It is disappointing that the Government failed to seize the opportunity to strengthen employee share ownership in Ireland in the recently published Finance Bill.
IPSA had urged Finance Minister Paschal Donohoe to implement much-needed measures to ensure that both the SAYE and KEEP employee share ownership schemes remain viable.
There are concerns about the future of Save As You Earn (SAYE) due to the decision of the scheme’s sole savings provider, Ulster Bank, to withdraw from the Irish market. In its pre-Budget submission, IPSA had called on the Government to persuade a new savings provider to enter the market and facilitate savers in place Ulster Bank, or to amend legislation so that employees enrolled in SAYE schemes can save via one of the State savings schemes or have their funds held on their behalf by the company they work for.
Take-up of the Key Employee Engagement Programme (KEEP) remains very low among its target audience of start-ups and SMEs due to its complexity. IPSA’s pre-Budget submission called for changes to reduce onerous qualifying restrictions and limitations, difficulties navigating the scheme, and costs associated with establishing KEEP.
IPSA Vice Chair Gemma Jacobsen said: “The future of SAYE is very uncertain. Ulster Bank currently has approximately 6,000 SAYE accounts, with savings valued at around €20m, on its books. We don’t even know whether or not they will remain in Ireland long enough to see these existing SAYE schemes to maturity. What we do know is that SAYE will not survive as a viable share scheme unless the Government acts.
“Similarly, KEEP will continue to be rejected by the business community until changes are made to ensure that it serves the SME and start-ups companies that it is intended to.
“IPSA will continue to engage with Government on behalf of our members to ensure the future viability of SAYE and KEEP, and to further other policy objectives. These include amending existing company and tax legislation to facilitate share buy-backs in Irish companies, to ensure that long options are only be taxed when excised instead of when granted, and to advocate for increased incentivising of employee share ownership in Irish business.”