Brian O'Shea
Question:468 Mr. O'Shea asked the Minister for Finance the additional measures he will introduce in 2001 to promote social inclusion in view of a submission (details supplied); and if he will make a statement on the matter. [1064/01]
Written Answers. - Social Inclusion.
My recent budget announced an additional £1.2 billion in social inclusion spending in full year terms. This was on top of substantial expenditure increases announced in the context of the Estimates and covering all aspects of public services, including housing, health and education.
Within this overall context, the value of the social welfare improvements contained in the 2001 budget amounts to a record high of £850 million in a full year. This is more than double the previous year's budget package, which was a record in itself, and will bring estimated total expenditure by the Department of Social, Community and Family Affairs to more than £6 billion in 2001, compared to £4.5 billion in 1997.
There can be no doubt that the 2001 budget, which is the first budget covering the three year period of the Programme for Prosperity and Fairness, provides for very substantial progress towards the commitments made in the programme, including those in regard to social welfare rates generally and child benefit improvements.
As outlined in An Action Plan for the Millennium, tax reductions are an integral part of the Government's strategy to maintain and improve competitiveness and to encourage the take up of employment. We have made considerable progress in this regard through a balanced strategy of removing more of the low paid from the tax net, by reducing tax rates, by ensuring that a large majority of taxpayers are subject to no more than the standard rate of income tax and by completing the transition to a more progressive system of tax credits. The tax changes announced in the 2001 budget will remove a further 133,000 people from the tax net, bringing the total number of income earners outside the tax net to 668,000 or 38% of all taxpayers. The substantial increase in tax credits and the reduction in the standard rate of tax will also reduce the tax burden for other lower income households. Moreover, since April 2000, all those earning less than £226 per week are exempt from PRSI and there is a commitment over time to remove all those on minimum pay from the tax system.
In the tax year 2000-01 a single person pays no tax on the first £110 of income per week, whereas when the Government came to office a single person entered the tax net at £77. As of 6 April 2001 a single person will not enter the tax net until they have earned in excess of £144 per week. I am confident that the 2001 Estimates and budget will consolidate the very welcome progress which has been made to date on poverty reduction and social inclusion. This has seen the numbers experiencing consistent poverty, as targeted by the national anti-poverty strategy, fall from 9%-15% in 1994 to 6%-8% in 1998, the latest date for which figures are available and since when there have been further substantial reductions in unemployment, particularly long-term unemployment. Indeed, employment remains the single most effective weapon in tackling poverty.