Fine Gael say hike would impact participation rates in workforce as employers ‘cry out’ for staff
The Coalition is on a collision course over increases in the €208 per week jobseeker’s allowance in the Budget.
Fine Gael do not believe the unemployment benefit should be increased but Fianna Fáil and the Green Party are in favour of increases in the welfare payment.
Senior Fine Gael figures do not think the payment should be increased due to high demand for workers across several sectors.
There is a belief in the party that increasing jobseeker’s allowance will disincentivise unemployed people to take up jobs in the labour market.
“We would not be in favour of anything that would impact on the participation rates in the workforce,” said a senior Fine Gael source.
A Fine Gael Cabinet minister said it would not make sense to increase jobseeker’s payments at a “time employers are crying out for staff”.
A third senior party source said no decision has been taken on increasing the unemployment benefit.
However, a senior Fianna Fáil source said the Budget will see the weekly payment increase in line with State pension hikes.
The source said a jobseeker’s hike will increase in either percentage or cash terms with the pension.
Meanwhile, Minister of State Pippa Hackett said the Green Party favoured “across the board” increases to welfare payments.
“It’s no secret that we are supportive of targeted measures in the Budget, whether that’s social welfare supports, qualified child allowance, working family payment, things like the living alone allowances – I think across the board we’d like to see some supports,” Ms Hackett said.
Asked about recent calls by her Green Party ministerial colleague Joe O’Brien for “double digit” welfare increases, she said: “Personally, I’m not really interested in sort of kite-flying and putting figures out there. Everyone to their own.
“I support where we stand as a party and that is about targeting measures to those who need it most. I think that is crucial.”
Mr O’Brien previously suggested the jobseeker’s allowance should increase by €50 per week.
In their submission to the Commission on Taxation and Welfare, Sinn Féin also suggested the unemployment benefit should increase by almost €50 a week. However, they have since said they do not want this to happen in the forthcoming Budget.
Meanwhile, Social Protection Minister Heather Humphreys has said she would need to be an octopus to hold down all the kites being flown at the minute in terms of her department and the Budget.
Asked about a proposed €15 increase across the board in social welfare, Ms Humphreys said the Budget will be in a few weeks’ time and she would be happy to make the announcement, but she must engage with her Government colleagues first so would not speculate.
“There’s no point in adding to speculation and giving people information that’s not correct,” she added.
The Department of Finance’s Tax Strategy Group examined the costs and impacts of increasing all social welfare rates by €15 – sparking speculation that this is what the Government will announce on Budget Day next month.
Tánaiste Leo Varadkar insisted the Government has not promised anything ahead of September 27, the date of the Budget.
“Any number of suggestions have been put forward, and none of them have actually been considered by Government yet, and that won’t happen for a couple of weeks,” the Fine Gael leader added.
However, Higher Education Minister Simon Harris said college students and their parents could be in line for a double Budget boost.
He said students and their families should receive financial support in both next year’s Budget measures, and the cost-of-living package which will be introduced before the end of the year.
“I’m very clear that if there’s a package to help people with the cost of living between now and the end of the year, and a package into 2023, I want students and their parents to be part of both,” Mr Harris said at an event at Trinity College Dublin.