Benefits to be cut for those who do not retrain

The Government has yet to decide if there will be a cut-off point beyond which unemployed people will no longer receive state support under the new social welfare system, Education Minister Ruairi Quinn has said.

Pathways to Work is to be launched early next week and will include a cut in benefits for anybody who does not take the retraining and education opportunities offered to them.

Mr Quinn, who has worked on the new system with Social Protection Minister Joan Burton, said: “It has yet to be decided if there is to be a cut-off point.”

He added: “No such option has been put before us by the minister, we will have to wait.”

Unemployment should not be a punishment, he said but could be an opportunity to retrain, adding the intention is to ensure that people have a job.

“If someone refuses to participate in that social contract they are at risk of forfeiting the right to be sustained by the rest of the community.”

Mr Quinn acknowledged that with 50 people for every job available at the moment, finding work for everyone would be a challenge, but said it would take time to get the new system up and running given that there was more than 400,000 people unemployed.

The new system would be more like the Scandinavian model, he said.

Up to now when an unemployed person went to their social welfare office, the only issue to be assessed was what they were entitled to. In future they will be assessed to see what they need to improve their employment prospects.

The local VEC training board — which is to be transformed next year — will also be involved and will measure people for the most suitable course of study.

“If you do not take that course, there will be a financial penalty — we want this to become a labour market activation system where the safety net is a safety net and not a double bed for life”, said Mr Quinn.

There are a number of pilot projects testing the new scheme underway at the moment.

Ms Burton explained to a gathering of accountants on Thursday that the programme is designed not just to get people ready for work, but to help employers find suitable employees among the long-term unemployed.

It will assess how likely a person is to get a job when they first claim benefits, taking account of their age, education, work experience, and this will help identify who is in danger of becoming long-term unemployed.

Other changes are designed to make sure that people are not better off on social welfare.

One of the disincentives is rent supplements and Ms Burton said she will shortly bring proposals forward that will have people paying a percentage of either their welfare payment or pay towards their rent through the local authority.

She is also considering using private companies to provide employment, guidance, job placement and case management services.