Vol. 457 No. 8
10 Mr. S. Brennan asked the Taoiseach if he will explain the unemployment figure difference of 84,000 people between the recent CSO Labour Force survey and the total on the live register; and if he will give details of the policy implications. [16023/95]
11 Mr. B. Ahern asked the Taoiseach if an explanation can be given for the difference between the live register measurement of unemployment by the CSO and the Labour Force definition. [16040/95]
12 Mr. McCreevy asked the Taoiseach the number of persons who were classified as on home duties in the 1995 Labour Force Survey; and if he will explain the difference between the Live Register and the Labour Force Survey of 1995 as regards total unemployment. [16341/95]
I propose to take Questions Nos. 10, 11 and 12 together.
The live register total has always exceeded the labour force survey estimate of unemployment. The difference was relatively small until the mid-1980s but has grown considerably since then. The latest figures, for April 1995, show that the live register exceeds the LFS estimate of the number unemployed by some 84,000.
The labour force survey, which has followed a consistent methodology since 1975, is the only objective source of information on numbers employed and unemployed. The recent survey results are based on a classification of persons according to their own description of their situation — that is whether at work, unemployed, working in the home, retired, etc. The live register, on the other hand, relates to persons who fall within the ambit of certain social welfare schemes designed essentially to cushion the impact on income of job loss. Changes in the administrative rules and practices governing these schemes all have an impact on the live register.
The most significant change in recent years was the Social Welfare (No. 2) Act, 1985 which resulted in an increased number of women signing on, without any change in their labour force status. Other factors which are likely to have had an impact on the live register, and to have contributed to the divergence, include the introduction of signing on as an eligibility requirement for subsequent participation in employment or training schemes; the increasing number of part-time and occasional workers (other than those on systematic short-time) who sign on in respect of days when they are not employed; changes in the rules and practices in relation to means testing; changes in the levels of unemployment assistance and unemployment benefit payments; arrangements for splitting of entitlements between spouses. These factors would tend, in the main, to exert an upward influence on the live register. However, it is not possible to quantify the exact impact of any one of these factors.
Given that the labour force survey, not the live register, provides the only objective measure of unemployment, a key policy implication which arises is the need for more frequent surveys. Proposals in relation to sub-annual surveys are currently being formulated by the CSO in consultation with the relevant Government Departments and agencies. It is the Taoiseach's intention to bring a final set of proposals to Government in the coming weeks in this regard which would address, inter alia, the issue of the content of such surveys and the frequency with which they should be conducted. Finally, the number of persons on home duties in the 1995 labour force survey was 625,000.
I thank the Minister of State for his reply. He will be aware there were 84,000 people more on the live register than were measured as unemployed in the labour force survey. What are 84,000 people who are not claiming to be unemployed doing on the live register?
As I have explained this arises as a result of a number of divergences. The live register is compiled monthly. The labour force survey is carried out in April and May of every year, covering 5 per cent of the population and 45,000 households. It is carried out in accordance with the best international standards and norms and it is generally recognised as the definitive gauge of employment and unemployment.
The Deputy's question as to the seeming contradiction is valid. One has to look at the reasons the measures differ. Some persons who are unemployed may not be included on the live register while others who satisfy the administrative requirements for unemployment assistance or benefit may not be unemployed. The detailed results of the 1994 labour force survey indicate that 28,000 who described themselves as "at work" also said they were signing on. It is possible for a large number of people who work part-time or occasionally to sign on in respect of days when they are not employed.
The 1994 labour force survey also indicates that 23,000 persons who described their status as "on home duties" also said they were signing on. This is indicative of the impact of equality legislation in the mid-1990s.
Which benchmark does the OECD use when examining Irish unemployment?
In its analysis of the Irish economy the OECD takes both figures into consideration. It is in everybody's interest to ascertain the precise figure and it is recognised internationally that the figure we should use is the labour force survey. The Government is looking at the possibility of moving to a more regular definitive assessment, in other words the labour force survey. There is a cost implication of an additional £1.9 million if one moves to quarterly surveys. I do not wish to pre-empt a Government decision but from the points of view of accuracy, economic analysis and satisfying people's understandable scepticism we should move toward a quarterly labour force survey.
I would impress on the Minister of State the urgency of moving more quickly on this. He mentioned the cost implication but the cost of a thousand persons on the live register is now £4 million per year and the cost of the survey must be put in proportion to that.
Is the Minister aware that ten years ago the gap was 6,000 and this year it is 84,000 and rising? Is he also aware that such surveys are carried out quarterly in the UK whereas we carry them out once a year? Will the Government examine the level of unemployment as indicated on the live register given that it is becoming a joke to have 84,000 drawing benefit in a way which conflicts dramatically with what the Minister of State describes as an accurate survey?
I agree with the Deputy's observation that the gap has grown —in 1987 the figure was 18,600, in 1988 23,000, in 1989 31,000, in 1990 45,000 up to 84,000 this year. It is not, however, a uniquely Irish experience but is repeated in other countries. In Belgium the figure is 163,000, in Denmark 130,000, in Greece 189,000, in France 111,000 and in Italy 2,420,000. There is a recognition in those countries of the need for a more standard procedure.
I do not accept there are 84,000 people getting dole who should not be getting it, in other words lying for a living. Many people signing on are simply exercising their right to do so. They are stating in effect that they are available and able for work and are looking for a job, but they may not necessarily qualify for unemployment assistance. Many people apply in the hope they will get a place on a community employment scheme or a FÁS scheme by signing on for a set period of time and this get some work beneficial to them or the community. There are also many people who are signing on from the point of view of credits.
It is a matter for the Minister for Social Welfare as to whether the matter can be tackled by trying to weed out people who are getting unemployment assistance or benefit illegally.
The estimated cost of a quarterly survey is £3 million. Would that not be money well spent? Given that in 1992 the overpayments detected by the Department of Social Welfare were £6.7 million, in 1993 roughly £9 million and in 1994 almost £14 million, does that not suggest that fraud may be rife in the social welfare system? Given the major divergence between the two surveys would it not be right and proper for the Minister, together with the Department of Social Welfare, to take far greater cognisance of overpayments and the fact that only 35 per cent of overpayments are recouped by the State?
The savings resulting from the detection of fraud are very welcome and show the vigilance of those policing the system. Let me emphasise that people should not jump to the conclusion that the 84,000 people who feature on the live register but not in the labour force survey are in any way guilty of fraud. Many people sign on for credits or other benefits and express their bona fide availability for work. Very often there is income splitting in families and the social welfare payment is divided between the husband and the wife.
Surely the Minister is not suggesting that accounts for the 84,000?
I would like to kill the suggestion that the 84,000 people in question are guilty of fraud. One has to look at the range of benefits through which that trawling takes place, for example people have been found to have been claiming disability benefit and disabled person's maintenance allowance who are not entitled to it. People may be claiming pensions without declaring on an annual basis that there has been an increase in their means. To give that as a global figure and relate it directly to the 84,000 people is simply not accurate in the context of the information I have given in the House.
I take a slightly different view from many others on the labour force survey. I urge the Minister to look very carefully at expanding the annual survey. If we were to have a quarterly survey the figures would be reconciled but we would not get the facts. The annual survey should be used to find more information. I think those who comprise the 84,000 is a very different question and I think the Minister has chosen the wrong way to tackle the problem in this area.
The survey has been thoroughly examined in the context of its accuracy and the percentage difference of 5 per cent, that is 47,000 households. It is at a standard time of the year and is uniformly distributed throughout the length and breadth of this country. It is not an isolated hit or miss survey. In some cases the percentage surveyed here is higher than that in other countries. I think there is uniformity and consistency but I will look at the Deputy's suggestion of getting more detail and greater penetration into aspects that may not be looked at.
I am not suggesting that the figure is incorrect but that we need more depth. If the question is asked every month people will give the obvious answer because they know how the information will be used. That would ruin the valuable information we have. That is the point I am making.
