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- System designed to cushion workers from sudden ‘cliff edge’ income shock
Minister for Social Protection, Heather Humphreys TD, has today launched a stakeholder consultation forum on proposals for a new Pay-Related Jobseeker’s Benefit scheme in Ireland.
Pay-Related Benefit is common in European countries and links a person’s jobseeker’s payment to their previous earnings and work history.
It is designed to soften the income shock that a worker may face if they suddenly lose their job.
The draft proposals for the introduction of Pay-Related Benefit for Jobseekers in Ireland are contained in a ‘Strawman’ published in December by Minister Humphreys.
Today’s event at the Chartered Accountants House in Dublin was organised to provide information and receive feedback on these proposals from stakeholders across society.
Speaking today, Minister Humphreys said:
Pay-Related Benefit is a system that is in place in countries across the European Union.
It is all about removing that so-called ‘cliff-edge’ and softening the sudden income shock workers can face upon losing their jobs.
Last year, I secured Government agreement to publish a strawman proposal which sets out one potential design for how Pay-Related Benefit could work.
Today’s forum represented an important opportunity to get the views of stakeholders from across society about this particular proposal.
The introduction of a pay-related benefit system would bring Ireland in line with our European neighbours.
It would also ensure that the employment benefit people receive is commensurate with their financial commitments as much as possible.
We saw during the Pandemic that a pay-related benefit system can work.
But it’s important to get the design of any such proposal right. That’s why this stakeholder forum was a valuable opportunity to gain a broad range of views.
On 7th December 2022, Minister Humphreys launched the public consultation process by publishing a Strawman document which sets out the broad parameters of one potential approach in designing a Pay Related Benefit scheme.
The final design will be considered following the consultation process.
While the Strawman primarily focuses on jobseekers supports, feedback received as part of the public consultation will also help to inform the consideration of potential changes to other short-term income supports for workers who have to temporarily cease work such as Maternity Benefit, Parental Leave Benefit and Illness Benefit.
Submissions are invited from all interested stakeholders, including workers, jobseekers, representative organisations, and employers, and should be forwarded by email to: [email protected] by 28 February 2023.
Notes
The Pay-Related Jobseekers Strawman document can be accessed at www.gov.ie/PRBConsultation.
It is not a final design, and its purpose is to frame a constructive discussion and seek feedback through a national public consultation process with stakeholders. The design of any proposal that may be brought to Government may differ significantly from that set out in the Strawman consultation paper.
The Strawman invites stakeholders to provide feedback on PRSI increases to cover any additional costs associated with a Pay Related Benefit for Jobseekers.
The key features of the proposal set out in the Strawman include:
The Benefit would be paid to employees who:
- are under State pension age (66) who are fully unemployed
- have a demonstrated strong, recent attachment to the labour force, and
- are available for and genuinely seeking paid employment
The Rate of Benefit would be set as follows:
- for people who have at least five years paid Pay Related Social Insurance (PRSI) contributions (of which six months must have been in the 12 months prior to their claim), the rate would be set at 60% of the person’s prior gross income subject to a cap of €450 per week
- for people who have less than five years prior PRSI contributions but at least two years (of which six months must have been in the 12 months prior to their claim), the rate would be set at 50% of the person’s prior gross income subject to a cap of €300 per week
- a minimum rate of €100 would apply
- payment would be payable for up to a maximum six months
People working part-time or on a casual basis would continue to be eligible for the Jobseeker’s Benefit scheme. Over time the existing Jobseeker’s Benefit scheme may be adapted and/or a new income tested Working Age Payment model may be introduced whereby payments could be linked each week to a person’s employment earnings (similar to the existing Working Family Payment).
Self-employed people would continue to be catered for under the current Jobseeker’s Benefit (Self-Employed) Scheme.