The Department of Employment Affairs and Social Protection says 584,000 people will receive the €350 Pandemic Unemployment Payment this week, 50,000 more than a week ago.

These payments are in addition to the 212,000 people on the Live Register who claim weekly dole payments and 281,000 workers being paid via the Temporary Wage Subsidy Scheme (TWSS).

There are now 1.1 million working age people on welfare, up from just 180,000 just over a month ago. Conall MacCoille, economist with broker Davy, calculates that the cost of Covid-19 welfare payments is now estimated at €4.5bn for 12 weeks.

MacCoille commented: "The surge in PUP claimants suggests a 25% drop in Irish employment, far greater than expected in the UK or US. The generous terms - €350 per week with no rigorous checking on whether claimants were previously employed or made involuntarily redundant - have created a financial incentive to leave work, particularly among the country’s 475,000 part-time workers.”

MacCoille noted that the UK is predicting a 10% unemployment rate in Q2, while US data points to a 13% drop in employment. “The more severe damage to Ireland’s market at least in part reflects the generous terms of benefits,” he added.

In Association with

“Anecdotal evidence from SMEs is consistent with the view that many younger, part-time workers have supplemented their income by choosing to leave employment and receive the €350 per week PUP.

“We do not believe the benefit is rigorously tested to ensure claimants satisfy the conditions of previously being in employment and being made involuntarily unemployed.

“Last week, the TWSS was raised from 70% to 85% but capped at €350 for net earnings up to €26,000. Remarkably, the government has created a financial incentive to not participate in its TWSS scheme,” said MacCoille.

Youth Unemployment

Minister for Employment Affairs and Social Protection, Regina Doherty (pictured), commented: ”The  situation is unparalleled in our nation’s history. This is a temporary health emergency and many sectors of the economy will be able to switch back on relatively quickly once the danger has passed.

“However, some sectors will be slower than others to recover and we will also have a challenge with youth employment as many young people who could have expected to have entered a buoyant jobs market will now face a much more complex environment.

“My department is already planning for the post-pandemic environment and considering the best measures to help every worker to get back into the labour force as quickly as possible,” the minister added.

Doherty said that c.51,000 people have contacted the department to cease their pandemic payment while c.52,000 applications have been declined for a variety of reasons.

DEASP says there are now over 46,000 employers who have registered with Revenue for the wage subsidy scheme. Workers whose employers have registered them on the scheme are not eligible to receive PUP.

There are now 32,000 people medically certified for receipt of the Covid-19 enhanced Illness Benefit. This relates to people who have been advised by their GP to self-isolate, and a smaller number of people who have been diagnosed with Covid-19.

In March the waiting period for Illness Benefit relating to Covid-19 was abolished, and the weekly payment rate was raised to €350, the same as PUP.