Hanafin frees up funds for bigger dole queues

SOCIAL and Family Affairs Minister Mary Hanafin last night outlined plans for savings of e300 million this year and €400m in 2010 with the tightening of certain benefits set to free up funds for the growing number of people on the dole.

Social welfare expenditure for this year is set to reach e21.3 billion, with Ms Hanafin admitting that as many as 440,000 could be on the Live Register by the end of the year.

Aside from the controversial changes to childcare benefit and jobseekers’ allowance for under-20s and the axing of the Christmas bonus to social welfare recipients, the main measures outlined in yesterday’s emergency budget were:

* Increased fraud control measures targeting areas such as child benefit and jobseekers’ payments, which could save e82m this year and e125m in 2010;

* Changes to the rent supplement scheme, which could pull in savings of e50m this year and e78m next year, primarily by restricting entitlement to those who have been existing tenants for at least six months, increasing the minimum contribution made by claimants from e18 to e24 per week, a reduction in maximum rent limits of up to 10% and encouraging landlords to drop their rents, with payments to tenants being reduced by 8%.

While many welfare rates are not being reduced, in his budget speech Finance Minister Brian Lenihan warned: “It may be necessary to review rates of payments in future years if reductions in the cost of living materialise.”

Ms Hanafin conceded some of the measures introduced yesterday were tough, but said she hoped to protect the rates in future and that any changes would be “a last resort”.

The Department of Social and Family Affairs will provide a package of measures under the Back to Work Enterprise Allowance (BTWEA) and Back to Education Allowance (BTEA) schemes, facilitating 1,400 extra claims for support. The cost is to be met within existing resources.

The package includes reducing the duration payable for the BTWEA from four years to two years’ support and earlier access to BTEA (Second Level Option) at three months instead of six months and earlier access to BTEA (Third Level Option) when recommended by a facilitator.

Fine Gael spokesperson on Social and Family Affairs, Olwyn Enright, said the budget would result in young families facing “an appalling future”, while John Monaghan from St Vincent de Paul said the budget “will leave people worse off”.

He said attempts to encourage landlords to pass reductions onto tenants would not work unless it was properly policed, a scenario he described as “absolutely disgraceful”.

Ms Hanafin denied a combination of tough measures spread across the budget could plunge more people than ever into poverty, but Focus Ireland chief executive, Joyce Loughnan, said the proposals would make it increasingly difficult for some vulnerable people to get by.

“The decision to lower the eligibility threshold for the 2% income levy to e289 per week will create significant hardship for low earners, as will the cancellation of the Christmas welfare bonus for people in receipt of social welfare,” she said.

Ms Loughnan also criticised the reduction in the rent supplement scheme, claiming it would impact on the weekly income of some of the poorest families.


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