I move: "That the Bill be now read a Second Time."
As Deputies will be aware, the purpose of the Bill is to give legislative effect to the changes announced on budget day. The Estimates for the Department of Social Protection in 2021 is €25.1 billion. This is more than €4 billion larger than the Department's budget day allocation for 2020. Much of that additional spending will be required to meet the ongoing costs of the PUP and other jobseeker payments and supports. I am pleased, even in these difficult times, to have also been able to secure almost €300 million for a series of targeted measures to support some of the most vulnerable groups in our society. In addition, the Bill provides for maintaining the State pension age at 66, as committed in the programme for Government. This measure will cost more tha €220 million in 2021 and in excess of €450 million in a full year.
It is important to point out that some of the social protection measures announced on budget day do not require primary legislation and, therefore, are not reflected in this Bill.
These measures include the Christmas bonus, which I am pleased to say is being paid this week to a record 1.6 million recipients, with payments totalling €390 million. I take this opportunity to encourage people again to spend their Christmas bonus locally this year and support small businesses as they reopen their doors.
There are other budget day measures that are not included in the Bill. One of these is the increase of €20 in the earnings disregard for disability allowance, taking it from €120 to €140. This will, like the Christmas bonus, be done by regulation. In addition, as a non-statutory scheme, the increase of €3.50 per week in the fuel allowance payment does not require amending legislation, nor does the extension of the hot school meals programme.
I will now go through the sections of the Bill. Section 1 provides for the definitions used in the Bill. Moving to section 2, employer PRSI is currently charged at a rate of 8.8% on employees' weekly earnings between €38 and €395. Section 2 increases the reckonable earnings threshold for employees by €3 to €398, whereby employer PRSI contributions can continue to be paid at the lower rate of 8.8%. This provision is designed to take account of the increase in the minimum wage from €10.10 to €10.20 per hour from 1 January 2021. Employers with employees benefiting from the increase in the minimum wage will continue to attract the lower rate of employer PRSI. It is intended that this section will come into operation on 1 January 2020.
Section 3 provides that for the purpose of the Covid-19 employment wage subsidy scheme, EWSS, the Revenue Commissioners and the Minister for Social Protection may share information relevant to the effective operation of the scheme. A similar provision was included in legislation establishing its predecessor, the temporary wage subsidy scheme, TWSS. The employer PRSI contribution for the TWSS was 0.5%. Section 4 provides that an identical employer contribution will be made for the EWSS.
Illness benefit is, at present, paid after an initial waiting period of six days. Section 5 reduces the number of waiting days from six to three. This will ease the financial strain on employees, especially those who do not have occupational sick pay arrangements as part of their contract of employment. As Deputies will be aware, the Department of Enterprise, Trade and Employment is currently conducting a public consultation on the introduction of a statutory right to paid sick leave for all employees. I encourage all interested parties to engage with this consultation and make their views known on the matter.
Section 6 provides that self-employed pandemic unemployment payment, PUP, recipients can engage in limited self-employment and earn up to €480 over a rolling four-week period and continue to maintain entitlement to PUP. Section 7 provides for a regulation-making power to allow the Minister to prescribe, by statutory instrument, the income and expenses that can be included to reach the €480 limit. These are important provisions that allow self-employed people to carry out some work and still retain the PUP. The measure, which took effect from budget day, has been warmly welcomed by taxi drivers, musicians, electricians, plumbers and other self-employed workers throughout the country. There is no application process, it being done instead by self-declaration. A self-employed person simply needs to inform my Department if he or she earns more than €480 over a four-week period.
I am aware that an amendment has been tabled on Committee Stage to change the limit to €960 over an eight-week period. I am happy to accept the amendment. Having spoken to musicians and members of the entertainment industry directly, they have explained that this would make life easier for them when it comes to one-off gigs. Whether it is €480 over four weeks or €960 over eight weeks, the point is that we do not want people turning down work for fear that it might impact their PUP. I am happy to make that change. I acknowledge the constructive engagement on the issue by Jackie Conboy and the Music and Entertainment Association of Ireland. We all hope that with the vaccine coming on stream we will get back to some level of normality in 2021. We want to see our musicians and artists back performing as much as possible. In the meantime, this provision will provide them with greater flexibility to take up occasional gigs while knowing that the safety net of the PUP is still there for them. That is important because musicians may have a gig one week and nothing for the next four weeks. I hope the limit of €960 will help them in that respect.
Injury benefit is a payment made to employee contributors who are unable to work due to an injury or occupational disease sustained in the course of their employment and who satisfy certain PRSI contribution conditions. Section 8 reduces the waiting period for this payment from six to three days. As with illness benefit, the reduction in waiting days is intended to take effect in March 2021.
Section 9 provides for an increase in the widowed or surviving civil partner grant by €2,000, from €6,000 to €8,000. This is the first time the grant has been increased since 2008. Where people find themselves in the tragic situation that a loved one has passed away and they are looking after dependent children, this increased payment is intended to provide a small bit of extra help. The measure will take effect from 1 January.
Section 10 removes the earnings limit on the one-parent family payment. Currently, when a lone parent's earnings exceed €425 per week, he or she loses entitlement to the payment. The intention behind this provision is to tackle in-work poverty and remove a potential poverty trap by allowing single parents who are in employment to earn over the current earnings limit and retain the one-parent family payment. This section will come into operation on 8 April 2021.
Section 11 provides for an increase of €150 in the carer's support grant, raising the payment to €1,850, the highest level at which it has ever been set. The carer's support grant is an annual payment for carers who look after people in need of full-time care and attention. The grant is paid annually in a single lump sum, usually on the first Thursday in June. The grant is not means tested and is not taxable. This increase goes some way towards acknowledging the role family carers play in our society.
The working family payment, formerly known as family income supplement, is a weekly tax-free supplement available to employees with children. It gives extra financial support to people on low pay. Section 12 provides for a €10 increase in the weekly income threshold for the working family payment for families with up to three children. This allows parents to earn more and still retain the payment. This section will come into operation on 7 January 2021.
Section 13 amends section 248 of the Social Welfare Consolidation Act 2005 to provide that the Covid-19 pandemic unemployment payment may continue for a period of six weeks after death in certain circumstances. This will bring the PUP in line with other social protection payments for the unemployed, including jobseeker's allowance and jobseeker's benefit.
Sections 14 and 16 provide for increases in the qualified child payment. The weekly rate for a qualified child will increase for children under 12 by €2, from €36 to €38. It will increase for children aged 12 and over by €5, from €40 to €45.
This will result in increases to the qualifying child payment in respect of 419,000 children. Sections 14 and 16 also provide for an increase of €5 in the living alone allowance, which will benefit over 221,700 pensioners and people with disabilities.
Section 15 provides for an increase in the weekly payment of the island allowance by €7.30, bringing the rate to €20 per week. For people living on an offshore island, it is an increase to the weekly value of certain social welfare payments. The intention of this is to compensate for the additional costs of living on these islands when compared to people resident on the mainland. As Minister with responsibility for the islands, I am pleased to have been able to provide for this measure which is the first time the island allowance has been increased since it was introduced over two decades ago.
Section 17 repeals the increase in the State pension age. The programme for Government commits that the planned increase in the State pension age next year will be deferred and it will remain at 66, pending the report of the Commission on Pensions. The commission has been established and will report by June 2021. In the meantime, the Bill provides that the State pension age will remain at 66 years and not increase to 67 years on 1 January 2021 or 68 in 2028. This will also allow the Commission on Pensions to consider State pensions policy issues fully and make recommendations for the future, unfettered.
Section 18 provides for the Short Title, its construction and collective citation with the Social Welfare Acts.
In the context of a budget which had to be constrained due to dealing with the public health crisis caused by Covid-19, as well as the potential consequences of Brexit, we have focused on the vulnerable in society who are at most risk. Given the environment we are in and the significant economic challenges we are facing, it was simply not possible to do everything we wanted in budget 2021. We have, instead, sought to target resources to support our most vulnerable, namely, those who live alone, our carers, people with disabilities and low-income families.
I commend the Bill to the House and I look forward to hearing contributions of Deputies.