JOBSEEKERS ARE DETERRED from taking up part-time employment in case they lose out on other social welfare entitlements, a specialist expert group has told the government ahead of Budget 2026.

In order to ensure unemployed people are motivated to get a job again in the future, the government has been told to increase means-tested social welfare allowance thresholds so that they are in line with the national minimum wage or a recipient’s earnings.

It comes as Fine Gael leader and Tánaiste Simon Harris floats the possibility that the jobseekers’ allowance would be removed from the overall increases to social welfare, in favour of higher increases to pensioners.

The Tax Strategy Group, an expert advisory panel at the Department of Finance, said this week that “inconsistencies” have appeared in Ireland’s social welfare system as it has evolved since the late 1800s.

It explained, in its annual reports to government ahead of the budget this year, that jobseekers are disincentivised from picking up shifts in part-time roles in case they impact the specific thresholds of income which are disregarded from social welfare payments.

A portion of a person’s income is not taken into account when assessing how much they are entitled to from a social welfare payment. This means that you can earn a certain amount of money, without it affecting your entitlements.

In some cases, the threshold of income that is disregarded from the means test, which will later determine the value of the total payment, is surpassed when jobseekers take up part-time roles, leaving them with not enough money to rely on each week.

It can also impact any other means-tested social welfare payments that they may be receiving, the tax experts’ report said.

“This is a penal approach that acts to disincentive an unemployed person from taking up part-time work,” the report from the Tax Strategy Group said this year.

It has recommended that a system should be agreed whereby the values of these thresholds increase annually, “whether aligned with the National Minimum Wage or earnings”, to make sure that jobseekers find work.

It added that this change would avoid situations where a person’s social welfare entitlements are impacted or reduced, and that it should be done in order to achieve Ireland’s policy aims for social welfare. 

The report later questioned if there was indeed a “policy rationale for creating this deviation” – in which case, the state should disregard the advice, it said.

Speaking earlier this month, Tánaiste Harris said he was not convinced that dole increases should be in line with other social welfare payments, such as pensions and disability payments.

“When there are other supports out there for very many people who can’t work for very many good reasons. That’s my opinion. We’ll thrash it out all that out at the time of budget,” he told reporters.