The government should consider increasing housing supports if it cuts enhanced pandemic welfare payments, an economist with the Economic and Social Research Insitute (ESRI) has said.
With Taoiseach Leo Varadkar today signalling the level of payments will be cut for some part-time workers, Dr Barra Roantree said the payment has been particularly important for some groups, who may need other supports increased when a cut is forthcoming.
He said the PUP (Pandemic Unemployment Payment) “has been particularly important for low-income families and those living alone. Almost half of spending for these groups goes towards essentials, meaning they may find it difficult to weather large reductions in payments unless supports for housing costs are simultaneously increased.”
He said renters may be particularly impacted. “If the goal of reducing the PUP is to redirect supports to those who need them most, it should be accompanied by an extension of the more generous rent supplement rules” – a reference to a little-publicised government decision to expand eligibility for rent supplements taken earlier in the pandemic, which was due to expire at the end of May.
The Taoiseach said today a Cabinet decision would be made on Friday on the future of the payment but “nobody who was working full-time before the pandemic will see their unemployment payment cut. It will stay at €350 a week for those who were working full-time”.
Mr Varadkar said some people who were working part-time “will see their payment reduced but their weekly payment will still be more than they were earning on a weekly basis before the pandemic”.
Earlier, Minister of State Patrick O’Donovan has said no decision has been made by the Government on reducing emergency Covid-19 payments.
Mr O'Donovan told RTÉ radio it was "a bit early" for speculation after reports of an imminent 40 per cent cut on the €350 payment for part-time staff, as well as a phasing out of the payment over time for full timers.
“It was always envisaged that these payments and these schemes would be up for review in the middle of June, which is what is going to happen,” he said.
Last Sunday, Mr O’Donovan signalled that there could be changes to the PUP this week.
Speaking on The Week in Politics, he said: “It’s not sustainable going forward that we have 1.6 million people drawing an income support at some level from the State and 900,000 not drawing a support. We have to get to a situation as the economy reopens that we have more and more people transitioning back (to work).”
“It was always envisaged that these payments and these schemes would be up for review in the middle of June, which is what is going to happen,” he told RTÉ Radio One on Thursday.
The schemes were designed as a temporary emergency measure and as people go back to work there will be less demand for the payments, Mr O’Donovan said.
“There is no decision made on it . It is a bit early to be speculating on what might happen in terms of how the Government will react, because the exchequer figures only came in yesterday,” he added.
Mr O’Donovan said people will be provided with certainty once a government decision has been made.