Dáil Éireann Debate, Thursday - 1 July 2021
302. Deputy Róisín Shortall asked the Minister for Social Protection the estimated cost in 2022 and in a full year of restoring the subsidy under the wage subsidy scheme for persons with disabilities to 55%, 60% and 65% of the national minimum wage. [35686/21]
Amharc ar fhreagraThe Wage Subsidy Scheme is an employment support to private sector employers, the objective of which is to encourage employers to employ people with disabilities and thereby increase the numbers of people with disabilities participating in the open labour market. The scheme provides financial incentives to private sector employers to hire people with a disability for between 21 and 39 subsidised hours per week under a contract of employment. The basic rate of subsidy is €5.30 per hour giving a total annual subsidy available of €10,748 per annum based on a 39 hour week. The subsidy rate is not linked to the statutory minimum wage - it is a contribution paid to the employer, subject to certain conditions, against the cost incurred where a productivity shortfall arises from a disability.
The financial supports for employers are structured under three separate strands and companies could benefit under one strand or under two or three strands simultaneously depending on the number of people with a disability employed, as below:
Strand I is a general subsidy for any perceived productivity shortfall in excess of 20% for a person with a disability, in comparison to a colleague without a disability. The subsidy is based on the number of hours worked.
Strand II subsidy is payable when an employer employs three or more people with disabilities who are supported by a Wage Subsidy Scheme Strand I payment. Strand II is intended to cover the additional supervisory, management and other work-based costs relating to such employees. This top-up payment is a percentage of the Strand I subsidy and is based on the overall number of employees with a disability employed under Strand I. It ranges from an additional 10% of wage subsidy for 3 to 6 employees with a disability to a maximum of 50% of wage subsidy for 23+ employees with a disability. Therefore, when an employer has 23 or more Wage Subsidy Scheme employees a 50% top-up is applied to the hourly rate increasing the payment rate to €7.95 per hour for each employee.
|
Nos. |
% |
|
3 to 6 employees with a disability |
10% top-up of wage subsidy paid |
|
7 to 11 employees with a disability |
20% top-up of wage subsidy paid |
|
12 to 16 employees with a disability |
30% top-up of wage subsidy paid |
|
17 to 22 employees with a disability |
40% top-up of wage subsidy paid |
|
23 + employees with a disability |
50% top-up of wage subsidy paid |
Strand III subsidy enables employers who employ 25 or more workers with a disability on the Wage Subsidy Scheme to be eligible for a grant of up to €30,000 per year towards the expense of employing an Employment Assistance Officer to support these employees.
The total cost in a full year to set the rate of the Wage Subsidy at 55%, 60% and 65% of the national minimum wage are set out in tabular form below.
The figures below are based on the following:
- The current number of 1,602 private sector employers availing of the subsidy in respect of some 2,539 participant employees. The Wage Subsidy Scheme is a demand-led scheme so the figures below take no account of behavioural impact e.g. where a new employer might apply for the subsidy on account of an increased rate of subsidy.
- The subsidy is available from between 21 and 39 hours per week and therefore employees hours vary. The costs provided are based on employees' current average hours across the subsidised range of 21-39.
- The costs include Strand II and Strand III associated increases.
|
% of National Minimum Wage (NMW) |
Rate in € |
Full Year Cost |
|
55 % of NMW |
€5.61 |
€24,476,423 |
|
60% of NMW |
€6.12 |
€26,671,552 |
|
65% of NMW |
€6.63 |
€28,866,682 |
I trust the above clarifies the matter for the Deputy.
