Parents of newborns to get seven weeks’ paid leave from next August

Parents of newborn babies will be able to take seven weeks of paid leave from next August and nine weeks from August 2024 as new EU rules to improve the work-life balance of workers come into force.

Currently parent’s leave entitles each parent to five weeks’ leave during the first two years of a child’s life.

However, the Government has committed under the EU Work Life Balance Directive to extend the entitlement in two phases out to 2024. Parents availing of the leave can also claim parent’s benefit of €245 a week provided they have adequate social insurance (PRSI) contributions.

Cost

The full-year cost of extending the benefit from five weeks to seven weeks – estimated at €14.6 million – was detailed in the Department of Finance’s tax strategy papers.

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The department noted that the EU’s directive was part of a package of measures “to address under-representation of women in employment, and to support their career progression through improved conditions to reconcile their working and private duties.”

More than 20,400 parents received parent's benefit between April and July of this year – compared with just 4,600 in the same period in 2020, separate Department of Social Protection figures show.

The benefit was extended from two weeks to five weeks in April 2021, having been originally brought in by Tánaiste Leo Varadkar in 2016.

The department’s tax papers also noted that consideration was being given to benchmarking state pension rates to 34 per cent of average market earnings to better insulate the purchasing power of recipients.

The papers said that the Commission on Pensions was currently considering the implementation of such an approach, but no estimate of the cost was provided.

“Nearly every other OECD country has developed and implemented a system of benchmarking rates of pension payments,” the papers said.

"Ireland is one of the few countries that do not operate such a system and there have, accordingly, been calls for many years to benchmark the rate of state pension payments to average earnings," they said.

Hike

The tax papers put the cost of a €5 hike in the base working-age social welfare rate – with proportionate increases for qualified adults and those on reduced rates of payment – at €217million.

“Some working-age social welfare recipients, however, have seen no increase in the rate of their payment since March 2019, albeit that consumer prices have increased modestly (by 1.6 per cent) in that time,” the papers said.

A €5 lift in the basic state pension was also costed at €175 million.

Consideration was also given to increasing the rate of fuel allowance by €3.50 per week to offset the planned increase in the carbon tax at a cost to the exchequer of €36.8 million.