Vol. 573 No. 1
71 Mr. Penrose asked the Minister for Social and Family Affairs if the recent pre-budget submission of CORI has been drawn to her attention; her views on its statement that the income gap between an unemployed person and a person earning ?50,000 a year has widened by ?276 a week over the past six years as a result of Government actions; the steps she is taking to redress this; and if she will make a statement on the matter. [24390/03]
The pre-budget submission of CORI, together with the other submissions I have received, will be fully considered in the context of the forthcoming 2004 budget. The CORI submission argues that the effect of Government budgetary decisions relating to tax reductions, social welfare increases and other factors has been to increase income inequality in Irish society.
An important goal of Government policy has been to maintain and enhance Ireland's economic competitiveness, thus creating the conditions for the unprecedented levels of economic growth we achieved over that period and the resilience with which the economy is withstanding the current economic slowdown. That economic growth has led to an increase in overall employment of over 40% and a reduction in unemployment to half the EU average by end 2001 and to half the EU average long-term unemployment rate.
Being in employment is by far the most effective way to secure oneself against the risk of pov erty and social exclusion. Long-term unemployment in particular is very closely associated with social distress, as people who have been jobless for a long time tend to lose the skills and the self-esteem necessary to regain a foothold in the labour market unless appropriate and timely support is provided. This Government introduced a whole range of employment support measures, such as the back to work and the back to education allowance schemes, designed to assist the long-term unemployed, in particular, making the difficult transition back to employment. These, coupled with the economic growth, have reduced significantly what had been a major source of poverty and deprivation in recent decades.
The price of the rapid economic growth and the Government actions to incentivise and promote this growth is an increase in income gaps between the growing numbers in employment in good quality jobs and in two income households, and those who are unemployed, some of whom are in jobless households. However, while their relative position may have worsened compared to those in employment, their actual position in terms of better living standards has been steadily improving. Consistent poverty, which measures degrees of deprivation among those on low incomes, has fallen by almost two-thirds from 15.1% in 1994 to 5.2% in 2001. The Government is committed to reducing consistent poverty to below 2%, and ideally eliminating it by 2007.
The Government's determination to continue to seek to improve the position of the most vulnerable in our society is reflected in the revised NAPS and again in the recently completed national action plan against poverty and social exclusion.
One of the Minister's comments was that the Government introduced the back to work and the back to education schemes. However, when the Government was in a tight corner it did not touch the rich in respect of capital gains tax and so on but slashed the schemes which the Minister said had been introduced to help people. It is a disgrace and an indictment of the country and how it is run that relative poverty has sharply increased. Consistent poverty has dropped and 90,000 children still live in consistent poverty. Some 5,000 children will be born into consistent poverty this year.
Let us accept that the figures are as stated. Those in relative poverty live on less than 50% of the average industrial wage. Is it not clear that this is the result of the promotion of the individualism policy, the "me" policy as opposed to the "we" policy, and the promotion of community and solidarity for the less well-off? Is that not the result of Government policy and a clear indictment of that policy? If, as she says, CORI has a self-interest in promoting it, will the Minister agree from the plethora of reports available, that the independent agency which advises her has called in its pre-budget submission for an increase of €905 million in social welfare spending? Why is the independent Combat Poverty Agency calling for that level of social welfare increase? The reason is simple – it would reduce relative poverty by almost 1% and would have a positive knock-on effect on consistent poverty. Therefore, it is clear the Government has failed. For those on the lowest social welfare rate, the budget increase last year was only €6. What has the Minister to say about the report delivered to her today by her own independent agency, the Combat Poverty Agency, which advised her on what to do in the forthcoming budget to tackle poverty, particularly child poverty?
I am glad the Deputy said it was independent advice because often it is criticised for not giving independent advice. I had the opportunity to meet CORI and a number of organisations on Monday week to discuss the budget. Naturally people look at the aspects which they consider should be prioritised in the budget of 2004. The CORI document is specific and relates particularly to those in receipt of €50,000 and takes into consideration its interpretation of the widening gap between rich and poor. It is a matter of measuring and using certain indicators. We use the indicator of consistent poverty, not relative poverty. Under that indicator, as the Deputy rightly said, we have reduced consistent poverty considerably and it is our aim to reduce it to 2% by 2007.
In the context of the CPA report, I agree it has prioritised children and child poverty initiatives which are part of Sustaining Progress. I had the opportunity of meeting the board of the CPA to look at the parameters in which we could fully co-operate in the implementation of many of its recommendations.
In the context of the budget and the priorities set, the pre-budget submissions have indicated clearly that there should be a particular emphasis on support for the elderly, carers and those on the lower base line of social welfare payments. Those issues will certainly be taken into consideration in the context of the budget which is being prepared. It is not correct to say that no effort is being made in addressing these issues. I am firmly of the belief that employment, and access to employment, is the greatest modus operandi for dealing with social exclusion, apart from those who, unfortunately, cannot be within the workforce. The Government will continue to pursue and ensure a strong employment policy to address the many concerns raised and, more particularly, to provide access to employment.
