Oireachtas Joint and Select Committees

Thursday, 31 January 2019

Joint Oireachtas Committee on Social Protection

Bogus Self-Employment: Discussion

Photo of John BradyJohn Brady (Wicklow, Sinn Fein) | Oireachtas source

I welcome the witnesses and thank Ms King for her very informative opening statement. The one-page summary is very useful and gets to the point of the problems the State is experiencing in missing out on PRSI contributions. She said congress believed the problem of bogus self-employment was very significant and I believe this to be true. It contradicts what officials from the Department said at a previous hearing, which was that they believed the problem of bogus self-employment was not extensive. I side with the witnesses in believing it is endemic across the Irish economy, particularly as we see certain sectors, such as construction, pick up.

I was reading a paper prepared by congress in 2015 entitled False Economy. The Irish Congress of Trade Unions estimated that the State was losing roughly €80 million in PRSI contributions on an annual basis, amounting to €640 million between 2007 and 2015. This shows it is widespread across many sectors. Construction and other fields have picked up since 2015, so would the figures have increased in the intervening period? What might the estimated loss to the State be of PRSI contributions now? Has ICTU done any further analysis?

Ms King said that ICTU had called on the Government and the Department to address the issue. What steps has ICTU taken? Has it met the Department or the Minister or did it meet previous Ministers? We heard a lot from the Department at our previous meeting but I do not believe the Department is sufficiently resourced to seek out bogus self-employment. Huge resources were put into the social welfare cheats campaign and I have my own views as to what the purpose of that was. It coincided with an election campaign within Fine Gael and maybe one person was trying to show he or she was more right wing than the other. I do not see the same campaigns being rolled out for what is a significant amount of cheating that is taking place in the area of PRSI contributions, with the resultant denial of workers' rights and entitlements. Does ICTU think the Department is sufficiently resourced to seek out bogus self-employment? Would ICTU like the WRC and the Labour Court to take on the responsibility for reviewing reports of bogus self-employment?

The opening statement made a number of references to the construction sector and pointed out that 14.8% of people in the transportation and storage sector were self-employed. What other areas have significant problems? Philip Boucher-Hayes has done a lot of work on the State broadcaster, RTÉ, and there have been several internal reviews of work practices in that organisation. These issues seem to be widespread in that sector too. Are there other areas where there are significant problems with bogus self-employment? How often do ICTU members raise issues of bogus self-employment with the leadership? Is it done on a daily basis?

The recommendations ICTU is making are key to addressing the problems. One is to make the principal contractor liable for employer PRSI. At what rate should this be set? Ms King said that, in 2012, the paper-based registration of contractors was discontinued in favour of an online process.

Do the delegates think there has been a significant escalation since 2012 owing to that single measure? Does the evidence seen by them show that it has resulted in a significant increase in the level of bogus self-employment?

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