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Dáil Éireann debate -
Tuesday, 21 Nov 1995

Vol. 458 No. 5

Written Answers. - Unemployment Assistance.

Willie O'Dea

Question:

162 Mr. O'Dea asked the Minister for Social Welfare his views on a decision by his Department's office in Limerick on the amount of unemployment assistance payable to a person (details supplied) in County Limerick which will result in the family being approximately £10 per week worse off as a result of this person's wife taking up self-employment; whether the relevant regulation is a disincentive to people to take up employment; whether the regulation governing the means test in cases like this discriminates against people who become self-employed as opposed to people who become employees of another; and if he will make a statement on the matter. [17151/95]

The person concerned was entitled to unemployment benefit but opted not to avail of it in accordance with the legislative provisions which provide that assistance may be claimed where this is more beneficial.

Accordingly, he was paid unemployment assistance, including an increase for an adult and one child dependant, with no means assessed against him from 19 September 1994.

The claimant's wife became self-employed and as she was earning over £60 per week he was no longer entitled to the adult dependant allowance and was entitled to only half the child dependant allowance.

The legislation provides for the assessment of any benefit or privilege, including any benefit derived from income earned by a spouse from employment or self-employment. The person concerned was accordingly assessed with the benefit of his wife's income from self-employment.

Where the spouse of a person in receipt of unemployment assistance takes up insurable employment as an employee, the first £45 of weekly income is disregarded in recognition of the costs associated with going out to work. Where the spouse is employed three days or less each week, the disregard is £30.

In self-employment cases no specific disregard is allowed but full account is taken of all work-related expenses incurred by the spouse in operating the business. Such expenses would include all costs such as those relating to the hire or maintenance of premises, power and light, hire of staff, transport, materials, special clothing etc. The balance is assessed as means which in this case were assessed at £72 a week.

Where an increase is not payable in respect of a person who is one of a couple, the legislation provides for the halving of means assessed. Accordingly, the means were halved from £72 to £36 per week. This left the person concerned entitled to £33.10 per week, being the maximum rate appropriate to an individual plus half a child dependant allowance £69.10 less £36 means. This change was implemented on 8 November 1995. The person concerned has appealed against this decision.
A person who opts to claim unemployment assistance instead of unemployment benefit may revert to claiming unemployment benefit if this is more beneficial. The person concerned has exercised this option and will be paid unemployment benefit at the weekly rate of £69.10, being the personal rate of £62.50 plus half rate increase for one child. If the person concerned remains unemployed his entitlement to unemployment benefit will expire six weeks from 8 November.
While there is an overall reduction in assessed net family income in this case, nevertheless it primarily arises because of the present assessment of the wife's means arising from self-employment, an assessment which can vary from time to time. If this latter income increases, only one half of it will be reckonable as means, thus maintaining a worthwhile incentive.
I am anxious to ensure that the rules and regulations do not cause difficulties for a claimant or his-her spouse getting back into employment, and I will be looking at this aspect again in the light of the circumstances of this and similar cases.
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