said Fr Seán Healy, director of Social Justice Ireland.
Fr Healy said that the total value of new spending and cuts in VAT, PRSI and air travel tax is €470m in 2011 but that only €29m of this is allocated to labour activation measures.