Eamon Gilmore (Dún Laoghaire, Labour)
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Question 26: To ask the Minister for Social and Family Affairs the proposals she has to tackle the significant disadvantages built into the welfare system if someone is put on short-time working hours and ultimately is made redundant in terms of the potential reduced rate of jobseeker's benefit if later made redundant. [16976/09]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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Full social insurance cover was extended to part-time workers from April 1991. At that time a range of measures were introduced to ensure that the rate of Jobseekers Benefit payable would be proportionate to the person's income and PRSI contributions. They were also intended to ensure that disincentives to employment were not created. In the absence of these measures, a situation would exist whereby many workers on low incomes would have access to weekly social welfare payments in excess of their income from employment.

These measures are regularly updated to keep pace with rises in benefit levels. Budget 2003 sought to bring the income threshold and banding structure back into line with the level of benefits payable. However, with the increases in benefits that have been provided since then, these thresholds and related bands had again gone seriously out of line with the associated rates of benefit. For example, an employee who earned €150.00 per week in 2004 qualified for a personal rate of payment of €134.80. In 2008, this payment had increased to €197.80 for the same level of earnings. At these levels, the weekly income threshold and graduated Jobseeker's Benefit rates represented a serious disincentive to employment.

The new thresholds that were introduced in January will address these disincentive effects by completing the process of bringing the income thresholds and banding structure back into line with the benefits payable. A reduced rate of Jobseeker's Benefit is now payable if average weekly earnings in the Relevant Tax Year (RTY) before unemployment were under €300.

Average weekly earning is total earnings from employment divided by the number qualifying contributions in the RTY. The RTY is 2 years before the year of claim, so if a claim for Jobseeker's Benefit is made in 2009 the Relevant Tax Year is 2007.

A person in receipt of a reduced rate Jobseeker's Benefit payment which is insufficient to meet their needs, may be eligible for a top-up under the Supplementary Welfare Allowance scheme, subject to a means test. Recipients of Jobseeker's Benefit may also opt to transfer to means tested Jobseeker's Allowance.