Government warned over mounting costs of lockdown measures

Government warned over mounting costs of lockdown measures

THE GOVERNMENT has been cautioned about the mounting financial costs of continued lockdown restrictions, RTÉ reports.

Current data shows that Covid-19 contingency funds could dry up by the middle of the year if there is only a gradual easing of restrictions after 5 March.

The added burden of support schemes could set State coffers back another €4.7bn by June, depleting the vital Contingency Reserve and Recovery funds.

Minister for Finance Paschal Donohoe and Minister for Public Expenditure and Reform Michael McGrath outlined the grim figures at a sub-committee cabinet meeting on Economy and Recovery last week, according to RTÉ News.

Vying for increasingly scarce funds, Minister for Social Protection Heather Humphreys has confirmed she will be seeking an extension to the Pandemic Unemployment Payment (PUP) until summer.

She assured the public that Government "will not be found wanting" in supporting those who are out of work due to the pandemic.

Overall, extending the PUP, the Employment Wage Subsidy Scheme and the Covid Restrictions Support Scheme to June would cost €3.7bn.

A further €300m hit will come from extending the commercial rates waiver until then, and additional pressure on the Department of Enterprise Trade and Employment is estimated to cost €700m.

Funds put aside for surplus health and education costs will also need to plug a €700m gap in those areas.

Committee members include Taoiseach Micheál Martin, Tánaiste Leo Varadkar and Green Party leader Eamon Ryan – all of whom were warned about the additional costs associated with the vaccination programme and quarantining.

In a reversal of a downward trend since the 2008 crash, the number of non-performing loans are also set to increase this year.

More optimistically, experts anticipate an injection of financial stimulus once day-to-day economic activity resumes and the contribution from household savings are accounted for.

The Government has announced its plans to reopen the construction sector on 5 March.

Minister for Housing Darragh O'Brien commenting on the necessity to build new homes, while highlighting that each week the sector is out of action, between 700 to 800 home are not built.

Speaking on RTÉ's Today with Claire Byrne programme, Mr O’Brien said that sites have a proven track record of operating safely and expressed his confidence that they will be able to reopen on 5 March.