Paul Murphy (Dublin South West, RISE) | Oireachtas source

For the benefit of other people who may be on the list of speakers I will take approximately ten minutes. I welcome the introduction of pay-related jobseeker's benefit in the Bill.

It is long overdue that workers are not plunged way below the poverty line as soon as they lose their jobs. However, I do have a real problem with how the Government is proposing to pay for it. This Bill which we are being asked to vote on today is going to hit all full-time workers with a PRSI increase every year for the next five years, one increase building upon the other. People Before Profit will vote against this tax increase on ordinary workers. There is absolutely no need to increase employees' PRSI to fund pay related jobseeker's benefit. It could easily be funded by a larger increase in employer's PRSI.

Section 3 of the Bill provides that the rate of PRSI in all full-time workers' pay will go up from 4% to 4.7%. That is a significant increase which every full-time worker in this country and any part-time worker who earns over €424 will feel in their pockets. Unlike other kinds of income tax, where you pay a higher rate as you earn more, all full-time workers pay PRSI at the same rate. It is a flat, regressive form of income tax. In concrete terms, this Bill means that a full-time worker on the minimum wage will have to pay an extra €178.55 in PRSI. A worker on the average wage will have to pay almost an additional €350. Self-employed workers are also being hit with an increase of €150 in their minimum annual self-employment payment. Instead of hitting workers, the Government could increase employer's PRSI by a lot more than the 0.7% it is planning at the moment. It could start by rolling back the employer's PRSI tax break it gave bosses just last week as part of its business support package. ICTU has calculated that by increasing the threshold for the lower employer PRSI rate from €441 to €494, the Government is costing the Social Insurance Fund €60 million a year. Coincidentally, that is the exact same amount that will be raised with the 0.1% increase in all PRSI rates, employee and employer, in October. The Government is acting like a reverse Robin Hood, taking money out of workers' pockets to stuff it in the pockets of the bosses.

Let us not forget that employer's PRSI in this country is among the lowest in Europe. The Government's own tax strategy group found that even the higher employer's PRSI rate of 11.05% is less than half the EU average rate of 22.62%. It is less than a quarter of what employers pay in France, where employer's PRSI is 45%. In People Before Profit's latest alternative budget, we calculated that more than an additional €2.5 billion a year could be raised from a relatively small 2% increase in the 11% rate of employer's PRSI, combined with a new employer PRSI rate of 19.75% on salaries over €90,000. This is many times more than what the Government is planning to raise by increasing PRSI for everyone.

If the Government wants to increase PRSI, that is what it should do. It should increase PRSI for employers by several percent and not increase it for all employees. It is a false idea of equality that we are going to increase it like this for employers and then also in the same way for employees. The Minister might not have noticed, but workers are still in the midst of a terrible cost-of-living crisis and now she is asking them to pay more tax on their income. Barnardos told us yesterday that nearly half of families in this country have had to go without or cut back on essentials like food or heating in the last six months. It beggars belief that in the midst of that kind of deprivation, the Government is going to hammer people with a PRSI increase on top of the increases in excise, carbon tax, petrol and diesel that it is planning in August and October. That is three tax increases in three months from this Government. Of course, it is increasing the most regressive kind of taxes that hit low-paid workers the hardest, not progressive taxes on bosses and genuinely high earners.

As I said, I welcome the introduction of pay-related jobseeker's benefit. It will make a real difference for workers who qualify for it, if they lose their jobs, that they will not be pushed below the poverty line. However, the Government is doing it in the most minimal way possible and has designed the benefit to exclude as many workers as possible. The Minister referenced this in her opening statement by saying that if we tried to do a perfect one, we would not be here. It would take the same time to write legislation that applies to a greater number of workers and gives them a greater level of protection as it took to write what the Government has brought before us. Doing so might create more opposition from the bosses in IBEC. I guess that is what the Minister is getting at.

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