Ahead of the third increase in PRSI contribution rates in three years coming into effect next week, from Thursday 1 October, the Irish Congress of Trade Unions has hit out at Government for allowing a sharp fall in the real value of the pay-related payment for recently unemployed workers and for dragging its feet on introducing a promised pay-related payment for working parents taking up to nine weeks leave in their baby’s first two years.
Congress General Secretary Owen Reidy said: “The average worker is paying an extra €2 a week in PRSI since 2024, rising to €3.50 from 1 October, towards the cost of keeping the State Pension age at 66 and funding new pay-related payments to better protect them and their family’s living standards during short breaks out of work. From 2028, workers and their employer, on their behalf, can expect to pay an additional €4 billion PRSI annually.
“All the while PRSI is going up and up, the real value of the new Jobseeker’s Pay-Related Benefit is falling at a rate of knots. The maximum €450 weekly payment for the first 13 weeks of unemployment originally replaced 60% of the average industrial wage. Today, it is close to 50% because there has been no increase to the payment caps since 2022 to take account of strong wage growth. The promised stronger social safety net in return for higher social insurance contributions is looking pretty shabby.”
Congress social policy officer Laura Bambrick said: “Not only has Pay-Related Jobseeker’s Benefit been frozen at 2022 wage rates, but we’re no closer to introducing Pay-Related Parent’s Benefit than when a clear commitment was given in the Programme for Government in January 2024. Even if the process to legislate started today, no parent of babies born before the end this year will qualify because their baby will be aged over two years by the time a pay-related scheme is up and running. Given the high cost of living, it’s not surprising that the uptake of the current €299 flat weekly payment is down 6% compared to last year. How many more working families will have to let this precious time with their young child go unused because of Government inaction?”
Owen Reidy added: “Government is running the risk of losing public buy-in for higher PRSI contributions by reneging on their side of the ‘pay more in, get more out’ deal. It’s a very shortsighted strategy given the scale of revenue-raising needed to fund social protection in the years ahead.
“More immediate, freezing contributory pay-related benefits for workers and working families flies in the face of Government’s claims that Budget 2027 ‘will look after people who get up early every morning and go to work’ Mr Reidy said.”
