Tells Forum that welfare prevents poverty, stabilises economy
The Department of Social Protection’s €20.24 billion budget plays a crucial role both in preventing poverty and stabilising the economy, the Minister for Social Protection, Joan Burton TD, has said today (Friday, 5th July, 2013).
Minister Burton said that while welfare’s importance as a safety net was well understood, it was often missed that welfare payments were spent in shops and on services across the country.
The Minister was speaking at the Pre-Budget Forum she hosted for over 30 voluntary and community groups in Dublin Castle this morning.
The purpose of the annual Forum is to provide these organisations with an opportunity to have an input into the Budget process. The Forum enables the organisations to discuss their views on the Budget with the Minister and senior Departmental officials.
This year’s Forum was chaired by a moderator, Ms Olivia O’Leary, and included a number of workshops on specific themes, such as children and families, illness and disability, and poverty and social inclusion.
Addressing the Forum, Minister Burton stressed that no decisions had been made in relation to measures for Budget 2014, and that the views heard at the Forum would be relayed to Government prior to any such decisions being taken.
The Minister said that, since 2009, the Department had implemented cost-saving measures which had cumulatively reduced expenditure by more than €3 billion. At the same time, the number of people in receipt of a weekly welfare payment increased from 1.209 million at the end of 2008 to 1.476 million now – an increase of approximately 267,000.
She cited the dual importance of the welfare spend – both in preventing poverty and stabilising the economy.
“The most important effect of welfare payments is that they reduce poverty levels. Research has demonstrated that social transfers reduce the at-risk-of-poverty levels in Ireland by over 60% - the most effective performance in the EU,” Minister Burton said.
“The second impact of our expenditure – sometimes forgotten - is the contribution it is making to the stabilising the economy. The spend of my Department puts money in the tills of almost every business and shop in the State in a very immediate way as our customers spend their benefits and pensions each week, thereby maintaining domestic employment and economic activity.
“The necessity to reduce overall Government current expenditure must be balanced against the primary redistributive role of the social protection system. It is my firm belief that the options chosen to reduce overall expenditure can only be considered having regard to potential poverty impacts and the effect on demand in the wider economy.”
This year, the Department of Social Protection will spend over €20.24 billion on its entire range of schemes, services, and administration. At the end of May, there were 1.476 million people receiving a weekly payment in respect of 2.283 million beneficiaries. In addition, some 614,000 families were in receipt of the monthly Child Benefit payment.
While the Minister stated that no decisions had been made in relation to the Budget, she reiterated the importance of protecting core social welfare weekly payments. “I have protected core rates in successive Budgets in order to protect the most vulnerable in society from the worst effects of the economic crisis. Protecting core weekly rates makes absolute sense not alone from a poverty prevention perspective but also for the economy generally at a time when we need to boost consumer confidence.”
Minister Burton said her focus in Budget 2014 would be to continue the wide-ranging reforms that have ensured the services offered by her Department provide both a safety net but also a springboard back to work – through both income supports and employment supports.
“In the forthcoming Budget, the Department of Social Protection will be expected to play its part in keeping Government finances on the path to recovery. However, this year again, I will be making every effort to ensure that those dependent on social welfare payments are not marginalised while also ensuring that those who are in work and paying PRSI are better off working than claiming social welfare.”
ENDS
Note for Editors
List of voluntary and community groups who are invited to attend today’s Pre-Budget Forum
Active Retirement Ireland Irish Countrywomen’s Association
Age Action Ireland Irish National Organisation for the Unemployed
Alone Irish Senior Citizens Parliament
Barnardos National Association of Widows in Ireland
Care Alliance Ireland National Federation of Pensioners Associations
Carers Association National Women’s Council of Ireland
Centre for Independent Living One Family
Children’s Rights Alliance OPEN
Congress Centres Network (ICTU) Pavee Point
Crosscare Retired Workers Committee
Cúram St. Vincent de Paul
Disability Federation of Ireland Simon Community
End Child Poverty Coalition Social Justice Ireland
European Anti Poverty Network The Wheel
FLAC Threshold
Focus Ireland TREOIR
Healthy Food for All Trustus We Care
Inclusion Ireland Unmarried and Separated Families Of Ireland
Irish Council for Social Housing Vincentian Partnership for Social Justice
Women’s Aid
List of Tables that follow:
Table 1: Department of Social Protection Expenditure by Programme – Revised Estimate, 2013 (REV)
Table 2: Social Welfare Expenditure, 2002 to 2013
Table 3: Recipients & Beneficiaries of Primary Weekly Social Welfare Payments, 2002 to 2013
Table 4: Savings Target and Expenditure Reductions
Table 1: Department of Social Protection Expenditure by Programme – Revised Estimate, 2013 (REV).
Programme
2013 REV Expenditure €million % of Total Expenditure
1. Administration 580 2.9%
2. Pensions (Including State Contributory and Non-Contributory Pensions and Widow’s, Widower’s or Surviving Civil Partners Contributory Pension) 6,469 32%
3. Working Age – Income Supports (Including Jobseeker’s Allowance, One Parent Family Payment, Farm Assist, Maternity Benefit, Basic Supplementary Welfare Allowance etc.) 5,493 27.1%
4. Working Age – Employment Supports (Including Community Employment Programme, Rural Social Scheme, TÚS, Back to Work Allowance, Back to Education Allowance etc.) 1,056 5.2%
5. Illness, Disability and Carers (Including Disability Allowance, Illness Benefit, Carer’s Allowance, Invalidity Pension, Disablement Benefit etc.) 3,328 16.4%
6. Children (Child Benefit of €2 billion as well as other schemes such as Family Income Supplement, Back to School Clothing and Footwear Allowance, School Meals Scheme and Guardian’s Payments) 2,251 11.1%
7. Supplementary Payments, Agencies and Miscellaneous Services
- Rent Supplement
- Mortgage Interest Supplement
- Household Benefits
- Free Travel
- Fuel Allowance 1,067
403
42
283
77
211 5.3%
Overall Total
Expenditure on Schemes, Services and Administration
20,243
100%
Table 2: Social Welfare Expenditure, 2002 to 2013
Year
Total Social Welfare Expenditure
€m Index
of Expenditure
2002 9,517 100.0
2003 10,493 110.3
2004 11,291 118.6
2005 12,168 127.9
2006 13,586 142.8
2007 15,518 163.1
2008 17,809 187.1
2009 20,536 215.8
2010 20,850 219.1
2011 20,968 220.3
2012 20,727 217.8
2013[1] 20,243 212.7
Table 3: Recipients & Beneficiaries of Primary Weekly Social Welfare Payments, 2002 to 2013
Year Weekly Recipients Weekly Beneficiaries[2]
2002 938,971 1,496,714
2003 959,432 1,511,740
2004 957,732 1,463,921
2005 976, 613 1,469,106
2006 1,003,517 1,506,824
2007 1,060,327 1,577,463
2008 1,208,883 1,799,875
2009 1,379,206 2,076,256
2010 1,430,833 2,179,428
2011[3] 1,467,129 2,248,284
2012 1,469,202 2,259,807
2013[4] 1,475,913 2,283,127
Budget 2014
The Expenditure Report 2013 was published by the Department of Public Expenditure and Reform in December 2012. It included the savings measures introduced in Budget 2013 (€391m net), their ongoing impact in 2014 and the quantum (€440m) of the new savings measures required in 2014.
Table 4: Savings Target and Expenditure Reductions
Savings measures identified by 2013 €m 2014 €m
Expenditure Report 2013
Savings measures
introduced in 2013 and ongoing impact 391 453
New Savings remaining to be specified 440
Expenditure ceilings 20,243 19,633