How much does welfare actually cost the state?

woodoo

Hi,

I'm listening to Damien Kibird on The Dunphy show now. He was saying the government income from tax is in the low 30's. €32billion i think in 2010.
http://www.finance.gov.ie/documents/exchequerstatements/2010/analysisenddectax.pdf

The Dept of Social Protection cost 21 billion according to Kibird and Medical Cards costs €2.5 billion per year. He says there are other welfare costs spread out among the Dept of Education, Dept of Health etc.

In reality could welfare be costing in excess of €25 billion? If so this could be eating up 80% of Government Tax Revenues. A truly frightening figure.

padma

I wonder how much of that welfare actually goes back in to the system and makes up the tax intake of 30 odd billion. My guess would be quite high, considering the levy's on electricity and the fact that every cent paid for goods by people on welfare is taxed.

bpb101

i say it very little because most OAP woulnt be buying stuff off websites and importing stuff
also there buying cereates employment

n97 mini

padma wrote: »

every cent paid for goods by people on welfare is taxed.

Not true.

0% (Zero) VAT rating applies to all essential foods like tea, coffee, milk, bread, meat, vegetables. It also applies to books, children’s clothes and shoes, oral medicine for humans and animals, vegetable seeds and fruit trees, fertilisers, large animal feed, disability aids such as wheelchairs, crutches and hearing aids.

In addition you do not have to pay any VAT on financial, medical or educational services. You may also not pay VAT for live theatrical and musical performances (except those where food or drink is served during all or part of the performance).

woodoo

padma wrote: »

I wonder how much of that welfare actually goes back in to the system and makes up the tax intake of 30 odd billion. My guess would be quite high, considering the levy's on electricity and the fact that every cent paid for goods by people on welfare is taxed.

The same argument could be made for Public Servants pay i suppose.

It gets very complicated if your talking about the money coming back on the other side of the balance sheet. Its prob best if we stick to what is actually going out (not whats coming back in on the tax side).

padma

woodoo wrote: »

padma wrote: »

I wonder how much of that welfare actually goes back in to the system and makes up the tax intake of 30 odd billion. My guess would be quite high, considering the levy's on electricity and the fact that every cent paid for goods by people on welfare is taxed.

The same argument could be made for Public Servants pay i suppose.

It gets very complicated if your talking about the money coming back on the other side of the balance sheet. Its prob best if we stick to what is actually going out (not whats coming back in on the tax side).

It's still a very valid point. In Limerick where I'm living the busiest days of the week is dole day. Near the only people walking the town are on the dole. Tbh it's the welfare that's keeping this economy floating at the moment. As someone pointed out the V.A.T not being paid on the essential food items is not coming in due to them being vat free, the dole is still keeping the shops open and helping the economy in a big way.

Obviously if there WERE jobs out there more money would be spent thus growing the economy. At the moment with the high official unemployment rate and the high unofficial rate ( people off the live register on mickey mouse courses) the money spent by these folks are what is keeping the country afloat. If in the next budget they decrease the welfare rate by too much the next year will become even more stark business wise.

The obvious thing to do would be to do away with some benefits but definitely not the needed ones.

irishh_bob

bpb101 wrote: »

i say it very little because most OAP woulnt be buying stuff off websites and importing stuff
also there buying cereates employment

oap,s are not big spenders , generally speaking

ei.sdraob

new figures are here released yesterday, should be of interest to you @OP

• Exchequer Figures
  
• Tax Receipts
  
• Expenditure Analysis

also see this

Social Protection Minister Joan Burton has signalled her intention to engage in major reforms of the system to protect basic welfare rates as the department's budget now devours 60 per cent of all taxes raised in the State.

dont forget that the likes of HSE also involved in "welfare" of sorts as well as other departments (think free travel passes and so on)

woodoo

ei.sdraob wrote: »

also see this

That will be a good move. Welfare as a lifestyle choice needs to be addressed. Its crazy that someone can be on the full rate of dole for decades anyway.

Its in everyone's interest to weed out the welfare fraudsters too. Savings not made from weeding out welfare fraud will most likely have be taken from the overall welfare budget. Which i'm sure genuine cases wouldn't be too happy about.

Geuze

Seamus Coffey (UCC) on welfare spending:


http://economic-incentives.blogspot.com/2010/12/social-welfare-expenditure.html

Geuze

Geuze

Geuze

All figures from 2009.

Tax take is just one part of Govt revenues.

Exchequer tax take = 32.5bn approx.

Other taxes = 12 bn.

Total tax take = 44.5 bn.

Total Govt revenue = 56.5 bn.

Geuze

Geuze

Social Insurance Fund expenditure (all based on PRSI conts):

Geuze

Social Assistance payments (not based on PRSI, universal or means-tested)

woodoo

Some great info there geuze.



Seamus Coffee:- "This is not the full extent as cash transfer provided by the government. Schemes run by other Departments brought total expenditure on direct transfer programmes to over €26 billion."