The government has confirmed it will be raising national insurance from next month, the Labour Party said yesterday.

The NI rate hike will be applicable to all those aged below 48 who earn more than €17,000, the PL said in a statement. NI will increase again within two years.

The PL said in a statement the government had failed to mention the rise in NI in its budget speech in October as well as failing to explain whether the increase in NI will be taken into consideration in its financial estimates.

“What is certain is that this news will shock thousands of families and businesses, while the government remained mum.”

The Employment Ministry last Friday did not deny that national insurance contributions will rise, but said this was the result of decisions taken in the pensions reform five years ago following wide-ranging consultation in which the Labour Party failed to participate.

The ministry said that the maximum pensionable income on which national insurance contributions is calculated is currently €17,175.60. For those born after 1962, this will rise to €18,400 and, as a result, when they retire they will receive a higher pension than they would today.

Employees will pay up to a maximum of €122.50 per year while those who earn less than €18,400 will pay less.