Social assistance payments are means tested. The means assessment reflects the fact that there is an expectation that people with reasonable amounts of income or capital are in a position to use these resources to support themselves so that social welfare expenditure can be directed towards those who need it.
However, in recognition of the benefits that work can bring – both financially and socially – most schemes have an earnings disregard. This means that a recipient of a social assistance payment can have a certain amount of earnings and still retain a proportion of their social welfare payment. The amount of earnings disregarded, and how this income is assessed, depends on the scheme. As a person’s earnings increase above a certain point, their social welfare payment will decrease, meaning that in the vast majority of social welfare means tested schemes cliff-edges are avoided.
There have been a number of significant changes made in this area in recent years, including:
• Increasing Working Family Payment income thresholds for all families by a combined €94 per week across Budgets 2023 and 2024. This ensures that families will not lose this in-work payment as the National Minimum Wage increases, and allows more families to qualify for this tax-free payment;
• Providing for higher earnings disregards for Disability Allowance, Blind Pension and One-Parent Family;
• Removal of the weekly earnings limit of €425 for One-Parent Family Payment, ensuring that recipients of the scheme do not face a cliff-edge when their earnings reach €425 per week;
• Expanding the list of agri-environmental schemes that qualify for a disregard, which was increased in recent Budgets;
• In 2022, I significantly increased the income and capital disregards for Carer's Allowance. This enables more carers with modest incomes to become eligible for the scheme and allows carers and their families to earn more from employment while retaining their payment. As part of Budget 2024 I further increased the disregard to €450 for a single person, and €900 for couples from June of this year.
In addition to the Working Family Payment, there is also a range of supports available to people who move into employment/self-employment:
• Back to Work Family Dividend is a weekly payment to help people with qualified children who stop claiming jobseeker’s or one-parent payments to move into employment or self-employment. In the first year, the weekly payment is the equivalent of any Increase for Qualified Children that was being paid on their previous payment (up to a maximum of 4 children). Half that amount will be paid weekly for the second year.
• The Back to Work Enterprise Allowance scheme which encourages people getting certain social welfare payments to become self-employed. Where a person takes part in the scheme, they can keep a percentage of their social welfare payment for up to two years.
• The Part-Time Job Incentive Scheme which allows certain people receiving Jobseeker’s Allowance to take up part-time work and get a special weekly allowance instead of their jobseeker’s payment. It is intended to be a stepping stone to full-time work.
• The Short-Term Enterprise Allowance gives support to people who have lost their job and want to start their own business. To qualify, a person must be getting Jobseeker’s Benefit or Jobseeker’s Benefit Self-Employed. It can be paid for a maximum of 9 months.
Other related areas which the Department are currently working on include the introduction of a Pay-Related Benefit, which will more closely align earnings and unemployment benefits and mitigate the impact of any income shocks. In line with the commitment in Pathways to Work, the national employment strategy, work is continuing in relation to the development of the possible features of a Working Age Payment, which will include examining the structure of the jobseeker's allowance scheme.
