Eliminating the poverty trap has to be a priority
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THE ESRI study published yesterday identifies several factors involved in the creation of a long-term dependency on social welfare payments.
Apart from the obvious one of poor literacy and numeracy skills, others, such as a large number of children, old age and previous engagement with the social welfare system may help identify those more at risk.
The study was carried out in the Celtic Tiger era and, as the authors point out, those joining the dole queues today may have far higher qualifications and are at less risk of becoming long-term unemployed.
Unfortunately, there are other factors which need to be considered and which lie outside the study's remit.
It is not just that there are fewer job opportunities around today, but also that employers often find they cannot compete with the social welfare system.
Simply put, leaving the system poses several risks to a prospective employee. Primarily, it puts their right to a medical card at risk, as well as a plethora of other assistance payments such as rent allowance, supplementary child benefits, spousal allowances etc.
In his Bord Snip report, Colm McCarthy pointed out that anyone with three children and a spouse (non-working) can claim benefits amounting to €803.09 a week, or €41,960 a year.
A couple with no children and in receipt of rent allowance receive the equivalent of €27,000 a year.
The problem for individuals in this position is that to take up employment they run a huge risk of losing out on one or all of their benefit payments, a real poverty trap.
As the recession has deepened and the dole queues lengthened, the social welfare system has provided a safety net for thousands.
The Government will have to fork out some €4.6bn on unemployment payments this year -- this accounts for around 22pc of the social welfare spend.
A study which tells us how to spot those who may take up long-term residency within the system certainly has its merits, but really what we need is to address the inequities which make it more attractive to stay on the dole than take up a job offering over €40,000 a year.
- Pat Boyle
