Cowen: Dole payments not immune from Budget cuts

Taoiseach Brian Cowen today dismissed calls to safeguard dole payments and protect the unemployed from Budget cuts.

The amount of people signing on fell by 3,000 to 422,500 last month and despite pleas from Labour leader Eamon Gilmore, the Taoiseach insisted the out-of-work will not be immune from swingeing savings.

Even though the Live Register was down for the first time in two years, world leading think-tank, the Paris-based OECD, warned Ireland now faced the risk of high long-term unemployment.

Five weeks ahead of the Budget, Mr Cowen again warned no area of spending was sacred.

“The idea that we can deal with it by saying ’No’. There is over 35% of our current day-to-day spending, it will remain immune... That is not taking into account the seriousness and scale of the difficulties we face,” the Taoiseach told the Dáil.

The slight fall in the Live Register backed findings by state training agency FÁS which claimed unemployment was rising at its slowest rate in two years.

While more than 160,000 people have been added to dole queues in the last year, the number of people on FÁS schemes has doubled in the same time.

The unemployment rate is now 12.5%.

Trade union group Congress said the Government cannot take comfort or credit from the slight fall.

Sally Anne Kinahan, Congress assistant general secretary, said Ireland was suffering more than the rest of Europe because not enough had been done to protect jobs.

“To date, the scorecard reads – Banks: €54bn; Jobs: €0,” she said.

Labour’s Willie Penrose warned the figures appeared to show emigration and youth unemployment were returning as a major issue.

“Youth unemployment is a social time bomb,” he said. “If young people are condemned to a pattern of long term unemployment in their teens and early 20s, it is particularly difficult to emerge from it.

“The Government needs to very significantly increase the number of educational and training options for the young unemployed.”

Mr Penrose also warned that emigration may only help ease the unemployment on a temporary basis as the numbers out of work increase over the winter.

Mr Cowen said dole payments increased as the economy boomed and social welfare could not escape cuts in the downturn.

“We had during the good times in this country, and quite rightly, that people saw social welfare rates receive unprecedented increases,” the Taoiseach said.

“That was the right thing to do with the revenue we had at the time. We now face a totally different situation as a result of a crisis that has developed and we have to deal with it.”

Business lobby group Ibec warned it was too soon to say the economy has turned a corner.

Chief economist David Croughan said: “It is vital that the Government puts in place a stimulus package to retain current employment and stimulate job creation.”