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Social Welfare Benefits

Dáil Éireann Debate, Wednesday - 18 April 2012

Wednesday, 18 April 2012

Questions (597, 598, 599)

Billy Timmins

Question:

608 Deputy Billy Timmins asked the Minister for Social Protection the position regarding a scheme to assist persons who were self employed and who now find that they do not qualify for jobseeker’s benefit; what has been put in place to assess these persons to qualify for benefit; and if she will make a statement on the matter. [18821/12]

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Mattie McGrath

Question:

681 Deputy Mattie McGrath asked the Minister for Social Protection the supports available to a person (details supplied) in County Tipperary who has had to close their business of seven years due to the economic downturn; and if she will make a statement on the matter. [19352/12]

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Terence Flanagan

Question:

683 Deputy Terence Flanagan asked the Minister for Social Protection the position regarding sickness benefit for those who are self employed (details supplied); and if she will make a statement on the matter. [19366/12]

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Written answers

I propose to take Questions Nos. 608, 681 and 683, inclusive together.

The core issue relating to this question is the position of the self-employed.

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 jobseeker's benefit or social insurance illness benefits, 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 workers may establish eligibility to assistance-based payments such as jobseeker's allowance and disability allowance. In the case of jobseeker's allowance they can apply for the means-tested jobseeker's allowance if their business ceases or if they are on low income as a result of a downturn in demand for their services. In general, their means will take account of the level of earnings in the last twelve months in determining their expected income for the following year and, in the current climate, account is taken of the downward trend in the economy. As in the case of a non-self-employed claimant for jobseeker's allowance or disability allowance, the means of husband/wife, civil partner or co-habitant will be taken into account in deciding on entitlement to a payment.

Question No. 609 withdrawn.
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