The Government is to seek Oireachtas approval for an additional €4.1 billion for the Department of Social Protection, including funding for Covid-19 supports such as the pandemic unemployment payment.
Minister for Social Protection Heather Humphreys will tell an Oireachtas committee on Wednesday the State's social insurance fund is projected to have a deficit of €4.22 billion by year end. The fund underpins welfare and pension payments. At the start of 2021 it had a surplus of €453 million.
The department will spend more than €29 billion this year, with increased expenditure mainly due to coronavirus supports.
Ms Humphreys will tell the Oireachtas committee on social protection that when spending estimates for her department were being drawn up last October, parts of the country were at either Level 2 or 3 of public health restrictions. But the situation changed considerably shortly afterwards.
“That estimate envisaged expenditure in 2021 of €25.13 billion, based on Government decisions . . . including that pandemic supports such as the pandemic unemployment payment and the employment wage subsidy scheme would close at the end of March,” she said.
“Resurgence of the virus in the weeks and months which followed led to the Government deciding to extend payment of, and access to, the pandemic unemployment payment until the end of June 2021. The employment wage subsidy scheme was similarly extended to end June 2021.
“These decisions, as well as the extension of other Covid-related spending, mean that further funding is required in 2021 . . . An additional €4.1 billion in funding is required, bringing the estimate for the department’s spending to €29.14 billion.”
In an opening statement to the committee ahead of Wednesday’s hearing, the Minister said “the primary drivers of the increase in social protection spending in 2021 are the schemes which provide support to those parts of the economy which continue to suffer the consequences of the Covid crisis”.
Nearly 20 per cent, or €5.75 billion of the total departmental spending of €29.14 billion this year, will be attributable to Covid-related schemes.
The Minister said about €3.3 billion was likely to be spent on the pandemic unemployment scheme while the cost of the employment wage-subsidy scheme was estimated to be €2.36 billion.
Ms Humphreys said the social insurance fund, from which the pandemic unemployment payment is funded, was now in deficit. She said spending on pensions was the biggest element of her department’s expenditure, amounting to €8.8 billion this year.
She said €3.2 billion would be spent on jobseeker payments for the year.
The department said on Tuesday that 333,993 people would receive the pandemic unemployment payment this week, a reduction of 29,174 compared to last week
It also said that 9,000 people would receive more than €3.7 million collectively in pandemic unemployment-payment arrears.
The number of people receiving the pandemic unemployment payment is in addition to the 177,969 people who were on the Live Register at the end of April
Over the past fortnight, the number of people in receipt of the pandemic unemployment payment had fallen by about 50,000.
