Historic welfare reforms to enhance support for carers and jobseekers
THE Cabinet has granted approval for comprehensive reforms aimed at bolstering Ireland's welfare system.
These transformative changes brought forward by Minister Heather Humphreys include two vital aspects with the introduction of a new pay-related jobseeker’s benefit scheme and significant improvements to the state pension, with a focus on supporting long-term carers.
Mayo TD Alan Dillon emphasised that the approval of the new pay-related benefit system signifies a significant shift in how Ireland aids individuals facing job loss. This progressive system ensures that those with extensive work histories will receive improved benefits if they find themselves unemployed.
It also brings Ireland in line with other European nations. The newly approved system features three payment tiers:
* A top rate of up to €450 or 60% of prior income for individuals with a minimum of five years PRSI contributions, payable for the first three months.
* A second rate of up to €375 or 55% of prior income for the next three months.
* A third rate of up to €300 or 50% of prior income for the final three months.
Should an individual remain unemployed after the nine-month period, they can apply for the basic Jobseeker’s Allowance.
Deputy Dillon expressed his support for the introduction of the pay-related benefit scheme, saying: “This reform of jobseekers aims to alleviate the hardships faced by those who have built a long work history and paid their PRSI. This system is about making it easier for people when they face tough times, and it also recognises the money they've put into the system through their Pay Related Social Insurance (PRSI) contributions.
“Most European countries already have something like this in place, and now Ireland will too.”
It is expected that the Department of Social Protection will commence work on the legislation required to implement the pay-related benefit system, with an expected rollout in the second half of 2024.
Cabinet also approved significant reforms to the state pension system, set to take effect in January 2024. These include:
* The implementation of flexible access to the State Pension (Contributory), enabling individuals who choose to defer their pension until the age of 66 to receive a higher payment rate, which is actuarially adjusted and continues until the age of 70.
* Enhanced pension provision for long-term carers of incapacitated dependents, who have provided care for 20 years or more, by attributing the equivalent of paid contributions for the time spent caring. This is to help with gaps in the contribution record faced by long term carers for State Pension (Contributory) purposes. This will mean that some long-term carers who never had a contributory pension will receive one for the first time in their own right.
The chairperson of the Fine Gael Parliamentary Party added: “The significant restructuring of the Irish state pension system will guarantee that long-term carers receive contributions to bridge gaps in their social insurance records, mirroring paid contributions, the first time in the history of the State. This will significantly improve state pension benefits for carers who have dedicated over two decades to caring for incapacitated dependents, often their loved ones.”