Bernard Allen
Question:77 Mr. Allen asked the Minister for Social and Family Affairs the efforts he is making to tackle the new phenomenon of the working poor; and if he will make a statement on the matter. [17150/05]
View answerTuesday, 24 May 2005
Questions (78, 79)
Gay Mitchell
Question:90 Mr. G. Mitchell asked the Minister for Social and Family Affairs the supports, programmes and measures his Department intends to take to address the problem of the working poor; and if he will make a statement on the matter. [17205/05]
View answerWritten answers
I propose to take Questions Nos. 77 and 90 together.
The two main methods of measuring poverty in Ireland are the national "consistent poverty" measure, based on a relative income threshold of 60% of median income and enforced deprivation of certain items, and the EU "at risk of poverty" measure, which is simply based on 60% of median income. The 2003 EU survey of income and living conditions, EU-SILC, indicates that 3.5% of people at work fell into the consistent poverty category compared to 9.4% of the population generally. The survey further shows that 9.2% of people in Ireland who were at work were at risk of poverty, compared to 22.7% of the population generally. It is clear from these figures that being at work significantly reduces the risks of poverty and deprivation.
However, despite the economic advances of recent years some families find themselves dependent on low wage employment, leading to the phenomenon mentioned by the Deputy — the working poor. The reduction of poverty is a core objective of this Government. In that regard, accepting and keeping a job is seen as the most important route to escape poverty and to ensure social inclusion.
However, it is important to ensure that work "pays" and a number of policy instruments crossing a range of Departments are used as a way of preventing poverty among the working poor. These include changes to the taxation system, the introduction of a national minimum hourly wage, provision of training and access to lifelong learning opportunities, assistance with job search and placement, the introduction of flexible working arrangements and increased access to affordable child care and changes to the social welfare system to support the transition to employment and improve the retention of non-cash benefits during that transition.
One of the main policy responses in my Department, designed to address the problem of low income working families, is the family income supplement, FIS, scheme. The scheme provides cash support amounting to a minimum of €20 per week for employees who work a minimum of 19 hours per week or 38 hours per fortnight. This preserves the incentive to remain in employment in circumstances where the employee might only be marginally better off than if he or she were claiming other social welfare payments.
Budget 2005 increased the FIS earnings thresholds by €39 in respect of each family size. This increase was unprecedented since the introduction of the scheme in 1984 and added €23.40 to the weekly payments of most existing FIS recipients from January 2005. The cost of this measure is estimated at €15.53 million in 2005. Following the increased thresholds, it is estimated that 2,600 additional families became eligible for a FIS payment. The ongoing development of the FIS scheme has resulted in current levels of both applications and claims in payment being at an all time high. In 2004, there were 21,000 applications and 15,000 claims in payment. The current average FIS payment is almost €94.00.
Effective and adequate support for making work pay will continue to be a major priority for this Government and for me as Minister for Social and Family Affairs.