Self-employed in line to get dole benefits in the Budget
Jobseeker paymentss to be extended in new policy bid to shore up the middle-class vote
Self-employed workers will be entitled to weekly jobseeker payments if they become unemployed under a new policy decision to be announced in Tuesday's Budget.
The Government move to shore up support among middle-class workers ahead of a fast-approaching election will see unemployment benefits extend to more than 310,000 self-employed workers and small business owners.
Self-employed workers currently have to apply for means-tested jobseeker allowances based on the previous year's income. This excludes many of those seeking unemployment benefits when their businesses collapse.
After weeks of Budget negotiations, Social Protection Minister Regina Doherty has secured funding from Finance Minister Paschal Donohoe to extend PRSI benefits to self-employed workers.
Speaking at the Fine Gael presidential dinner last night, Taoiseach Leo Varadkar said he planned to "eliminate" this "discrimination" in the welfare system against the self-employed.
Yesterday, Fianna Fail social protection spokesperson Willie O'Dea welcomed the extension of jobseeker benefits. "This is something I have been seeking for several years and I am glad Fine Gael are considering introducing it in this budget," he said
The Sunday Independent has also confirmed Minister Doherty has agreed a budget package which will see all welfare payments increase by €5-a-week next year. She will also introduce a series of targeted measures aimed at reducing child poverty.
Last night, the Taoiseach said: "At long last, we will fully reverse the cuts made by governments of the past in weekly payments to carers, people with disabilities, widows, the blind, and lone parents with young kids."
A source said Ms Doherty wanted a "fair" social welfare budget which would address the "lost decades of cuts".
Fianna Fail insisted on increasing all weekly payments, apart from the jobseeker allowance. However, underspending in the Department of Social Protection means Ms Doherty could increase all welfare payments by €5-a-week.
Welfare changes for self- employed workers is one of the most significant policy decisions taken by the Government since the crash.
During the recession, thousands of self-employed workers were forced to close businesses as finances spiralled out of control. The issue was acute in construction.
Most of these workers could not sign on for means- tested benefits due to income they earned in previous years and assets on their books.
Under the new rules, PRSI contributions will entitle self-employed people to more access to jobseeker allowances if they become unemployed. The S Class PRSI contribution paid by the self-employed does not entitle them to all benefits. Dental and optical benefits were extended to the self-employed. They can also apply for an invalidity pension if they are unable to work due to a long-term illness.
Fine Gael Senator Ray Butler has been campaigning to extend social welfare payments for the self-employed.
The Budget will also see the 4.75pc rate of USC reduced to 4.5pc for all income earned between €19,000 and €70,000.
The entry point for the 40pc tax rate is expected to be raised by €750 to €35,300. Deposit Interest Retention Tax paid on savings is also to be reduced, while the home carers tax credit will be increased.
Prescription charges will be reduced by 50¢ for over-70s and the cap for the drug payment scheme will be reduced by €10 to €124. Revenue-raising measures will see tax on gambling doubled to 2pc and diesel prices increased.
Children's Minister Katherine Zappone is in negotiations with Mr Donohoe over a childcare package. Sources close to the minister said they were concerned they had not yet reached a deal. However, they do expect a breakthrough.
The Independent Alliance held more talks with Fine Gael yesterday over concerns about the 9pc VAT rate being increased for tourism. Mr Donohoe is said be anxious to raise the rate for hotels but may exclude other areas.