AQW 14263/22-27
Ms Kate Nicholl
Alliance Party
South Belfast
Tabled Date: 02/09/2024
Answered On Date: 06/09/2024
Priority Written: No
Question:
To ask the Minister for the Economy to detail the (i) methodology; and (ii) rate of uptake used by economists in his Department to calculate the initial estimated cost of implementing paid carers leave, as outlined in the Good Jobs Employment Rights Bill consultation.
Answer:
The Good Jobs consultation covers a wide range of potential employment rights changes, including the introduction of a new Carer’s leave entitlement. The consultation asks respondents for their views whether this entitlement should be a paid or unpaid right. To inform respondents in making their response, an initial estimated cost of a paid entitlement of £60 million per annum was referenced. Census 2021 data was utilised to identify the number of unpaid carers in employment. This cohort was split by gender; age group and hours worked. The proportion of self-employed from the annual population survey was applied to the various groupings so as to estimate the numbers of unpaid carers who are employees within each group. This methodology identified the maximum number of potential beneficiaries based upon the most recently available data. The median weekly wage excluding overtime within each group, as indicated by the 2023 Annual Survey of Hours and Earnings (ASHE), was multiplied by the estimated number within each grouping. Full wage costs were used to identify the maximum amount potentially payable. This does not indicate any policy position on the level that the entitlement, should it be a paid one, would be paid at. The full wage cost using this methodology was estimated to be c£54m per annum. Non-wage labour costs, including national insurance and pension contributions, have been estimated by ONS to equal 17.95% of wages. Applying this percentage to the estimated wage costs of £54m results in annual costs of £9.7m, giving a combined total of £63.8m. This approach has not taken into account any increase in population since the last census, nor the ageing population trends. In addition, it has not taken into account the intended beneficial impact of a paid entitlement to allow paid carers to increase their hours or enter/re-enter the workforce which may in turn escalate the level of demand. The figures above relate to absence costs only and do not take into account additional costs which may fall to employers or government (e.g. cost of regulation, familiarisation costs, administrative costs, etc). For the purpose of the consultation the estimated upper cost of a paid entitlement was rounded down to £60m. Further work is ongoing to refine these calculations together with cross departmental engagement.
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