Written Answers. - Long-Term Unemployment.
Joe Walsh
Ceist:
181
Mr. J. Walsh
asked the
Minister for Social Welfare
the special measures, if any, he proposes to take to halt the increase in the numbers of the long-term unemployment register, as recommended by the task force on long-term unemployment.
[14539/96]
In the context of the 1996 budget, the Government announced a wide range of initiatives particularly addressing the needs of the long-term unemployed. My colleague, the Minister for Enterprise and Employment, has, for example, refocused community employment into two distinct options in order to give priority to people who are long-term unemployed. A specific emphasis on the long-term unemployed is also contained in the new recruitment subsidey scheme, Jobstart, and in the pilot whole-time jobs option which were announced in the budget earlier this year. These initiatives are designed to encourage the creation of job opportunities for the long-term unemployed and to assist employers in hard-pressed labour intensive sectors.
In so far as my own Department is concerned I am taking a proactive and work supportive approach to encouraging the unemployed to return to the active labour force and a wide range of initiatives are already in place.
The back to work allowance scheme was introduced by my Department in 1993 to allow people who have been long-term welfare dependent to test employment and self-employment options and retain a foothold in the labour market while retaining some financial security for up to three years.
Even though the scheme has only been in operation for just over two and a half years there are over 12,700 people currently in receipt of the allowance at an average weekly payment of £55. This scheme has been a significant success and it will continue as my Department's principal incentive to the long-term unemployed to leave the live register. Its value as a measure to encourage those who are long-term unemployed to make the transition to work was confirmed by an independent evaluation earlier this year. In this year's budget I obtained the agreement of the Government to the provision of 5,000 additional places on the scheme and I confidently expect that by the end of the year most of these places will be filled.
I have a team of 30 jobs facilitators in place in my Department's eight regions and they are responsible for promoting the scheme at local level among employers, the long-term unemployed and lone parents. They also have a significant role to play in assessing the needs of unemployed people, supporting them in seeking job opportunities and informing and directing them towards the wide range of existing initiatives and options provided by various Government Departments, agencies, voluntary bodies and community groups. They are also co-operating at local level in the development and implementation of the new Local Employment Service, the establishment of which was the main recommendation of the Task Force on Long-Term Unemployment.
A package of pro-employment measures was introduced in this year's budget designed to increase the incentive to work among the unemployed and also to encourage employers to create and retain jobs. These measures included the following:——
Family Income Supplement:
income thresholds increased by £10 which means a £6 a week increase for most recipients; qualifying period of employment reduced from six months to three months; scheme extended to job sharers; qualifying hours of employment reduced from 20 to 19 and payment to be adjusted immediately on birth of extra child.
PRSI changes
Employers: Lowest 9 per cent rate reduced to 8.5 per cent; main 12.2 per cent rate reduced to 12 per cent.
Employees: PRSI free allowance increased to £80 a week.
Self-Employed: £10 PRSI free allowance increased to £20; minimum annual PRSI contribution reduced to £215.
Unemployment Assistance
Changes were introduced in the way earnings are assessed which are designed to enable unemployed people to retain more take home pay when they take up part-time or casual work.
Retention of child dependent allowance for 13 weeks for people who return to employment who have been out of work for 12 months or more.
A programme of educational opportunities is also available to unemployed people. These optional schemes encourage people who have been cut out of the education system for a long time to resume their education and increase their chances of obtaining employment. At present my Department has approved just over 2,100 unemployed people to take part in third level education. In addition under Social Welfare regulations unemployed persons can participate in recognised second level courses if they are over 21 years and receiving a social welfare payment for at least 6 months. Usually these are second level courses run by the vocational education committees and lead to junior or leaving certificate or City and Guilds qualifications.
I should also mention another important employment support scheme, the family income supplement (FIS), which is designed to support families, with children, on low earnings. This scheme reinforces the incentive to remain in employment where family income is not significantly above the level of unemployment payments. The number of families receiving FIS payments has increased to almost 11,400 since mid-1993.
The question of removing poverty traps and work disincentives from the tax and social welfare systems has been a source of some concern in recent years. While the number of people affected by these traps is small, it is clearly undesirable that anyone should find themselves in the position where they are better off not working than taking up whatever employment opportunities are available. Last week the report of the Expert Working Group on the Integration of the Tax and Social Welfare Systems was published. The report contains a detailed examination of the way the lack of co-ordination of the tax and social welfare systems creates disincentives to employment, and looks at different approaches to overcoming this problem. The report made it clear that there are no quick and easy solutions to the problem, but put forward a general strategy for gradually removing disincentives and poverty traps over time. Two key parts of this strategy were child income support and tax reform.
The report draws attention to the need for reform of child income support. As is now widely recognised, the current range of income supports for children contributes to poverty traps and disincentives to work. The Government has already been taking steps to reduce the disincentives effects associated with the current structure of child income support. We have been gradually improving child benefit, while reducing the relative importance of child dependant allowances. Child benefit has been increased by 45 per cent since this Government took office. The group put forward a number of different ways in which the overall system of child income support could be improved, from the point of view of incentives. The Government will be looking at these options very carefully, in order to develop the best strategy for continuing reform in this area. I will continue to take a very pro-active and work supportive approach to job creation and retention and I will ensure that all relevant programmes administered by my Department are geared towards this objective. I am confident that the measures which we have in place at present will assist the unemployed in returning to the workforce and my Department will continue in its efforts to support and encourage unemployed people in this regard.
