The Pandemic Unemployment Payment (PUP) is to be phased out in three stages from September, while business supports are to be extended until later in the year.

The Government will today publish its National Economic Recovery Plan, which outlines how it will gradually reduce the State support for employees who lost their jobs due to Covid-19 restrictions.

The first cut will see €50 taken off the top three rates of the pandemic support. That means those now on €350 a week will see their payment reduced to €300 in September.

A further €50 reduction is planned for November, followed by a final cut of the same amount in February next year.

Once the final cut is implemented, it will mean the pandemic support will be reduced to the same rate as the €203-per-week Jobseeker’s Benefit.

The PUP scheme is expected to be closed off to new entrants from July 1, while students returning to studies in September will also stop receiving the payment.

The number of people in receipt of the pandemic payment has dropped significantly in recent weeks but still stands at 309,000.

The politically sensitive move to cut the payment is coming against a backdrop of people returning to work as restrictions on non-essential retail and hospitality are lifted.

However, the Government is set to face pressure from opposition parties over the moves.

Meanwhile, supports for businesses are expected to be extended until the end of the year. The Employee Wage Subsidy Scheme (EWSS) will run until June next year.

The suspension of redundancy payments will be extended until November while the commercial rates waiver will remain in place until at least September.

The Covid Restrictions Support Scheme (CRSS) is to be extended until the end of the year. The scheme offers businesses up to €5,000 a week if they were forced to close due to Covid-19 restrictions and there is double weekly payment when they are returning to work. There was some discussion in Government about increasing the exit payments.

The National Economic Recovery Plan will also outline how the Government will spend almost €1bn in funding it received under the European Recovery and Resilience Facility.

More than half of this funding will be committed to green initiatives aimed at ensuring the Government reaches its carbon emission targets.

This will include a loan scheme for retrofitting homes, which it is hoped will see banks and financial institutions offer loans with 3.5pc interest rates to homeowners seeking to make their houses more environmentally
sustainable.

The EU funding will be used to provide risk protection to banks and financial institutions that offer retrofitting loans at low rates.

Green Party leader and Transport Minister Eamon Ryan is also planning to spend the EU funding on major public transport projects in rural Ireland.

The finance will also be used to fund environmental business, research and innovation projects.

A condition of the EU funding is that 37pc of the money is spent on green initiatives.

Another €225m in funding will go to the Department of Further and Higher Education, Research, Innovation and
Science.

Higher Education Minister Simon Harris will spend €40m on a transformation fund for technological universities (TU) across the country and €70m for research projects in the areas of climate action and digital infrastructure.

Continued investment in skills – both upskilling and reskilling – will be essential for those whose jobs are unlikely to return.

A new Green Skills Action Programme will be launched, including an online green skills programme and an expansion of the retrofitting scheme to include an
additional 5,000 people.

There will also be training to help those in construction make buildings more usable and sustainable in the context of an ageing population and for people with disabilities.

There will be targeted supports for those who have lost their job as a result of Covid-19 and are unable to return to their previous employment following the pandemic, including training them in new digital skills.

Under the TU fund, higher education staff will be upskilled in digital technology, outreach and blended learning, as well as a reform of local and regional enterprises to develop pools of graduates with the skills and training required.

A Cabinet committee on the economy has been working on the Economic Recovery Plan for a number of months. Finance Minister Paschal Donohoe, Public Expenditure Minister Michael McGrath and Social Protection Minister Heather Humphreys have been centrally involved in
drafting the plan.

Arts Minister Catherine Martin has been seeking to have a basic income support for artists included in the plan, but her spokesperson would not say last night if it was included in the final plan to be
published this afternoon.

The Cabinet will sign off on the plan before the three Government leaders hold a press conference.