Operational Guidelines: Short-Term Enterprise Allowance

This is the current version of the Short-Term Enterprise Allowance (STEA) Scheme guidelines which is effective from March 2025.

Purpose of Short Term Enterprise Allowance Scheme

This scheme is designed to provide immediate support for someone who loses their job and qualifies for Jobseeker's Benefit (JB) or Jobseeker's Pay-Related Benefit(JPRB) but wants to start a business. It provides an incentive to Customers of Jobseeker's Benefit/Jobseeker's Pay‐Related Benefit to avail of self-employment opportunities by allowing them to retain their appropriate Jobseeker's Benefit/Jobseeker's Pay‐Related Benefit rate. The maximum duration of the allowance is the same as if the person remained on Jobseeker’s Benefit/Jobseeker's Pay‐Related Benefit until their entitlement expires.

Objective

The objective is to support certain DSP Customers to commence self-employment through setting up a new enterprise.

Legislative Basis

The STEA is a non-statutory scheme approved by Government as part of the package of measures announced in the budget of 07 April 2009.

Administration

Scheme policy is administered by Short Term Enterprise Allowance:

Setting up a New Business

STEA is a support to qualifying Customers wishing to take that first step into self-employment. It assists in alleviating the risks involved with a new venture and provides an element of financial security along with business mentoring and supports.

What is a New Business?

• The STEA should only be used to offer support to the setting up of a new enterprise that is currently not in operation but will be tradable and tangible. Note: a current business for JBSE applicants cannot be considered, it must be a new enterprise

o Where a business is similar to a previous unsuccessful business, the onus is on the Customer to establish why this proposal is deemed a new business and not a recommencement of a prior venture.

o Where the viable enterprise has ceased trading e.g. retirement of owner.

Businesses not considered eligible for STEA

• Where a business proposal does not involve the setting up of a new enterprise,it will not be eligible for STEA support.
• Businesses setting up under an already market-established brand (franchises or self-employed sales) or a business that has been operational prior to the application for STEA.
• Business taken over by the Customer or trading under the Customer’s management, will not be considered.
• Where a business is bought, inherited or leased as a going concern.
• Where STEA was previously approved and in payment for one business and then the business ceases, the Customer cannot resume or continue their STEA payment for a different business until five years has elapsed.

Business Structure

The structure of a proposed business will not impact the eligibility for STEA.

STEA supports a sole trader, a partnership or a limited company.

Further information on the shareholding of a company can be found at Shareholders - Irish Legal Guide

Employment

Customers are not allowed to enter into paid employment as an employee, either in a full-time or part-time capacity while in receipt of STEA (exception retained fire fighter refer below)

Tax Status

The Short Term Work Enterprise Allowance is subject to income tax in the same way as Jobseeker’s Benefit and Jobseeker's Pay‐Related Benefit.

Absence from the State

All new enterprises approved for STEA must operate within the State.

If it is a genuine requirement of the business to spend periods of time outside of the State, this should be highlighted in the business plan at the time of application and supporting evidence supplied. The Customer must notify the Employment Personal Adviser in advance of all business trips. A reasonable business trip shall be classified as being in the region of 3 to 4 days. Un-notified periods spent outside of the State may result in the claim being suspended and depending on the circumstances closed and overpayments may be raised.

Retained Fire Fighter

A retained fire fighter is eligible to participate in the STEA scheme, while continuing as a retained firefighter, provided they are awarded the Jobseeker’s Benefit and fulfil the scheme requirements.

“Retained firefighter” is a person employed as a firefighter by a fire authority, e.g. County Council/Corporation, on a part-time basis and who is paid a retainer plus a fee for attendance at training and callouts.

It is classed as a Community Service which is assigned a special dispensation due to the nature of the employment. It is not necessary to have 100% dedication to the business in this instance.

Changes in Circumstances

The onus is on the Customer to advise the Department of any change in their circumstances during the duration of their STEA payment.

Payments and Secondary Benefits

Payments

The STEA replaces the participant’s Jobseeker’s Benefit/Jobseeker's Pay‐Related Benefit. On establishing and qualifying an entitlement to STEA, the person is paid at the appropriate JB/JPRB rate until entitlement of JB/JPRB expires.

Under JPRB – the person will continue to be paid the personalised underlying rate of entitlement which can adjust at 3-monthly intervals in line with the underlying payment. For example, if a person in receipt of the maximum JPRB rate of €450 per week transfers to STEA after 13 weeks on JPRB, the STEA rate will be adjusted to €375 at week 14 and €300 at week 27.

Customers are entitled to the appropriate Budget increases.

Secondary Benefits

Customers of the scheme may retain any secondary benefits they were in receipt of prior to participation on STEA such as Medical Card, Back to School Clothing and Footwear Allowance, Diet Supplement, Rent Supplement or Mortgage Interest Supplement payable under the Supplementary Welfare Allowance Scheme.

Any increase in income may affect a participant’s Rent or Mortgage Interest supplement.

Applicants for STEA should contact their local Community Welfare Officer to see how their Rent or Mortgage Interest Supplement may be affected.

Applicants do not qualify for the Household Benefits Package or Free Travel while in receipt of JB/JBSE.

Eligibility

The STEA Customer must satisfy the following conditions immediately prior to commencing self-employment:

• applicants must be awarded Jobseeker’s Benefit or or Jobseeker's Pay‐Related Benefit
• have made an application for STEA before engaging in self-employment
• setting up a new enterprise (refer to section Setting up a New Business)
• the applicant must be in a position to start up a viable business as a self-employed person
• a Qualified Adult on a JB claim does not fulfil the eligibility criteria of this scheme

Resumption of an STEA claim

Customers are allowed to resume the STEA, where the STEA ceased due to mitigating circumstances(can include a long-term illness or injury requiring prolonged absence from self-employment or the serious illness of an immediate family member requiring the Customer undertaking a caring responsibility).

Resumption must always be in respect of the enterprise originally approved for STEA.

Customers resume STEA at the original rate unless there is a change in circumstances (including budget changes).

Claiming STEA for a second time

A Customer who has previously participated in the STEA scheme may apply again once all eligibility criteria have been met and:

• In the case of a new enterprise five years must have elapsed since their previous STEA claim closed.
• In the case of the same enterprise, the business must have ceased trading for 5 years.

STEP 1

Examination of suitability for STEA

• A meeting must be conducted on a one to one basis with the Customer and the Employment Personal Adviser.
• Where a Personal Progression Plan (PPP) has been previously agreed, it is appropriate that this is examined to establish if self-employment was previously considered. If they are case managed then a PPP should be updated and the ‘case managed’ ended where an STEA claim may be put into payment.

A new applicant should be informed of the services of a Local Development Company (LDC) once an Employment Personal Adviser has established that the Customer meets the eligibility criteria for the STEA.

• Having established their eligibility, an Employment Personal Adviser must complete an assessment of suitability form which must be signed by both the Employment Personal Adviser and the Customer. If a participant is not eligible a letter of refusal should issue to the Customer.
• The Employment Personal Adviser must establish that the proposed business is a new enterprise and examine the proposal under the following headings:
• Sustainability
• Displacement
• Seasonality
• Market Saturation/Competition

Sustainability

To ensure a business is capable of operating at full capacity, the Employment Personal Adviser should document any concerns on financial sustainability for consultation with the LDC, and where satisfied, the Employment Personal Adviser will allow the application to progress.

Displacement

STEA should not be considered where the supported new enterprise will likely cause displacement i.e. provide an unfair trading advantage over local competitors as a result of DSP support. If displacement is a concern this should be noted by the Employment Personal Adviser on the assessment of suitability form and discussed with the Customer. Where necessary the Employment Personal Adviser may need to consult with the Enterprise Officer in the LDC.

Market Saturation/Competition

Another consideration is where an Employment Personal Adviser does not see the sustainability of a proposed new enterprise due to an existing high level of operation within that sector locally. One such example can be found within the taxi industry, which is not supported under STEA for new business start-ups.

Seasonality

Seasonal, temporary or part time self-employment is not acceptable for the STEA. All business plans for a new enterprise should indicate year round operations.

STEP 2

Employment Personal Adviser Consultation with Local Development Company

• Consultation with the LDC is advisable but not compulsory and the Employment Personal Adviser may use their discretion to examine if this is viable considering the duration of the JB/JPRB claim. This should be discussed with the Customer where they are advised of this option and noted on the assessment of suitability form.
• As the STEA is payable for the remaining duration of the JB/JPRB claim, processing a claim promptly is important. If the LDC does not have the capacity to assist the applicant in a timely manner the Employment Personal Adviser should proceed to the final recommendation.

Business Plan

The business plan should include the following as a minimum:

• A full description of the business idea including how and where trading is to take place. This will help give an indication of income and overheads.
• Compliance with all statutory requirements.
• Business Financial Planning (include concerns highlighted by the Employment Personal Adviser)

o Business cash-flow

o Incomings

o Outgoings (Overheads such as public liability insurance, rent, business rates, stock/equipment costs etc.)

The participant will need to demonstrate that their Business Plan is viable and that the business has sustainability potential.

Income from STEA should not be included as part of the business cash flow or income projections.

• Consider issues of local displacement and market saturation, and address any concerns highlighted by the Employment Personal Adviser.

Employment Personal Adviser Recommendation

The Employment Personal Adviser must then make a final signed recommendation on the STEA1 application form and forward to the Deciding Officer.

All claims are administered through the Intreo Centre.

STEA Claims - Scanning Steps for Employment Personal Advises

All documents should be scanned under:

• Activation Case Management;
• Employment Support Services;
• Action and;
• Document Creation.

Documents should be scanned separately and dated accordingly with relevant subject heading.

Employment Personal Adviser Non Recommendation

There may be two stages where an Employment Personal Adviser may not recommend a Customer for STEA.

1. Employment Personal Adviser initial assessment stage on the basis of scheme eligibility;

2. Employment Personal Adviser after examination of the completed business plan and application (following consultation with the LDC where necessary).

At this point the Employment Personal Adviser should scan all documents as outlined in section above and notify Deciding Officer.

The Deciding Officer will then make the final decision, register the STEA claim on ISTS, scan all documents to STEA claim on BOMi and issue correspondence accordingly.

Requests for Review of Entitlement

A Customer who is not satisfied with a recommendation of an Employment Personal Adviser may request a review in writing within 21 days.

The request must clearly state the basis of the review, enclosing any new evidence or any other information that may support their case.

The Short Term Enterprise Allowance scheme is a non-statutory scheme and therefore not appealable to the Social Welfare Appeals Office.

Re-examination of an Employment Personal Adviser’s Non-recommendation

A re-examination and review of the assessment must be conducted by another experienced Employment Personal Adviser/Area Manager, who was not involved in making the initial recommendation.

The outcome of the re-examination and review should be clearly documented and communicated in writing to the Customer by the Deciding Officer and all documentation scanned to the STEA- as in section STEA Claims - Scanning Steps for Employment Personal Advisers.

STEP 3

Deciding Officer (DO)

Ultimately the Deciding Officer (DO) has sole responsibility for making the decision to approve or refuse an STEA claim. The DO should take account of the recommendation of the Employment Personal Adviser.

A Deciding Officer’s decision should be communicated to the Customer & Employment Personal Adviser.

Where the DO does not accept the recommendation, they should discuss and clarify any issues with the Employment Personal Adviser before making the final decision.

In the event of a refusal the decision must be clearly outlined.

The Deciding Officer should then scan all documents, individually to the STEA claim on BOMi.

Re-examination of a Deciding Officer’s Refusal

A Customer who is not satisfied with a decision of a Deciding Officer may request in writing to have this decision reviewed.

Process is similar to steps above at Requests for Review of Entitlement ; however, review is carried out by another Deciding Officer.

Divisions/Intreo Centres should put in place standard arrangements for dealing with re-examination and reviews of STEA recommendations and decisions.

Assignment of Applications

Applications for Short Term Enterprise Allowance are dealt with by the Department’s Intreo Centre/Branch Offices.

Control Procedures and Recovery of overpayments

Failure by Customers to comply with the rules and conditions of the scheme will result in closure of the STEA payment and, where identified, the raising of an overpayment or consideration of a prosecution where fraudulent conduct is suspected.

The onus is on the Customer to advise the Department of any change in their circumstances at all times.

Freedom of Information (FOI) and General Data Protection Regulation (GDPR)

DSP Staff are required to ensure that all information and personal data received in respect of STEA comply with the Department’s Freedom of Information and General Data Protection policies.

Formal arrangements are in place for the exchange of information with other Government Departments /Agencies in accordance with the law.

Any exchange of information should be compliant with Section 261 of the Social Welfare Consolidation Act 2005

Contacts

All Customer queries should initially be addressed at the Find your local Intreo Centrelocal Intreo Centre and those that cannot be resolved submitted by email to BacktoworkAllce@welfare.ie or in writing to Short Term Enterprise Allowance (STEA):

Assessment of suitability form and other correspondence can be located at the WASP team site link

Enterprise Support Grant (ESG)

Enterprise Support Grant provides financial support of up to €2,500 for recipients of the BTWEA scheme. This is prorated for those Jobseeker Benefit (JB)/Jobseeker's Pay‐Related Benefit (JPRB) applicants that are approved and awarded the Short Term Enterprise Allowance. Financial support of up to €1,000/€625* is provided depending on the qualifying period of the JB/JPRB claim i.e. 6 or 9 months.

If two people are in receipt of STEA for the one business, only one ESG grant is payable.

Public Liability Insurance is the only type of insurance covered under the ESG scheme. All other types, including vehicle insurance, should not be covered.

Except for training/mentoring costs, claims should not be accepted or approved for amounts less than €100.

(*See ESG rates applicable to the STEA scheme at tables 1 and 2 below)**

TABLE 1:

TABLE 2:

Link to the schemes page- Short-Term Enterprise Allowance (STEA)