The pandemic has caused untold damage to people's lives and livelihoods. We recognise that and the budget is an attempt to respond. Too many businesses have been severely impacted by the restrictions needed to ensure public health safety during the pandemic. The agenda has to be to protect public health while also trying to ensure we can keep our economy alive and open, keeping people in jobs and businesses open as long as possible. Our response to Covid-19 will continue to assist those businesses affected. The budget builds on announcements made in May and in the July stimulus plan.
Budget 2021 provides a significant additional package of tax and fiscal measures to build the resilience of the economy and help vulnerable but viable businesses in all sectors. It has been well recognised by the business community that this is what the budget is trying to achieve, that is, to protect and support businesses to keep their doors open, to keep their employees on the books and, at the first available opportunity, to be able to grow that number of employees and regrow their businesses. The budget comes in addition to the July stimulus plan, a substantial financial package to stimulate our economy worth more than €5 billion, including €2 billion in loan guarantees for the new credit guarantee scheme, the benefits of which will be seen in the months ahead.
Budget 2021 is unprecedented in scale at almost €18 billion. Its purpose is to protect the lives and livelihoods of everyone in the State, irrespective of age. In 2021, workers will see no increases to income tax, the universal social charge, USC, or PRSI; a modest increase in the minimum wage, as recommended by the Low Pay Commission; and a reduction from six to three in waiting days for illness benefit, to be paid on day four, which will be of assistance not only to employees but also to businesses because we all recognise that many SMEs have been trying to work with their employees and carry some of the costs of absenteeism and so on. It will certainly help them and lead to discussion on introducing statutory sick pay, which the Tánaiste mentioned earlier and flagged in recent days. Further measures include an extension of parental leave benefit by a further three weeks to five weeks, building on the work of the previous Government; an increase in the earned income tax credit for the self-employed; and self-employed workers in receipt of the pandemic unemployment payment, PUP, will now be able earn up to €480 per month. A strong case was made that some SMEs have begun to get back on their feet and get some work, but they also need the support of the PUP to keep them going.
There is also a new Covid restrictions support scheme, which has already been beneficial and will continue to be. The employment wage subsidy scheme will be extended, as will the commercial rates holiday, and there is more that I can outline in my follow-up response.