PAYE Modernisation – Opportunities and Challenges Seán O’Connor Administrative Data Centre
ADC (Administrative Data Centre) CSO Survey Survey Survey Survey system 1 system 2 system ... system n ADC DEASP Revenue Organisation n Admin Admin Admin Admin data data data data source 2 source 2 source 1 source 1
PMOD? From 1 January 2019 employers are required to report their • employees’ pay and deductions to Revenue as they are being paid. This change makes it easier to deduct and pay at the right time the correct amounts of: • Income Tax • Pay Related Social Insurance • Universal Social Charge • Local Property Tax. 3
Old style Two files sent to CSO • Sent in year t (April and August) • Data for t-1 • • April/August 2019 – Employee/Employer information for 2018. • One record based on each unique combination of; Employee ID, Employer ID • • PRSI information contained also. Circa 3.7million records and 29-35 variables. • Used as an input for various CSO statistical products. • • GDP, SBS, SILC, Earnings and Labour Market. 4
New Style • Larger volumes of data being sent. Sent in month t (Last Monday of month t). • • All payslip submissions received into the system for month t-1. • Monday Sep 28 th – All records sent to Revenue from August 1 st – August 30 th . • 5.5 – 7.5 million records per dataset and circa 70 variables. • +/- depending on economic circumstances. 5
Creating a usable dataset for statistics Dataset contains a variable called (pay date). • • Date individual is being paid. Split records into year-month based on (pay date). • • Jan-2019 Feb-2019 • • June-2020 One record for each valid payslip in the month. • • Gross Pay, Pay for Income Tax, PRSI class, Pension payments etc. • Also create a year to date dataset too which will incrementally update as we move through periods. • Aggregated based on a unique combination of Employee ID, Employer ID and PRSI Class. 6
Tricky Part!!!!! • Employers are able to make amendments and deletions to payslip submissions at any time. • Month t delivery may have amendments and deletions relating to a delivery received in month t-1,-2,-3,-4,…….- n. • Generally only amendments/deletions for the previous month or two. 7
Active monthly records - as of July 2020 returns recevied in August 2020 8.0 7.5 7.5 7.3 7.3 7.2 7.0 7.0 6.8 6.7 6.6 6.6 6.5 6.5 6.5 6.5 6.4 6.4 6.3 6.2 6.0 6.0 5.6 5.5 5.5 5.0 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Active records 6.7 6.2 6.8 6.3 7.5 6.5 6.6 7.3 6.5 7.2 7.0 6.6 7.3 6.4 6.4 6.0 5.6 5.5 6.5 8
Pay Frequencies by selected NACE sectors 100.00 WEEKLY FORTNIGHTLY MONTHLY 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0.00 9
Current benefits and potential new avenues More accurate estimations of quarterly macroeconomic • indicators. • Quarterly estimates of GDP. Providing insights into employment and earnings during Covid- • 19. Cohorts of interest to help inform public policy and society. • Next few slides is an illustration of what has been done and • potentially can be done. 10
-5.6 Industry 11 0.9 Human health and social work -4.9 Information and communication 2.6 Public administration and defence 4.7 Education Percentage change between 2020Q1 vs 202Q2 -6.3 Financial, insurance and real estate -6.5 Earnings Construction -3.9 Employment Professional, scientific and technical activities 0.6 Transportation and storage 1.9 Wholesale and retail trade; repair of motor vehicles and motorcycles Source: Labour Market Insight Bulletin – Series 2 2.9 All sectors -4.2 Administrative and support services 14.1 Arts, entertainment, recreation and other service activities 11.6 Accommodation and food services 20.0 10.0 0.0 -10.0 -20.0 -30.0 -40.0 -50.0 -60.0 -70.0
Percentage of employments and total earnings supported by TWSS - Q2 2020 51.8 Accommodation and food services 61.0 24.2 Construction 54.2 14.9 Transportation and storage 43.8 24.1 Arts, entertainment, recreation and other… 43.0 18.3 Wholesale and retail trade; repair of motor… 41.9 8.7 Industry 33.1 10.2 Professional, scientific and technical… 32.3 8.5 All Sectors 25.9 10.6 Administrative and support services 22.5 3.3 Financial, insurance and real estate 15.1 3.1 Information and communication 14.9 3.8 Human health and social work 10.4 1.9 Education 5.5 0.1 Public administration and defence 0.3 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 TWSS payments as share of total earnings Employments with at least one TWSS payment Source: Labour Market Insight Bulletin – Series 2 12
Illustration 4000 Housing and Income 300,000 100,000 and below 46 100,001 to 150,000 43 purposes only 3500 105,001 to 200,000 38 250,000 200,001 to 250,000 37 243,947 3000 250,001 to 300,000 36 200,000 300,001 to 350,000 36 2500 350,001 to 400,000 36 400,001 to 450,000 37 2000 150,000 450,001 to 500,000 37 500,001 to 550,000 39 1500 100,000 550,001 to 600,000 39 1000 600,001 to 650,000 40 74,194 650,001 to 700,000 40 50,000 55,539 500 700,001 to 750,000 40 750,001 to 800,000 41 0 0 800,001 to 850,000 42 850,001 to 900,000 42 900,001 to 950,000 43 N>30 950,001 to 1,000,000 44 1,000,001 and above 44 13
Housing and Income Illustration purposes only 14
Conclusion PMOD can act as a compliment to outputs produced by the LFS, EHECS and other official • labour market metrics. New insights at detailed geography/ sectoral possible in a timely fashion. • Can combine with other sources (admin and non-admin) for further policy relevant • outputs. Housing affordability, job churn and educational attainment, firm characteristics etc. • Can do a lot but still need surveys to fill in gaps. • • Qualitative information – deprivation indicators. Non-admin indicators – hours worked/union membership etc. • Official and internationally comparable definitions of employment/unemployment • etc. 15
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