Dole recipients face cuts under bailout to 'make work attractive'
Published 30/11/2010 | 05:00
PEOPLE on social welfare who are receiving multiple state payments could have their benefits cut as part of a drive to make it more attractive to go back to work.
The Government's agreement with the IMF-EU makes it clear that the "housing allowance" will be part of the benefits considered for cutbacks.
The aim is to reduce the "replacement rate" -- the difference between the income a person earns from being at work and being on the dole.
The Government considers a replacement rate of 70pc (of the income of someone in a minimum wage job) to be "excessive".
The programme agreed with the EU and IMF states that there will be steps to tackle unemployment and poverty traps "including reducing replacement rates for individuals receiving more than one type of benefit (including housing allowance)".
Although these measures were alluded to in the four-year plan, there was no detail about where the focus would be.
The move to review the payment of multiple social welfare benefits, including housing benefits, drew a furious response last night from the Irish National Organisation for the Unemployed.
Its director of policy and media, Brid O'Brien, said the proposals had been drawn up by people who had no idea of what it was like to live on €196 per week.
"They are probably being paid €196 per hour or every half-hour," she said.
Ms O'Brien said cutting social welfare to impoverish people at a time when there was no jobs growth was nonsense.
"The four-year plan talks about a 'cumulative increase' of about 90,000 jobs over the next four years.
"That's not enough jobs for the people currently unemployed, those coming out of school and those coming back into the market after going back to further education," Ms O'Brien said.
However, a recent Department of Finance report found that rent supplement -- the rent support payment made to around 92,000 people on social welfare -- could have a significant influence on people's incomes.
It found that a couple living in Dublin with no children, getting the maximum rent supplement payment, could have an income of €17,542.
This was a 100pc replacement rate -- the same income as someone receiving the national minimum wage who was not receiving rent supplement.
Social Protection Minister Eamon O'Cuiv last week told the Dail that he was keeping the rent supplement scheme "under review".
But according to the most recent analysis of the live register by his department, the majority of people on social welfare had replacement rates of less than 70pc.