Self-employed persons are liable for PRSI at the Class S rate of 4%, which entitles them to access long-term benefits such as State pension (contributory) and widow's, widower's or surviving civil partner's pension (contributory). Ordinary employees who have access to the full range of social insurance benefits pay Class A PRSI at the rate of 4%. In addition, their employers make a PRSI contribution of 10.75% in respect of their employees, resulting in the payment of a combined 14.75% rate per employee under full-rate PRSI Class A. (For employees earning less than €356 per week, the rate of employer's PRSI is 4.25%).
Any changes to the PRSI system to extend the full range of social insurance benefits, including illness benefit, to self-employed persons would have significant financial implications and would have to be considered in the context of a much more significant rise in the rate of contribution payable. I established the Advisory Group on Tax and Social Welfare last year to meet the commitment made in the Programme for Government. The Advisory Group will, inter alia, examine and report on issues involved in providing social insurance cover for self-employed persons in order to establish whether or not such cover is technically feasible and financially sustainable. In addition, the Actuarial Review of the Social Insurance Fund, which is due to be completed in mid-2012, will examine this matter.
Self-employed individuals may establish entitlement to assistance-based payments such as Disability Allowance. Disability Allowance is a weekly payment made to persons with a disability whose employment capacity is substantially restricted by reason of their disability and whose means are insufficient to meet their own needs and those of their dependents. As well as providing income support for people with disabilities, incentives towards employment and training are also a key feature of Disability Allowance. An income disregard for earnings from rehabilitative employment provides that all earnings up to €120 per week are disregarded as means when assessing entitlement, while income between €120 and €350 is assessed on the basis of 50 cents for every euro earned.