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The Government was advised that the financial costs of ongoing restrictions are very large and that the short-term economic outlook has worsened due to the current Level 5 restrictions.
Covid-19 contingency funds could run out by mid-year if restrictions are only gradually eased after March 5.
Additional costs for various income support plans could reach 4.7 billion euros in June, depleting reserve funds for contingencies and recovery.
Finance Minister Paschal Donohoe and Public Expenditure and Reform Minister Michael McGrath released the figures at a meeting last week of the Cabinet’s Economy and Recovery subcommittee.
The Minister of Social Protection has said that she will seek an extension of the pandemic unemployment payment until the summer.
Heather Humphreys said the government “will not fail” to help those who are out of work.
Extending the PUP, the Employment Wage Subsidy Program and the Covid Restrictions Support Program until June would cost € 3.7 billion.
Another € 300 million would be incurred by extending the trade fee waiver until then and additional lawsuits from the Department of Business Trade and Employment would cost € 700 million.
An additional € 700 million will be required, previously reserved for additional health and education expenses.
The committee includes Taoiseach Micheál Martin, Tánaiste Leo Varadkar, and Green Party leader Eamon Ryan.
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They were also warned about the risk of additional costs of the vaccination program and the cost of quarantine.
The number of non-performing loans is also likely to rise, reversing the decline seen since the crisis.
On a positive note, a stimulus of higher consumer spending is expected once restrictions are lifted and household savings are tapped.
The government has also said that it is working to reopen the construction sector on March 5.
Housing Minister Darragh O’Brien said that the provision of new housing is essential in his opinion, and there is a loss of between 700 and 800 housing constructions each week that the sector remains closed.
The government is working to reopen the construction sector on March 5, said Housing Minister Darragh O’Brien. | Read more: https://t.co/edUdaLVA0Z pic.twitter.com/MfzdeKFuy6
– RTÉ News (@rtenews) February 8, 2021
Speaking on RTÉ’s Today with Claire Byrne show, she said the sites have proven they can operate safely and she is confident that they will be able to reopen on March 5.
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