Questioning Quinn | On the use of the European Globalisation Fund to support redundant workers

Stephen asked the Minister for Education and Science:

 if he will explain the nature and scope of the system in place to track emerging redundancies in the banking sector since the European Globalisation Fund became operational in 2007; the number of such redundancies that emerged as a consequence in each year to date and the job types and other characteristics of the redundant population that it tracked.

the way he satisfied himself that between 2009 and 2011 a threshold of 500 redundancies within a period of nine months was never reached across the totality of the Irish banking sector; if he will elaborate on the circumstances in which redundant bank workers have failed to benefit from the widening of conditions governing support from the European Globalisation Fund to allow for the retraining and further development of such banking and other workers that have lost their jobs as a consequence of the global economic downturn.

Reference Number: 23589/12, 23590/12

Minister of State, Ciarán Cannon

My Department monitors national redundancies on both a company and sectoral

basis to ascertain whether a sustainable case for EGF co-financing assistance

may be made for affected workers in a number of ways.

The primary EGF related redundancy monitoring system used by the Department is

the statutory notification procedure under Protection of Employment

legislation. This requires the Minister for Jobs, Enterprise and Innovation to

be notified by employers of certain proposed collective redundancies. In

addition, my officials maintain contact with relevant Government Departments,

in the case of banking sector redundancies, the Department of Finance, as well

as monitoring media and other information sources for early warning of proposed


Certain large-scale redundancies in the banking sector in particular were the

subject of media speculation and various announcements in recent years. Taken

as a whole hundreds, if not thousands, of redundancies were in view over a

period of one, two or three years in this sector.

The level of redundancies in the banking sector was tracked by the Department

particularly during 2010 and 2011 in an effort to establish whether a

sustainable EGF sectoral application could be made. Data on collective

redundancies is collected and collated on an ongoing basis with a view to

establishing, inter alia, whether the prescribed four or nine months reference

periods under the EGF Regulations can be met within which the required minimum

number of 500 redundancies must occur. As such the monitoring undertaken is

continuous rather than annualised and data is not readily available in the

format sought by the Deputy.

There were certain points in the 2010 to 2011 period when it appeared

numerically, based mainly on announcements of proposed announcements, that the

numbers of redundancies did meet the minimum EGF threshold of 500. However,

there still remained the other relevant qualifying criteria to be met. It

should be recalled that certain collective redundancy notifications cited

significant redundancy time periods that went well beyond the nine months

reference period required under EGF Regulations and without sufficient detail

to ascertain the precise timing of redundancies, or indicated no set timescale,

or no formal redundancy rationale. Nor do actual redundancies always equate to

the numbers of proposed redundancies cited in the final analysis.

The Department sought to maximise the scale of any potential sectoral EGF

application through optimal timing of an application and consulted with the

Department of Finance as to proposed future restructuring and related

redundancies in the sector, which indications were would be on a very

significant scale of thousands of workers. This was estimated to be likely in

the latter half of 2011 and into 2012, when very significant redundancies were

being signalled to take place.

In late 2011 when the significant redundancy announcements which were

anticipated being made did not occur, further detailed examination, including

the collation of data from the Department of Finance and the Department of

Social Protection, was undertaken by the Department. This exercise was also

undertaken in the context of uncertainty over the continuance of the so called

EGF “crisis derogation” after 31 December 2011 and which heretofore allowed

redundancies to be based on direct linkage to the global economic and financial

crisis,. However, upon examination at that time the 500 threshold figure in

verified actual redundancy terms within the nine-months reference period

required by and agreed with the European Commission for submission of

applications, was not met.


Stephen asked:

if his attention has been drawn to the fact that eligibility conditions that would otherwise apply to support from the €500 million annual budget of the European Globalisation Fund can be substituted to allow for the funding of programmes for redundant workers in small labour markets, in circumstances that are exceptional or where redundancies arising have a serious impact on employment and on the local economy; the reason this exceptional provision has never to date been invoked to benefit redundant Irish workers; if it is now his intention to invoke it and the circumstances and time-frame in which this is likely to happen.

Reference Number: 23591/12

Minister of State, Ciarán Cannon

The Department understands following discussions with the European Commission

that the small labour market criterion under Article 2(c) of the EGF

Regulations is to be invoked only in particularly narrowly focused

circumstances. For example, in cases where redundancies occur in a remote or

geographically isolated area like an island or a mountain valley.


All seven Irish applications made to date since 2009 have ben made under the

criteria set out in either Articles 2(a) or 2(b) of the EGF Regulations, as

appropriate, and, therefore, reliance has not been required to be placed on

Article 2(c) to date.


The Department will continue to monitor redundancies on a national basis and to

consider which criteria can be most appropriately invoked to sustain viable EGF

applications for co-financing assistance on a case by case basis.


It should be borne in mind that all relevant criteria and requirements of the

EGF Reguations must be met, not just those under Article 2, including the

requirements relating to globalisation which have been narrowed since 1 January

2012 with the expiry of the so called “crisis derogation” relating to

redundancies which are as a direct result of the global financial and economic