Government plans to slash the PUP by €50 in September, €50 in November and €50 in February.
The first cut will come in "mid-September", a senior Government source who has seen the proposals told the Irish Mirror on Monday night.
Government ministers will announce the plans to wean over 300,000 people off PUP on Tuesday.
It will come with the promise that there will be “no cliff edge”, but over a number of months, it will nearly be halved from €350 down to the regular unemployment rate of just over €200.
This means that there will be no cuts until the end of the summer, with plans to go before ministers’ approval on Tuesday calling for a series of €50 cuts across the autumn and winter.
Students will also be kicked off the scheme in September as they head back to college and no new entrants will be allowed.
The wage support paid through employers for workers, the EWSS (Emergency Wage Support Scheme) is “likely to be extended into the medium term,” according to a Government source.
The full Cabinet will have a discussion on these proposals at a meeting on Tuesday morning and will have the final collective say.
Opposition politicians and workers will vehemently oppose any tapering off of the payment, but the Government will argue back that it is unsustainable going forward.
Last week PUP cost the Exchequer €102m and it has clocked up €7.7bn in payments since it was first introduced last year.
The PUP cuts will be announced alongside a major stimulus package to get the economy back on its feet after Covid.
Taoiseach Micheál Martin, Tánaiste and Minister for Business, Leo Varadkar, and Green Party leader, Eamon Ryan, will jointly launch the National Economic Recovery Plan.
The Government is in line to receive almost €1bn from a special EU Covid fund.
This will help pay for a number of initiatives, including the extension of the VAT waiver for the tourism sector and another waiver of commercial rates, which was due to end at the end of this month.
And as part of an overall reform of working life, Mr Varadkar will commit to introducing a ‘living wage’ as soon as two years’ time, with auto-enrolment for pensions also to be announced.
