LINKING JOBSEEKER’S PAYMENTS to a person’s previous PRSI contributions will “soften the cliff edge” if someone loses their job, according to Social Protection Minister Heather Humphreys.
Speaking to reporters in Dublin this morning, where she hosted a stakeholder consultation on the plans for the new pay-related Jobseeker’s Benefit scheme, the minister said the aim is to “cushion” the income drop people experience when they become unemployed.
The plan, which has been well flagged in the last two years, will see unemployed people who have been working for the previous five years or more get a benefit of 60% of their salary to a maximum payment per week of €450.
Those working between two and five years, will get a benefit of 50% of their salary, up to a maximum of €300.
The pay-related payments are payable for a maximum of six months.
Humphreys said the public consultation of the scheme finishes at the end of February.
Following this, the minister said she will sit down and work on the plan with officials.
“It’s my plan to bring proposals to Government on how we can bring forward a pay-related benefit that will help people when they lose their job.
“I have to do some work on it yet. Hopefully by the end of the year I will bring proposals to Government.
“We’re an outlier in the EU in terms of the fact that we’re the only country that doesn’t have pay-related benefit. We’re looking at practices across Europe as well and we learn from those. Then we formulate a policy,” she said.
When asked by TheJournal how those in long-term unemployment might be impacted by the system overhaul and whether they will be adversely affected, the minister said: “No, absolutely not, that’s not the intention here.”
Basic Jobseekers Allowance payments – €220 for someone aged 25 and over – will remain in place alongside the new pay-related scheme.
“You normally get Jobseekers Benefit for nine months at a reduced rate, we’re looking at a shorter period of time just to cushion that income shock you get when you suddenly find yourself unemployed, and to make it easier to manage.
“People are contributing for many, many years into the social insurance fund, and the whole point is that you’re paying in so that when you need help, it’s there for you. It’s for those with longer contributions in social insurance,” she said.
In terms of Jobseeker’s Allowance, the minister said if a person is better off to get Jobseekers Allowance, they will be allowed to take up that option instead of the pay-related benefit.
“This benefit, really, is specific to your pay so it doesn’t take account of how many children you have or how many benefits you have,” she added.
Auto-enrolment pension scheme
On a separate matter, the minister was also questioned about the Government’s plan for a new auto-enrolment pension scheme.
The scheme will see that employees contribute into their pension pot, with their contributions matched by their employer at a percentage of the employee’s gross income.
This contribution will then be topped up by the State. Currently, the Government plans to phase in the contribution rates over several years.
While there had been some doubts cast about whether the 2024 date would be reached, the minister today poured cold water over such a suggestion.
“Auto enrollment is a huge change. There’s a huge amount of work has gone into it. I’ve had consultations with a number of different stakeholders only last week, and my plan is that we would push on with this.
“I know some people might say ‘you should change this’, or ‘you should change that’. As far as I’m concerned, the auto enrollment train is on the tracks, it’s moving off. And I’m going to make sure that we deliver auto enrollment in 2024.”