Joan Burton (Dublin West, Labour)

One of the strange features of the Irish social welfare system is that the calculation of days goes back to when social welfare was first created. The social welfare week is based on a six-day week and Sunday is not included for calculating earnings for social welfare purposes. This goes back to the time when people often worked a half day on Saturdays and the only people who worked on Sundays were, by and large, public servants such as nurses, doctors and firemen, for example. There was very little issue of such workers ever being in receipt of social welfare.

As announced in the budget I propose to bring the social welfare week to a five-day week this year in accordance with long-established employment practices and next year I propose to have Sunday earnings taken into account where a person works on a Sunday. It is possible that some workers earn a significant part of their income through working on a Sunday, perhaps in a sector where Sunday working is very significant. These are changes in social welfare which over a period of time will help the social welfare system to reflect modern working arrangements as they apply currently.

The effect of this measure will not impact on anyone whose sole income is from social welfare. The headline rate of €188 per week for a single person is unaffected if the person does not have any additional income from employment in respect of days worked. It will only apply to those who have earned additional income from working some days during the week. In the current fiscal context some savings will also be achieved. At present, a single person in receipt of jobseeker's benefit who works three days a week receives €94 of their jobseeker's payment, that is 50% of it, in addition to their income from employment. The income from employment will vary according to rates of pay and amount of time worked each day but as jobseeker's benefit is not means tested, no regard is held to this when paying the €94.

The effect of this measure will be to reduce the contribution from jobseeker's benefit to the weekly amount of total income, welfare plus wages combined, and help towards a reduction in reliance on social welfare among those who currently avail of a mix of welfare and earned income. It is proposed to base the payment week for jobseeker's benefit on a five day week. Payment is currently based on a six day week. This effectively brings all casual part-time workings into the same method of calculation of payment as systematic short-time workers. If a person normally works full-time but their employer reduces the number of days worked on a permanent basis, the person may get jobseeker's benefit for the days they do not work. For each day a person is unemployed, one sixth of the normal rate of jobseeker's benefit is currently payable. For example, if they get part-time work for two days, they can get four sixths of the normal jobseeker's benefit for that week. This measure proposes that from July 2012, for each day a person is unemployed, one fifth of the normal rate of jobseeker's benefit is payable. For example, if a person gets part-time work for two days, they can get three fifths of the normal jobseeker's benefit for that week.

There has also been some comment to the effect that the measure acts as a disincentive to additional employment. In this regard, the following key points may be noted. Under the measure, people working zero, one or two days per week will continue to have a financial incentive to take up additional employment even at the national minimum wage. Losses currently experienced where a person working three days a week gains a day of employment and thereby exits the social welfare system are lessened by the measure. Under the measure, jobseeker's benefit customers will continue to receive benefit for the same number of weeks as provided for currently.

In some cases employers who have people on short-time working and want them to take up more work because conditions in the business have improved have found exiting the social welfare system becomes quite difficult because of the basis of the six day week. It has been suggested that if the social week were more aligned with reality in terms of how people work nowadays, this would be a reform which would be worthwhile in the longer term. It is proposed to address the Sunday issue in the legislation for next year. In general, there are significant numbers of people who work on a part-time basis. If we could get employers to offer people more employment, the savings to the social welfare system would be considerable and it would allow us much more scope to do some of the things people have identified at different times of the debate on the legislation.