I propose to take Questions Nos. 303 to 305, inclusive, 331 to 334, inclusive, 339 to 343, inclusive, and 345 together.
On Budget Day, I announced the first general increase in the weekly rates of payment since 2009. A €5 increase in the weekly rates of payment for all social welfare payments will commence from March, with proportionate increases for qualified adults and those on reduced rates of payment (including jobseekers on age-related reduced rates of payment).
Approximately 1.5 million people will benefit from this increase, from pensioners, people with disabilities, carers, lone parents, maternity and paternity benefit recipients and jobseekers.
Jobseeker’s allowance (JA) claimants under the age of 26 generally receive age-related reduced rates of payment. Age-related reduced rates of payment do not apply in certain circumstances, however, such as when the claimant has a dependent child, or transferred to JA from Disability Allowance, or was in State care during the 12 months prior to applying for JA.
There are no age-related reduced rates of payment for the Jobseeker’s Benefit scheme, which is based on a person’s social insurance record. Accordingly, young people who are eligible for the maximum rate of Jobseeker’s Benefit will receive the full €5 weekly increase from March.
The cost of the proportional €2.70 increase in the weekly rate of payment for jobseekers on the age-related reduced rate of payment for 18 to 24 year olds, from €100 per week to €102.70 per week, is €3.2 million in a full year. A €5 increase, from €100 per week to €105 per week, would cost €5.9 million in a full year. These costs include increasing the qualified adult rate (€100) by the same amount.
The cost of the proportional €3.80 increase in the weekly rate of payment for jobseekers on the age-related reduced rate of payment for 25 year olds, from €144 per week to €144.80 per week, is €0.8 million in a full year. A €5 increase, from €144 per week to €149 per week, would cost €1 million in a full year. These costs include increasing the qualified adult rate from €124.80 to €128.10 per week.
Increasing the €100 and €144 rates by €5 per week, instead of proportionate increases, would cost an additional €3 million or €6.9 million in total in a full year.
In 2017, it is estimated that there will be, on average, c. 22,515 young jobseekers on the €100 per week rate of payment and c. 3,870 jobseekers on the €144 per week rate of payment.
The full year cost of bringing the lower age related rates of jobseeker’s allowance to match the rates payable to people aged 266 and over is €116 million (based on the proposed 2017 rates outlined in the Budget).
The long-standing practice of my Department is to award proportionate increases for people who are on reduced rates of payment and for qualified adults. If the full increase was awarded to some categories of people on reduced rates, and not to others, this would not be fair to others on reduced rates of payment.
The rationale for having reduced rates of payment for young jobseekers in receipt of a means-tested jobseeker’s payment is to prevent young people from entering welfare dependency by providing a strong financial incentive to take up a job, or a training or education programme.
Financial incentives already exist for young people taking up education, training and employment supports. Young people participating in employment programmes such as Community Employment, Tús and Gateway already receive the full adult rate of payment, which is currently €210.50 per week and will rise to €215.50 next year.
From next September, when a young jobseeker participates in my Department’s Back to Education scheme, he or she will be entitled to receive the full maximum rate of jobseeker’s payment which will then be €193 per week (for people of any age), as against the €160 which they are currently on.
This 21% increase represents an extra €33 a week, and demonstrates the State’s support for young jobseekers who seek to enhance their skills. The rate payable to young jobseeker’s who participate on Solas training courses is a matter for the Minister for Education and Skills.
The number of young people on the Live Register on jobseekers payments was close to 90,000 in 2010 and is now down to 34,000. There is a continuing strong downward trend this year with the numbers down from 42,000 to 34,000 since the beginning of 2016.
Youth unemployment has fallen by 5 percentage points in the last year alone and it is now below the EU average. Of course more remains to be done and I am determined that we help more young people in the most effective way possible, by helping them into the workforce or education.