Maureen O'Sullivan (Dublin Central, Independent)
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47. To ask the Minister for Jobs, Enterprise and Innovation if he is satisfied that self-employed persons are afforded the same rights as pay as you earn workers; his views on concerns expressed by self-employed persons that they are under pressure to liquidate their business in order to receive State assistance; if he will elaborate on whether local enterprise offices offer assistance to self-employed persons on the way to access assistance, without having to cease their business, and the stress that this occurs; and if he will make a statement on the matter. [18324/15]

Richard Bruton (Dublin North Central, Fine Gael)
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The Government’s Spring Economic Statement clearly acknowledged that while the income tax system remains highly progressive by international standards, disincentive effects are obvious with a marginal tax rate of 51 per cent for middle-income workers, and top marginal rates of 52 per cent for PAYE workers and 55 per cent for certain self-employed persons, when Universal Social Charge (USC) and PRSI are taken into account. In Budget 2015, my colleague the Minister for Finance, Mr Michael Noonan, TD, signalled the start of a multi-year programme of income tax reform to address these issues.

In relation to access to social welfare supports for the self-employed, I have been informed by my colleague, the Minister for Social Protection, under whose remit this issue arises, that 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) as well as guardians payment (contributory), maternity benefit and adoptive benefit. 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.

Self-employed workers may access social welfare supports by establishing eligibility to assistance-based payments such as jobseeker’s allowance and disability allowance. In the case of jobseeker’s allowance they 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.

In the report of the Advisory Group on Tax and Social Welfare on Extending Social Insurance Coverage for the self-employed, published in September 2013, it was noted that almost 9 out of every 10 self-employed people who claimed the means tested jobseeker’s allowance between 2009 and 2011 received payment. It recommends that social insurance for the self-employed should be extended on a compulsory basis and that the rate of contribution for class S should be increased by at least 1.5 percentage points. This recommendation will be further considered by the Minister for Social Protection taking into account the findings of the most recent Actuarial Review of the Social Insurance Fund and the views of industry who have concerns about rising costs.

In relation to my area of responsibility the Local Enterprise Offices (LEOs) are the first port of call in terms of advice, information, mentoring, training and, subject to eligibility criteria, grant support for anyone who wishes to start or expand a business. Where appropriate the LEOs will refer clients to other State Agencies or Government Departments for advice on supports such as the Start-up Refunds for Entrepreneurs (SURE), Microfinance Ireland, the Credit Guarantee Scheme and the Credit Review Office.

Businesses can also access the online search tool for SME business supports that was launched last year. The Supporting SMEs Online Tool is a cross-governmental initiative to help Irish start-ups and small businesses navigate the range of Government business supports for which they could be eligible. The Supporting SMEs Online Tool is available at: