Thursday, 22 March 2012
Finance Bill 2012 (Certified Money Bill): Committee and Remaining Stages
Darragh O'Brien (Fianna Fail)
I have a few questions on this section. This section effectively removes the tax exemption for the first 36 days of illness benefit and occupational injury benefit. In his statement yesterday, the Minister of State, Deputy Brian Hayes, said that in some circumstances when an employee goes sick and continues to be paid by the employer, the employee can be better off financially on sick leave than when working and that this change will avoid such a situation. I am sceptical with regard to the percentage of cases in which the Department feels an employee out of work for that period of time would be better off financially. Beyond that time, many schemes have long-term permanent health insurance type contracts that kick in. Some of these kick in at 13 weeks, some at 26 weeks and some at 52 weeks. All of those schemes, based on Revenue rules, provide up to 75% of salary and the majority are minus the social welfare deduction. That is how the schemes are structured. I am not aware of any scheme that pays 100% as no scheme is permitted to do so. Reference to the first 36 days refers to just over the first month of illness. I am very interested to know what analysis the Department has done in this regard and I am interested in hearing the Minister's views before deciding how to proceed.