The Government is open to a legal challenge on the basis of the unfairness of its Covid-19 welfare payments and will likely have to raise the standard weekly unemployment payment when it starts reducing the pandemic payments in the coming months, a leading adviser to the Irish Congress of Trade Unions, or Ictu, has said.
The number of people who have lost their jobs or forced to tap some type of Covid-19 payment has raced to 1.24 million and the Government has talked about “tapering”, which means reducing, the payments and to cut the €1.5bn minimum monthly cost of the two main payments, as parts of the economy start up again in the coming months.
However, Tom McDonnell, who is co-director of the Nevin Economic Research Institute, the think trade union tank that sits in many meetings involving Government meeting said it was understood in official circles that the eventual tapering of the weekly pandemic payment of €350 will go hand in glove with the increase in the benchmark weekly €203 payment for people on the official unemployment count.
The difference in the payments for people who had lost their jobs before March 1 and getting €203 a week, and for those on the €350 weekly payment after March 1, was so stark that there was an understanding the payments would have to come together over several months, Mr McDonnell said. Unfairness and the issue of a legal challenge would become more likely, Mr McDonnell said.
The scale of the crisis was again illustrated in new figures showing that 1.24 million people -- an unprecedented 65% of the private sector workforce -- were either on the live register unemployment count, or were availing of the pandemic payment or a wage-support scheme in April. The official count shows 28% of the labour force are jobless.
Finance Minister Paschal Donohoe yesterday reiterated the pandemic payment will be tapered over time. He told a webinar Q&A session by Feargal O’Rourke, head of PwC Ireland, the Government will publish at a road map of changes to the pandemic payment and wage-support schemes in the coming weeks. The State can afford the schemes “over a period of time”, he said.
On the costs, the Department of Finance said the two main schemes cost €1.5bn in April, with the wage-subsidy scheme costing €600m and the pandemic payment costing €900m in the month.