A new €36 million scheme announced by Government today will give employers PRSI exemptions for taking on new workers.
Taoiseach Brian Cowen and by Minister for Social Protection Eamon Ó Cuív announced details of the scheme in Government Buildings today. The measure is specifically targeted at those who have been out of work for six months and more.
Any employer creating a new job for a person who has been unemployed for six months will save in the region of €3,000 over a year, because of reduced employer contributions for pay-related social insurance.
Mr O Cuiv said that the concession, which was announced in last December’s Budget would be back-dated until January 1. In effect, any employer who has taken on a qualifying unemployed person this year will benefit from the concession.
The Minister said that while €36 million had been earmarked for the scheme, his Department would not know the extent of take-up until it was underway.
He also said it would be self-financing because of the countervailing reduction in social welfare payments.
Mr Cowen said the shceme would make it easier for employers to make the decision in favour of creating new jobs and play a significant role in re-establishing people in the workforce.
Outlining the rationale behind the reason it only applies to those unemployed for six months or more, he said: “After six months on the Live Register there is a danger that people will drift into long-term unemployment and welfare dependency. For this reasons the scheme is open only to those unemployed for six months or more.”
Asked about the delay in implementing a Budget-day measure, Mr Ó Cuív said there that issues relating to drawing up regulations arose.
There are a number of rules underlying the new shceme. The job must be full-time and an additional, not a replacement, job. The scheme is limited to an existing 5 per cent of the workforce, or five new jobs for smaller companies.
The new job must last for at least six months.