TÁNAISTE MARY Coughlan has said that Ireland’s application for EU aid to support former Dell workers is ready and will be sent off once the number of employees losing their jobs hits 500.
The aid would come as part of the EU’s Globalisation Adjustment Fund, originally set up in 2006 to finance one-off payments to large numbers of workers made redundant after their employer relocated outside the EU.
However, she stressed yesterday that the workers would not be getting a cash handout.
“It’s very important to say what this money is for,” she said, after a meeting of EU enterprise ministers in Brussels. “This money is for the training and retraining of people and it’s not, as people might think, cash in hand. It just augments the spend we have for these people.”
Dell, Ireland’s largest exporter, announced in January that it would be shedding 1,900 jobs in phased redundancies at its manufacturing plant in Raheen, Limerick, throughout 2009. The move is part of a $3 billion cost-cutting exercise announced last year.
According to the Department of Enterprise, 450 workers had received their redundancy papers by the end of April. However, to qualify under EU rules – which have been relaxed due to the financial crisis – the number of people out of work must be at least 500.
The scheme has a yearly envelope of €500 million and can only be used to fund training and job-search assistance. The money has been notoriously difficult to get, with only five countries drawing down just over €21 million since the fund was set up.
Dell’s move from Ireland to another EU member state – Poland – initially put the Government’s eligibility in doubt. However, the European Commission has since relaxed the requirements to tap the fund. It can now be accessed if layoffs are a result of the current economic downturn.
Fás is currently funding all upskilling programmes for the Raheen workers, which, Ms Coughlan says, will be a major operation – just when the Government’s budget is stretched to its limit.
“I don’t want to be disrespectful to people, but there’s not a huge skill level there, so we would be looking at completely increasing the skill base and the competencies there. It’s basic manufacturing and we have to move it up.”
The training and employment authority has around half a billion euro at its disposal to retrain people out of work across Ireland but, under the EU scheme, 65 per cent of its budget for the Dell workers would be subsidised by Brussels.
The Tánaiste said the application was likely to be submitted during the summer and could be approved a few weeks after that.
Ms Coughlan also used the Brussels meeting to tell her EU counterparts how small Irish companies were “jumping up and down” over the lack of working capital and trade credit insurance.
She said the European Investment Bank – the EU’s long-term lender – was looking “favourably” to increasing its lending to small and medium-sized companies.
She also launched a Department of Enterprise project to simplify and reduce the cost of applying for public contracts, saying the process should be more “SME-friendly”.
