THE social welfare bill is forcing the Government to borrow €127m every month. A massive €3.32bn was borrowed during the past two years as the country struggled under the weight of growing unemployment. Another €1.5bn will be borrowed this year.
The Government is forced to borrow the money after the Social Insurance Fund -- into which all PRSI payments go -- was exhausted last year as a result of our soaring unemployment rate.
On May 28, 2010, the fund went into deficit for the first time since 1997 as the PRSI payments no longer covered the amount of welfare being paid out.
Figures show that a total of €6.71bn in PRSI payments were gathered in 2010 -- but €9.46bn was paid out, leaving a gap of €1.86bn which was covered by borrowing.
Last year the Exchequer gathered €7.54bn in PRSI payments but €9bn was paid out, a gap of €1.46bn.
Estimates for this year show the Government is expecting PRSI payments to drop marginally this year to €7.37bn -- but it also expects welfare payouts to drop by around €100m to €8.9bn.
This will leave a shortfall of €1.53bn which the cash-strapped Exchequer will have to pay into the welfare system.
A spokeswoman for the Department of Social Protection said: "On the basis of the current position, it would not be expected that the Social Insurance Fund will move towards breakeven levels of funding in the near term.
"An actuarial review of the Social Insurance is currently underway and is expected to be completed by July 2012."