Written answers

Tuesday, 12 June 2012

Department of Social Protection

Social Welfare Code

8:00 pm

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context

Question 382: To ask the Minister for Social Protection the extent to which she can review the position in respect of entitlements to means-tested social welfare payments for the self-employed which will take into account the economic circumstances of families that find themselves in situations of social and economic distress; and if she will make a statement on the matter. [28359/12]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
Link to this: Individually | In context

Self-employed persons are liable for PRSI at the Class S rate of 4% which entitles them to access long-term benefits such as State pension (contributory) and widow's, widower's or surviving civil partner's pension (contributory). Ordinary employees who have access to the full range of social insurance benefits pay Class A PRSI at the rate of 4%. In addition, their employers make a PRSI contribution of 10.75% in respect of their employees, resulting in the payment of a combined 14.75% rate per employee under full-rate PRSI Class A. For employees earning less than €356 per week, the rate of employer's PRSI is 4.25%.

Any changes to the PRSI system to extend the full range of social insurance benefits, including jobseeker's benefit or social insurance illness benefits, would have significant financial implications and would have to be considered in the context of a much more significant rise in the rate of contribution payable. I established the Advisory Group on Tax and Social Welfare last year to meet the commitment made in the programme for Government. The advisory group will, inter alia, examine and report on issues involved in providing social insurance cover for self-employed persons in order to establish whether or not such cover is technically feasible and financially sustainable. In addition, the actuarial review of the social insurance fund, which is due to be completed in mid-2012, will examine this matter.

Self-employed people can become unemployed if their business has to close down. It may also be the case that, although the person continues to be self-employed, the amount of work that they are getting has reduced so much that it no longer provides them with sufficient income. Self-employed people can apply for the means-tested jobseeker's allowance if their business ceases or if they are on low income as a result of a downturn in demand for their services. Self-employed customers do not have to de-register as self-employed persons in order to claim jobseeker's allowance.

Legislation provides for the assessment of all income in cash and any non-cash benefits which the person or his or her spouse or civil partner may reasonably expect to receive during the succeeding year. While accounts provide significant information, a means assessment is not based solely on audited accounts. The income from the previous 12 months is used as an indicator of likely future earnings but it is not simply assumed that the previous year's earnings will be received in the following year. Any circumstances that would be likely to lead to a significant variation, either upward or downward, in the level of a person's income from one year to the next are taken into consideration.

If a self-employed person's situation changes after they have made an initial claim for jobseeker's allowance, the person can apply to have his or her means reviewed in the light of these changed circumstances. In addition, it is open to the individual to appeal to the Social Welfare Appeals Office if he or she is dissatisfied with the level of means assessed.

Comments

No comments

Log in or join to post a public comment.