Social welfare increases very welcome

7 Dec 2006

The Irish National Organisation of the Unemployed welcomes the €20 increase in the lowest rate of social welfare, announced in the Budget. The INOU also welcomes the overdue changes announced to the Child Dependent Allowance.

Other welcome budget announcements include the increases in tax credits that will ensure people who earn the minimum wage will not have to pay tax when the minimum wage increases.

The rise of €20 per week in the lowest rate of social welfare to €185.80 means that the government has achieved the National Anti-Poverty Strategy (NAPS) and Sustaining Progress target of benchmarking the lowest rate of social welfare at around 30% of gross average industrial earnings (GAIE). “The government is to be congratulated on reaching an important milestone on the road to eliminating poverty in Ireland”, said Mr. Eric Conroy, General Secretary. “This will contribute towards helping people to live life in dignity while they are unemployed”, he added.

In addition, the INOU is very pleased that the Child Dependent Allowance (CDA), which is paid to families on social welfare, has been increased for the first time since 1994. In recent years, the government concentrated on increasing Child Benefit in successive Budgets to the exclusion of CDA’s. This is an important measure targeted at people with low incomes, in the fight against child poverty.
The INOU welcomes the announcement to increase tax credits. This will ensure that people who receive the increased national minimum wage will continue to remain outside the tax net (this allows for a minimum wage increase of €1 per hour).

On the negative side, the INOU is disappointed that no further moves have taken place on reducing the eligibility periods for the Back to Work and Back to Work Enterprise Allowances. These are important Welfare to Work measures in the battle against long-term unemployment. The INOU is also disappointed that the limit for the retention of secondary benefits has not been increased.