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.
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