Employers pick up tab for €300m 'human capital' education initiative
A €300m 'Human Capital Initiative' unveiled in the Budget aims to increase investment in higher education courses and will be paid for by employers.
Business employers' group Ibec said that while the scheme for the higher education sector is to be welcomed, it will "fall well short" of its actual funding needs.
The initiative's funding is coming from the National Training Fund, which is bankrolled by a levy from businesses across Ireland. That levy is being increased by 0.1pc from January to 0.9pc based on the earnings of an employer's employees.
From the start of 2020, employers will be hit with another hike in the levy, when it rises to 1pc.
The Government said the increased levy next year will yield an additional €69m and a further €77m in 2020.
The higher levy will likely hit businesses such as restaurants and regional hotels hardest. Already reeling from the increase in the 9pc VAT rate to 13.5pc, they will also be shouldering a higher minimum wage from January.
Finance Minister Paschal Donohoe said the new human capital fund is being established following an independent review of the National Training Fund. It will run between 2020 and 2024.
"The long-term focus on investing in education has allowed Ireland to attract and develop world-leading businesses across a range of sectors," said Mr Donohoe. "And while Brexit poses many challenges it also provides us with opportunities to attract new business."