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Workers on low salaries can claim FIS – Family Income Supplement

Title: Family Income Supplement (FIS) is a weekly tax-free payment for families, including one-parent families, at work on low pay.

Author: Citizen’s Information

Full Text & Source: http://www.citizensinformation.ie/en/social_welfare/social_welfare_payments/social_welfare_payments_to_families_and_children/family_income_supplement.html
The Internet, Online, 21/01/2015

Writers/bloggers if you are on low salaries and have a child or children look into FIS, medical cards and back to school uniforms, free pre school year, free prescription drugs if you have a long term illness & other entitlements on the Citizens Information Database: http://www.citizensinformation.ie/en/.

You would be strongly advised to meet your local welfare officer and bring all your bills: rent or mortgage, ESB, phone, Internet, car insurance, house insurance, food, clothes, property tax, water charges etc.

List your income and all the costs going out of your wages on a weekly basis. Ask her or him to help you fill in the FIS form and ask about medical card and help with school books & uniforms etc.

If you get FIS the minimum payment is €20, a €1,040 a year. The local welfare officer is an expert in helping people get their benefits, listen to them and do as they recommend.

If you have one child you must be earning over €26,312 not to qualify. If you are working odd hours your partner can go and meet the welfare officer for your family and bring your bank details. Of course, you can just print the form and apply for it yourself. Please include bank account details for them to pay you.

How much can I get?
Your FIS payment is 60% of the difference between your average weekly family income and the income limit for your family size, rounded up to the nearest euro. If you qualify at all you will get the minimum payment of €20 per week.

Form FIS1: http://www.welfare.ie/en/pdf/fis1.pdf

If you think you have been wrongly refused FIS you can appeal this decision, and please do. In many cases a lot will just walk from the hassle, pursue your rights.

Please Note They Are Other allowances for low earners:
Apply for medical card online or by post: http://www.hse.ie/eng/services/list/1/schemes/mc/apply/

Child Benefit: Budget 2015
It was announced in Budget 2015 that the rate of Child Benefit will increase by €5 to €135 per month for each child from January 2015
Claim for your new baby: https://www.welfare.ie/en/pages/secure/eforms.aspx

Workers can claim rent tax credit: Who can Claim?
An individual, paying for private rented accommodation used as a sole or main residence. This includes rent paid for flats, apartments or houses. The tax credit for the years 2011 onwards applies to individuals who were renting a property on 7 December 2010. This tax credit will cease in 2017.
Form http://www.revenue.ie/en/tax/it/forms/rent1.pdf

Rent Supplement: (for those on welfare only)
http://www.welfare.ie/en/Pages/rent_faq.aspx#q2

Back TO FIS:
Complete application form FIS 1 (available on http://www.welfare.ie or at any local Social Welfare Office) and submit the following documents with it, if available:
your most recent payslip to show your income and hours of employment
your latest P60 (if you have one) and
your Certificate of Tax Credits for the current year (if you have one).
Even if you do not have these documents when you fill in the application form, send us the form straight away. You can send the documents or certificates as soon as you have them.
Send your application to: Family Income Supplement Section, Social Welfare Services, Government Buildings, Ballinalee Road, Longford

Example 3:
Single Parent, 1 child, recently commenced working 25 hours per week as a secretary
Gross taxable earnings to date €360.00
Total tax deducted €0.00
Employee PRSI €14.40
Total USC €10.54
Net assessable earnings €335.06
Number of weeks worked 1
Average weekly earnings €335.06
Other Income €0.00
Total family income €335.06
Income limit (1 Child) €506.00
Difference between income limit and earnings €170.94
FIS Payable (60% of difference rounded) €103.00

Married parent, 4 children working 41 hours per week as a manager
Gross taxable earnings 2012 €45,876.00
Total tax deducted €8,621.50
Employee PRSI €439.75
Total USC €2,833.68
Net assessable earnings €33,981.07
Number of weeks worked 52
Average weekly earnings €653.48
Other Income €0.00
Total family income €653.48
Income limit (4 Children) €824.00
Difference between income limit and earnings €170.52
FIS Payable (60% of difference rounded ) €103.00

Sample Text:
Family Income Supplement (FIS) is a weekly tax-free payment available to employees with children. It gives extra financial support to people on low pay. You cannot qualify for FIS if you are only self-employed – you must be an employee to qualify.

You must have at least one child who normally lives with you or is financially supported by you. Your child must be under 18 years of age or between 18 and 22 years of age and in full-time education.

To qualify for FIS, your average weekly family income must be below a certain amount for your family size. The FIS you receive is 60% of the difference between your average weekly family income and the income limit which applies to your family. For more information about average family income see ‘Rates’ below.

Your FIS payment is not taxed. If you are getting FIS you may also be entitled to the Back to School Clothing and Footwear Allowance. Your income from FIS is not taken into account in the assessment for a medical card.

The new Back to Work Family Dividend (BTWFD) and FIS can be paid together and the BTWFD will not be taken into account in the means test for FIS.

FIS is a tax-free weekly payment for employees:

•Working 19 or more hours per week (or 38 or more hours per fortnight). You can combine the weekly hours you have worked with your spouse, civil partner, cohabitant’s hours to meet this condition. You cannot use time spent in self-employment (or on Community Employment, Gateway, Tús, JobBridge or the Rural Social Scheme) to meet this condition.
•Where the employment is likely to last at least 3 months
•Looking after one or more children and
•Earning less than a set amount which varies according to family size

Under EU regulations you may be able to claim FIS if your children are living abroad and dependent on you. Generally the payment continues for one year (52 weeks) and is not affected by, for example, an increase or a decrease in earnings.

However, in the following 2 circumstances, your weekly rate of FIS can be revised during the year:
•If you start to care for an additional child your FIS rate will increase (because your family size has increased)
•If you were getting a One-Parent Family Payment and your payment stopped because your youngest child reached the relevant age limit your FIS rate can be revised to take account of the loss of your OFP

If you lose your job or have reduced working hours

If your pay from work is reduced your Family Income Supplement (FIS) payment will stay the same. It will not increase. However, when your FIS payment ends you can re-apply giving details of your new reduced income. (FIS is usually paid for 52 weeks. At the end of the 52 weeks, you can re-apply for FIS.)

If the number of hours you work each week is reduced to below 19 hours (38 hours per fortnight) you are no longer entitled to FIS. You should notify the FIS section if your hours fall below the minimum requirement.

If you lose your job you are no longer entitled to FIS. You must notify the FIS section.

Getting FIS with other social welfare payments

You cannot get FIS if you are on one of the following schemes or social welfare payments:

•Community Employment Scheme, Gateway, Rural Social Scheme, the Tús scheme or JobBridge.
•Jobseeker’s Benefit, Jobseeker’s Allowance or Farm Assist
•State Pension (Transition) or Pre-Retirement Allowance

Your spouse, civil partner or cohabitant can claim FIS while you are getting one of these payments. However an Increase for a Qualified Adult (IQA) will no longer be paid and your social welfare payment will be assessed as income for their FIS payment. Any Increase for a Qualified Child will be affected. Similarly if your spouse, civil partner or cohabitant is getting one of these payments, you can qualify for FIS but an IQA will no longer be paid for you.

If you are parenting alone you may be entitled to FIS in addition to your One-Parent Family Payment, Deserted Wife’s Benefit or Widow’s, Widower’s or Surviving Civil Partner’s (Contributory) Pension.

You can get FIS while you are taking part in the Part-Time Job Incentive Scheme.

You can get Illness Benefit while you are getting FIS (for 6 consecutive weeks). If you are out of work for more than 6 consecutive weeks payment of FIS is suspended until you return to work and send a final certificate into the Illness Benefit section or until your FIS award period expires (whichever is the earlier).

Under the Maternity Protection Act 1994, a woman who qualifies for Maternity Benefit, Adoptive Benefit or Health and Safety Benefit is entitled to claim FIS (provided she meets the conditions of the FIS payment and has a family – a pregnant woman who has no other children does not qualify for FIS until the birth of the baby).

Your income must be less than the income limit for your family size. (If you are claiming Maternity Benefit your average weekly earnings are worked out using your gross earnings to date or your P60). Your FIS claim will then be paid for one year from the start of your Maternity Benefit payment (if you have a child already) or from the birth of your baby if it is your first baby.

You are not entitled to continue to claim FIS if you take additional unpaid maternity or adoptive leave, if you do not return to work following maternity or adoptive leave or if you lose your job after returning to work.

Maintenance
A separated parent can apply for FIS once he or she meets the qualifying conditions and

• Is living with the children or

• Is wholly maintaining the ex-spouse, ex-civil partner or ex-cohabitant with whom the children are living

Wholly maintaining means that maintenance paid by you, the FIS applicant, must be the sole income of your ex-spouse, ex-civil partner or ex-cohabitant.

Only one FIS payment can be made for a family

Paying maintenance
If you are a separated parent and paying maintenance you may qualify for FIS. To qualify you must be wholly maintaining the parent with whom the children are living. Only one FIS payment can be made for a family, the parent to whom you are paying maintenance must not be getting FIS.

If you are paying maintenance as a result of a court order or legally binding agreement for a second family, the amount of that maintenance payment will not be deducted from the income to be assessed for FIS.

Getting maintenance
If you are getting maintenance, your total maintenance payment will be assessed as income for FIS. Only one FIS payment can be made for a family. This means that the parent from whom you are getting maintenance must not be getting FIS.

A parent getting maintenance for a qualified child will also have that maintenance assessed for FIS.

Rates

FIS is calculated on the basis of 60% of the difference between the income limit for the family size and the assessable income of the person(s) raising the child(ren). The combined income of a couple (married, in a civil partnership or cohabiting) is taken into account.

Income from any source (excluding the disregards stated below) is assessed as means. However, though there are no rules excluding the assessment of capital, the Department of Social Protection generally does not assess capital or examine your bank account details when you apply for FIS.

The main items counted as income are:

•Your assessable earnings and your spouse, civil partner or cohabitant’s assessable earnings. (Assessable earnings are gross pay minus tax, employee PRSI, Universal Social Charge and superannuation (including the Public Service Pension Levy.) Income from working as a home help is included.
•Any extra income you or your spouse, civil partner or cohabitant have from employment (such as pay for overtime, bonuses, allowances or commission).
•Any income you or your spouse, civil partner or cohabitant may have from self-employment.
•Income from occupational pensions.
•Income you or your spouse, civil partner or cohabitant may have including social welfare payments.
•All family income from carer’s payments (Carer’s Allowance or Carer’s Benefit).
•Rental income from the letting of property or land (the capital value is not assessed). The gross rental income is assessed and you cannot deduct mortgage payments or other expenses.

The following payments do not count as family income:

•Child Benefit
•Guardian’s payments
•Supplementary Welfare Allowance
•Domiciliary Care Allowance
•Foster Child Allowance
•Rent Allowance for tenants affected by the de-control of rents
•Income from a charitable organisation
•Income from providing accommodation to students studying Irish in Gaeltacht areas under a scheme administered by the Minister for Arts, Heritage and the Gaeltacht

Calculating income for FIS

The Department of Social Protection calculates your assessable income and your average income over a certain period of time.

If you are newly in employment, your average weekly income is calculated from when you started work. If you have been working for over a year, your average weekly income are calculated from your latest P60. Your P60 is also used to calculate your average weekly income when your claim is being renewed.

If your spouse, civil partner or cohabitant is self-employed, his or her income over the 12-month period before you lodge your claim is used to work out his or her average weekly income.

Again, to qualify, your average weekly family income must be below a certain amount for your family size. You can read examples of calculations on welfare.ie.

FIS income limits in 2015 (fact)

If you have: And your weekly family income is less than:

One child €506
Two children €602
Three children €703
Four children €824
Five children €950
Six children €1,066
Seven children €1,202
Eight children €1,298

It’s important to be aware, that no matter how little you may qualify for, you will still get a minimum of €20 each week. You can use the Benefit of Work Ready Reckoner from the Department of Social Protection to help you assess out the financial consequences of taking up full-time work.

The Reckoner works out the total amount you would receive on taking up full-time work (including any Family Income Supplement) and compares this to what you are getting in jobseeker payments (including Rent Supplement).

If you are getting FIS you may also be entitled to the Back to School Clothing and Footwear Allowance.

How to apply

To apply fill in an application form for Family Income Supplement (pdf). You can get a copy of this form in your Intreo centre or social welfare local office. If you need help to fill in this form, the staff in your social welfare local office or Citizens Information Centre can help you.

To make sure that your application for FIS is processed as quickly as possible, you should include your latest P60 form, 2 recent payslips, and a copy of your Certificate of Tax Credits for the current tax year with your application.

If you think you have been wrongly refused FIS you can appeal this decision.

Where to apply

Send your completed Family Income Supplement application form to:

Family Income Supplement (FIS) Section

Department of Social Protection
Social Welfare Services Office
Government Buildings
Ballinalee Road
Longford
Ireland

Tel:(043) 334 0053
Locall:1890 92 77 70
Email: fissection@welfare.ie

Iran Presidential election: Any difference among moderate, reformist, conservative…?

Taking aim at Hassan Rohani: The reformist president of Iran faces a tough re-election

Face-off: Politician versus religious legal personalities

Hardliners are cracking down on social media

APPLICATIONS for the ticklish job of president of Iran opened this week, with more than 100 hopefuls vying to replace the incumbent, Hassan Rohani, a relative moderate, at the election on May 19th. (They were 1,300 candidates a couple days ago, including former President Najad)

The religious conservatives who loom so large in Iran are hoping they can unite around a single candidate, overcoming the divisions that doomed their prospects in 2013 and allowed Mr Rohani to win.

Their preferred man is Ebrahim Raeisi, the newly appointed head of one of Iran’s most important and best-endowed shrines, Imam Reza in Mashhad. In addition to income from the shrine’s holdings, which include car factories, he is a protégé of the Supreme Leader, Ayatollah Ali Khamenei.

But to Mr Raeisi’s probable consternation, on April 12th a divisive ultra-conservative former president, Mahmoud Ahmadinejad, also entered the race, despite orders from Mr Khamenei not to stand. This makes it more likely that the hardliners will again see their vote split.

Still, the anti-Iranian rhetoric of Donald Trump, America’s president, is a big bonus for the anti-reformists, should they come together.

After a nuclear deal between Iran and six major powers was concluded in 2015, Mr Rohani’s re-election had seemed assured. But the promised fruits from the lifting of UN sanctions (in return for Iran curbing its nuclear programme) have been slow to arrive. Far from encouraging investment in Iran, America has tightened some sanctions, and continues to prevent Iran from trading in dollars.

With the army, Revolutionary Guards, judiciary and state television in their hands, as well as the power to approve candidates (which the Guardians Council they dominate has yet to do for the coming election), Mr Khamenei’s hardliners already wield huge power. They are now targeting social media, where pro-Rohani reformists have until now mostly operated freely.

Last month masked goons arrested 12 administrators of popular social-media news channels.

But the hardliners’ task is proving daunting.

First in their sights is a phone app, Telegram, that enables encrypted messaging between users, and also offers uncensored news channels. It claims 20m Iranian users and thousands of Persian-language channels, some claiming over a million subscribers.

Last year it helped the reformists get out the vote in parliamentary elections. Confounding the hardliners’ efforts to disqualify well-known reformist candidates, voters went to the polls armed with “lists of hope” of the lesser-knowns on their phones, and unseated the staunchest conservatives, some of Mr Khamenei’s relatives among them.

No sooner had Mr Raeisi’s candidacy been announced than they began tarnishing his squeaky-clean image with claims that, as a 28-year-old prosecutor, he had sentenced hundreds of leftist political prisoners to death.

Under a more reactionary government, censors might have banned Telegram.

Mahmoud Ahmadinejad, the hardline former president, simply switched off the mobile network when protesters contested his 2009 re-election, and restricted internet bandwidth to such an extent that it took hours to access a page. Facebook and Twitter were banned.

But Mr Rohani’s government has made censorship harder. It has boosted bandwidth a hundredfold, compared with 2009. And it has expanded mobile coverage from 39% to 99% of Iran, including to 27,000 villages which the hardliners hitherto considered strongholds.

So Mr Rohani continues to get his message out. Recent signs of mild economic improvement may have given his continued support for Western engagement a boost, too. The hardliners will not have the campaign all their own way.

This article appeared in the Middle East and Africa section of the print edition under the headline “Taking aim at the president”
Note: Hezbollah in Lebanon is usually affected to some degree by these elections, even though it is directly linked to Khamenei

They are complementary with advantages: Optimists and pessimists

If I were in a position of power, I’ll surround myself with optimistic consultants, counsels and close assistants.

If I were in a position of power, I’ll appoint the executive and operators from the kinds of pessimists.

Many think that I got it wrong and not matching any logic or scientific research outcomes.

Power is assessed and evaluated by the number and quality of decisions.

Decisions considered almost impossible to undertake and eventually taken are highly ranked in your favor.

And these decisions require a climate of optimistic surrounding.

Pessimistic executives and operational personnel will achieve what has to be done and do the job most effectively: They are paid for a job well done. And they are better than optimists in considering the dangerous risks in health, safety and hasty execution in any project.

Pessimists may take longer to finish the job, but the job saves you many fold the delays from repairs, lousy maintenance tasks, accidents and near accidents.

The correct term is Effectiveness in the longer-term.

The Not so realist neural mechanism in the Hippocampi, amygdala, and anterior cortex Cingular are the center or source of optimistic activities. Otherwise, from our successive experiences, mankind tend to be at least slightly depressed as they observe the world as is.

Until we manage to communicate with various animal species, the conjecture is that pessimism is a typical mankind survival addition.

The magical thinking that reinforce our confidence allows us to adapt to contingencies contrary to our plans.

There are people with rooted pessimism tendencies. Prosper Merimee wrote in 1873:

Get rid of your optimism and start figuring out that we are in this world to fight one another

In general, people who survive calamities, particularly man-made catastrophic phenomena and genocide are mostly of the pessimist kinds. Once they decide on a line of actions, they don’t look back.

The active pessimist live side by side with the will-powered optimists.

Sane optimist needs the well-founded pessimistic arguments in order for his rational thinking to be useful and works for encouraging cooperation among individuals: The much needed guidance to getting out of the planetary obstacles.

What we need are the pessimists who circumvented their natural tendencies in order look optimistically into the future: What we can observe today that could guide us into a better future.

 

Environmental management practices in the Lebanese pharmaceutical industries

187(3):4290. doi: 10.1007/s10661-015-4290-3. Epub 2015 Feb 12.

Implementation strategies and challenges.

Author information

  • 1Department of Environmental Health, Faculty of Health Sciences, American University of Beirut, P.O. Box 11-0236, Riad el Solh, Beirut, 1107 2020, Lebanon, maymassoud@yahoo.com.

Abstract

This research attempts to provide an understanding of the Lebanese pharmaceutical industries’ environmental management strategies, priorities, and perceptions as well as drivers, barriers, and incentives regarding the implementation of the voluntary ISO 14001 Environmental Management System.

Accordingly, a semistructured in-depth interview was conducted with the pharmaceutical industries.

The findings revealed a significant lack of knowledge about the standard among the industries.

The main perceived drivers for adopting the ISO 14001 are improving the companies’ image and overcoming international trade.

The main perceived barriers for acquiring the standard are the lack of government support and the fact that ISO 14001 is not being legally required or enforced by the government.

Results revealed that adopting the ISO 14001 standard is not perceived as a priority for the Lebanese pharmaceutical industries. Although the cost of certification was not considered as a barrier for the implementation of ISO 14001, the majority of the pharmaceutical industries are neither interested nor willing to adopt the Standard if they are not exposed to any regulatory pressure or external demand.

They are more concerned with quality and safety issues with the most adopted international standard among the industries being the ISO 9001 quality management system.

This study highlights the aspect that financial barriers are not always the hurdles for implementing environmental management strategies in developing countries and underscores the need for regulatory frameworks and enforcement.

PMID:
25673269
[PubMed – in process]

How to double return on your investment? Have you considered Employment through Social Enterprise?

SAN FRANCISCO, Feb. 5, 2015 /PRNewswire-USNewswire/ —

Today REDF announced the findings of the Mathematica Jobs Study (MJS), showing social enterprise businesses provide a cost-effective way to both improve the lives of people who face barriers to work and generate savings for communities and taxpayers.

Beyond an average 268% monthly wage increase for those employed by these businesses, the report also revealed that the social enterprises generate a significant return on investment for society.

Commissioned by REDF, a grantee of the Social Innovation Fund, this first-of-its-kind study was conducted by Mathematica Policy Research, an internationally-known research and evaluation firm.

Jobs report from REDF and Mathematica Policy Research evaluates the impact of jobs for people facing barriers to employment

“Hundreds of thousands of people in this country want what we all want, the opportunity to work and contribute to their families and communities, but don’t currently have the chance,” said Carla Javits, REDF President & CEO.

“As a results-driven organization, we can now make the powerful case that social enterprises that put people to work not only generate the obvious benefits of greater hope and a paycheck, but also produce a clear win for taxpayers.”

REDF provides funding, business connections, and operational expertise to social enterprises, which are mission-driven businesses focused on hiring and assisting people who are willing and able to work, but have the hardest time getting a job, like people who’ve been in prison or homeless, young people who’ve dropped out of school, and those who live with mental health disabilities.

Some of the barriers to employment that people faced included:

  • 25 percent had never had a job;
  • 85 percent did not have stable housing in the year before starting the job; and
  • Only 23 percent of their monthly income came from work, with 71 percent coming from government benefits.

Social enterprises provide employees with real on-the-job skills development and comprehensive benefits including job placement services, counseling, and life-stability supports.

With the goal of helping employees secure long-term employment, these transitional jobs enable people to realize their full potential and establish a career path.

The Mathematica Jobs Study contains four integrated study components, finding that about one year after the social enterprise job began, workers were more likely to be employed, had greater economic self-sufficiency, and more stable housing.

Other successes include:

  • 67 percent of social enterprise employees were still working 6 months later.
  • These workers were more likely to be employed than those that were not hired: Social enterprise employment led to a 19 percentage point increase in employment one year later, compared to those that were not hired by the social enterprise and only received job readiness and search services.
  • Income from government benefits went down from 71 percent to 24 percent.
  • Housing stability tripled with employees living in a home or apartment throughout the year. (15 percent to 53 percent).
  • 90 percent received training to build soft, vocational or technical skills, and nearly 80 percent received material work support such as clothing, transportation or housing assistance, making this a comprehensive and holistic approach to employment preparedness.

In addition to the benefits for the individual, there is a significant return on investment for society:

  • For each dollar spent by social enterprise, taxpayers save $1.31. When you add in the social enterprise’s revenue, and worker’s income, the return on investment rises to $2.23. This means a $100,000 investment would have a return of $223,000 for society.

This report is based upon work supported by the Social Innovation Fund (SIF), a program of the Corporation for National and Community Service (CNCS).

The Social Innovation Fund combines public and private resources to grow the impact of innovative, community-based solutions that have compelling evidence of improving the lives of people in low-income communities throughout the United States.

As an awardee of the inaugural year of SIF grants in 2011, REDF is one of the first organizations funded by this initiative to deliver on that promise – new, compelling evidence of the power of an innovative approach to solve one of America’s most vexing problems.

“The Social Innovation Fund’s promise is simple, find solutions that work and make them work for more people,” said Lois Nembhard, Deputy Director of the Social Innovation Fund.

“With this promise, we are proud to support REDF’s Mathematica Jobs Study, which serves as a catalyst for other social enterprises and organizations in finding innovative, cost-effective ways to impact the lives of economically disadvantaged individuals.”

For more information on the Mathematica Jobs Study, click here: www.redf.org/finalmjsreportbrief.

About REDF

REDF creates jobs and employment opportunities for people facing the greatest barriers to work – like people who’ve been homeless or in prison, young people disconnected from work or school, and people with mental health disabilities.

Founded in 1997 by George R. Roberts (KKR), REDF provides funding and expertise to organizations in California to launch and grow social enterprises, which are mission-driven businesses focused on hiring and assisting people who face barriers to work.

As a result REDF has helped thousands of people in California get jobs and find hope.  Now REDF is taking best practices learned from nearly two decades of experience to grow their impact nationally and put hundreds of thousands of people to work. For more information, follow REDF on Twitter at @REDF_CA or visit http://redf.org/.

Photo – http://photos.prnewswire.com/prnh/20150204/173631-INFO
Logo – http://photos.prnewswire.com/prnh/20150204/173632LOGO

Most Important Bankruptcy In U.S. History?

Not Detroit, but General Motor?

Many people, including President Obama, have trumpeted their role in the success of the government-backed turnaround plan that saved General Motors, the most important industrial company in the history of the United States.

But on the fifth anniversary of the crisis, Forbes presents an exclusive, unprecedented look at what really happened during GM’s darkest days, how a tiny band of corporate outsiders and turnaround experts convened in Detroit and hatched a radical plan that ultimately set the foundation for the salvation of the company.

Dan Bigman, Forbes Staff, published on Nov. 18, 2012:

How General Motors Was Really Saved: The Untold True Story Of The Most Important Bankruptcy In U.S. History

Author Jay Alix, one of the most respected experts on corporate bankruptcy in America, was the architect of that plan, and now, for the first time, he reveals How General Motors Was Really Saved.

By Jay Alix

For months the news was horrific, a pounding beat of warm-up obituaries for what once had been America’s greatest and most influential corporation: General Motors.

At death’s door or already in the graveyard were Bear Stearns, Lehman Brothers, Merrill Lynch, AIG and Citibank. The mood was apocalyptic.

With car sales in a free fall from the worst economic downturn since the Great Depression, GM was losing billions and running out of cash. By the time the company closed its books on 2008, it would be in the red by a staggering $30.9 billion.

Chief executive Rick Wagoner led the auto delegation in Washington to seek government funding in order o save the industry and keep GM out of bankruptcy.

Five years later, after an unprecedented government equity investment, GM is thriving and the Treasury plans to sell its remaining stake in the coming months. With countless articles and books now written about the GM restructuring and turnaround–not to mention three years of trumpeting by the Obama Administration taking full credit for the turnaround’s success–the most startling aspect of the prevailing narrative is that the core of how the restructuring really happened, inside GM, is yet to be fully told.

In the popular version of the company’s turnaround story, as GM teetered toward liquidation in 2009, an Obama-appointed SWAT team, led by financier Steven Rattner, swept in and hatched a radical plan: Through a novel use of the bankruptcy code they would save the company by segregating and spinning out its valuable assets, while Washington furnished billions in taxpayer funds to make sure the company was viable.

The real GM turnaround story, significant in saving the auto industry and the economy, is contrary to the one that has been published. In fact, the plan that was developed, implemented and then funded by the government was devised inside GM well before President Obama took office.

In what follows, the inside story of this historic chapter in American business unfolds, laying bare the key facts.

GM’s extraordinary turnaround began long before Wagoner went to Washington in search of a massive loan to keep GM alive. My involvement in that story began in GM’s darkest days, five years ago on Sunday, Nov. 23, 2008, when I visited Wagoner at his home that morning, presenting a novel plan to save General Motors.

As a consultant with expertise in restructurings and turnarounds, I had completed a half-dozen assignments at GM over the years. I had worked with Wagoner in 1992 when he became chief financial officer. I was asked to come in for a two-year stint as CEO of GM’s National Car Rental, the first time GM had recruited an outsider to lead a turnaround in one of its subsidiaries.

By 2008 I had over 20 years of experience with the auto industry and almost 30 years of working on turnarounds.

But for the past eight years I had backed away from business and my firm, AlixPartners, to care for my daughters after the death of my wife. I was essentially “retired.” But GM’s enveloping crisis and my friendship with Wagoner would bring me out.

Early on that November Sunday I called Wagoner at his home in a Detroit suburb. I asked to see him right away, explaining that I had a new idea that could help save the company.

Three hours later I walked through his front door and into his family room. I knew Wagoner believed GM could not survive a bankruptcy. Studies showed consumer confidence would crash. No one would buy a car from a company that was bankrupt. However, what I knew about the economic crisis and GM’s rapidly deteriorating liquidity position told me the company had no choice but to prepare for a bankruptcy.

Yet I agreed with Wagoner. For a global company as big and complex as GM, a “normal” bankruptcy would tie up the company’s affairs for years, driving away customers, resulting in a tumultuous liquidation. It had happened to other companies a fraction of GM’s size. It would mean the end of GM.

“I don’t think the company will survive a bankruptcy,” he told me. “And no one has shown me a plan that would allow it to survive a bankruptcy.”

War room: Wagoner and Alix saved GM with one of corporate America’s greatest Hail Marys, but neither stayed with the company.

“Filing bankruptcy may be inevitable, Rick. But it doesn’t have to be a company-killing bankruptcy,” I said. “I think we can create a unique strategy that allows GM to survive bankruptcy.”

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Love of learning is the new employability

Train graduates with the right “attitudes and attributes” to keep learning for life,

Ensuring that skills are used at work will soon be a focus of future education debate, Pearson report argues

Female student reading and studying in library

Making sure graduates use their skills in the workplace could become as important to education policymakers as the quality of university learning in the first place, according to a report that warns that skills “atrophy” if left dormant.

The Learning Curve: Education and Skills for Life, published by the education firm Pearson on 8 May, uses the example of South Korea, which shows a particularly sharp drop in problem-solving skills for adults once they pass the age of 24.

Part of the explanation is that a higher than average proportion of the country’s graduates do not go on to employment or further training, “a situation in which their hard-won skills are more likely to atrophy”, it suggests.

It cites Eric Hanushek, an educational economist based at Stanford University, as saying that whether or not skills are put to use in employment – and so kept sharp – will be as big a part of the future education debate as formal education itself.

Sir Michael Barber, Pearson’s chief education adviser, told Times Higher Education that in the 21st century “it’s clear that however great your first degree is, you’re going to have to keep learning”.

Because there is so little certainty about what the jobs of the future will involve, universities must train graduates with the right “attitudes and attributes” to keep learning for life, he said, noting that this was something the “best” higher education already did.

Universities should focus on this when trying to improve employability, he added, rather than on “preparation for a specific job”.

Although some universities and institutional leaders are “thinking radically” about this, he said, “individual academics” found it “harder” to accept this idea.

Sir Michael added: “If graduates leave with a love of learning, that’s good for employability.

The report also warns that widening access to education through technology – massive open online courses, for example – “appears to be not enough” to retrain under-skilled adults because those likely to take Moocs are already highly educated.

This is because people who have already learned a lot will have the confidence to “That goes into reverse for people who struggle at school.” Sir Michael

david.matthews@tsleducation.com

Times Higher Education free 30-day trial


adonis49

adonis49

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