Government must utilise the €855 million surplus in the National Training Fund to address skills gaps
Ibec, the group that represents Irish business, is calling on Government to utilise the €855 million surplus in the National Training Fund (NTF) to address skills gaps in the economy.
Employers contribute 1% of their payroll to the NTF to support access to training and education for individuals in employment and seeking employment. This year the surplus in the NTF will increase by a further €150 million. By 2025, it is projected to rise to between €1.4 billion and €1.9 billion.
Ibec Policy Executive Meadhbh Costello said: “It is unimaginable that employers’ contributions could accumulate to as much as €1.9 billion in a fund that is not being fully utilised for key upskilling and reskilling initiatives while businesses across Ireland are facing talent shortages and increasing business costs. In the context of a tight labour market, such investment is critical for the development, attraction and retention of talent and the competitiveness of business.
“Employers continue to face challenges in filling vacancies in sectors such as IT, engineering, construction and the experience economy. A mechanism is now urgently needed to prevent the untargeted accumulation of employer payments and to leverage the surplus. A proportion of the funds from the NTF should also be used to support businesses who are facing additional employment costs through a time-limited National Training Fund rebate.”
Ibec estimates suggest that the rollout of auto-enrolment, the living wage, pensions, statutory sick pay and other leave proposals already announced will add 9% to average labour costs in Ireland over the coming decade. For many domestic facing firms and SMEs, these costs are on top of existing pressures related to energy, commodity, and transport costs. The NTF rebate should take the form of both a break from payments to the NTF for the period where viability is challenged, and a further rebate of up to 2% of payroll (or two years payments) equivalent in training vouchers for the upskilling and reskilling of staff.