Questions Nos. 9, 16 and 27 will be taken together. They have been tabled by Deputies O'Dea, Joan Collins and Broughan. I call on Deputy O'Dea to introduce his question.
Thursday, 28 November 2013
Questions (9, 16, 27)
Oral answers (11 contributions)
Willie O'Dea
Question:9. Deputy Willie O'Dea asked the Minister for Social Protection the estimated number of persons who will be affected by the cuts to jobseeker's allowance in 2014; the amount of money she estimates it will save in the full year; and if she will make a statement on the matter. [50826/13]
View answer
Joan Collins
Question:16. Deputy Joan Collins asked the Minister for Social Protection if she will reverse the budget decision to cut jobseeker's allowance for those under 26 years of age. [50843/13]
View answer
Thomas P. Broughan
Question:27. Deputy Thomas P. Broughan asked the Minister for Social Protection the number of persons aged 26 years and under who are currently in receipt of jobseeker’s allowance and who will receive reduced rates of jobseeker’s allowance from January 2014; and the specific actions that are being taken and will be taken to assist this category of jobseekers to find employment and training opportunities. [50607/13]
View answerThe Minister will be aware that people aged under 26 years suffered pretty drastic cuts to their job seeker's allowance or benefit in the recent budget. I am trying to ascertain how many people have been affected and what it has contributed to the State. The Government took almost €3 billion out of the economy, so what contribution has this reduction made?
What savings will be achieved by this reduction which is imposing so much suffering on one category of the population?
I propose to take Questions Nos. 9, 16 and 27 together.
In 2013, my Department will spend approximately €3.66 billion on jobseeker's benefit and allowance. It is one of the highest spends by the Department. At the end of October 2013, there were 67,990 persons aged 26 or under in receipt of jobseeker's allowance. Data included in the most recent Quarterly National Household Survey published by the CSO a few days ago is encouraging in respect of youth unemployment. It shows that the rate of youth unemployment in the 15 to 24 age bracket decreased from more than 31% to 26.5% over the year to the end of quarter 3 of this year. This is a very positive outcome for the recovery of jobs.
It is still significantly high.
Currently, there are 38,000 jobseekers under 25 years of age in receipt of a reduced jobseeker's allowance payment on foot of the changes that were first introduced in 2009. Receiving the full adult rate of a jobseeker's payment at a young age can lead to welfare dependency from an early age. If young people do not improve their skills, they are at risk of becoming long-term unemployed, which I am anxious to avoid. Therefore, it is considered necessary to provide young jobseekers with a strong financial incentive to engage in education, training or take up employment.
The changes made to jobseeker's allowance rates in 2009 are being extended from January, 2014 so that young jobseekers who are 25 years of age or under will have a financial incentive to engage in education, training or employment. This decision was made on foot of ongoing consideration of unemployment and incentives policy by Government. It is estimated that the measure will affect 13,767 persons in 2014 and will result in savings of €32 million in 2014. An additional €46 million will be spent on initiatives aimed at young people. I am happy to inform members that from 1 January next an employer who employs a young person who has been unemployed for more than six months will receive a cash wage subsidy of €300 per month. I appeal to Deputies to make employers in their constituencies aware that not alone can they assist a young person get back into employment but they will also get a significant wage subsidy in this regard.
It is acknowledged that many of the people adversely affected by the budgetary changes will not, because there are 30 applicants for every available job, be able to secure employment. It is also acknowledged that the number of available education and training places will not be sufficient. What will be the position in respect of a person who cannot get a place on a training or education scheme and cannot get a job? Does the Minister believe it is fair that such a person should lose 40% of his or her social welfare payment?
Regardless of what the Minister says in trying to defend her position, the reduction in core payment from €188 to €144 in respect of persons under 26 years age is a cut. As has been already stated, there are 30 applicants for every job. Nobody wants to remain on the dole or to have to live on €188 per week. It is a poverty income. People do want jobs. The Minister should allow the people concerned to remain on the €188 per week payment, create the jobs about which she speaks by way incentivising employers to take on people or any other system she wishes to put in place instead of trying to do both and using this to back up her position that this is to incentivise young people to go out and get a job at a time when it is difficult to do so.
I ask that the Minister retain the core payment for the under 25s, which is a low income. For a young person to even qualify for jobseeker's benefit his or her family must be on poverty income. I ask the Minister to allow these people some income stability in their lives and to focus on the creation of jobs which pay more than the minimum wage and include proper working conditions.
I read an article this morning in which the Minister spoke eloquently about a living wage and how difficult it is for people to exist on the minimum wage or welfare benefits. However, the Minister has significantly reduced a basic social welfare benefit for young people. The National Youth Council of Ireland has stated that there are now only two doors open to young people, namely, a social welfare payment of €100 or emigration. Every year since this Government has been in office the number of people required to fill the Aviva stadium have left this country. The phrase "a living wage" is only pious words, which the Minister will probably repeat on Saturday afternoon. Unfortunately, I cannot be there and will not hear them. In reality, this reduction in benefits is a severe cut.
As I understand it, we are in terms of the youth guarantee introducing the Dutch model, under which training or a job is provided. However, as stated by Deputy O'Dea it is not possible for the Minister to deliver the Dutch model in this country in a situation where the Labour Party is not really in power. That is the problem.
Some of the opportunities that will be available for young people include the following: commencing on 1 January next payment under the JobsPlus initiative of a €300 per month subsidy to an employer who takes on a person unemployed for six months will, I believe, be attractive to employers; an additional in-take of 1,500 young people on to JobBridge; 1,000 Tús scheme places targeted at young people; development of a pilot programme to support approximately 250 young unemployed people where there are opportunities under EURES; and ring-fencing of a minimum of 2,000 training places for the under 25s under the successful Momentum programme operated by the Department of Education and Skills, with income supports for participants provided by the Department of Social Protection. The Department of Jobs, Enterprise and Innovation will also make approximately €2.5 million in funding available next year to young entrepreneurs via Microfinance Ireland and other business start-up schemes. These measures are in addition to the significant existing spend of approximately €170 million on employment training and further education programmes for young people.
I know that Deputy Broughan and other Deputies have been heavily involved in supporting community employment and training initiatives. Is any Member here seriously suggesting that life on social welfare at the age of 18 years is better than being in employment, education or training? Is this the start in life they want for young people? Youth unemployment in this country is a very difficult problem. We must provide mechanisms to get our young people back to education and training, into work experience and, ultimately, into employment. Deputies will be aware of the recently published statistics which indicate 58,000 additional jobs have been created and that the rate of unemployment has decreased from 31% to 26%, which I accept is still too high. Deputies need to come up with ideas and work with us in addressing this issue. I hope they do not see the future of young people in Ireland on the dole as acceptable.
May I ask a final question?
No, we are over time and must move on to the next business.
Written Answers follow Adjournment.