Ray Butler (Meath West, Fine Gael)
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I thank the various groups for coming today. I wish to give some insight into what has been happening in this committee over the past three years. This was a huge issue in the 2011 general election. I have been pushing this because it affects me personally. I come from a self-employed background. I had a shoe shop for 24 years, which unfortunately had to close because of the recession. When I first became a member of this committee, we met representatives of the Department of Social Protection. High-ranking civil servants proposed a 30% PRSI contribution for the self-employed. That was the first figure. We subsequently invited in representatives from various groups, including the Self-Employed Alliance from Louth and Meath. They outlined how their businesses collapsed with no access to social protection.

There followed the Mangan report, commissioned by the Government, which recommended that a new stamp be introduced at between 4% and 5.5%, which is a long way from the 30% originally suggested by the official from the Department of Social Protection to whom I referred. We had to wait nearly two full years for that report to be published, after which various groups pronounced that a 4% to 5.5% stamp could not be introduced when small businesses were struggling so much in the recession. We can see all sides of the issue, but my question to these groups is whether, having dismissed the report entirely, they engaged with the Department and the Minister in a meaningful way. Did they, for example, make any inquiries about the implementation of the proposals contained in the report? I would like answers to these questions because I have raised the issue of introducing social protection measures for the self-employed with the Minister, Deputy Burton, on many occasions in the past three years. She told me that it was never her intention to bring in a full 1.5% rise straight away but rather to introduce an increase of 0.25% in the first year, after which the scheme would be reviewed over a period of time, depending on the state of the economy.

We are all agreed that the current position in regard to the self-employed is not satisfactory. We have an obligation to address the social protection shortfalls in the system in respect of that cohort. Ireland is the only industrialised nation in the European Union which does not offer such protections. In Britain, for example, benefit is allocated on the basis of profits. A self-employed person in that country whose business profits are below €7,000 - I am giving the figures in euro - can apply to be exempt from paying any contributions. Those with profits of €7,000 to €15,000 pay €3.30 per week. Where the company's profits are between €15,000 and €50,000, the owner pays 9%, which entitles him or her automatically to sick pay and disability pay, with assessment for long-term payment arising thereafter, where applicable.

I am asking ISME and all the other organisations representing the self-employed to put their weight behind the proposal for a new stamp in order to assist those who contributed so much to the general economy and take some of the burden off the shoulders of PRSI workers. In fairness to the Minister, she has reduced the threshold such that some self-employed people are now receiving social protection. However, self-employed people are not putting into the fund; it is PRSI workers who are funding it. As we know, self-employed people do not want to be begging for anything. They want to contribute their share.

We must push for change in this area. The jury is out, in my view, as to whether any new system of contributions should be mandatory or voluntary. I really do not know which is preferable. I have seen many instances in this country where something that is voluntary has fallen by the wayside. In that context, I am leaning towards making this system mandatory as we move forward. Starting with 0.25% and working up from there gives everybody a chance to get on board as we proceed. Voluntary systems do not seem to work in this country, looking at how things have worked out on previous occasions.

I took part in a discussion on local radio recently during the course of which a woman rang in to relate what happened to her family when her self-employed husband became ill. She was working and bringing home €450 per week to support two adults and two children. Her husband was assessed as being entitled to €1.60 per week. As I recall, their mortgage was €1,600 or €1,700 per month. It is time to stop the grandstanding and move forward on this issue. We must work together and get the new stamp up and running. Self-employed people, when the economy starts moving, will begin employing people and helping to rebuild our economy. We must put in place a system to safeguard them so that if anything goes wrong or their business fails, there is inbuilt protection for them and their loved ones. I am pleading with all the organisations represented here today to get behind this proposal. It has been discussed at Cabinet and the relevant Ministers are in favour of it. I hope all the delegates will leave this meeting prepared to put their weight behind it. I am confident it can be introduced, if not in this budget then in the following one. Certainly, I hope we have a system up and running before the end of the Government's term.