Leo Varadkar (Dublin West, Fine Gael)
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Self-employed people who earn €5,000 or more in a contribution year, are liable for PRSI at the Class S rate of 4%, subject to a minimum annual payment of €500. This provides them with access to the following benefits: State pension (contributory) and Widow’s, Widower’s or Surviving Civil Partner’s Pension (contributory), Guardian’s Payment (contributory), Maternity Benefit and Adoptive Benefit and, since September 2016, the newly introduced Paternity Benefit.

Core to the Programme for Government is improving the position of the self-employed generally, including the commitment to introduce an enhanced PRSI scheme for the self-employed.

Making progress on this commitment has been one of my key priorities since becoming Minister in this Department. On Budget Day, I was pleased to announce a number of important measures which will benefit the self-employed.

From March 2017, the self-employed will have access to the treatment benefit scheme which includes free eye and dental exams, and contributions towards the cost of hearings aids. As you will be aware, these treatments are already available to Class P contributors; however, the Treatment benefit entitlements will also be extended from October 2017 providing further dental and optical benefits.

More significantly, self-employed contributors will be eligible for the Invalidity Pension from December 2017. For the first time, this will give the self-employed access to the safety-net of State income supports if they have a serious illness or injury that prevents them from working without having to go through a means test. This is a real advance in the level of cover available to the self-employed.

The self-employed will also benefit from the further increase in Earned Income Tax Credit announced by my colleague, the Minister for Finance, as well as the extension of entrepreneurship supports. These measures are all part of the Government’s policy of making work pay and encouraging self-employment and entrepreneurship

It is estimated that around 205,000 self-employed workers paying Class S PRSI are solely dependent on their self-employed contributions to access social insurance benefits. These contributors will now have access to the wider range of benefits outlined above as well as the new paternity benefit introduced last September. It will not be possible to obtain cover for the wider range of benefits on a voluntary basis. The self-employed will continue to pay PRSI at the 4% rate in 2017.

I plan to continue extending cover for the self-employed to other benefits on a phased basis in future Budgets. In this regard, in 2017, my Department will carry out detailed work to establish how to provide a better safety net for self-employed including, for example, access to jobseeker’s benefit.