Vol. 511 No. 6
44 Mrs. Owen asked the Tánaiste and Minister for Enterprise, Trade and Employment the discussions, if any, she has had with Government Departments concerning some of the impediments for many on the employment register, for example, loss of rent subsidy and medical card, which discourage people from taking up work; and if she will make a statement on the matter. [25060/99]
115 Mrs. Owen asked the Tánaiste and Minister for Enterprise, Trade and Employment the discussions, if any, she has had with Government Departments concerning some of the impediments for many on the employment register, for example, loss of rent subsidy and medical card, which discourage people from taking up work; and if she will make a statement on the matter. [25102/99]
I propose to take Question Nos. 44 and 115 together.
This Government attaches a high priority to creation of the conditions necessary for persons to seek and take up paid employment. A major focus of the Government is to improve the reward from work for those in employment, potential job recruits and the unemployed, and very significant progress has been made in the tax and social welfare areas on this front. The thrust of current policies are centred on fiscal initiatives, as well as removing other impediments to seeking and accepting a job.
Recent measures include the introduction of tax credits and the removal of persons earning up to £100 from the tax net and structural changes in the calculation of the family income supplement which was enhanced to provide for the assessment of entitlement on the basis net pay, rather than gross pay.
During this year a consultative group was established under the chairmanship of the Department of Social, Community and Family Affairs to consider the complex issues raised, including the traps faced by particular unemployed cohorts arising from the loss of the supplementary welfare allowance rent and mortgage payments on their transition to employment. Discussions in this committee are ongoing with a view to devising solutions to the problems that arise for some categories of people who return to work.
As regards the medical card, long-term unemployed persons are allowed to retain their medical cards for three years on their transition to work, a measure that has been in operation for some considerable time.
The forthcoming budget will continue to build, as in recent budgets, on ways of assisting in the re-integration of the unemployed and persons outside the labour force into the open labour market by way of fiscal measures and by tackling disincentives to taking up employment.
With more than 170,000 people on the live register and advertisements for jobs in every sector of our economy, can the Minister give any explanation, other than that there are still impediments in the system, why people who are unemployed are not taking the opportunity to work? Would she agree there is a menu of impediments now in existence which prevents people from taking up jobs, including the loss of their rent allowances and help with mortgages, increased rent if they are in a county council house, the loss of medical card because it is not universal that people will keep their medical card, failure to qualify for third level education grants, changes in family income supplement payments, loss of fuel allowances, and so on? Will she give a commitment that she and the relevant Ministers will examine all these impediments to ensure that they are removed with a view to encouraging people back to work rather than continuing with the existing minimal system, given that we need these people to work?
For many years I have held that the tax and welfare systems act as a disincentive to people to take up employment. That is why many of the reforms of Governments of every hue in recent years have helped in this regard. We need to go further. We are turning around the very anti-work tax system to make it pro-employment and reward people who take up work, work harder, and so on.
The number of long-term unemployed people is now down to in the region of 40,000. There are particular difficulties. The success of the employment action plan is well known – 66 per cent of those cases in which we intervened are no longer on the live register. They are back at work, in education or in training. However, there is a core of people who do not have the basic skills to access any job. There is a high level of illiteracy, unfortunately some drug and substance abuse, and other personal problems. Some of the initiatives to be announced by the Minister for Finance tomorrow are aimed at tackling some of those problems, particularly in the area of training where we need to focus clearly on the needs of that cohort of people. Maybe the issues mentioned by Deputy Owen are clear factors. Everybody responds to the economics of their own situation. If it is not economic to return to work for whatever reason, people will not do so. Some of the things that will happen tomorrow will make it clear that we are seeking to assist people to return to work. It is hoped that will play its part in remedying some of the difficulties which have been highlighted.
In light of the Minister's reply, will she again examine the changes she has made to the community employment schemes in order to ensure that the long-term unemployed who currently can work on a community employment scheme for three years can continue to do so if they cannot get into full-time employment, because it is better to pay people to work on a community employment scheme than to pay them to stay at home? That would be my ethic. There should be flexibility there.
That is interesting. Many of the people who opposed the community employment schemes some years ago are the very ones who are screaming at me now to keep these schemes going. It is a funny old world. It is a fact that the 19 hours a week suits many people's circum stances, and some of the incentives which were brought in to encourage people into community employment have worked. We need to learn from that and apply those incentives to the wider area. Additional tax allowances for children and adult dependants were introduced in the budget two years ago. They have helped, but the take-up has been very low. We need flexibility in community employment and the jobs initiative which I have extended for a further six months. There is a category of people who will perhaps never progress beyond CE or jobs initiative schemes and we must recognise that. I do not want to see people going back to being unemployed because that strips them of their dignity. The flexibility of which Deputy Owen speaks is something I wish to see maintained in the system.
There is a hint of a promise there.
