The Minister for Social Protection, Joan Burton, says the drop in the numbers on the Live Register has prevented harsher cuts in her Department.
€226m in savings will be required from Social Protection next year - almost half what was expected.
Burton acknowledged that the cuts will cause hurt, but she says it could have been much worse.
"I'm keenly aware that reductions of €226m will still impact on, and cause difficulties, for people who rely on social welfare for their income," she said.
"However, the lower adjustment means that I've protected the state pension, carer's allowance, disability allowance, and all other core weekly payments upon which people depend."