Will Budget 2012 mean €8 off dole payments or €10 off child benefit?
'Everything up for grabs' in battle to bridge deficits
Published 21/11/2011 | 05:00
FINANCE Minister Michael Noonan today dismissed reports of a €10 cut in child benefit as speculation and said the government had not made final decisions on the Budget yet.
The Budget, in two weeks time, would be pro-growth, pro-growth and fair he said, but did not comment on reports that a dole cut of €8 is being considered too.
Social Protection Minister Joan Bruton neither confirmed nor denied child benefit rates may be cut today.
She said this rate along with all other social welfare rates was being looked at, but no final decisions had been made.
Protecting child benefit is a red line issue, Fianna Fail social welfare spokesman Barry Cowen, said.
A dole cut of €8 a week is being considered in a desperate attempt to bridge the Budget deficit, The Irish Independent has learned.
Ministers have discussed reducing unemployment benefit despite numerous pledges from Taoiseach Enda Kenny and Tanaiste Eamon Gilmore that basic welfare rates would not be touched.
The Cabinet is also looking at a controversial €10 across-the-board cut in child benefit.
The Programme for Government explicitly rules out cuts to basic payments like the dole, and the coalition wants to avoid such reductions if possible.
Family support groups today expressed alarm at the proposed cut in child benefit.
The National Women's Council said the payment had become an easy target for successive governments and that any reduction would lead to further hardship for families.
Early Childhood Ireland, which represents pre-schools and day-care services, said such a proposal would hit the poorest families hardest.
And the Children's Rights Alliance has said low income families would have to be compensated in the event of a cut.
It is understood the €8 dole cut was discussed as an alternative to reducing the welfare budget in other areas -- including child benefit. Sources said Ms Burton was resisting the proposal.
Labour ministers last night maintained that payments like dole, pension, as well as carer's and lone-parent allowances -- areas where a person is entirely dependent on welfare for income -- would be protected.
When asked if the dole and the old-age pension would be protected from cuts, Transport Minister Leo Varadkar said yesterday: "Everything in the budgetary process is up for grabs. Nothing is decided."
Ms Burton is responsible for the €21bn welfare budget and her department will bear the brunt of the €2.2bn in spending cuts to be announced by Mr Noonan.
She has to find €700m in savings in her department, and discussion of a dole cut illustrates the stark options she and the Government face.
The Cabinet will meet twice this week to finalise the programme, while taxation changes will be agreed in the next week.
Former finance minister Brian Lenihan last year reduced child benefit by €10 a month for the first and second child and by €20 for subsequent children. He also reduced the dole and carer's and disability allowances by €8 a week.
The dole currently stands at €188 a week, with those aged 18 to 21 getting €100 and others between 22 and 24 getting €144. Child benefit is currently €140 a month for the first child, and rises for subsequent children.
A coalition source last night said the idea of a dole cut was floated as recently as 10 days ago, when Ms Burton made presentations to cabinet colleagues on how she was going to bring about reductions.
A source said it was part of "a menu" of cuts presented to ministers.
Labour backbenchers expressed alarm at reports of a €10 cut in child benefit, while others said they expected it to be hit. But they may be faced with an alternative of cutting unemployment payments instead.
Dublin North-Central's Aodhan O Riordain said "it would be a particularly difficult pill to swallow unless it is counterbalanced by some other serious measures that protects the same families".
Galway East TD Colm Keaveney said he was "absolutely uneasy" about any child benefit cut, and couldn't see "how it could be justified".
"There is a degree of anger, since we said we'd protect children as we went through this austerity," he added.
Protecting child benefit rates against Fine Gael cuts was a key election promise of the Labour Party.
Cork South-West's Michael McCarthy said he wasn't surprised that child benefit was in the firing line, insisting that basic rates like the dole and pension would be maintained.
Labour Junior Foreign Affairs Minister Jan O'Sullivan last night said the coalition faces "no easy choices" as it looks for €3.8bn in cuts and taxes for next year.
"That is the situation we are in as country," she told RTE's 'The Week in Politics'.
"We don't want to have to do this," she said. "But certain measures have to be taken and they have to be taken in a way that protects the least well off as well as we can and that's the intention of the Government."