Written answers
Monday, 9 September 2024
Department of Employment Affairs and Social Protection
Social Insurance
John Lahart (Dublin South West, Fianna Fail)
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924.To ask the Minister for Employment Affairs and Social Protection her plans, if any, to abolish or reduce employers’ PRSI for small businesses; and if she will make a statement on the matter.[34096/24]
Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The Actuarial Review of the Social Insurance Fund as at 31 December 2020 found that even without any economic shocks to the economy or change to policy, the long-term sustainability of the Fund will face significant challenges. In the absence of any action to tackle the shortfalls, the excess of expenditure over income of the Fund will increase significantly over the medium to long term with an accumulated deficit of €500 billion by 2076.
It is in this context that under the PRSI Roadmap agreed by Government there will be modest, incremental increases in all classes of PRSI (employer, employee and self-employed) over the period 2024-2028 commencing with an increase of 0.1 percentage points on 1 October 2024.
However, in recognition of the pressures faced by businesses, in particular, the need to help small and medium businesses reduce their costs, the Government recently agreed, as part of a series of such measures, to increase the employer PRSI threshold from €441 to €496 per week, effective from the 1st October 2024. This will ensure that employers with full time employees on the national minimum wage or employees with wages under €496 per week will attract the lower employer PRSI rate of 8.8%.
Any change to the employer PRSI rate would have to be considered in a budgetary context, taking account of the current economic circumstances and with a view to the sustainability of the Social Insurance Fund.
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