Dáil Éireann Debate, Wednesday - 28 April 2004
86 Ms Lynch asked the Minister for Social and Family Affairs the steps she intends to take to bring Ireland’s social spending into line with the European norm; and if she will make a statement on the matter. [12048/04]
Amharc ar fhreagra123 Mr. Penrose asked the Minister for Social and Family Affairs if her attention has been drawn to the recent document produced by the Conference of Religious in Ireland which claimed that economic decisions made by the Government over the past seven years have been totally skewed in favour of those with higher incomes; the steps she intends to take within the social welfare code to address this imbalance; and if she will make a statement on the matter. [12037/04]
Amharc ar fhreagra142 Mr. Gogarty asked the Minister for Social and Family Affairs if she has considered the CORI annual socio-economic report; and the implications this will have for Government policy. [12092/04]
Amharc ar fhreagraI propose to take Questions Nos. 86, 123 and 142 together.
These questions relate to the recent socio-economic review for 2004 published by the CORI justice commission entitled, "Priorities for Fairness: Choosing Policies to Ensure Economic Development, Social Equity and Sustainability". This document will make a valuable contribution to the debate on the development of socio-economic policy over the next few years. The report argues that the effect of Government budgetary decisions relating to tax reductions, social welfare increases and other factors, such as wage increases and the introduction of the special savings incentive accounts, has been to increase income inequality in Irish society. It also argues that Ireland's low spend on social protection, in GDP percentage terms, contributes to poverty, unequal income distribution and deficits in social provision.
I believe, however, that budgetary decisions must be viewed in the context of the wider economic policies which have been successfully pursued by this Government in recent years. These policies have seen significant increases in employment levels; reductions in unemployment, in particular in long-term unemployment; heavy investment in infrastructure and in public services; and substantial increases in real terms in household incomes at all income levels. This is reflected most clearly in the sharp decrease we have seen in consistent poverty rates. Consistent poverty — a combined measure using income thresholds and the experience of deprivation — is the measure used for the global poverty reduction target in the revised national anti-poverty strategy, NAPS, launched in 2002 and in the national action plan against poverty and social exclusion — NAPs inclusion — submitted to the EU in July last year.
Consistent poverty has fallen from 15.1% in 1994 to some 5.2% in 2001. The Government is committed to reducing consistent poverty to below 2% and ideally eliminating it by 2007. Ireland's GDP percentage level of social expenditure is lower than other EU states due to a number of factors. Ireland's elderly population is a third lower than the EU average, thus requiring much lower expenditure on pensions, health care and care of the elderly. Social insurance was only extended to the full working population in recent decades, as a result of which a high proportion of current pensioners qualify for pensions under social assistance only. Ireland does not provide for supplementary pensions under the State social welfare system leaving these to be provided by private insurance, the subject of the current PRSA campaign. Expenditure on these schemes is, therefore, not included as social protection expenditure. Ireland's current level of unemployment is among the lowest in the EU, thus requiring less expenditure on unemployment related support.
Furthermore, while Ireland has had low levels of investment in social and economic infrastructure historically, we are now financing a major catch up in infrastructure with public investment running to over 6% of GDP in 2002 compared to approximately 3.5% for the other cohesion countries, Spain and Portugal and 1% to 1.5 % for developed countries such as Belgium, Denmark, Germany and the UK. The policies pursued by the Government over recent years in combating unemployment and in reducing the level of consistent poverty have brought about a significant improvement in the situation of people on lower incomes. In the period from 1998 to 2003, for example, the value of the lowest social welfare payment has increased by over 50% in nominal terms and by 19% in real terms. The Government's determination to continue to improve the position of the most vulnerable in our society is reflected in the revised NAPS and in the NAPS/inclusion which contain ambitious targets across a number of areas — including that of increasing the minimum social welfare rate to €150 per week in 2002 terms by 2007.
The implementation of these targets will ensure that we are brought further along the road to our overall goal of building a fairer and more inclusive society in which everyone has the opportunity and incentive to participate fully in the social and economic life of the country.
