The Irish Government has approved a new pay-related jobseeker’s payment, under a system that will provide enhanced benefits to individuals with strong work histories who lose their employment. The Minister for Social Protection, Heather Humphreys, called this a major step toward reforming Ireland’s social welfare system and aligning it with similar systems in other EU countries.

Under the new system, jobseeker’s payment rates will be linked to previous employment income, with three payment tiers based on the length of PRSI (Pay Related Social Insurance) contributions. The top rate will be a maximum of €450, or 60% of prior income, for individuals who have made at least five years of PRSI contributions. This rate will be paid for the first three months. The subsequent rate for the following three months will be a maximum of €375, or 55% of prior income. A final rate of a maximum of €300, or 50% of prior income, will be paid for the last three months.

Humphreys shared that the law introducing a new Pay-Related Benefit System, aiming to prevent a dramatic income drop for those falling out of work, has received cabinet approval and is moving forward in the legislative process. The plan is for the scheme to be implemented in Q4 this year.

In order to fund the scheme and support the state pension age of 66, the government has agreed on an incremental increase in all classes of PRSI over the coming years, beginning with a 0.1 per cent increase in October 2024.

There will also be gradual increases up until 2028, with Humphreys stating, these measures will ensure that we can retain the State Pension age at 66 years and provide for Pay-Related Benefit.