Monday 5 December 2016

Family can earn up to €42,500 in 'welfare bonanza'

Charlie Weston Personal Finance Editor

Published 04/10/2011 | 05:00

A FAMILY with four children can get up to €42,500 a year in welfare payments, the Government admitted last night.

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The revelation prompted employer groups to complain about a "welfare bonanza" which was sucking away incentives for taking up work.

ISME boss Mark Fielding acknowledged there were few jobs available, but high welfare payments were deterring workers from taking up those vacancies that were to be filled.

A study by the Department of Social Protection found that a family of two adults and four children was entitled to €42,552 a year in social welfare payments if they lived in Dublin. This works out at €818 a week.

A Galway-based family of the same size would get €38,444 a year. In weekly terms the family would end up with €740.

The lower total welfare figure for the West of Ireland family is due to lower rent supplement as housing costs are lower than in the capital.

Officials denied this would stop people taking up jobs, insisting it would still be worth while for of one of the parents to take a job paying €28,000. They would qualify for other welfare schemes while working which would supplement any loss of income.

There have been persistent claims that generous welfare payments, particularly those for families, were keeping families locked in a welfare trap, where it was more rewarding to stay on the dole than take a job.

Officials carried out the examination of the welfare trap after a businessman said in March he offered a permanent job to two separate workers who had been unemployed for two years but was rejected.

Last night the Department of Social Protection study showed a family with four children received €16,266 a year in Jobseeker's Allowance for the unemployed person and the qualified adult. Payments of €6,198 were due for the four children as part of the dole. The department also added in €7,488 in child benefit.

Fuel allowance of €640 was also included, but no amount was included in the department's figures for back-to-school payments.

Rent supplement varies between €12,000 in Dublin and €7,852 in Galway.

Supplement

The welfare payments were compared with a job paying €28,000. After paying PRSI and the universal social charge the net pay would be €25,865.

But officials said the family would also be entitled to €10,190 in family income supplement -- a welfare payment made to the low paid.

Child benefit of €7,488 would take the net income up to €43,543. The department also added €3,647 to cover rent under a scheme administered by local authorities called the rental accommodation scheme.

Mr Fielding said employers were now finding staff they had put on three-day weeks were reluctant to now go back full time as they would lose welfare entitlements.

Irish Independent

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