Ireland spends least on welfare payments to pensioners

Ireland spends less money on social welfare payments to pensioners than any other country in the EU.

New figures compiled by the European Commission also show that the Government spends proportionately more on financial supports for unemployed people than any of the other 27 EU states.

The breakdown of spending levels by all 28 EU countries as a percentage of GDP provides insight into the different priorities which various countries attach to issues such as education, health, defence, and social protection.

It shows how just 10.2% of GDP last year was spent on old-age social protection measures by the Government— the lowest rate of any EU country. This represents less than half of the average expenditure among EU states on social welfare payments to pensioners which stands at 21.4% of GDP.

However, the low rate of expenditure on pensions is partially explained by the fact that pensioners in Ireland account for a smaller proportion of the total population than most other countries because of our relatively high birth rate in recent decades.

The figures also reveal that overall spending by the Irish government as a percentage of GDP is one of the lowest in the EU.

At 39% Ireland had the fifth lowest level of government expenditure out of the 28 EU states in 2014 — a decrease of 1.7% on the previous year and the third-highest decrease after Greece and Slovenia. Only Romania and the Baltic states of Lithuania, Latvia, and Estonia spent less as a percentage of GDP. The EU average was 48.1%.

Total government expenditure represented more than half of GDP in eight EU states last year including Finland, France, and Denmark, where such spending exceeded 57% of each country’s national GDP.

In all EU states, social protection represented the most important area of general government expenditure.

Ireland recorded the 10th highest level of such expenditure, contributing 38.6% of GDP to various social protection measures including payments to the unemployed, sick, children and pensioners but below the EU average of 41%. EU states differ somewhat in the second most important area of general government expenditure, although Ireland was one of 11 countries where spending on health is the second biggest priority.

Ireland spent 17.4% of its GDP on health in 2014 — the third highest level in the EU after Slovakia and the Netherlands.

Although overall Government spending is one of the lowest in the EU, Ireland spends double the EU average on measures to support the unemployed, allocating more than any other EU country at 6.7% of GDP. The EU average is just 3.2%.

Irish expenditure on welfare supports to families and children is the fourth highest within the EU and almost twice the EU average at 6.4%.