IT PAYS TO BE ON THE DOLE; Our Generous Social Welfare Is Finally on the Hit-List as It's Revealed That Couples on Benefit Earn MORE Than Those on Minimum Wage

Daily Mail (London), November 15, 2010 | Go to article overview

IT PAYS TO BE ON THE DOLE; Our Generous Social Welfare Is Finally on the Hit-List as It's Revealed That Couples on Benefit Earn MORE Than Those on Minimum Wage


Byline: Niamh Lyons Political Correspondent

A FAILURE to tackle overgenerous welfare payments is fuelling unemployment because the jobless are choosing to stay on the dole rather than seek work.

Leaked documents from the State's business advisory body Forfas show couples claiming the dole are paid more than minimum wage workers.

Benefits have become so generous that employers say even vacancies offering [euro]15 an hour - the minimum wage is [euro]8.65 - are proving hard to fill.

Yesterday Enterprise Minister Batt O'Keeffe gave the clearest indication yet that the Government would finally do what critics have been urging for years - cut jobseeker's allowance and a raft of other unemployment-related payments.

Mr O'Keeffe said the system governing payments to the unemployed needs to be 'rebalanced' and that a 'fundamental shift' in the social welfare model is needed.

Business leaders and opposition TDs last night claimed an 'overhaul' of the welfare system was vital in order to get people back to work.

A report by Forfas, which is under consideration by the minister, claims an unemployed couple with two children can claim 19,8annually from the welfare system, through a combination of dole, rent and fuel allowance, and other benefits .

If one person in the family were to accept a 39-hour-a-week minimum wage job, their overall income would drop to just 1,992. 'A couple with one earner and two children in receipt of welfare have 13 per cent more income 2,3per annumby staying at home rather than take the job,' the Forfas analysis states.

Ireland has the fifth highest net wage level in the 28 countries in the Organisation for Economic Co-operation and Development area.

The economic advisers also argue that the disincentive to work increases the longer a person is unemployed due to increased entitlement to additional secondary benefits - such as fuel and rent allowance - while their employability is diminishing.

The analysts say: 'An across-the-board reduction in primary and secondary welfare rates will have a positive impact on labour market activation and, ultimately, place downward pressure on unemployment, improve our cost competitiveness, reduce the cost of our goods and services internationally, and make us more attractive for foreign direct investment.'

Jobseeker's Benefit - around 196 a week - is paid weekly to those who have made adequate social insurance contributions and who are out of work.

Jobseeker's Allowance is a means-tested payment made to people who are unemployed but do not qualify for Jobseeker's Benefit.

The latest data from the Department of Social Protection reveals that from January to the end of July this year, 9million has been paid in Jobseeker's Benefit while a further 1. …

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