Government considers linking jobseeker's payments to income

Picture: JSE/MRA/cla

The Government is looking at linking the jobseeker's payment to income and has hinted at increasing welfare rates for widows, carers, and people on disability benefit.

Announcing a raft of new measures, including the phasing out of the pandemic unemployment payment with a view to removing it by February, social protection minister Heather Humphreys said her officials are already looking at increasing rates for other benefits.

"I think one of the things that we have learned from the pandemic is people suddenly lose their jobs, they don't want to see that cliff edge income drop, because they have entered commitments, commensurate with their income," she said.

"We do need to avoid that drop, and I think that's where we can look at and I've asked my officials to look at pay-related benefit. I think that we need to do that. And as I said, my officials are looking at that specifically."

These supports are kept under review in terms of a changing situation regarding the pandemic, but I'm very hopeful.

People currently on the lowest rate of PUP of €203 a week will be transitioned onto jobseeker's benefit from September 7 under the new plans, with the other two rates cut by €50.

Minister of Public Expenditure Michael McGrath said the government is "conscious that it is over two years since there has been any change in core social welfare rates."

"There are many thousands of widows, carers, people on disability allowance, invalidity pension and on a much lower level of weekly social welfare, than the top rate of PUP and that is the reality of life people on all those payments are living with. 

"I'm sure Minister Humphreys will be keen to have some level of a social welfare package in the budget in the Autumn and that's something we'll be discussing," he said.

The package of supports announced on Tuesday will cost almost €4bn, additional to the total current government spend of €88bn.

The Employment Wage Subsidy Scheme (EWSS) will be extended until December 31 and a new Business Resumption Support Scheme (BRSS) for businesses with reduced turnover as a result of public health restrictions, is to be implemented in September 2021.

The tax debt warehousing scheme, in which liabilities arising can be deferred will be extended to the end of 2021 for all eligible taxpayers, with an interest-free period during 2022.

"We will be going beyond the expenditure provision made in the budgets last October," Mr McGrath said.

"At this point in time we have, essentially, fully accounted for the Covid Contingency Fund, and the recovery fund that we provided for on Budget Day, and so we will be going beyond that."

On Budget Day last year, the forecast was a general government deficit of €20.5bn, coming in at around 5.7%.

"So now we are adding to that by virtue of the measures that we're announcing.

"But it is firmly with a view to creating jobs and retaining existing jobs in the Irish economy, and so we think it is helpful towards that overall objective," Mr McGrath said. 

Finance Minister Paschal Donohoe says Ireland must not only rebound but recover.

"I believe a very strong rebound in our economy is possible in the second half of this year.

"There is a difference between a recovery that is sustained that leads to a fall in unemployment later on this year and throughout all of 2022, so, a rebound, is the first vital step in recovery, but it isn't equal to all of the recovery," he said.